New investment options include Taiwan Index Futures, Small Taiwan Index, and Micro Taiwan Index

        In the futures trading market, "Taiwan Index Futures" and "Small Taiwan Index" were issued earlier. In order to encourage more novice investors to participate, a new option of "Micro Taiwan Index" has emerged in recent years. What are the advantages of futures trading? Which investors are suitable for these three types of futures? This issue of 'Finance Column' takes you to explore the truth.

        What is Taiwan Index Futures?

        Taiwan Index Futures, also known as "Taiwan Weighted Stock Index Futures," is a financial product launched by the Taiwan Futures Exchange (TAIFEX) in 1998, with the code "TX." Its underlying asset is the Taiwan Stock Exchange Corporation's Weighted Stock Index (TAIEX), so price changes are closely related to the Taiwan stock market index.

        The trading unit for Taiwan Index futures is "NTD 200 per point". When the Taiwan Stock Index is 20000 points, the value of one Taiwan Index futures order is NTD 20000 × 200=NTD 4000000. The original margin required for placing an order is NTD 322000, while the maintenance margin is NTD 247000. The amount of margin is adjusted according to the announcement of the Futures Exchange. For example, when Taiwan Index Futures was first launched, the original margin for placing an order was only NTD 83000. With the rising price of the Taiwan Stock Index in recent years, the margin for Taiwan Index Futures has gradually been adjusted to the current amount. Due to the leveraged nature of Taiwan Index futures, investors only need to pay a certain percentage of margin to trade, which enhances the efficiency of capital utilization, but also comes with higher risks.

        Taiwan Index futures are suitable for institutional investors, large corporations, and individual investors with ample funds. In addition to making profits, they can also serve as a hedging tool to reduce the risks brought by stock market fluctuations.

                Xiao Tai Zhi: Choosing to lower the threshold

        In order to encourage more investors to participate in the futures market, the Taiwan Futures Exchange launched the "Small Taiwan Index Futures" (code named "MTX") in 2001, which is one fourth the size of Taiwan Index Futures, or "NTD 50 per point", lowering the trading threshold and allowing general retail investors to participate.

        For example, when the Taiwan stock index is 20000 points, the value of a small Taiwan index is NTD 20000 × 50=NTD 1000000, with the original margin currently NTD 80500 and the maintenance margin NTD 61750. Compared to Taiwan Index Futures, the required capital is significantly reduced. Due to the smaller contract size, the risk is relatively low, and it has the same trading method and similar leverage effect as Taiwan Index Futures, making it more suitable for small and medium-sized investors to use.

        Weitai Index: More affordable entry-level futures

        With the development of the investment market, more and more investors hope to participate in futures trading, but for some beginners, the burden of the Small Taiwan Index is still slightly high. Therefore, the Taiwan Futures Exchange will further launch "Micro Taiwan Index Futures" (code named "TMF") in 2023, with a scale of one twentieth of Taiwan Index Futures, or "NTD 10 per point".

        Calculated based on the Taiwan Stock Index at 20000 points, the value of a micro Taiwan Index is only NTD 20000 × 10=NTD 200000. Currently, the original margin is NTD 16100 and the maintenance margin is NTD 12350, allowing more investors with limited funds to participate in the futures market, especially suitable for beginners. Investors can learn the basic operations of futures trading through this, accumulate experience, and then further participate in the Small Taiwan Index or Taiwan Index futures.

        The advantages of trading platform index futures, small platform index and micro platform index

        1. Leverage effect: Investors can use smaller margin to control larger assets and improve capital utilization efficiency.

        2. Hedging function: For investors holding stocks, futures can serve as a hedging tool to reduce the impact of market volatility on the investment portfolio.

        3. Two way trading: Taiwan Index futures, small Taiwan Index, and micro Taiwan Index can all engage in long short two-way operations, with opportunities to profit regardless of whether the market rises or falls.

        4. High liquidity: Taiwan Index futures are one of the most traded futures commodities in the Taiwan market, with good liquidity that allows investors to quickly enter and exit the market.

        5. Diversified selection: Futures commodities of different scales can meet the needs of various investors, from institutional legal persons to small investors can participate.

        Oriental Securities Corporation: Provides professional futures trading services

        Finding a suitable securities firm is crucial when choosing to trade futures. As a well-known financial institution in Taiwan, Oriental Securities Corporation not only provides complete Taiwan Index futures, small Taiwan Index, and micro Taiwan Index trading services, but also has the following advantages:

        Robust trading system: Oriental Securities Corporation provides an efficient trading platform, ensuring that investors can quickly place orders and stay informed of market changes in real-time.

        Professional Investment Consultant: With a professional research team, we provide real-time market analysis and operational advice to help investors make more accurate decisions.

        Diversified investment tools: In addition to Taiwan Index futures and other commodities, Oriental Securities Corporation also offers diversified investment tools such as stocks and options to meet different investment needs.

        A sound risk control mechanism: providing a risk management mechanism to assist investors in reducing the risks brought by market fluctuations and ensuring safer trading.

        conclusion

        Taiwan Index Futures, Small Taiwan Index, and Micro Taiwan Index are important derivative products in Taiwan's financial market, suitable for investors with different fund sizes and risk tolerance to participate. Whether hoping to make profits through futures trading or engaging in hedging operations, these futures commodities can provide corresponding opportunities and strategies. Choosing the right securities firm is equally crucial. Oriental Securities Corporation, with its professional trading platform, well-established investment consultant team, and rigorous risk management mechanism, provides investors with comprehensive trading support and has become a reliable partner in the futures trading market. In the rapidly changing market environment, mastering the correct investment tools and professional resources will help investors cope with challenges more calmly and seize opportunities for wealth appreciation.

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