Shenzheng-Hong Kong Stock Connect ready to debut

CCTV News

Shenzheng-Hong Kong Stock Connect ready to debut

The Shenzhen Stock Exchange has given final approval to its system that supports the stock connector between Shenzhen and Hong Kong. The approval paves the way for the official launch of the highly anticipated trading mechanism.

ICS’s Chen Tong reports for CCTV.

Shenzheng-Hong Kong Stock Connect ready to debut

Shenzheng-Hong Kong Stock Connect ready to debut

The Shenzhen Stock Exchange has given final approval to its system that supports the stock connector between Shenzhen and Hong Kong. The approval paves the way for the official launch of the highly anticipated trading mechanism. ICS’s Chen Tong reports for CCTV.

Two years after the Shanghai-Hong Kong Stock Connect project was launched, the technology is now ready and waiting for the countdown to open the system to investors. Domestic traders will get a new way to invest in the Hong Kong market, while international investors will have broader access to mainland-listed stocks. Experts say the Shenzhen-Hong Kong Stock Link will help to ease the current high valuation of mainland A-shares.

The threshold for investors to trade on the Shenzhen-Hong Kong Stock Connect is 500,000 yuan (around $73,000) and investors will be required to score above 90 out 100 in a pre-test about the trading system in Hong Kong. The threshold is the same as on the Shanghai-Hong Kong Connect. But some Shanghai retail investors we talked to are still hesitant about investing via the new Shenzhen-Hong Kong link.

The government has not revealed the exact date for the launch of the service. Guosen Securities, Haitong Securities and China Merchant Securities have already started to accept Shenzhen-Hong Kong Stock Connect accounts being opened by retail investors. Hong Kong officials say the inter-connectivity of stock markets between the Chinese mainland and Hong Kong will also further promote Renminbi cross-border flows and therefore strengthen Hong Kong’s role as an international financial center and offshore Renminbi hub.