Hong Kong structured products battered by index plunge
Dealers react to mass knocking out of popular retail equity derivatives
A collapse of the Hang Seng Index (HSI) has left issuers scrambling to restock their inventories of popular Callable Bull/Bear Contracts (CBBCs) referencing the index, to meet rising demand from retail investors in Hong Kong eyeing a market rebound.
The index shed over 2,100 points between August 17 and August 26 on signs that the Chinese economy may be slowing. Speculators using CBBCs to bet on an upward movement of the index have seen the contracts' knock-out barriers triggered but are short
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