There are now almost 1.1 million outstanding options on Tencent, outnumbering those on the Hang Seng Index by more than four-to-one. The demand for the derivatives mirrors a trend in the US, where volume in single-stock options exploded this year and helped underpin the rally in technology shares.
HONG KONG: Caught off guard by Tencent Holdings Ltd’s record-breaking rally earlier this year, Hong Kong’s stock investors are getting well prepared for the next one.
For about two months, options traders have consistently shelled out more for bullish three-month contracts on the stock than they’re willing to pay for those protecting against losses, according to data compiled by Bloomberg.
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