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International Commodities Account

1. Introduction ?

• Which commodities markets can I trade through Electronic international commodities trading platform?
Chicago Mercantile Exchange (CME)
Chicago Board of Trade (CBOT)
New York Mercantile Exchange (NYMEX)
London International Financial Futures and Options Exchange (LIFFE)
European Futures and Options Exchange (EUREX)
Sydney Futures Exchange (SFE)
Singapore Exchange (SGX)
Korea Exchange (KRX), etc

• What are the trading hours of the commodities exchanges?
Please refer to Contract Specifications for the trading hours of the exchanges.

• Are there any specific requirements for electronic trading on commodities?
With the Electronic Commodities trading, 100% of the initial margin is required prior to opening a contract. To avoid inconvenience of physical delivery of some futures contracts such as cotton and bean, it is recommended that clients should close the position of such contracts before the "1st Notice Date". In case the client requests for physical delivery, the instruction should be submitted 3 days before the 1st Notice Date, and all charges shall be liable to the client.

• What is the trading currency?
USD is set as the currency of margin deposit and will be held on first priority. In case of insufficient USD deposit for opening a contract, Celestial Commodities Limited will hold the required initial margin of the open position(s) by converting HKD deposit into USD at the exchange rate on the trading day. Please note that the initial margin (non day-trade) and the realized P/L will be kept in USD after closing the position. For HK commodities trading,please either deposit HKD into the account or convert your USD funds back to HKD by submitting an on-line Currency Transfer Instruction.

• What types of orders can I submit?
You can submit limit orders with electronic Commodities account.

• What are the differences between electronic trading system and open outcry commodities markets?
The electronic trading systems such as GLOBEX and ACE are used to extend trading time after the close of the traditional open outcry trading hours to offer investors additional trading opportunities.
The open outcry is the primary market for commodities trading which facilitates more liquidity to the market because of more number of trades involved and the ability to negotiate price face to face.

• Introduction– Glossary
Discount
The price of a futures contract is quoted or trading below the cash market price.

Premium
The price of a futures contract is quoted or trading above the cash market price.

Margin
A sum of money normally related to the value of each position, in order to insure the clearinghouse against credit risk.

Margin Call
A demand for additional funds because of adverse price movement on an open futures position in order to continue trading in the contract.

Mark to Market
The daily assessment of an account to reflect potential profits and losses on open contract based on closing market prices at the end of the trading day.

Open Interest
It refers to the number of outstanding bought and sold contracts.

Long Position
Denotes the position of one who buys an asset. Therefore, one who is short of an asset anticipates a rise in its price.

Short Position
Denotes the position of one who sells an asset. Therefore, one who is short of an asset anticipates a fall in its price.
Spread
The difference between the price at which a marketable security is simultaneously bought and sold.

2.Placing Orders

• Can I trade international commodities futures during Hong Kong public holidays?
You can place orders via Internet or phone during trading hours of the relevant exchanges, despite the Hong Kong market holidays.

• What is the initial margin amount to open an international futures contract?
The initial margin requirement for each international futures contract is different and may vary. Please refer to Fees and Commission for details.

• How long do my orders keep effective?
Unless you cancel your instructions, orders will keep effective until the end of the trading hours of the selected trading session.

• How will I be notified whether the order has been executed?
You can check your order status online at anytime. Besides, all of your transaction statuses, portfolio and account balance will be automatically updated on a real-time basis. You will also receive an email confirmation once the order is executed. Daily transaction statement will be mailed to you.

• What can I do if I cannot get a computer and still want to place an order?
You can call our Dealing Hotline (2525-3510) and place order. Commission ratios for futures and options trading are the same by phone or through Internet.

• What statement will I receive?
“Instant Long/Short confirmation”
Long/Short confirmation will be sent to you by e-mail at the end of each trading day. A hard copy of this bought and sold confirmation will be delivered to the client by regular mail no later than the end of the next trading day.
“Monthly statement”
All accounts in which activity has taken place or maintain a balance or position during the preceding month will receive a monthly statement or e-statement.
CFSG also supports environmental protection by deducing paper usage, clients are encouraged to use e-statement service, please contact 2663-8888 for application.

