Hong Kong Futures Exchange (HKFE) is a futures exchange in Hong Kong. Established in 1976, it offered a variety of options and futures contracts, linked to stock market indices, stocks, short-term interest rates, and foreign exchange. HKFE is a subsidiary of Hong Kong Exchanges and Clearing Limited.

History[edit]

The HKFE went bankrupt in 1987 during the October 1987 global stock market crash when Sino Group chairman Robert Ng, who had been speculating in futures through two Panamanian-registered companies, suffered paper losses of HK$1 billion, but then refused to pay, claiming to be protected by the limited liability of the companies through which he had traded.^[1] Trading was also halted on the Hong Kong Stock Exchange for four days.^[2] An investigation by the Commercial Crime Bureau of the Royal Hong Kong Police revealed that Ng had avoided required margin calls through collusion with one of his brokers.^[1] However, in the end, no charges were laid against Ng because the colonial government of Hong Kong felt that prosecuting him would pose a risk to overall market stability.^[3] Instead, a deal was worked out which saw Ng repay HK$500 million, with Hong Kong taxpayers providing the rest of the funds needed by the Exchange through a government bailout.^[2]

On 6 March 2000, a new parent company Hong Kong Exchanges and Clearing for the HKFE, the Stock Exchange of Hong Kong Limited, and Hong Kong Securities Clearing was formed.

See also[edit]

• List of futures exchanges

References[edit]

Notes[edit]

Sources[edit]

• Studwell, Joe (2007), Asian Godfathers: Money and Power in Hong Kong and Southeast Asia, Atlantic Monthly Press, ISBN 9780871139689