On January 4, the China Securities Regulatory Commission approved the Shanghai Futures Exchange's application for natural rubber options trading, which will be officially listed on January 28. Relevant insiders reminded that the listed natural rubber options were selected by the US. Right way.
The relevant person in charge of the previous period said that there are three main reasons for adopting American options. First, from the international experience, agricultural products options are mostly American options, that is, rights can be exercised on any trading day before the option expires, while European options can only exercise rights on the option expiration date;
Second, American options are characterized by flexibility, and can be exercised at any trading time before the expiration date. For option buyers, they can obtain futures positions at any time when the market is favorable or actually needed. For options markets that may not be active early in the market, option exercise can provide an alternative way for investors to exit the market. Investors can achieve specific investment objectives through advance exercise in certain circumstances;
Third, in the industrial customer survey, Hainan Natural Rubber Industry Group Co., Ltd., Yunnan Natural Rubber Industry Group Co., Ltd., Guangdong Guangsheng Rubber Group Sales Co., Ltd., Sinochem International (Holdings) Co., Ltd., etc. Natural rubber companies say that the use of American options is more in line with the needs of natural rubber companies.
In addition, natural rubber, as an important chemical raw material, has been subject to high price fluctuations. For related industrial chain enterprises, on the one hand, the good development of natural rubber futures provides sufficient liquidity for industrial hedging; on the other hand, rubber prices fluctuate drastically and enterprises have strong demand for hedging. In this case, the on-the-field option can be combined with the futures to fill the last piece of the risk transfer mechanism.
From the international market, there is no on-the-counter option for natural rubber, and the listing of natural rubber on-site options will become an innovation in the world.
For rubber-growing farmers and rubber industry enterprises, the listed natural rubber options can not only meet the risk management needs, but also help to further expand the scale of the natural rubber futures market, and promote the natural rubber futures market to find more real prices and enhance the pricing power of commodities.
In addition, the main natural rubber production areas in Yunnan and Hainan provinces, which are concentrated in poverty-stricken counties, the introduction of natural rubber options will help win the fight against poverty.