• Placing Orders– Glossary
Open Position
① Click "Buy/ Sell" button ② Select products, which include Index Futures, Index Options or Commodities ③ Select contract ④ Select contract month ⑤ Select order type ⑥ Input contract price ⑦ Input contract quantity ⑧ Input trading password ⑨ Click “Long” or “Short” button to submit.

Option Premium
The cost of an option is option premium, which is quoted on per share/ index point basis. The buyer of a stock option pays the option premium, while the seller receives the option premium (margin requirements apply to stock option sellers).

Electronic trading system
The electronic trading systems such as GLOBEX and ACE are used to extend trading time after the close of the traditional open outcry trading hours to offer investors additional trading opportunities.

Open outcry commodities markets
The open outcry is the primary market for commodities trading which facilitates more liquidity to the market because of more number of trades involved and the ability to negotiate price face to face.

Normal (Order type)
If you place an order with "Normal" type, your open contract will be closed by opposite position.

Lock (Order type)
If you select the order type as "Lock", position of the contract will not be closed unless you place an order with the order type of "Pre-determined".
Pre-determined (Order type)
You are free to select the specific contract(s) you would like to close.

Stop Loss Program Trade (Order type)
Stop Loss Program Long Orders will be sent to the market at the 'Order Price' when the Market Last Price is reached or rose above the 'Touch Price'.
Stop Loss Program Short Orders will be sent to the market at the 'Order Price' when the Market Last Price is reached or fell below the 'Touch Price'.
* Under certain market situations, the Stop Loss Program Trade Order may not work even if the instructions have been preset properly. Should you need any assistance,
please contact your Account Executive or Dealing Department at 2525-3510.
* All Stop Loss Program Orders are valid only on the same trade day where the prices are set, all outstanding orders will be cancelled at the end of the trade day without prior notice.

Stop Gain Program Trade (Order type)
Stop Gain Program Long Orders will be sent to the market at the 'Order Price' when the Market Last Price is reached or fell below the 'Touch Price'.
Stop Gain Program Short Orders will be sent to the market at the 'Order Price' when the Market Last Price is reached or rose above the 'Touch Price'.
* Under certain market situations, the Stop Gain Program Trade Order may not work even if the instructions have been preset properly. Should you need any assistance, please contact your Account Executive or Dealing Department at 2525-3510.
* All Stop Gain Program Orders are valid only on the same trade day where the prices are set, all outstanding orders will be cancelled at the end of the trade day withoutprior notice.

3.Order Status?

• Would the record be updated automatically when the order status is changed?
The record will be updated automatically for every 1 minute or you may click “refresh” to have instant update.

• How long are the order status records kept?
The order records are kept up to the previous 5 trading days. Please refer to the monthly statement in case you would obtain records of executed orders.

• Order Status– Glossary
Type
N =New Order
U =Change Order
C = Cancel Order
L = Long
LC = Long Call
LP = Long Put
S = Short
SC = Short Call
SP = Short Put

Status
Sending = the order is being sent to Exchanges
Processing = the order is being processing
Queuing = the order is queuing at the Exchanges
Changed = the order has been changed
Canceled = the order has been canceled
Executed = the order has been successfully executed
Rejected = the order has been rejected by Exchanges
Completed = the changed or cancelled order is completed
Watch = the order is being watched and waited to send to Exchanges
SL = Stop Loss Program Trade
SG = Stop Gain Program Trade

Touch Price
The touch price of the Stop Loss/ Gain Program Trade Long/ Short orders

Bal. BF
The day starts cash balance which is brought forward from the end of the previous trading day

On Hand
The cash balance on hand and which is available for current placing order

Available
The available cash balance in which can be withdrawn

Held Margin
The total amount held for all transactions which are not yet executed plus the amount held for cash withdrawal

Held Expenses
The total amount of commission and levy charges held for all orders executed

Cheque
The amount of your cheque deposit which has not been cleared

Init. Mgn
The total initial margin of the transactions

Req. Mgn
The total required margin which is needed to be maintained

Realized P/L
The realized profit and loss

Unrealized P/L
The unrealized profit and loss

Buy Premium
Total amount of premium payment

Sell Premium
Total amount of premium receive

Held Sell Premium
Premium held on options contracts to be received by after liquidation

4.Cash balance?

