| Article 1 |
These Rules are specially promulgated to maintain orderly trading of Mini-TAIEX Futures contracts ("the Contracts") at the Taiwan Futures Exchange Corporation ("TAIFEX") and ensure security and fairness in trading of the Contracts.
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| Article 2 |
Futures commission merchants (FCMs) that engage in trading of the Contracts, shall observe these Rules in addition the Futures Trading Act and related laws and regulations. Matters on which these Rules are silent shall be handled in accordance with the rules and regulations, public announcements, and official letters of the TAIFEX.
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| Article 3 |
The Chinese code for the Contracts is "Hsiao Hsing T'ai Chih Ch'i Huo [in Chinese characters]" and the English code for the Contracts is "MTX."
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| Article 4 |
The underlying of the Contracts is the Taiwan Stock Exchange Capitalization Weighted Stock Index ("the Index"). Matters related to the Index calculation formula, sample stocks, base periods, and adjustments thereto shall be as prescribed by the Taiwan Stock Exchange Corporation (TWSE).
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| Article 5 |
The value of each contract shall be 50 New Taiwan Dollars multiplied by the mini-TAIEX futures index.
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| Article 6 |
The minimum unit of price fluctuation ("tick") in trading orders for the Contracts shall be one index point. Each tick shall have a value of 50 New Taiwan Dollars.
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| Article 7 |
A futures trader may conclude rights and obligations under a contract prior to the delivery deadline by selling or buying back at the TAIFEX centralized exchange all or part of the volume of contracts originally bought or sold.
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| Article 8 |
The trading hours for the Contracts are as follows:
- Regular trading session: from 8:45 am to 1:45 pm on TWSE business days. On the last trading day of Contracts reaching expiration, the trading hours are 8:45 am to 1:30 pm.
- After-hours trading session: from 3 pm on TWSE business days to 5 am of the following day.
If the TAIFEX has made other provisions regarding the trading hours referred to in the preceding paragraph, those provisions shall govern.
When for any reason the TWSE announces a halt of trading prior to market opening of the Contracts , or when other factors influence trading of the Contracts, trading of the Contracts may be halted; when the TWSE announces a halt of trading during trading hours of the Contracts, trading of the Contracts may still continue. As necessary, however, the TAIFEX may announce a halt of trading based on a current situation, and report the halt to the competent authority for recordation on the next business day.
When the TWSE changes its trading hours, or when other factors influence trading of the Contracts, or in response to a suggestion by a futures industry association or the National Federation of Futures Industry Associations, the TAIFEX may change the trading hours for the Contracts after reporting to the competent authority for approval.
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| Article 9 |
Except where otherwise provided, delivery months for the Contracts shall be the spot month and the next two calendar months, and the three nearest of the quarter months of March, June, September, and December, for a total of six periods, listed and traded concurrently. The last trading day for contracts of any delivery month shall be the third Wednesday of the month in which such contract reaches expiry; the last trading day shall be the final settlement day for a contract, and trading of the Contracts of a new delivery month shall commence from the regular trading session of the next business day following the last trading day of the contracts in the expiration month.
The TAIFEX may, in the regular trading session on the Wednesday in a given trading week, add contracts for which the initial trading day is the given Wednesday and the last trading day is the second Wednesday following the initial trading day. The exception is the first Wednesday of each month; the last trading day for that contract is the final settlement day.
Trading of expiring Contracts shall be terminated at close of the regular trading session on the last trading day. If the last trading day or the initial trading day falls on a holiday, or if trading may not proceed on that day due to a force majeure event, or if the TAIFEX has made other provisions, the next following business day shall be the last trading day or the initial trading day.
The TAIFEX may change the delivery months, initial trading days, final trading days, and final settlement days referred to in the preceding three paragraphs when it deems necessary after report to and approval from the competent authority.
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| Article 10 |
Buy and sell orders for the Contracts, unless otherwise provided, will be matched automatically by computer. Matching is carried out by call auction at the opening of market, and then by continuous matching during market hours.
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| Article 11 |
Equity in positions held by traders of the Contracts shall be calculated each day after close of the regular trading session in accordance with the daily settlement price announced by the TAIFEX.With respect to Contracts listed pursuant to Article 9, paragraph 1, the daily settlement price shall be the same as that for the TAIFEX Taiwan Stock Exchange Index (TAIEX) futures contracts.With respect to Contacts listed pursuant to Article 9, paragraph 2, the daily clearing price shall be set in accordance with the trading information from the regular trading session and the following provisions:
- It shall be the volume-weighted average price of all trades during the last minute before market close.
- If there is no trade price for the Contracts during the last minute before market close on the current day, the average of the highest unexecuted bid and lowest unexecuted ask quoted as of market close shall be taken as the daily settlement price.
- When there is no quoted bid price, the lowest quoted ask price shall be taken as the daily settlement price; when there is no quoted ask price, then the highest quoted bid price shall be taken as the daily settlement price.
- If a daily settlement price cannot be determined by any of the methods in the three preceding subparagraphs, or if the settlement price yielded is obviously unreasonable, the settlement price shall be set by the TAIFEX.
With respect to Contracts listed pursuant to Article 9, paragraph 1, for traders holding open positions in the Contracts for various delivery months, four of the Contracts may be offset against one TAIFEX Taiwan Stock Exchange stock index futures contract for the same delivery month.
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| Article 12 |
The price limits for each trading session of the Contracts shall be 10 percent above and 10 percent below the daily settlement price of the preceding regular trading session.
