General Information
Thailand Futures Exchange (TFEX) is a subsidiary of the Stock Exchange of Thailand. TFEX was established on May 17, 2004 under the Derivatives Act B.E. 2546 as a central marketplace for trading futures and options contracts relating to equities, debt securities, and commodity products. TFEX lunched its first product, SET50 Index Futures, on April 28, 2006.
The Office of the Securities and Exchange Commission (SEC) serves as the regulatory body responsible for overseeing TFEX's activities.
TFEX offers a diverse range of products, including Futures and Options referencing:
- Equity Securities (Stock Indices and Individual Stocks)
- Debt Instrument (Government Bonds and Interest Rate)
- Commodity Products (Gold, Silver and Rubber)
- Foreign Exchange Rates
Product & Trading
Investors can access real-time data through trading platforms provided by TFEX member and TFEX Data provider vendors. Delayed data (15 minutes) is available on the "Daily Trading Information" page, while historical data (up to 2 years) can be found on the "Market Statistics" page. For historical data beyond 2 years, visit the "Data Service" page.
Product details such as contract specifications and trading hours are available in the “Products” Page.
- There are two methods to trade on TFEX for foreigners. First, to open an account with one of TFEX member brokers listed on the "Membership List" page. If you already have a stock trading account opened with our TFEX member, please contact our member to open an additional derivative trading account (Your broker must be listed on the Membership List page)
- The second method is to open account with your FCMs that have relationships with our TFEX members.
Yes, orders are matched using Price then Time priority method, like stock markets.
A Combination Order allows simultaneous buying and selling of futures positions across various series.
A block trade or trade report is the trading method that helps facilitate investors who would like to create a large buy or sell positions in derivatives market. An investors will make agreement regarding the price and quantity with his counterparty and then ask TFEX member to record a “Put Throught” transaction on TFEX system. More details on guidelines for Block Trade Transactions can be found on the “Announcement and Regulation” page.
A Circuit Breaker measure is implemented during extreme market volatility to temporarily halt trading and provide investors time to assess impactful news.
TFEX halts trading for each product when the trading price reaches the specified level based on the contract specifications of each product. The triggering price is determined from the trading price of the nearest contract month or the contract that has active trading, or as deemed appropriate by TFEX, during the period leading up to the contract expiration, for example, 10 business days before the last trading day. TFEX may consider using the trading price of the subsequent contract month (2nd Contract month) as the triggering contract series instead of the trading price of the Nearest Contract Month.
A Market Maker is appointed by TFEX to provide bid and offer for certain types of products in the market. They consistently provide Bid and Offer orders per the criteria set by TFEX, ensuring that investors can trade these products throughout the trading hours.
In cases of Corporate Actions, like special dividends or changes in stock value, TFEX may adjust contract terms to protect Stock Futures holders' benefits. More details on Corporate Action can be found on the “Announcement and Regulation” page.
Clearing & Settlement
Thailand Futures Exchange (TFEX) is a subsidiary of the Stock Exchange of Thailand. TFEX was established on May 17, 2004 under the Derivatives Act B.E. 2546 as a central marketplace for trading futures and options contracts relating to equities, debt securities, and commodity products. TFEX lunched its first product, SET50 Index Futures, on April 28, 2006.
The Office of the Securities and Exchange Commission (SEC) serves as the regulatory body responsible for overseeing TFEX's activities.
TFEX offers a diverse range of products, including Futures and Options referencing:
- Equity Securities (Stock Indices and Individual Stocks)
- Debt Instrument (Government Bonds and Interest Rate)
- Commodity Products (Gold, Silver and Rubber)
- Foreign Exchange Rates
Margin
Margin in TFEX
Margin in TFEX
Yes. When discussing margin trading in securities, it refers to borrowing money to purchase securities. For instance, using a 50% margin means having 100,000 Baht and borrowing an additional 100,000 Baht to buy securities worth 200,000 Baht. However, in the context of TFEX (futures market), margin refers to the collateral that investors must deposit with their broker for trading purposes.
In futures trading, it involves an agreement to buy or sell an underlying asset in the future at a price and under conditions agreed upon in advance. However, there is no actual exchange of money or delivery of goods yet, unlike immediate delivery in the spot market. Futures prices are related to spot prices, which change based on news and market conditions. To ensure both buyers and sellers fulfill their contract obligations, margin - a form of collateral - is required from both parties involved in futures trading. This is to ensure confidence that all parties will abide by the futures contract agreement.
Two main types of assets can be utilized as collateral for trading commodities on TFEX:
- Cash Collateral:
- Thai Baht (THB)
- Foreign currencies (USD, EUR, JPY)
- Non-Cash Collateral (starting from April 23, 2021):
- Registered securities and Non-Leverage ETFs held at securities depositories, excluding Warrants and Derivatives Warrants. Initially, the service will only accept common stocks that are underlying assets for Stock Futures.
- Government bonds or Bank of Thailand bonds held at securities depositories.
Non-Cash Collateral
This service, provided by the Thailand Clearing House (TCH), allows investors to utilize assets beyond cash such as government bonds, Bank of Thailand bonds, and securities (initially limited to common stocks that are underlying assets for Stock Futures) as collateral alongside cash (this service commenced on April 23, 2021)
Enabling investors to use other assets as collateral alongside cash adds convenience and flexibility to managing their collateral. It helps reduce some costs for investors who would otherwise need to prepare only cash as collateral. Moreover, it enhances the efficiency of portfolio management for better investment outcomes.
No, initially, only common stocks that are underlying assets for Stock Futures will be accepted. Additionally, TCH has other requirements such as the securities offered as collateral must be unencumbered. This means that securities like Warrants, Derivatives Warrants, and Leveraged securities cannot be used as collateral.
Investors cannot solely use Non-Cash Collateral or securities as full margin. They need to include cash as part of the margin to cover daily profit and loss calculations or the Mark-to-Market value of the collateral. This is because at the end of the day, cash settlements are required for any realized profits or losses. Additionally, brokers might have other requirements. For instance, in opening new futures contracts, the Initial Margin must be in cash, although other securities can be used to calculate the Maintenance Margin level.
Since the value of securities fluctuates with market conditions and different types of assets have varying liquidity in converting to cash, to accommodate these fluctuations, the Thailand Clearing House (TCH) and brokers calculate the value of Non-Cash Collateral daily. They apply a 'haircut,' a reduction in value based on the risk associated with each type of security, as per the rates set by TCH.
Investors and brokers using these stocks as margin need to carefully track any Corporate Actions related to these stocks. It is recommended to convert these particular stocks into cash or different securities before any Corporate Actions occur. If Corporate Actions happen while the stocks are held as margin, brokers might not be able to pass on associated rights to investors. Additionally, there could be costs and taxes involved in dealing with these actions.
The Thailand Clearing House (TCH) establishes maximum quantities of each security that can be used as margin, considering the liquidity of each security. If TCH determines a decrease in a security's liquidity, it may limit the amount brokers can accept as margin. If the overall margin securities exceed the set limit, your broker may ask you to convert those securities into cash or other assets.
You can inquire with TFEX member about their policy on accepting securities as margin. Each TFEX member might have different conditions or additional details regarding this service, so it is essential to ask for specific terms and conditions.
Other
You can try calculating prices on the “Calculator” page.
You can simulate trading orders with real-time data at Click2Win.