• Cash balance- Glossary

Bal. BF
The day starts cash balance which is brought forward from the end of the previous trading day

On Hand
The cash balance on hand and which is available for current placing order

Available
The available cash balance in which can be withdrawn

Held Margin
The total amount held for all transactions which are not yet executed plus the amount held for cash withdrawal

Held Expenses
The total amount of commission and levy charges held for all orders executed

Cheque
The amount of your cheque deposit which has not been cleared

Init. Mgn
The total initial margin of the transactions

Req. Mgn
The total required margin which is needed to be maintained

Realized P/L
The realized profit and loss

Unrealized P/L
The unrealized profit and loss

Buy Premium
Total amount of premium payment for buying an option

Sell Premium
Total amount of premium received by selling an option

Held Sell Premium
Premium held on options contracts to be received by after liquidation

5. Position ?

• Position– Glossary
Product
The Code of the product assigned by Exchanges (NQV8 = E-MINI NASDAQ 100 INDEX contract on Oct 2008)

Contract Month
The month during of contract expires according to the terms of the contract.

Long/ Short
The Long or Short positions of the product:
L - Long
S - Short
LC - Long Call
SC - Short Call
LP - Long Put
SP - Short Put

Mode
The order type of the above product:
Normal - If you place an order with "Normal" type, your open contract will be closed by opposite position.
Lock - If you select the order type as "Lock", position of the contract will not be closed unless you place an order with the order type of "Pre-determined".
Pre-determined - You are free to select the specific contract(s) you would like to close.

Quantity
The filled quantity of the above product

6. Margin control ?

• When do I need to deposit the required margin call amount?
A margin call will be initiated by CCL via email and/or telephone when the net balance of the electronic trading account falls below the maintenance margin. You should either (a) deposit the required margin call amount; or (b) transfer fund from other trading account(s) among CFSG within the margin call period; or (c) close out position, otherwise his/her position would be compulsorily closed out by CCL.

• Does CCL have right to close their clients’ open position(s)?
Yes.(a) If client could not meet the margin call within the specific settlement period, CCL will reserve the right to close out client's open position(s). Or (b) If market fluctuates during the specific settlement period and client's open position(s) with value falls to 20% or below of the initial margin, his/her open position(s) will be closed out by CCL. CCL will send e-mail to client in acknowledgment of the closed out position.

• Does CCL provide physical delivery services?
CCL does not provide physical delivery services. In order to avoid inconvenience of physical delivery of some futures contracts such as cotton and bean, it is recommended that clients should close the position of such contracts before the last trading day or the first notice day. The last trading day or the first notice day of each spot month contracts is varied from different products subject to the related exchange(s).
International Commodities Trading:Client shall liquidate all spot month contract(s) 2 days before the last trading day or the first notice day; otherwise, CCL shall liquidate all spot month positions(s) for the client at its absolute discretion without further notice.
Japanese Commodities Trading:Client shall liquidate all spot month contract(s) 3 weeks before the last trading day or the first notice day; otherwise, CCL shall liquidate all spot month position(s) for the client at its absolute discretion without further notice.

• Margin control– Glossary
Margin Call When the net balance falls below the maintenance margin, CCL will initiate a margin call via email and/or telephone.

• Forced Liquidation
If client could not meet the margin call within the specific settlement period, CCL will reserve the right to close out client's open position(s) without further notice.