Chapter 1112: Taking action against the futures market

Liu Tianci did not dare to answer carelessly when it came to the issue of the opening of the Hong Kong-Jiangsu Stock Exchange.

He fell into deep thought. After considering the company's internal plans and the actual situation, he said after a long while, 'Chairman, with your previous strategic guidance and by referring to other large stock exchanges in the world, the construction of the system of the Heung Kong United Exchange has been very rapid. The complete draft of the system was completed last month, and now we are checking for deficiencies and making up for any omissions. In four months at most, we will be able to release the complete system.'

'In terms of hardware, the Xiangjiang Unified Exchange will completely abandon the remaining manual trading and fully adopt a computer-assisted trading system for securities trading. The machines are already in place, and it will take a maximum of two months to complete the commissioning of all the machines, until they are ready to be used...'

'I personally predict that the earliest it should be possible to completely complete all the work in October, close the four major exchanges, and activate the Unified Stock Exchange.'

'Even in the most conservative case, it can be activated before December this year!'

At the end, Liu Tianci's tone was very determined and affirmative.

According to Liu Tianci, that means it will take another five to seven months!

That's not long at all!

Once the Hong Kong United Stock Exchange is up and running, Xia Yu will be able to set about transforming Hong Kong into a financial centre in Asia and the world!

He smiled and nodded to Liu Tianci and said, 'Tianci, it's fine if it can be opened this year.'

'After I meet with Peter Monroe, things should go more smoothly for you here.'

'If there are any areas where resources are lacking, just let me know and I'll arrange for someone to allocate them, to ensure that the joint stock exchange can be launched quickly and smoothly.'

'Okay!'

...

After that, Xia Yu gave Liu Tianci some more instructions. After he left, Xia Yu called Wang Qi and went with him to a place.

At first, Wang Qi was confused, but when the car stopped and he got out to see a signboard not far away, a shocking guess came to his mind.

'Wang Qi, let's go!'

After glancing at Wang Qi's shocked expression, Xia Yu gave a faint smile, called out to him, and walked straight towards the Xiangjiang Commodity Exchange Co., Ltd.

Wang Qi suddenly came back to his senses, took three steps and caught up with Xia Yu's pace, walking next to Xia Yu towards the Xiangjiang Commodity Exchange.

Once inside, he could see that the Xiangjiang Commodity Exchange was very quiet. Although he could see many people trading, it was in no way comparable to any of the four major stock exchanges in Xiangjiang.

Although the Xiangjiang Commodity Exchange is currently the only futures exchange in Xiangjiang, and it is not as well-established as the four stock exchanges, its operating conditions are indeed not optimistic.

The Hong Kong Mercantile Exchange was established in February 1977, and it has now been in existence for five years.

However, in just five years, the Hong Kong Mercantile Exchange has developed six futures products, namely raw sugar and cotton trading, which were the first products traded; soybean trading, which started in 1979; gold futures trading, which started in 1980; and silver futures and corn trading, which started last year!

Last year, the total trading volume of the Hong Kong Mercantile Exchange was only 2.6 billion Hong Kong dollars, equivalent to an average monthly trading volume of just over 210 million Hong Kong dollars. This trading volume is not even comparable to that of the securities market!

Considering that the Hong Kong securities market has a trading volume of over 100 billion Hong Kong dollars a year, the trading volume of the Hong Kong Mercantile Exchange is less than 1/50th of that of the securities market. This gap is like a chasm!

As one of the three major markets, the futures market has potential that goes far beyond this level, and this is also inconsistent with Hong Kong's plan to become a financial centre.

Without a huge and mature futures market, the bustling stock market alone cannot support Hong Kong becoming a world financial centre!

In Xia Yu's opinion, the Hong Kong Mercantile Exchange is a typical failure!

In February of this year, the Hong Kong Mercantile Exchange also conducted its first internal review in five years, and the internal review also concluded that its own operations had not been successful. In the face of Hong Kong's current sluggish and chaotic financial market, both shareholders and management are worried.

It was under these circumstances that Xia Yu, while in Paris, remotely controlled the situation, and without making a sound, he allowed the Galaxy Fund to complete the full acquisition of the Hong Kong Mercantile Exchange.

So now, the Hong Kong Mercantile Exchange is already Xia Yu's property.

Now he has brought Wang Qi here, so the meaning is clear – he is going to take action against the Xiangjiang Futures Market!

After entering the company, Zhao Zhiyuan, the acting president, who had been informed by the staff, hurriedly came to Xia Yu.

Because the company was acquired by the Milky Way Fund, Zhao Zhiyuan had not met Xia Yu before, and he had only spoken to Xia Yu on the phone a few times.

Faced with Xia Yu's unannounced inspection, Zhao Zhiyuan was a little apprehensive, fearing that he might have done something wrong and would not be able to keep his job.

'Boss, welcome!'

'Zhiyuan, this is Wang Qi, the president of Jiuding Securities.

'He is Zhao Zhiyuan, temporarily acting as the company president.'

Xia Yu, as the intermediary, said a few brief words and let the two of them get acquainted.

After the two men had exchanged pleasantries, Xia Yu instructed Zhao Zhiyuan, 'Zhiyuan, show me to the office.'

'Okay, boss, please follow me!'

After saying this, Zhao Zhiyuan led Xia Yu and Wang Qi to the boss's office, which had long been prepared for Xia Yu but had never been used.

After entering the office, Xia Yu was satisfied with the interior décor. He was not polite and directly sat on the leather-backed chair in front of the desk. Then he told Zhao Zhiyuan, who wanted to make tea, 'Zhiyuan, you can let the others make tea, you go and get all the company's information.'

'Okay!'

Zhao Zhiyuan immediately put down the tea set, respectfully responded, and quickly walked out of the office. He told his secretary to go to the boss's office to make tea for Xia Yu, while he himself looked for the information.

It wasn't long before he returned to Xia Yu's office with a well-organised report on the company's development and other materials. At Xia Yu's prompting, he first handed half of the materials to Wang Qi.

'Wang Qi, take a good look and get a clear understanding of the situation at the exchange. Later, you and Zhiyuan will need to work together to build the exchange.'

'Yes!'

Wang Qi replied, and then picked up the materials and began to go through them carefully.

Before they knew it, nearly an hour had passed.

Xia Yu and Wang Qi exchanged information halfway through, and both of them gained a clear understanding of the situation of the Xiangjiang Commodity Exchange.

'Wang Qi, you've finished reading the information, so please give your opinion and tell us why the Xiangjiang Commodity Exchange has been unsuccessful.'

As soon as Xia Yu finished speaking, Zhao Zhiyuan paid full attention and looked at Wang Qi.

After a moment of thought, Wang Qi said slowly, 'Chairman, I personally feel that there are two factors that have contributed to the failure of the exchange.'

'First, there are problems with the trading rules and management regulations of the exchange, which need to be overhauled and improved in all aspects.'

'Second, there are too few types of transactions. In five years, only six commodities have been launched: raw sugar, cotton, soybeans, gold, silver and corn. Apart from gold and silver futures, the trading volume of the other four commodities is not large, and Xiangjiang is not a producing area, but only a transit station. There is naturally no advantage in terms of trading.'

'And the exchange has also had bad luck. In recent years, it has not been easy to trade either gold or silver futures!'

'There are problems in both areas, and it is already quite good that the exchange has managed to hold on until now.'