China's increasing influence in global finance highlights the need for traders to understand the complexities of its derivatives market. Additionally, it is crucial for them to recognise the advantages of the Qualified Foreign Institutional Investor (QFI Scheme).
In this article, we delve into the latest updates and insights surrounding China's Derivatives Market and the QFI China Scheme.
Strength of China Market
The strength of the China market lies in its sheer size and remarkable growth potential. China has a large population and a growing middle class. This makes it a big market for businesses from both inside and outside the country.
As the world’s second-largest economy, the United States International Trade Administration reported that China’s economy is larger than those of the next four economies - Japan, Germany, the United Kingdom, and India – combined. Its largest province, Guangdong, has a nominal GDP larger than Canada’s.
Benefit of QFI China Scheme
Introduced in 2013, the Qualified Foreign Investor (QFI) scheme simplifies the application process for international traders looking to invest in China's trading market. This scheme enables international traders to participate in China’s derivative market, facilitating investment opportunities. This includes cross-arbitrage trading, including refined copper arbitrage trading and rubber arbitrage trading.
New Internationalised Product – Shanghai Containerized Freight Index Futures
On 18th august 2023, the Shanghai International Energy Exchange (INE China) has announced the launch of the new Containerized Freight Index Futures Contracts (Europe Service). The SCFIS is an index for sea freight rates for imports from China worldwide. It is an indicator of freight prices for container transport from Chinese ports.
Read to find out more:
INE China Launches New Containerized Freight Index Futures
4 Things About New Shanghai Containerized Freight Index Futures
QFI China And China Internationalised Products Updated List
China offers many different derivative futures and options products under the QFI Scheme and Internationalized Products. This includes Dalian Commodity Exchange Soybean Futures, Zhengzhou Commodity Exchange ZCE PTA Futures, Shanghai International Energy Exchange INE Crude Oil Futures (Chinese crude oil futures) and more. Click to see the Full Updated QFI China And China Internationalised Products List.
How to Access China’s Derivatives Futures Market?
Figure 1. Source: Orient Futures Shanghai: Ways to Access China Futures Market
Access to China’s Futures market has been made more accessible with the diversification of schemes. As shown in the above diagram from Orient Futures Shanghai, traders can choose to trade through overseas intermediaries (Orient Futures International Singapore), QFI (Qualified Foreign Investor) schemes, or PFM WOFE. Currently, there are 14 futures and 9 options available in the internationalized product schemes, 27 futures, and 19 options available in the QFI scheme.
Importance of Using a Regulated Broker
With the rising cases of forex trading scams happening, it is important for investors, including expert investors Singapore institutions, to ensure that they trade through regulated brokers, such as Orient Futures International Singapore. This is crucial to avoid falling prey to such fx trading scams.
Orient Futures International Singapore is not only a Singapore forex broker but also a trusted futures trading Singapore broker. We are proud to hold a Monetary Authority of Singapore MAS CMS License, which reaffirms our commitment to adhering to the highest standards of financial regulation and security. We provide financial services for various futures and stock exchanges.
Find out What is a Regulated Broker and the 4 Comon Forex Trading Scam in 2023 here.
Start Trading With Orient Futures Singapore
Being an Overseas Intermediary of Shanghai International Energy Exchange (INE), Dalian Commodity Exchange (DCE), and Zhengzhou Commodity Exchange (ZCE), when foreign clients participate in internationalised futures contracts in these Chinese markets with us, they have direct access to trading, clearing, and settlement. Our parent company, Shanghai Orient Futures, is the largest broker in terms of aggregated volume across the five regulated exchanges in China.
Orient Futures Singapore also currently holds memberships at the Singapore Exchange (SGX), Asia Pacific Exchange (APEX), and ICE Futures Singapore (ICE SG). Starting August 2023, corporate clients can also gain access to the B3 Exchange through us.
We provide bespoke services to our professional clients, tailored to their corporate and individual needs. Our team will be there for you 24 hours on trading days to provide a one-stop portal for all your trades, with simple processes and an intuitive user interface that has low or near-to-zero latency.
