Secondly, restrict futures companies from entering the derivatives market. The Interim Measures for the Administration of Derivatives Transactions of Financial Institutions (hereinafter referred to as the Interim Measures) divides derivatives transactions of financial institutions into two categories: one is derivatives transactions conducted by financial institutions to avoid their own asset-liability risks or gain profits, and the other is derivatives trading services provided by financial institutions to customers (including financial institutions).
The Interim Measures limit financial institutions that can engage in financial derivatives trading to banks, trust and investment companies, finance companies, financial leasing companies, auto finance companies as legal persons and branches of foreign banks in China. City commercial banks, rural commercial banks and rural cooperative banks may engage in transactions only after the consent of the local CBRC and the approval of the China CBRC. However, futures companies specializing in derivatives trading have no corresponding qualifications, and these specific regulations restrict futures companies from entering the derivatives market.
If futures companies want to set foot in the financial derivatives market in the future, they can only be affiliated with these companies. Because of this, people in the futures industry are not without anxiety and anxiety. The Interim Measures actually keep the futures industry out of the derivatives market, which is extremely unfavorable to the development of derivatives market and futures market.
Third, China lacks some market makers. Market makers can maintain trading volume, activate the market, start the market, and ensure the orderly and coherent changes of market prices to a certain extent. Market makers provide immediacy and liquidity for the market through continuous two-way quotation, ensuring that the market will not lack counterparties at a certain price, thus ensuring stable and orderly changes in market prices.
In the international options trading market, the vast majority of investors are options buyers, and a few sellers are generally huge market makers. They have a good grasp of the market, and the quotation of power money eventually leads to the majority of buyers not exercising their rights, but China just lacks such market makers. At present, no company in China futures market has the strength to be such a market maker. However, the admission quotation of the exchange is inevitably the disadvantage of integrating referees and athletes.
Finally, due to the risks in the futures and options markets, investors in China have a low level of awareness and lack of experienced professionals. On the one hand, many domestic enterprises and individuals don't know much about commodity futures, let alone commodity options. Generally speaking, their cognitive level is very low. Whether this situation can be solved is related to the participation and trading level of the futures market. On the other hand, although the development of China in recent ten years has trained a large number of market participants, China still lacks experienced professionals in the face of the prosperity of the international futures and options market. In option trading, because the quotation of power premium involves very strict information analysis and calculation, once the quotation of professionals is wrong, it will often cause huge losses to the seller of options.