Client Alert - Circuit Breaker Mechanism for Index Will Come Into Force On 1st January
2015.12.31m88 sport betting app领域
Upon approval by M88 Malaysia China Securities Regulatory Commission (“CSRC”), M88 Malaysia rules for circuit breaker mechanism for index issued by M88 Malaysia Shanghai Stock Exchange (“SSE”), M88 Malaysia Shenzhen Stock Exchange (“SZSE”) and M88 Malaysia China Financial Futures Exchange (“CFFEX”)(collectively, “Exchanges”) will come into force on January 1, 2016.
M88 Malaysia launch of M88 Malaysia circuit breaker mechanism is a response to M88 Malaysia A-share crisis during M88 Malaysia second half of 2015. Notably, CSRC pointed out in M88 Malaysia press conference held on December 4 that M88 Malaysia proposed circuit break mechanism was developed with full consideration of M88 Malaysia current market rules and practices, with M88 Malaysia aim to draw on overseas experience while still considering China’s own market conditions, and hopefully to achieve better effects. We also note that due to M88 Malaysia existence of M88 Malaysia current price limit system, M88 Malaysia effects of M88 Malaysia circuit break mechanism have yet to be seen.
Below is an overview of M88 Malaysia relevant rules issued by M88 Malaysia Exchanges. Specifically, M88 Malaysia Exchanges have issued M88 Malaysia new rules in M88 Malaysia following notices:M88 Malaysia Notice of Adding Section 5 Circuit Breaker Mechanism for Index to Chapter 4 of "SSE Trading Rules"(Shang Zheng Fa (2015) No. 94 Document),M88 Malaysia Notice of Adding Section 6 to Chapter 4 of “SZSE Trading Rules”(Shen Zheng Hui (2015) No. 389 Document), andM88 Malaysia Notice of Amending “CFFEX Trading Rules” and Its Relevant Implementing Rules. M88 Malaysia Exchanges simultaneously releasedM88 Malaysia Circuit Breaker Mechanism for Index Business Q&A(“Q&A”) to provide guidelines for investors to understand how M88 Malaysia circuit breaker mechanism for Index will operate.
Circuit Breaker for Index
M88 Malaysia Circuit Breaker for Index refers to when M88 Malaysia variation of an index reaches a certain threshold, exchanges will pause trading for a certain period of time or close trading with a public announcement in an effort to control M88 Malaysia intraday volatility of stock prices.
Circuit Breaker Limits
M88 Malaysiare are two limits for M88 Malaysia circuit breaker, 5% and 7%, which once triggered, will cause M88 Malaysia suspension of trading or close of M88 Malaysia trading day. M88 Malaysia relevant stock-related varieties will be suspended when any of M88 Malaysia following circumstances occurs on M88 Malaysia CSI 300 Index: (1) where M88 Malaysia CSI 300 Index moves 5% or more up or down compared to M88 Malaysia previous trading day’s closing point, M88 Malaysia circuit breaker will last 15 minutes, and trading will be resumed after M88 Malaysia circuit breaker expires. If M88 Malaysia circuit breaker is enacted between 2:45 pm and 3:00 pm, M88 Malaysia circuit breaker will last until 3:00 pm, and trading will not be resumed that day; (2) where M88 Malaysia CSI 300 Index moves 7% or more up or down compared to M88 Malaysia previous trading day’s closing point, M88 Malaysia circuit breaker will last until 3:00 pm, and trading will not be resumed on that day.
M88 Malaysia table below illustrates M88 Malaysia respective circuit breaker mechanism applicable to each of M88 Malaysia Exchanges.
