Hong Kong Exchanges and Clearing Limited (HKEX) has revealed plans to launch weekly individual stock options on 10 Hong Kong-listed stocks.
HKEX plans to launch these new weekly expirations by the end of 2024, subject to market readiness and regulatory approval.
HKEX Head of Equities Product Development Brian Roberts said:
“We are pleased to introduce weekly stock options to our growing product ecosystem. The new additions will add to the attractiveness and diversity of our derivatives market, further supporting the risk management needs of investors. At HKEX, we are committed to continuously enhancing our product range and further developing our markets, strengthening Hong Kong’s position as the leading hub for derivatives trading and risk management in Asia.”
Weekly stock options will be add-on expirations to existing individual stock option contracts, supporting investors’ trading needs and optimizing their risk management capabilities. Contracts can be used to manage positions in response to short-term or specific events, such as corporate results. With their shorter time to maturity, they have relatively low option premiums.
The launch of weekly stock options complements HKEX’s suite of weekly index options, which were introduced in 2019 with the Hang Seng Index and the Hang Seng China Enterprises Index. Since then, weekly picks have become one of the fastest growing product types. The average daily volume (ADV) of the Weekly Hang Seng Index Options quadrupled from 3,380 contracts in 2019 to 12,948 contracts in 2023, representing about 31 percent of the total volumes of the Hang Seng Index Options product line.
The HKEX derivatives market hit a record ADV of 1.35 million contracts in 2023, up 4 percent from last year. This momentum continued in 2024, with ADV of 1.50 million contracts in the first quarter.