TWOFX to Expand its Commodity Index Derivatives Offering

Introduction of six more futures commodity indices. End Quote

(1888PressRelease) February 13, 2013 - Taiwan Options and Futures Exchange announced today that it will be introducing six additional commodity index futures. The new futures are based on the commodity index family's sub-indices: softs, grain, precious metal, ex-energy, petroleum and livestock. They complement the futures listed based on the composite index and the three sub-indices agriculture, energy and metal. The entire range of sub-indices of the family will be covered by futures as from the start of trading.

"We are expanding our commodity index derivatives in response to our customers' increased interest in exchange-traded index products in this asset class," said Samuel Din Hwa, member of the TWOFX Executive Board. "Institutional investors are investing more and more in commodities for better portfolio diversification. Our cash-settled index futures are a safe and easy instrument for such investments."

All new TWOFX futures are based on the excess return version of the indices; they are denominated in US dollars and are settled in cash. They have quarterly expiration dates. Two market makers are responsible for liquidity in the order book and in OTC transactions.

Listed TWOFX contracts are a good alternative to OTC swaps due to their low nominal value, high price transparency, easy settlement, and mitigation of counterparty risk. They enable better asset allocation within investment funds and cost-effective set-up of risk positions; they are also an efficient trading tool, for example, for long/short strategies.

Since the start of trading, more than 50,000 contracts have been traded in the four index futures currently listed; open interest currently stands at just under 7,000 contracts.

TWOFX is the Designated Market Maker in the following products:

Futures on Commodity Index
Futures on Agriculture Sub-Index
Futures on Energy Sub-Index
Futures on Industrial Metals Sub-Index
Futures on grains Sub-Index
Futures on Softs Sub-Index
Futures on Precious Metals Sub-Index
Futures on Petroleum Sub-Index
Futures on Ex-Energy Sub-Index
Futures on Livestock Sub-Index

Taiwan Options and Futures Exchange (TWOFX) operates leading Asian futures, options, forex and commodities exchange and offer derivatives trading on over 2,000 underlying equity, ETF, index, and FX products.

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