How can mainlanders invest in Hong Kong stocks given Beijing's foreign exchange and currency controls? Financial analysts and market players said there were plenty of ways.
Stephen Tsui, director of Hong Kong-based Taiwan Concord Capital Securities, said many mainlanders had opened bank accounts in Hong Kong.
'It's legal for anyone to open bank and investment accounts in Hong Kong. Some mainland retail investors used to just bring cash to Hong Kong regularly and deposit it in their accounts.'
Mainlanders can legally buy US$50,000 a year in foreign currency, and carry a maximum of US$10,000 in cash across the border. They can also carry 20,000 yuan per trip in cash.
Bigger investors wire money through grey channels such as exchange shops and firms they set up in Hong Kong or as far afield as Africa, he said.
'That kind of remittance is not so legal but it has been an open secret for a long time since the mainland opened up,' Mr Tsui said. 'And there is just too much liquidity on the mainland that Hong Kong can absorb.'