Foreign Exchange Trading Varieties Are Expected To Expand Or More Foreign Trade Enterprises Hedging "Hedge"

< p > industry insiders told reporters that the fluctuation of the RMB exchange rate by the central bank is more symbolic than the actual exchange rate.

Against this background, the trading activity in the foreign exchange market will be improved and the conditions for the increase of foreign exchange pactions will be created.

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< p > China Merchants Bank (9.56, -0.11, -1.14%) head office a href= "//www.sjfzxm.com/news/index_c.asp" > financial market < /a > Senior Analyst Liu Dongliang said that as the RMB exchange rate fluctuates increasingly fiercently, in order to reduce exchange rate risk, the future foreign trade enterprises need to lock in the cost by means of forward settlement, swap and other tools.

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< p > < strong > < a > href= > //www.sjfzxm.com/news/index_c.asp > foreign exchange > /a > the market of derivatives will be more abundant < /strong > /p >

< p > Liu Dongliang said that after the fluctuation of the RMB exchange rate, the trading activity in the foreign exchange market will be improved and the conditions for the increase of foreign exchange pactions will be created.

The expansion of foreign exchange market and the increase of trading varieties are the general trend, but at the same time, we need certain conditions.

One of the most important is that the market must have a certain volatility, and pactions should be active, which is not available in the past fluctuation mode of RMB.

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< p > "after that, we need to consider two factors, namely, market demand and supply for < a href=" //www.sjfzxm.com/news/index_c.asp "> RMB > /a > trading products.

Liu Dongliang said that with the increase of market volatility, market demand is likely to break out no matter whether to avoid risks or speculation. The supply side depends on two aspects, one is the financial product innovation ability of banks, the other is whether regulators are allowed to launch more financial products, especially derivatives.

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< p > Liu Dongliang also said that the domestic market of foreign exchange derivatives is not very developed now. The most frequently traded products are forward exchange and forward swap. Although there are foreign exchange options, the market is very small and the volume of trading is not active.

In fact, in the case of unilateral appreciation of the renminbi in the past, it does not need too much foreign exchange products to meet the needs of domestic and foreign trade enterprises.

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Zhao Yayun, director of financial investment projects at Chongyang Financial Research Institute, Renmin University of China, said P, "daily economic news" reporter said that the expansion of the foreign exchange derivatives market is sooner or later, but the time may be longer and the threshold will be very high.

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< p > strong > more foreign trade enterprises will take part in derivatives. < /strong > /p >

< p > according to the previous investigation by reporters, many small and medium sized trading enterprises in China have not yet hedged through foreign exchange derivatives.

With the increase of the RMB exchange rate and the arrival of the two-way fluctuation era, will more and more enterprises begin to conduct derivatives trading? < /p >

"P >" previously, the RMB exchange rate was mostly expected to rise in unilateral appreciation, and the strategy of import and export enterprises was very simple. Importing enterprises would only delay the time of foreign exchange purchase as the US dollar would be cheaper than the renminbi.

But this situation may not exist in the future. With the fluctuation of exchange rate, the risk of further drag will also increase.

In order to reduce the risk of exchange rate fluctuations, foreign trade enterprises need to lock in exchange rate risk through some foreign exchange derivatives.

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< p > Liu Dongliang pointed out that the demand for foreign exchange derivatives of domestic and foreign trade enterprises should start with relatively simple varieties, such as forward selling and remittance, foreign exchange swaps, foreign exchange options, and more complex varieties, which requires a long-term process.

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