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What is the market volatility regulation mechanism (VCM)

When the price of the stock / futures contract reaches the trigger price range, the market volatility regulation mechanism (VCM) will be triggered, starting a five-minute cooling-off period, so that the transaction will be limited to the specified price limit, and the normal transaction will be restarted in 5 minutes.

Trigger price range
Securities market: reference price changes by more than ±10% Derivatives market: reference price changes by more than ±5% Reference price: last transaction 5 minutes ago

Market scope
Hang Seng Index of State-owned Enterprises Index (81 at present) and related index futures contracts (currently 8).

Applicable time period
Applies only to continuous trading periods, excluding 15 minutes in the morning and the first 15 minutes in the afternoon and the last 15 minutes in the afternoon. During the 5-minute cooling-off period, the transaction price can only be within the trigger price limit, that is, ±10% / ±5% of the reference price (depending on the market).

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