September 2022, Shanghai Securities News (Reporter: Fei Tianyuan)
"After more than 30 years of development, we have observed gradual positive results from the price discovery and risk management functions of China’s futures market. This affirmed that these functions have been increasingly important in the development of the real economy and will be an effective tool in price risk management". Tang Lei, general manager of Orient Futures Co., Ltd, said in an interview with the Shanghai Securities News.
Founded in 2008, Orient Futures Co., Ltd. is a wholly-owned subsidiary of Orient Securities Co., Ltd. The company's latest registered capital is 3.8 billion yuan while the number of employees exceeds 800. After more than ten years of rapid development, Orient Futures currently ranks at the forefront of the industry in various indicators such as total market transaction share, assets under management, and scale of profit.
Despite the rapid development of the futures industry, Orient Futures is committed to providing stable operation and innovative development, as well as focusing on expanding the customer base through serving different groups of customers, from high net-worth customers to corporate customers and institutional customers. All these efforts contribute to building a strong foundation for the company to continue staying ahead as a leading first-class derivatives service provider. In the 2021 Outstanding Member Commendation of China Financial Futures Exchange (CFFEX) Awards, Orient Securities won the highest-level Excellent Member Platinum Award, demonstrating the company's leading position in the field of financial futures.
The Rise of Orient Futures
When discussing the business characteristics of Orient Futures, Tang Lei shared that the company has a higher proportion of institutional customers than its peers. He also emphasised that the development of China’s financial futures is a contributing factor to the increase in business opportunities for the company.
After the launch of some products by CFFEX in 2010, Orient Futures actively played the role of an intermediary by communicating and servicing its customers. The company continues to be customer-centric and focuses on meeting customer needs.
Moreover, after 14 years of research and development, Orient Futures has built an integrative and developed service model that is applicable for a suite of products including public offering, private placement, banking and insurance. This service model also extends into comprehensive support for customers in the areas of contract-signing, technical pairing, trade execution, risk control, compliance management and customisation. Separately, the company also synergises the advantages of Orient Group and its multi-channel customer resources to provide financial institutions with a professional suite of comprehensive services and trading platforms to enhance customer loyalty.
For example, as bank wealth management products completed their transformation in recent years, the demand by wealth management funds and low-risk customers for investment strategies that can yield stable returns has increased sharply. After understanding the demands from a bank's wealth management subsidiary, Orient Futures leverages CFFEX stock index futures and stock index options tools to provide customised solutions for customers. Though the first half of 2022 saw a large fluctuation and fall in the equity market, Orient Futures’ asset management products make full use of the flexibility and leverage of financial futures to help institutional clients to avoid drawdown and control risk, thus winning the recognition and trust of institutional clients.
"Looking at the asset management system in China, many financial products require the use of financial futures to hedge their risks, yet the proportion of institutions using financial futures is not high. With the introduction of the Futures and Derivatives Law, more traders will be protected within the comprehensive framework. Therefore, I believe that more institutions and enterprises will realise the importance of using financial futures tools, and that will likely increase the amount of participation in the financial futures market." Tang Lei said.
Leveraging Fintech to Build Core Competitiveness
Apart from a higher volume of institutional clients, continuous innovation in financial technology is another major distinguishing feature of Orient Futures. “The diversity of trading strategies in the futures market depends on whether futures companies have invested enough resources in financial technology tools such as trading systems and research platforms. Therefore, investing in fintech innovation to improve the investment and research capabilities and technical level of futures companies will be the upcoming trend in the futures industry." Tang Lei emphasised.
At present, Orient Futures has reformed its organisational structure to what it terms as "one body, two wings and two cores". "One body" refers to having the brokerage business as the company "base" to achieve rapid development; "Two wings" refers to the distinct characteristics of the asset management business and the three subsidiaries business; Lastly, "Two cores" refers to the use of research and technology to help the company transit from low-level competitiveness to high-tech competitiveness.
After years of careful preparation, Orient Futures has launched the self-developed "Fanwei" intelligent investment and research platform. "Fanwei" consists of two major functions, mainly data integration and quantitative analysis, combining analysis methods and models compiled based on numerous years of experience. As such, this platform has its unique competitive edge in the industry.
Moreover, Orient Futures has also established Orient Securities Innovation Technology Research Institute and Orient Securities Quantitative Finance Innovation Laboratory. The former is dedicated to improving the company's investment and research capabilities, while the latter focuses on improving the company's technical abilities and standards. In addition, Orient Futures is working closely with Fintechs, to further develop its two core competencies in research and technology, through the utilisation of big data, cloud computing, artificial intelligence, blockchain and other latest technology.
"In recent years, the company continues to unleash its financial technology expertise and stabilises its position in the field of finance and big data. Furthermore, we combine our 'Fanwei' system with Fintech’s data to provide effective tools to manage futures and options' price risk for many industrial and financial customers. This will serve the real economy with practical value." Tang Lei said.
Market-Oriented Mechanism Builds an Agglomeration of Talent
"Compared to banks and securities companies, the futures industry has always been an attraction for talents." Tang Lei said, "The company attaches great importance to the building of talented teams, so it uses market-oriented mechanisms to hire professional talents in fields such as research and technology development. Besides that, the salary system for these individuals is similar to those in securities companies, and all of these factors shall allow a gradual establishment of a talented team."
Specifically speaking, Orient Futures continuously perfects its market-oriented operation mechanism to drive employees' motivation and vitality. The company also implements market-based assessment and incentive mechanism that are based on the organisational structure. With these measures in place, it hopes to encourage every department to find its advantages, explore profit-making opportunities, breaks business barriers, explore career progressions, and use scientific and feasible methods to avoid “stagnation”. The company has always emphasised that a 'win-win' healthy competition forms a solid foundation for the stable advancement of the market-oriented mechanism.
At the same time, Orient Futures uses market-standard processes to build a talented team with an internal driving force. It also implements a scientific and refined talent management model that can discover talents effectively, dare to invest in talents, use talents efficiently, and be quick to retain talents. After all, the market is an invisible ‘sieve’, and it is highly competitive. Hence, the company will make use of market-oriented internal competition and adaptable performance evaluation mechanism to screen professionals who can work well under the corporate culture and possess a fighting spirit. Ultimately, these professionals will make up a pool of talented experts.
Tang Lei added, Orient Futures will continue to adhere to its goal of providing stable operation and innovative development and focuses on leveraging financial technology to develop the derivatives industry. Last but not least, the company will continue to develop its two core competencies, research and technology, through the utilisation of big data, cloud computing, artificial intelligence, blockchain and other financial technology means. The company’s direction will stay consistent, that is, to internationalise and grow with the market and as a Group, moving forward towards the goal of being a first-class derivatives service provider.
Source: https://news.cnstock.com/industry,rdjj-202209-4957082.htm
