WEDNESDAY, DECEMBER 21, 1983
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FUTURES MARKET PROPOSALS STUDIED
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A COMMITTEE HAS BEEN SET UP BY THE COMMISSIONER FOR SECURITIES AND COMMODITIES TRADING, WITH REPRESENTATIVES FROM THE FINANCIAL COMMUNITY, TO EXAMINE VARIOUS ASPECTS FOR THE ESTABLISHMENT OF A STOCK INDEX FUTURES MARKET IN HONG KONG.
THE SECRETARY FOR ECONOMIC SERVICES, THE HON PIERS JACOBS, IN REPLYING TO A QUESTION BY THE HON PETER POON IN THE LEGISLATIVE COUNCIL TODAY, SAID STOCK INDEX FUTURES HAD BEEN FOUND ELSEWHERE TO BE OF VALUE IN PROVIDING HEDGING FACILITIES FOR UNDERWRITERS AND OTHER INSTITUTIONAL INVESTORS.
HOWEVER, HE SAID, A MARKET OF THIS NATURE MUST BE REGULATED TO PREVENT ABUSE, AND THE POSSIBLE EFFECT OF A STOCK INDEX FUTURES MARKET MUST BE CAREFULLY EXAMINED TO ENSURE THAT IT DOES NOT LEAD TO UNDESIRABLE CONSEQUENCES.
MR JACOBS SAID TWO SETS OF PROPOSALS TO ESTABLISH A STOCK INDEX FUTURES MARKET IN HONG KONG HAD BEEN SUBMITTED TO THE COMMISSIONER FOR SECURITIES AND COMMODITIES TRADING. ONE PROPOSAL WAS PREPARED BY THE CONSORTIUM OF TEN BANKS AND THE OTHER BY THE HONG KONG COMMODITY EXCHANGE LIMITED.
ON DECEMBER 1, 1983, HE SAID, THE SECURITIES COMMISSION AND THE COMMODITIES TRADING COMMISSION SITTING TOGETHER CONSIDERED IN PRINCIPLE WHETHER A MARKET IN STOCK INDEX FUTURES SHOULD BE ESTABLISHED IN HONG KONG.
THE COMMISSIONS WERE ASKED WHETHER THEY WISHED TO MAKE A JOINT RECOMMENDATION TO THE GOVERNMENT TO THE EFFECT THAT SUCH MARKET WOULD BE GOOD FOR HONG KONG.
+ IT WAS FELT BY MEMBERS OF THE COMMISSIONS THAT FURTHER INVESTIGATIONS SHOULD BE MADE, AND TO THIS END THE COMMISSIONER FOR SECURITIES AND COMMODITIES TRADING IS CARRYING OUT STUDIES WITH THE INTERESTED PARTIES, MR JACOBS SAID.
ONCE THE COMMISSIONER HAS COMPLETED HIS FURTHER INVESTIGATIONS, THE MATTER WILL BE REFERRED BACK TO THE TWO COMMISSIONS FOR CONSIDERATION.
MR JACOBS STRESSED THAT HONG KONG IS A FREE ECONOMY AND IF THERE IS A DEMAND FOR A PARTICULAR TYPE OF INVESTMENT WHICH IS NOT OPPOSED TO COMMUNITY WELL-BEING, THEN GENERALLY IT IS ADVANTAGEOUS IF THAT DEMAND CAN BE MET BY THE LOCAL MARKET.
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