Global markets in mainland China

Foreign exchange derivative products

HSBC's global markets team in mainland China provides derivatives services through our network of 19 branches. We have a strong and dedicated sales team, committed to providing tailor-made solutions to meet the needs of our clients.

We provide two main types of derivatives - risk management and yield enhancement:

Risk management products

The risk management products provide options for the management of the exchange rate and interest rate risk generated from business activities. Examples of some of the products offered include:

• Structured forward
  HSBC provides foreign currency Structured forward for clients to management FX risks. The example products include CMS Range Accrual subsidized Forward, knock-in and knock-out forward, double accrual forward etc.
• Yuan renminbi cross currency swap
  foreign currency cross currency swap is available in China. yuan renminbi cross currency swap is only available in inter-bank market of China.
• Interest rate swaps
  HSBC is one of the first to obtain the licence for yuan renminbi yuan renminbi interest rate swap, which is traded actively in inter-bank market. For corporate clients, there are some extra regulation requirements. foreign currency Interest Swap is available for all G7 currencies.
• Yuan renminbi currency option
  foreign currency currency option is available in China. yuan renminbi currency option is not available at the moment.
• Yuan renminbi interest rate option
  foreign currency interest rate option is available in China. yuan renminbi interest rate option is not available at the moment.
• Non-deliverable forward
  NDF for some regulated currencies such as won, New Taiwan dollar is available onshore in mainland China. NDF for yuan renminbi can only be traded by offshore companies in offshore market.

Yield enhancement products

The yield enhancement products provide assistance in achieving higher returns on investments by taking different levels of risk appetite.

• Structured deposits
  We currently provide structured deposits to both corporations and individuals in both yuan renminbi and foreign currency. These are yield enhancement tools tailored to clients’ risk appetite. The structure offered may or may not guarantee protection of the principal invested. Examples of some of the products offered include:
  • Dual currency structured deposits
  • Libor wedding cake deposit
  • Multi-callable LIBOR range accrual deposits
• QDII products
  HSBC is among the first group to be granted the QDII licence and first foreign bank to provide QDII products in mainland China. We currently provide 13 structured investment products under QDII scheme to corporate and institutional clients, in both local currency and foreign currency. The QDII products mainly cover three categories:
  • FX-linked products
  • IR-linked products
  • Equity-linked products

Both risk management and yield enhancement products are not totally risk-free and the risk for any specific product will depend on the structure and characteristic of the product itself. Bank staff will explain all the risks associated with the product to customers and help customers understand the risks before deal. For more information on HSBC in mainland China's foreign exchange derivatives product offering, please contact us.