1. What happens to my CBBC if its underlying asset is suspended from trading?
If trading in the underlying asset of a CBBC is suspended, trading in such CBBC will also be suspended until trading in the underlying asset resumes. Investors must understand and take into account the risks arising from a loss of time value during a suspension period.
2. What is the method of determining the settlement price at expiry of a CBBC (assuming no mandatory call event has occurred) when there is a trading suspension or no closing price for the underlying stocks on the following day(s)?
(a) Trading suspension or absence of closing price on the original valuation date only - in that case, the closing price on the trading day following the original valuation date will be used as the settlement price at expiry.
(b) Trading suspension or absence of closing price on the original valuation date and each of the three trading days immediately following the original valuation date - in that case, the closing price on the fourth trading day following the original valuation date will be used as the settlement price at expiry.
(c) Trading suspension or absence of closing price on the original valuation date and each of the four trading days immediately following the original valuation date - in that case, the settlement price at expiry is determined based on the issuer’s good faith estimate made in accordance with the terms and conditions. Such determination will be made on a case-by-case basis by reference to the prevailing market conditions.
Note: Trading suspension above means suspension of trading of the underlying stock during the last half hour before close of trading.
For operations and impacts during the suspension period of the underlying stock on HK CBBC, please refer to the exchange's FAQ.
