Magazine article Modern Trader

Meet the New Skipper

Magazine article Modern Trader

Meet the New Skipper

Article excerpt

Robert "Randy" Gilmore took over as chief executive of the HKFE last year, replacing Ivers Riley. Gilmore, a founding executive director of the Securities and Futures Commission in Hong Kong from 1989 to 1995, also has held senior executive positions with the Chicago Mercantile Exchange, the Philadelphia Stock Exchange and the National Association of Securities Dealers. During his visit to Chicago in April, we spoke to him about the past, present and future of the HKFE.

Futures magazine: Oct. 27, 1667, Is called a correction new but was called a clash than. What was different for the HKFE then vs. after October 1987?

Gilmore: Actually it was Oct. 23, 1997 when Hong Kong caught hell.... In 1987, there was no centralized clearing system for equities. The risk management systems at equity and derivatives brokerage firms were basically non-existent. Today in Hong Kong, [there are] financial requirements and clearing systems you would find in the United States or Europe. In addition, we use the internationally recognized volatility studies to set margins and have a system for intraday margin calls. On Oct. 23, we had three intraday margin calls [that] brought in $4-$5 billion in secured debt [during trading]. And it's a variation intraday margin call- we don't pay out the winners, we just take money from the losing positions.

FM: Hew has the Asian currency crisis affected your market?

Gilmore: Back in the 1980s, Hong Kong put in place a pegged currency or board currency system that says for every 7.8 Hong Kong dollars in circulation there is $1 on reserve. So to expand the number of Hong Kong dollars in circulation, you need more U.S. dollars backing it up.

Last summer, when we saw there would be pressure put on the Hong Kong dollar, we knew there would be a break from the historical 25 to 35 basis point differential link between U. …

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