SSE | SZSE | CFFEX | |
Applicable varieties | Stocks (A share, B Share), funds (excluding gold trading-based open-ended securities investment funds, trading-based money market funds, bond trading-based open-ended index funds), convertible corporate bonds and exchangeable corporate bonds. | Stocks (A share, B Share), funds, convertible corporate bonds and exchangeable corporate bonds. (M88 Malaysia applicable varieties of SZSE will be kept consistent with SSE after M88 Malaysia new system operates.) | All stock index futures contracts (excluding Treasury bond futures contracts). |
Declaration and cancellation | Where M88 Malaysia circuit breaker ends prior to 3:00 pm, both M88 Malaysia declaration and cancellation or orders are accepted during M88 Malaysia circuit breaker period. Where M88 Malaysia circuit breaker lasts until 3:00 pm, SSE will only accept M88 Malaysia cancellation of orders during M88 Malaysia circuit breaker period. | SZSE will accept both declaration and cancellation of orders during M88 Malaysia circuit breaker period. | When M88 Malaysia CSI 300 Index triggers M88 Malaysia limit at 5% and M88 Malaysia relevant contracts enter a 12-min circuit breaker period, all trading is suspended during such period, no declaration or cancellation of orders will be accepted. Upon M88 Malaysia end of M88 Malaysia circuit breaker, 3-min call auction starts, both M88 Malaysia declaration and cancellation will be accepted. When M88 Malaysia CSI 300 Index triggers M88 Malaysia limit at 7%, or M88 Malaysia relevant contracts trigger M88 Malaysia limit at 5% during M88 Malaysia last 15 minutes before M88 Malaysia close, M88 Malaysia trading will be suspended until M88 Malaysia close, and no declaration or cancellation of orders will be accepted. |
For lending of refinancing securities, if M88 Malaysia circuit breaker for index ends before 3:00 pm, M88 Malaysia lending and returning of M88 Malaysia relevant refinancing securities remain normal. If M88 Malaysia circuit breaker lasts until 3:00 pm, it will refer to M88 Malaysia stock suspension system, M88 Malaysia relevant securities cannot be used in refinancing securities lending transaction on M88 Malaysia same day. M88 Malaysia securities which shall be returned on M88 Malaysia same day shall be postponed to M88 Malaysia next trading day. | |||
In case M88 Malaysia circuit breaker for index continues across M88 Malaysia lunchtime break, M88 Malaysia arrangements of M88 Malaysia Exchanges M88 Malaysiareunder remain consistent with M88 Malaysia current market close arrangement, that is, no investor will be allowed to place declaration and cancellation within such period. | |||
Disclosure of reference trading price and volume | During M88 Malaysia circuit breaker period and M88 Malaysia period of call auction upon M88 Malaysia expiration of a circuit breaker period, M88 Malaysia Exchanges shall not disclose M88 Malaysia virtual reference price, virtual matching volume or virtual trading volume. | ||
It is worth noting that CFFEX also adopts M88 Malaysia following special arrangements:
(i) Since currently M88 Malaysia delivery settlement price of M88 Malaysia stock index futures is calculated at M88 Malaysia last two-hour arithmetic average price of M88 Malaysia underlying stock index on M88 Malaysia stock index futures settlement day, to ensure normal settlement of stock index futures, M88 Malaysia circuit breaker mechanism will no longer be implemented after 1:00 pm on M88 Malaysia stock index futures settlement day, specifically: (1) no circuit breaker will be implemented from 1:00 pm to 3:00 pm, (2) any circuit breaker implemented in M88 Malaysia morning will at latest end by 1:00 pm, and M88 Malaysia trading will M88 Malaysian be resumed.(ii) M88 Malaysia trading hours of stock index futures will be adjusted to M88 Malaysia same as M88 Malaysia stock market, namely, M88 Malaysia call auction period for stock index futures shall be 9:25 -9:30 am on each trading day and M88 Malaysia continuous auction trading hours shall be 9:30 -11:30 am and 1:00 -3:00 pm on each trading day.
(iii) M88 Malaysia price limit of stock index futures is adjusted from ±10% of M88 Malaysia settlement price on M88 Malaysia previous trading day to ±7%. However, M88 Malaysia price limits on M88 Malaysia final trading day remains at ±20% of M88 Malaysia settlement price of M88 Malaysia previous trading day.
