I agree with you on all points re China. But I find the picking and choosing on the West's side hypocritical. It's not just 3 companies the are beholden to the communist regime. It's the entire Chinese corporate sector. So, again, why is Alibaba trading on an AMERICAN exchange right now as we speak while the Hang Seng index in HK is banned? Makes no sense from the intent's perspective.
Alibaba is not on the list of sanctioned companies that's owned and/or controlled by the Chinese military. It's so far still individually owned by Ma Yun or Jack Ma depending on where you read his name. That's why it can be traded on Nasdaq and can trade still in Hong Kong but if an index contains Chinese military-owned companies then THAT particular index cannot be traded, has nothing to do with Hang Seng index. It's not that complicated. Don't trade that f***ing index. Trade those individual Chinese companies that are not owned by the Chinese military, not yet anyway.
https://home.treasury.gov/policy-is...ormation/chinese-military-companies-sanctions C'mon have some faith in your own country!! Why don't you trade in US companies and US indices? Plenty of money to be made there still. Why so insistent on handing money over to a foreign authoritarian regime?
AMP Futures explained it quie well here: https://support.ampglobal.com/hc/en...8393-Hong-Kong-HKEX-Trading-has-been-Disabled US Treasury confirmed that futures and stock indexes that comprise those companies are also covered by the sanction. What interested me as a non US citizen (and living in New Zealand) was: a) AMP made it a blanket ban when in fact the sanction does not apply to me (non US citizen). But I can understand AMP's position because I *could* be a US citizen living in NZ - AMP would not know. So just easier for AMP to disable access for all customers. b) I was surprised that the volume of futures contracts on the HKFE has not really changed. I assumed a lot more of the volume would have come out of the USA as the HKFE hours I understand are not too bad for trading after work in the USA.
Just shows how little of an impact the west makes in Asian economy. Totally justifies China's position of doesn't give a s***. LOL
@JSOP, do you realize your argument is not logical at all? I do trade in US companies and indices as well. Huh? How the heck did you come up with that being my intention? 0. As a trader, I care about alpha, not politics. 1. Sometimes I'd find better trading opportunities in the MHI (not even the HSI). 2. Trading an index doesn't directly funnel money to "a foreign authoritarian regime". 3. The amounts I trade are puny, and even if hundreds of thousands of Americans traded those indexes, that would not make much of a dent. The Chinese regime has enough money, and as it was pointed out earlier in the thread, volume barely decreased on the HKFE.
Thank you but where does it state that even index futures that contain those companies are not allowed to be traded by US residents or corporations? I must have missed it Trading in futures does not hand money to any company, it takes or gives away to the counterpart of the futures contract.
I don't think the link clarifies that index futures whose underlying contains any of banned companies are included in the prohibition to be traded. According to my understanding of the relevant sections is that treasury specified stocks or directly derived securities. That is why GS and the likes stopped sponsoring and trading relevant warrants, stock options and the like. I hear that GS still shows up as counterparty in HSI futures locally in HK. They are a US linked entity, even the HK branch. And they need to because hsi is used for short term hedges all day long by large players. For example GS is quite a large player in HK program trading and I know for sure that they are still running multiple index arb books in HK. Obviously my understanding could be wrong but at least we now have some specifics from the source. Thanks for sharing that By the way the reason volume is hardly affected is because a large HK based crowd, both retail and professionals, trade Hangseng and hshare futures. Unlike kospi the foreign participation in HSI is way lower last time I checked. This entire issue is a travesty in my opinion. China can easily put all American companies on a banned list who directly supply the US government with military technology and that easily disqualifies the entire spx500 and russel2000 because of the companies in the index that do openly collaborate with the US government. Did you get the sense that the trade war had any positive effect on the US economy? I did not. It appears much more like some desperate measure by an administration that had no clue what it was doing. Let's see whether Biden will hold up this ban or whether something changes. It does not appear as if Biden is in any hurry to ease the tensions.