Pair drop out as Internet transactions expected to become popular part of retail punters' arsenal

Internet trading is expected to catch on quickly among retail investors following today's launch of Hong Kong Exchanges and Clearing's (HKex) new online stock trading function.

A total of 32 brokers will offer online trading utilising the Third Generation Automatic Order Matching and Executing System (AMS/3). The HKEx initially said 34 brokers would be in the rollout, but Karl-Thomson Securities and Oriental Patron Securities pulled out yesterday.

The AMS/3's online function enables customers of participating brokers to trade local stocks from their personal computers or mobile phones, instead of calling their brokers.

HSBC, with its subsidiary Hang Seng Bank, is one of the biggest banking groups offering online trading services. Both have offered Internet banking since August. A Hang Seng Bank official said its 30,000 Internet banking clients had carried out 3.7 million transaction online since it came into operation.

More than 35 per cent of these transactions involved clients using the Internet to send orders to the bank's staff to initiate a trade manually with the exchange.

'The AMS/3 will allow us to provide a more direct online trading services, which is set to increase the Internet stock trading volume,' the official said.