HKSI Paper 1 Participating in the Hong Kong exchanges question: long Hang Seng China Enterprises Index (HSCEI) futures

HKSI Paper 1Participating in the Hong Kong exchanges

For its own account, Pearl River Capital Ltd holds 21,500 long Hang Seng China Enterprises Index (HSCEI) futures and 20,000 long Mini-HSCEI futures across several contract months. It has no authorisation to exceed limits. What is its position under Cap. 571Y?

A Within the limit: the HSCEI prescribed limit is 30,000 position delta, the same as HSTECH
B Over the limit: the Mini contracts add 4,000 position delta, giving 25,500 against 25,000
C Within the limit: Mini-HSCEI futures are tested against a separate limit of their own
D Over the limit: the HSCEI prescribed limit is 15,000 position delta, the same as the HSI

Show the answer and explanation

Answer: B. Over the limit: the Mini contracts add 4,000 position delta, giving 25,500 against 25,000

Schedule 1 item 5 to the Securities and Futures (Contracts Limits and Reportable Positions) Rules (Cap. 571Y), as amended by L.N. 69 of 2025 from 2 July 2025, sets the HSCEI prescribed limit at 25,000 net long or short position delta for all contract periods combined. HKFE's contract specifications give one Mini-HSCEI future a position delta of 0.2, so 20,000 Minis count as 4,000 and the total is 25,500, which is over the limit. Mini contracts are not tested on their own: the single HSCEI limit covers the futures and options on that index together. 30,000 is the Hang Seng TECH Index limit (item 21) and 15,000 the Hang Seng Index limit (item 4). Source: Cap. 571Y s.4(1), Sch. 1 items 4, 5 and 21 (L.N. 69 of 2025); HKFE Contract Specifications for HSCEI Futures (as at October 2026). Source: Securities and Futures (Contracts Limits and Reportable Positions) Rules (Cap. 571Y) s.4(1), Sch. 1 items 4, 5 and 21 (L.N. 69 of 2025, in force 2 July 2025); HKFE Contract Specifications for HSCEI Futures (hkex.com.hk, viewed October 2026) (as at October 2026).

Common mistake

Candidates count each Mini contract as a full contract, or test the Minis separately. One Mini-HSCEI future is 0.2 position delta and joins the HSCEI total.

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Related HKSI Paper 1 questions

Kowloon Bay Asset Management Ltd, licensed for Type 9 only, manages HK$65 billion. Its funds need HSI futures positions above the prescribed limit. Can the SFC authorise the excess under the asset-manager route in Cap. 571Y?In October 2026, Mr Ip enters a limit order during continuous trading to buy an SEHK-listed ordinary share at HK$18.35. The share last traded at HK$18.30. How is the price of his order treated?Shares of Sai Kung Holdings, a CAS security, show nominal prices of HK$50.20 at 3:59:00 p.m., HK$50.10 at 3:59:15, HK$50.40 at 3:59:30, HK$50.30 at 3:59:45 and HK$50.10 at 4:00:00. What is its CAS reference price?

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Original study material mapped to the public HKSI Paper 1 syllabus. Unofficial, not endorsed by HKSI Institute or the SFC. Verify figures and rules against current guidance before relying on them.

HKSI Paper 1 Participating in the Hong Kong exchanges question: long Hang Seng China Enterprises Index (HSCEI) futures

HKSI Paper 1Participating in the Hong Kong exchanges

A Within the limit: the HSCEI prescribed limit is 30,000 position delta, the same as HSTECH
B Over the limit: the Mini contracts add 4,000 position delta, giving 25,500 against 25,000
C Within the limit: Mini-HSCEI futures are tested against a separate limit of their own
D Over the limit: the HSCEI prescribed limit is 15,000 position delta, the same as the HSI

Show the answer and explanation

Answer: B. Over the limit: the Mini contracts add 4,000 position delta, giving 25,500 against 25,000

Common mistake

Candidates count each Mini contract as a full contract, or test the Minis separately. One Mini-HSCEI future is 0.2 position delta and joins the HSCEI total.

Practise more Paper 1 Participating in the Hong Kong exchanges questions

Exam-style questions with worked answers, then full timed mocks. Free to start.

Start practising →

Build a daily practice habit — a few exam-style questions a day, with worked answers. Free to start.

Start practising →

Original study material mapped to the public HKSI Paper 1 syllabus. Unofficial, not endorsed by HKSI Institute or the SFC. Verify figures and rules against current guidance before relying on them.