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| Article 13 |
The final clearing price of the Contracts shall be set based on the simple average price of the underlying index during the 30 minutes before market close on the final settlement day as provided by the TWSE. If the TWSE postpones market closing or matching, the TAIFEX may extend the aforementioned 30-minute sampling time.
The calculation method under the preceding paragraph shall be separately prescribed by the TAIFEX.
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| Article 14 |
Cash settlement shall be adopted for settlement at expiry of the Contracts, with the futures traders on the final settlement day making payment or taking receipt of payment of the net amount of the price differential based on the final clearing price.
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| Article 15 |
An FCM engaging in brokerage trading of the Contracts shall, prior to accepting an order, first collect a sufficient trading margin based on the aggregate total of the brokerage trading orders, and from the date of the trades until the expiry of the settlement period shall mark to market on a daily basis the equity in the position held by the client based on the daily clearing price and credit the aggregate total to the balance of the margin fund account of the client.
When during the regular trading session the balance in a client's margin account is lower than the required maintenance margin, the FCM shall immediately notify the client to deposit within a specified time sufficient cash funds to cover the difference between the balance in the margin account and the total amount of the trading margins required for the client's open positions. If a client fails to make the deposit within the prescribed time limit, the FCM may offset the client's position on the client's behalf.
The trading margin and the maintenance margin referred to in the preceding two paragraphs may not be lower than the publicly announced TAIFEX standard for the initial margin and the maintenance margin.
The initial margins and maintenance margins publicly announced by the TAIFEX shall be calculated by multiplication of the clearing margins calculated in accordance with the Taiwan Futures Exchange Corporation Standards and Methods for Receipt of Clearing Margins by the percentage prescribed by the TAIFEX.
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| Article 16 |
The total open positions in the Contracts and the Flexible Futures Contracts, after translation by the one-to-four contract scale, held on either the long or short side of the market at any time by a futures trader plus the total open positions in Taiwan Stock Exchange Stock Index (TAIEX) Futures Contracts held on the same side of the market by the futures trader shall not in combination exceed the limits publicly announced by the TAIFEX.
Every three months or as occasioned by market conditions, the TAIFEX will announce the applicable position limits under the preceding paragraph for that period, according to the below-listed levels, based on the daily average trading volume or outstanding volume, whichever is higher, of the Taiwan Stock Exchange Stock Index (TAIEX) Futures Contracts plus the Contracts and the Flexible Futures Contracts after translation by the one-to-four contract scale, with the benchmark set at 5 percent thereof for natural persons and 10 percent thereof for juristic persons. However, the lowest position limit shall be 1,000 contracts for natural persons, and 3,000 contracts for institutional investors:
- When the benchmark is 1,000 or more contracts, the position limit shall be the benchmark rounded down to the nearest integral multiple of 200 contracts.
- When the benchmark is 2,000 or more contracts, the position limit shall be the benchmark rounded down to the nearest integral multiple of 500 contracts.
- When the benchmark is 5,000 or more contracts, the position limit shall be the benchmark rounded down to the nearest integral multiple of 1,000 contracts.
- When the benchmark is 10,000 or more contracts, the position limit shall be the benchmark rounded down to the nearest integral multiple of 2,000 contracts.
The position limit for a futures dealer shall be three times the position limit for a juristic person set out in paragraph 2.
When the TAIFEX examines the applicable position limit levels, if the increase or decrease in the daily average trading volume or outstanding volume for the period, as compared to that at the time of the previous adjustment, does not exceed 2.5 percent, no adjustment shall be made even if the level for adjustment has been reached.
Any raising of the position limit will take effect from the regular trading session of the next business day following the TAIFEX announcement date. Any lowering of the position limit will take effect from the regular trading session of the next business day following the expiration of the next-nearest month contract that is already listed on the announcement date. Provided, the TAFIEX may adjust this according to circumstances.
When the position limit is lowered under the preceding paragraph, a position held by a trader prior to the effective date that surpasses the lowered limit may be held until the expiration date of the contract; provided, no new position may be added until the lowered limit has been complied with.
The combined total open positions in the Contracts held by omnibus accounts are not subject to the limits in paragraph 2, with the exception of undisclosed omnibus accounts, which accounts are subject to the limits for institutional investors.
A juristic institution may apply to the TAIFEX for relaxation of the limits on positions when based on hedging requirements.
In addition to conforming to the provisions of this article, the limits on open positions held by traders of the Contracts shall also conform to the TAIFEX Regulations Governing Monitoring of Market Positions.
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| Article 17 |
An FCM engaging in proprietary or brokerage trading of the Contracts shall, unless otherwise provided, be subject to a limit of 100 contracts on the quantity of each trading quote.
The TAIFEX may make appropriate adjustments to the limit on the quantity of trading quotes in the preceding paragraph in view of market trading conditions.
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| Article 18 |
Where any circumstance exists requiring suspension of trading or delisting of the Contracts as enumerated in Article 31 of the Operating Rules of the Taiwan Futures Exchange Corporation, the TAIFEX shall make a public announcement 30 days prior to implementation, with the exception of termination of the Index licensing agreement by the Index compiling institute, which results in suspension of trading or delisting of the Contracts.
All open positions shall be liquidated before the announced implementation date for the suspension of trading or delisting. Any open positions on the implementation date will be settled at the settlement price of the trading day preceding the implementation date.
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| Article 19 |
These Rules, and any amendments hereto, will be publicly announced and implemented after approval by the competent authority.
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