Public Comments
Outline of Specifications for JPX-Nikkei Index 400 Futures
Considering the needs of investors for hedging, Osaka Exchange, Inc. (OSE) will introduce futures based on JPX-Nikkei Index 400, which is a new index jointly developed by Japan Exchange Group, Inc. and Nikkei, Inc.
OSE will invite public comments on this matter. If you have any comments, please submit them to OSE as follows:
OSE sought public comments on "Outline of Specifications for JPX-Nikkei Index 400 Futures" from March 26, 2014 to April 24, 2014. OSE appreciates those who made comments for the cooperation in reviewing this matter.
Please see the following concerning comment on this matter and OSE's response to them.
The draft is implemented as proposed.
Comment
The proposed JPX-Nikkei Index 400 futures contracts appear set for a notional principal amount around the same level as Nikkei 225 mini contracts to target retail investors. However, if online brokerages are unable to come up with a reasonable fee structure, then retail investors would not be able to participate, and this would undermine any plans to establish the new market.
Whether we are able to come up with a reasonable fee structure depends on trading fee rates. As such, trading fees are the most important aspect when considering whether to offer trading in these contracts. In terms of the development schedule, trading fees should be released at least at the same time as the outline of the trading rules and contract specifications.
(Rakuten Securities, Inc.)
OSE Response
OSE is launching JPX-Nikkei Index 400 futures contracts to accommodate the need for a futures market based on the index among institutional investors and other market users.
Before releasing the outline of the specifications for contracts, we had already understood the demand among market users for the early launch of a futures market. As such, when we made the initial announcement on March 25 on launching the futures market, we made accommodations for the time required for system-side preparations at trading participants by releasing most of the specifications, including the number of contract months, tick sizes, and trading hours, while leaving certain details, such as the market launch date and the fee schedules, undetermined. These details including the launch date and trading fees were later announced on June 17 on the OSE website, etc.
OSE will refer to this comment in future discussions.