FX.co ★ China Opens Stock Options to Foreigners

China has opened its stock options market to international investors as of Tuesday, aiming to enhance the attractiveness of assets denominated in yuan. The Shanghai Stock Exchange has announced that qualified foreign institutional investors are now permitted to trade options for hedging purposes. This initiative provides them with access to a substantial CNY 100 trillion market, where five exchange-traded fund (ETF) based option products are currently available. This development is aligned with recent efforts to increase foreign involvement in China’s bond market and to further the global usage of the yuan. Last week, regulatory authorities extended access to the bond repurchase market, increased the limits on the Swap Connect scheme, and introduced strategies to bolster offshore yuan businesses in Hong Kong. Additionally, a new hub in Shanghai has been established to support the implementation of the central bank’s digital yuan. Note that markets in China will be closed from today until October 8 due to the Golden Week holiday.