Derivatives jobs related to China's financial markets are set to boom this year, spurred on by the country's new interest rate benchmark mechanism and the expected launch of China's first index futures contract.
As the Chinese derivatives market develops, expertise is likely to be drawn from Hong Kong and Singapore. Dennis Koh, managing partner of Goshen Staines Singapore, an executive search firm, says pay in Shanghai is now on a par. A regional manager specialising in derivatives is paid between S$350k (US$229k) and S$500k. But when bonuses are included, those numbers may increase to anything from S$600k to just under S$1m.
China's first stock index futures contract is expected to be launched some time in second quarter 2007, according to local press. Its launch was delayed from the first quarter due to concerns in official quarters about too much potential speculative trading in the derivatives product.
The new Shanghai Interbank Offered Rate (SHIBOR) was also launched in January this year, and already HSBC and Citigroup have claimed interest rate swap deals based on SHIBOR rates.
Derivatives service providers are also moving into China. UK-based Patsystems, a derivatives technology and data firm, has won a contract to build a trading system for the China Foreign Exchange Trade System. Meanwhile, SunGard has acquired Shanghai Fudan Kingstar Computer, as part of a push into China's derivatives and financial software market.
As a result, Rick Jansz, managing consultant at BSI People, tells us, "I am also seeing increased demand for operations/middle office people, product controllers, structured product candidates and trade support."