Reported by Reuters on May 20, the Hong Kong Mercantile Exchange, operator of an electronic platform for trading in gold futures, has surrendered its authorization from the local securities official to run automated trading services.
In a statement by The Securities and Futures Commission stated that the Hong Kong-based operator had agreed to give up the license because it sensed trading revenues had not been appropriate to support operating costs.
At the weekend the operator said in a statement on its website “With immediate effect no new orders may be placed and all open positions will be financially settled at the settlement price determined by the Hong Kong Mercantile Exchange and its designated clearing house,”
The HKMEx plans to re-apply for the service with more effective and stronger market maker programs. In May 2011, the HKMEx started the electronic trade in gold futures, and had intends to introduce contracts for base metals. Formerly it was named by the media as a potential buyer of the London Metal Exchange, which was last year purchased by the Hong Kong Exchanges and Clearing.