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Hong Kong Property Stock Gloom Seen Deepening in Options Market

Residential buildings seen through a construction crane stand in the West Kowloon district of Hong Kong, China, on Friday, Jan. 9, 2015. Hong Kong home prices surged to a record last year, making Chief Executive Leung Chun-ying's task of addressing the city's affordability crisis even harder.
Photographer: Jerome Favre/Bloomberg
Updated on

As Hong Kong property prices slump with real estate stocks, investors are looking to the options market for protection.

Traders paid the most in four years in January to hedge against losses on Sun Hung Kai Properties Ltd. versus the cost of bullish bets, according to data compiled by Bloomberg. A similar pattern emerged in options on Wharf Holdings Ltd. A measure of the city’s property stocks is down 33 percent in the past year, with losses accelerating in January as the Hong Kong dollar weakened and real-estate sales fell to the lowest in at least 25 years.