'Rollercoaster day' in Hong Kong stresses dealers' exotic books

Autocallable knock-in levels under pressure but losses averted

Staying afloat: losses from a volatility short squeeze should be avoided

Buffeted Hong Kong indexes used as underliers for structured products have stressed dealers' exotic books but, without a further 10% fall, losses from a volatility short squeeze will be avoided.

Hong Kong indexes suffered heavy falls on July 6, but the drops were twice as steep two days later. On July 8, the Hang Seng China Enterprise Index (HSCEI) fell more than 7%, and the Hang Seng Index fell nearly 10% to register its lowest ever points fall of more than 2,000 points. While the markets have

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