| Article 1 |
These Rules are adopted to maintain orderly trading of Mini-TAIEX Flexible Futures Contracts ("the Contracts") at the Taiwan Futures Exchange ("TAIFEX"), to ensure security and fairness in the trading of the Contracts.
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| Article 2 |
Futures commission merchants (FCMs) that engage in trading the Contracts shall observe the Trading Rules in addition to the Futures Trading Act and applicable acts and regulations. Matters on which the Trading Rules are silent shall be handled in accordance with the applicable bylaws and rules, public announcements, and circulars of the TAIFEX.
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| Article 3 |
The Contracts are abbreviated as "Mini-TAIEX Flexible Futures" with the ticker symbol "MXFFX".
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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, constituents, base date, and adjustments thereto shall be as prescribed by the Taiwan Stock Exchange Corporation (TWSE).
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| Article 5 |
The value of the Contract shall be 50 New Taiwan Dollars multiplied by the index point of Mini-TAIEX Flexible Futures.
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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 |
Prior to close of the last trading day, a trader may settle rights and obligations under the Contracts by selling or buying back on the TAIFEX centralized exchange market part or all of the quantity originally bought or sold.
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| Article 8 |
The trading days of the Contracts are the same as business days of the TWSE. The trading hours for the Contracts are from 8:45 am to 1:45 pm. On the last trading day of Contracts reaching expiration, the trading hours are 8:45 am to 1:30 pm. However, if the TAIFEX has made other provisions, 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 will still continue. As necessary, however, the TAIFEX may announce a halt of trading based on the 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 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 |
The application for listing the Contracts shall be submitted to the TAIFEX by a FCM. The Contracts shall only be listed after TAIFEX's verification of the application.
The expiration of the Contracts shall be on a specified trading day within one year from the listing day; however, the Contracts shall not expire on the same day as any Mini-TAIEX Futures listed at TAIFEX. Trading in the Contracts shall commence from the next business day following the day TAIFEX verifies the listing application. The last trading day shall be the expiration day specified upon the listing of Contracts. Trading of the Contracts at expiry shall cease at market close on the last trading day, and the last trading day shall be the final settlement day for the Contracts at expiry.
If the last trading day referred to in the preceding paragraph falls on a holiday or if trading cannot proceed on that day due to a force majeure event, or if the TAIFEX has made other provisions, the next business day shall be the last trading day.
The TAIFEX may change the initial trading days, last trading days and final settlement days referred to in the preceding two paragraphs when it deems necessary after reporting to and receiving approval from the competent authority.
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| Article 10 |
If there is no open interest for a flexible contract for ten consecutive business days, it will be delisted by the TAIFEX on the next business day. The TAIFEX, however, may make adjustments as it deems necessary in view of market conditions.
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| Article 11 |
Orders for buying and selling the Contracts, unless otherwise provided, will be on continuous trading and matched automatically by computer.
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| Article 12 |
Open positions held by traders are marked-to-market daily after market close based on the daily settlement price published by the TAIFEX.
The daily settlement price as referred in the preceding paragraph shall be set in accordance with the following provisions:
- The price is the volume-weighted average price of all trades during the last minute before market close.
- When there is no trade price during the last minute before market close on the given day, the average of the highest unexecuted bid and lowest unexecuted ask prices quoted at market close will be taken as the daily settlement price.
- If a daily settlement price cannot be determined on the basis of subparagraphs 1 to 2, or if the settlement price determined on that basis is obviously unreasonable, then the settlement price will be set by the TAIFEX.
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| Article 13 |
The daily price limit for the Contracts shall be 10 percent above and 10 percent below the daily settlement price of the preceding business day.
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| Article 14 |
The final settlement price of the Contracts shall be set based on the simple average price of the underlying index during the 30 minutes before the TWSE market close on the final settlement day. 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 15 |
The Contracts shall be settled in cash with the trader delivering or receiving the net amount of the price differential in cash on the final settlement day based on the final settlement price.
