Launching the first stock ETF futures contract in the capital market – Tejaratnews
According to Tejarat News, the operations manager of the new financial instruments market of the Tehran Stock Exchange said: For the first time in the capital market, futures contracts for exchange-traded funds (ETFs) will be launched on Wednesday, July 21, in the Tehran Stock Exchange.
Stating that the futures market of ETF funds is currently launched in one symbol and based on the “lever” symbol as the basic asset, Vahid Motaharnia said: “The due date of the future symbol The leveraged fund, one day before the expiration date of option contracts, this symbol is considered to facilitate the conditions for adopting trading strategies between the futures market and the option market. Other specifications of the future market in the above symbol are available to investors through the announcement of the beginning of the trading period published on the website of Tehran Stock Exchange.
What is the main advantage of future contract definition?
He stated that the main advantage of defining a futures contract on tradable investment funds is not stopping the symbol of the funds in the market.
According to Motaharinia; One of the important risks of the derivative market is the stoppage of the underlying asset symbol for various reasons, which does not exist in funds. Other advantages of the futures market, such as hedging the risk of price fluctuations and clarifying the market’s expectations of the future of prices, the two-sidedness of the market and carrying out leveraged transactions, are also present in the futures market of ETF funds.
The operations manager of the new financial instruments market of the Tehran Stock Exchange, referring to the fact that the futures market of securities was introduced to the capital market by the Tehran Stock Exchange about a month ago, and during this period, the futures symbols in three basic assets (in the stock market and the debt market ) has been defined, stated: the volume of futures market transactions in the mentioned period was equal to 8 thousand contracts, which is considered appropriate considering the short period of time that has passed since its launch.
He continued: The futures market is following the natural path of development and the process of familiarizing the market participants with the mechanisms and executive procedures is time-consuming. This matter took about one to two years in the options market, but due to the existence of common areas, it is expected that the futures market will prosper more quickly.
Motaharnia pointed out that the future market of ETF funds is available to investors through online trading software, similar to the future market of other securities. Persons applying to use this tool must submit a market access request to their broker. Also, it is recommended to enter the derivatives market for people who have sufficient knowledge and mastery of the future market processes and trading options.
Source: Senate