Date
22 January 2017
Secretary for Financial Services and the Treasury Ceajer Chan Ka-keung said authorities are studying ways to enhance the Shanghai-Hong Kong Stock Connect program. Photo: HKEJ
Secretary for Financial Services and the Treasury Ceajer Chan Ka-keung said authorities are studying ways to enhance the Shanghai-Hong Kong Stock Connect program. Photo: HKEJ

No cut in account threshold for mainland stock connect investors

China is not relaxing the 500,000 yuan (US$80,630) account threshold for mainland investors buying Hong Kong-listed shares via the Shanghai-Hong Kong Stock Connect program, Secretary for Financial Services and the Treasury Ceajer Chan Ka-keung said.

Authorities are studying other ways to enhance the cross-border stock trading scheme, including adjusting transaction quotas, the Hong Kong Economic Journal quoted Chan as saying.

The quotas will be reviewed alongside those for the upcoming Shenzhen-Hong Kong Stock Connect.

Chan said the rules for the Shenzhen-Hong Kong stock trading link are expected to be ready by June, and the program will debut in the second half of the year.

China Securities Regulatory Commission chairman Xiao Gang earlier made similar remarks on the schedule for the rollout of the Shenzhen stock connect.

Market players have been longing for a loosening of the high threshold set for mainland investors in the stock trading program.

The high threshold is being blamed for the low level of southbound investment in the program.

Last Friday the Chinese securities watchdog opened the Shanghai-Hong Kong Stock Connect to mainland mutual funds. Previously, only funds with license under the Qualified Domestic Institutional Investor program could invest outside mainland China.

Julia Leung Fung-yee, executive director of the investment products division of Hong Kong’s Securities and Futures Commission, said the inclusion of mutual funds in the cross-border stock trading scheme will draw the interest of mainland investors in Hong Kong stocks and correct the situation where southbound fund flows lag behind those that are northbound.

This article appeared in the Hong Kong Economic Journal on April 1.

Translation by Vey Wong

[Chinese version 中文版]

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