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Securities and Futures Commission of Hong Kong Enhances Regulatory Framework for Single-Day Leveraged and Inverse Products to Ensure Orderly Market Trading (Golden-Ten Data APP)
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BlockBeats News, July 24, the Hong Kong Securities and Futures Commission today issued a revised circular, stipulating that leveraged and inverse products whose capacity is highly affected by market conditions must adopt a flexible leverage structure. Under this structure, the leverage ratio can be adjusted daily within the existing limits (i.e., leverage products at 2x, inverse products at -2x). Therefore, product providers may lower the target leverage ratio of such products when necessary, allowing for greater flexibility in managing the products during high trading volumes. The leverage ratio for these products on the next trading day will be disclosed after the close of each trading day. The potential daily adjustments to the leverage ratio also help deepen investors' understanding that leveraged and inverse products are designed as single-day products, reminding investors that such products are not suitable for holding for more than one day.

Source: BlockBeats

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