International Finance
Asset Management

Hong Kong stock exchange launches inline warrants to diversify offerings

The new inline warrants will be issued by BNP Paribas, Haitong, HSBC, JPMorgan, Societe Generale and Vontobel — and begin trading on July 18

The stock exchange of Hong Kong (HKEX) will launch inline warrants, which will be the first of a ‘new structured product’ since 13 years, according to the South China Morning Post. The launch is part of the local bourse’s three year strategic plan to diversify its offerings in the region’s asset management market. 

Hong Kong stock exchange’s inline warrants will be issued by BNP Paribas, Haitong, HSBC, JPMorgan, Societe Generale and Vontobel — and will begin trading on July 18. 

Garbo Cheung, managing director of markets for Hong Kong stock exchange told SCMP,  “As part of the three-year strategic plan of the HKEX, we will introduce more derivative and structured products to serve different investment strategies by investors.” Europe is already trading inline warrants and that Asian investors would appreciate trading the product in Hong Kong, Cheung added. 

CEO Charles Li told CNBC that he expects many Chinese companies to trade stock in their home country. “We are one of China(’s) home market(s), they can go back to Shanghai or Shenzhen or they can come to Hong Kong and there’s a lot of reasons for them to be in Hong Kong and I’m quite confident that many of them will,”  Li said. 

Tom Chan Pak-lam, chairman of the Institute of Securities Dealers, said that the Hong Kong stock exchange’s new product will require more attractive promotions. The first set of 50 inline warrants will have a six months shelf life. However, on the basis of Hong Kong stock exchange rules they can extend up to five years.

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