Japan's Mothers index futures off to slow start
19/07/2016 10:55
* Mothers Index futures make Japan market debut
* Bourse hopes futures will lure new investors to startup
index
By Tomo Uetake
TOKYO, July 19 (Reuters) - Futures contracts of Japan's
benchmark start-up stock index attracted meagre volumes on their
debut on Tuesday as investors remained cautious about the new
derivative product.
Trading in Mothers Index futures JMIc1 was 2.6 billion yen
($24.5 million), a small fraction of the 114 billion yen
turnover in its underlying cash counterparts, which are mostly
driven by speculative Japanese retail traders.
In contrast, trading volumes of the Nikkei and Topix futures
contracts were 60 percent of their underlying components on
Monday.
The Mothers Index .MTHR - an acronym for Market Of The
High-growth and Emerging Stocks - comprises biotech ventures and
other small-caps, and is known to be much more volatile than the
main board. It attracts largely speculative investment, much of
it from domestic retail investors.
The new futures contract - which is managed by the Osaka
Exchange - enables investors to trade the index at a preset
future date.
One of Osaka Exchange's main marketing points for the index
futures was the ability to take short positions in Japan's 3.5
trillion yen Tokyo Stock Exchange Mothers market, which has
historically been limited by thin liquidity.
Hiromi Yamaji, the president of the Osaka Exchange, Japan's
main financial derivatives trading centre, said last month
foreign players have shown strong interest in the Mothers
futures.
However, institutional investors are cautious.
"Unless you have a portfolio that is similar to the Mothers
Index, you could end up taking more risks by trading its
futures, rather than hedging," said Yasuo Sakuma, portfolio
manager at Bayview Asset Management.
Despite the small-cap profile, the index includes three
relatively large stocks that account for 40 percent of the
index: biotech venture Sosei Group 4565.T , robotics firm
Cyberdine 7779.T and social networking and mobile game
developer Mixi 2121.T .
($1 = 106.1000 yen)
(Additional reporting by Hideyuki Sano; Editing by Sam Holmes)
((tomo.uetake@thomsonreuters.com; +81-3-6441-1645; Reuters
Messaging: tomo.uetake.thomsonreuters.com@reuters.net))
Keywords: JAPAN STOCKS/STARTUPS