Hong Kong and mainland Chinese exchanges add 91 ETFs to Stock Connect scheme
- A total of 85 ETFs will be added for trading in the northbound direction and six in the southbound direction, with the expanded list to take effect from July 22
More than 90 new exchange-traded funds (ETFs) will be eligible to trade under the expanded cross border Stock Connect programme later this month, giving investors more trading options, according to separate announcements by bourses in Hong Kong and mainland China on Friday.
The Shanghai, Shenzhen and Hong Kong stock exchanges added 85 ETFs for northbound trading and six in the southbound direction, after average asset management sizes and index weightings were lowered in April to enhance the mutual market access programme.
The expanded ETF list under Stock Connect will take effect on July 22. This will add to the existing 141 ETFs in the northbound channel, which allows foreign investors to buy mainland-listed A shares. A total of 10 ETFs are in the existing southbound channel, which allows investors in mainland China to buy select companies listed in Hong Kong.
The latest enhancement is expected to help investors diversify their assets and add liquidity to the capital markets across Hong Kong and mainland China. It is also part of the five measures announced by the China Securities Regulatory Commission in April to strengthen ties between the two markets and boost Hong Kong’s status as a global financial hub.
Since ETFs were added to Stock Connect in 2022, exchanges on both sides have regularly reviewed and adjusted eligible ETFs. According to industry estimates, investors currently hold around 1.58 trillion yuan (US$218 billion) via the northbound ETF trading channel while taking up 200 billion yuan through the southbound ETF channel.
The latest expansion will further “enrich the product choices for domestic and foreign investors, help attract more funds to flow into the capital markets of the two places and benefit the long-term development of the market”, Financial Secretary Paul Chan Mo-po said at a meeting earlier this week to commemorate another connect scheme – Bond Connect’s seventh anniversary.
