Business Development

Finsec derivatives market launches today

Launch of Finsec derivatives market

Financial Securities Exchange (FINSEC) today (the 22nd of June 2022) launches the Derivatives Market.

This will further diversify capital markets products and trading, allowing market players to make more informed investment decisions. The launch follows the recent gazetting of Statutory Instrument 70 of 2022 as well as approval of the Derivatives Rules earlier.

The FINSEC Derivatives Market will be available for Stock Futures, Stock Options, and Stock Indices.

The Market is fully automated, complete with direct integration of contract writing, trading, clearing, custody, margin management, and settlement facilities to ensure efficiency, security, and transparency in the entire process.

Detailed Derivatives Market Guidelines covering pricing and underlying securities selection criteria are available on the exchange website. Pre-launch, FINSEC embarked on a market capacity-building exercise by holding masterclasses for market participants as well as potential investors to prepare them for the Derivatives Market.

Post-launch, a six months rigorous pilot window will be opened to allow the participants and investors to get acquainted with the product, hence maximum position limits of ZWL 3 million for institutional investors and ZWL 100 000 for retail investors have been set. Beyond the first 6 months, FINSEC will lift the limits and add more underlying assets (including commodities) to allow a fully-fledged Derivatives Market.

Stock Futures and Stock Options

Underlying securities will be selected based on minimum liquidity and volatility thresholds as determined by the exchange. Listed stocks that have so far met this criterion are Simbisa Holdings Limited; Econet Wireless Limited; Innscor Limited; Delta Corporation Limited, and Ecocash Holdings.

Index Futures

FINSEC will select the most volatile indices on the local markets. The following indices have met the set criteria and will form the underlying for Index Futures – Stock Indices Components M & C Telecoms, Media and Technology Index (MCTMT) Ecocash Holdings; Econet Wireless.

Webinar details below:

Register on this link to attend the launch: https://bit.ly/3Ortt2j
RSVP: [email protected]

About the author

Byron Adonis Mutingwende