The poor trading performance of the seven Nasdaq stocks trading in Hong Kong has prompted a review of their operations. Hong Kong Exchanges and Clearing deputy chief operating officer Lawrence Fok Kwong-man confirmed plans to bring new high-technology companies to the exchange were on hold due to the seven's thin trading. 'There is no point in bringing more Nasdaq companies to the SAR if there is no trading interest,' he said. 'But the exchange would bring more Nasdaq companies here when the reforms have created an active trade in these stocks.' The exchange is looking for a way to overhaul the system under which the shares trade, he said. One option is to allow the Hong Kong Nasdaq stocks to be traded in US dollars. At present they trade in Hong Kong dollars, but US dollars on Nasdaq. Mr Fok said December's implementation of Hong Kong's US dollar clearing system meant it was possible for the seven Nasdaq stocks to trade in US dollars. Another possibility, suggested by some brokers, was to let local investors trade the shares in smaller units. Some of the Nasdaq stocks are priced at several hundred HK dollars per share. Mr Fok was confident the review would help build an active market for a range of overseas products traded in Hong Kong. 'This is an important strategy to ensure Hong Kong Exchanges and Clearing takes the role of a leading financial centre in the region,' he said. Brokers have labelled the year-long pilot programme involving the seven Nasdaq-listed counters a flop. The seven - technology giants Microsoft, Intel, Dell, Applied Materials, Cisco Systems, Amgen, and coffee-shop chain Starbucks - made their debut on May 31 last year. Between then and the end of April, their total trading volume was a mere HK$349.26 million - an average of HK$1.55 million a day - lower than many second or third-line issues. Mr Fok blamed the thin trade on the poor sentiment for technology stocks. It saw the high-tech Nasdaq index drop 30 per cent during the course of last year. Also, Mr Fok thought it would take time for local investors to learn about these products. However, Louis Tse Ming-kwong, executive director of Standard Capital Brokerage, blamed high trading costs for the lack of interest in the Nasdaq offerings. He pointed out that the stocks were traded at a much wider spread than local companies. Also, if investors were buying Nasdaq stocks in Hong Kong and then selling them on the US market, they would have to pay high clearing costs. Mr Fok says the review of Nasdaq shares would also seek ways to increase the trading volume of the two Exchange Traded Funds - the two index funds based on MSCI indices on South Korea and Taiwan. The two funds, or iShares, are among more than 70 index funds listed on the American Stock Exchange. They started trading on Hong Kong Exchanges and Clearing on May 2, as part of another programme by the local bourse to introduce overseas-listed products to Hong Kong. However, local investors have shown little interest in them so far. During the course of the past month, iShares South Korea saw a total of some US$3.17 million worth of stock change hands, while the Taiwan unit was a lower US$2.72 million. There were 11 trading days during the month when there were no South Korea iShares traded and five days without any Taiwan iShares traded. Henry Wu King-cheong, the legislator who represents brokers, said local investors were not very knowledgeable about the South Korea and Taiwan markets and so this inevitably limited their interest in iShares. Mr Wu believed that local investors were more interested in trading local companies than overseas businesses because it was difficult to obtain information about stocks listed overseas, adding the exchange would continue to press for more overseas products.