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| Article 16 |
A futures commission merchant engaging in brokerage trading of the Contracts, prior to accepting an order, shall first collect a sufficient trading margin based on the aggregate total of the brokerage trading order, and from the date of the trade until the expiry of the settlement period, shall mark to market on a daily basis the balance of equity in the positions held by each principal based on the daily settlement price, and credit the aggregate total to the balance of the margin account of the client.
When the balance in a principal's margin account is lower than the required maintenance margin, the futures commission merchant shall immediately notify the principal to deposit cash funds within a specified time frame sufficient to cover the difference between the balance in the margin account and the total amount of the trading margins required for the principal's open positions. If a principal fails to make the deposit within the prescribed time limit, the futures commission merchant may offset the positions on the principal's behalf.
The trading margin and the maintenance margin as referred 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 margin and maintenance margin announced by the TAIFEX shall be based on the clearing margin calculated according to the Taiwan Futures Exchange Corporation Methods and Standards for Receipt of Clearing Margins plus a percentage prescribed by the TAIFEX.
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| Article 17 |
The total open positions that a trader holds at any time on either the long or the short side of the Contracts shall not exceed the following limits announced by the TAIFEX:
- The limits of the total open positions that a trader holds in the Contracts and Mini-TAIEX Futures contracts, after translation by the one-to-four contract scale, plus the total open positions on the same side of the TAIFEX Micro TAIEX Futures Contracts, after translation by the one-to-twenty contract scale, and the total open positions on the same side of the TAIEX Futures contracts.
- The limits of the total open positions that a trader holds on the same side of the Contracts.
Every three months, or as occasioned by market conditions, the TAIFEX will announce the applicable position limit standards under the subparagraphs 1 of the preceding paragraph, according to the levels given below, based on the higher of the overall combined daily average trading volume or combined open interest of the Contracts and Mini-TAIEX Futures contracts, after translation by the one-to-four contract scale, the Micro TAIEX Futures Contracts after translation by the one-to-twenty contract scale, and the TAIEX Futures contracts during that period, with the benchmark set at 5 percent thereof for individuals and 10 percent thereof for institutional investors. However, the lowest position limit shall be 1,000 contracts for individuals, and 3,000 contracts for institutional investors:
- When the benchmark is 1,000 or more contracts, the position limit is the benchmark rounded down to the nearest integral multiple of 200 contracts.
- When the benchmark is 2,000 or more contracts, the position limit is the benchmark rounded down to the nearest integral multiple of 500 contracts.
- When the benchmark is 5,000 or more contracts, the position limit is 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 is the benchmark rounded down to the nearest integral multiple of 2,000 contracts.
The position limit for a proprietary trader for the Contracts shall be three times the position limit for an institutional investor set out in preceding paragraph.
When the TAIFEX examines the applicable position limit levels, if the increase or decrease in the daily average trading volume or open interest for the period, as compared to that at the time of the previous adjustment, does not exceed 2.5 percent, no adjustment will be made even if the level for adjustment has been reached.
The position limits standards under the subparagraphs 2 of the paragraph 1 shall be 500 contracts for individuals, 3,000 contracts for institutional investors and 9,000 contracts for proprietary traders. The TAFIEX, however, may adjust this according to circumstances.
Any raising of the position limit will take effect from the next business day following the TAIFEX announcement date. Any lowering of the position limit will take effect from the next business day following the expiration of the next-nearest month Mini-TAIEX Futures contracts that is already listed on the announcement date. The TAFIEX, however, 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 that no new position may be added until the lowered limit has been complied with.
The total open positions in the Contracts held in an omnibus account are not subject to the limits of paragraph 2 and paragraph 5, with the exception of undisclosed omnibus accounts, which are subject to the limits for institutional investors.
An institutional investor may apply to the TAIFEX for relaxation of the limits on positions for hedging purposes.
In addition to the provisions of this article, the limits on open positions in the Contracts held by traders shall also conform to the Taiwan Futures Exchange Corporation Rules Governing Surveillance of Market Positions.
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| Article 18 |
A futures commission merchant 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 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 19 |
Where any circumstance under Article 31 of the Operating Rules of the Taiwan Futures Exchange Corporation requires suspension of trading or delisting of the Contracts, 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 20 |
The Trading Rules and any amendments hereto shall be implemented following ratification by the competent authority.
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