A “new normal” has come about in the stock market due to closer links and two-way trading channels between Hong Kong and mainland China, according to Charles Li, chief executive of the Hong Kong Exchanges and Clearing Ltd. (HKEx, 00388.HK).
Capital from China and the rest of the world finally has a real convergence point in Hong Kong under the new system, the Hong Kong Economic Journal cited Li as saying.
One should not be concerned about where the money comes from, Li said, arguing that the focus should be on removing all “human boundaries” to ensure free flow of funds through Hong Kong.
Nonetheless, there are some regulatory challenges, he said.
The Hong Kong bourse is looking at expanding its capacity, given skyrocketing transaction volumes after the relaxation of rules on the Shanghai-Hong Kong Stock Connect program, the report cited HKEx chairman Chow Chung-kong as saying.
Chinese authorities recently allowed mainland mutual funds to invest in Hong Kong shares through the Stock Connect scheme.
In other comments, Chow said he still believes that the Shenzhen version of the stock link will be unveiled by the end of June and commence operation in the second half this year.
Translation by Vey Wong
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