Vietnam’s derivatives market has maintained a monthly growth rate of 35 percent since it was launched one year ago, according to the Hanoi Stock Exchange (HNX).

The volume of transactions has enjoyed a strong growth rate since May 2018.

Compared to the total of 487 contracts that were transacted on the launch day (August 10, 2017), the market saw a record high on July 6, 2018 with 164,872 contracts. The average number of transactions in 2018 reached 58,613 contracts per day, up 5.3 times against that in 2017.

The number of derivative accounts has steadily increased, with 153 new accounts activated each day. As of July 31, there were 39,631 accounts, of which 11,225 have made transactions.

Individual investors account for 95 percent of the total in the derivatives market, compared to the 90 percent figure in the wider stock market. 

Domestic organisations made 1.41 percent of the total transactions conducted in the past year. Foreign investors meanwhile transacted 23,305 contracts, or 0.12 percent of the total.

HNX, the market’s operator, said that the derivatives market is an effective solution to keep investors by preventing them from withdrawing capital when the stock market suffers downtrends. Data from international markets show that liquidity on the derivatives market rises significantly when the stock market’s points decrease.

The derivatives market opens at 8:45am, 15 minutes earlier than the opening hour of the stock market, and closes at 3pm. Prices of products are allowed to fluctuate by /- 7 percent and price quotation is 0.1 VN30 index point.

Each transaction unit is one contract. Contract units are valued at 100,000 VND per VN30 index point. The last trading day is the third Thursday in the month of maturity. The month of maturity is the current month, the following month, and the last two months of the next two quarters. –VNA