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Typhoon trading: ‘scores’ of brokers not ready for markets to stay open during storms
- They need to upgrade their systems in the coming months to enable remote trading, or they may let fellow brokers trade for their clients during storms
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Many of Hong Kong’s small brokers may have difficulty enabling their customers to trade remotely in the event of a severe storm, though most of them are willing to upgrade in preparation for the new policy allowing the stock market to remain open during typhoons, according to industry players.
“There are still scores of the smallest stockbrokers which do not have remote trading facilities,” said Tom Chan Pak-lam, permanent honorary president of the Institute of Securities Dealers.
“They will need to upgrade their systems in the coming months to enable remote trading during typhoons, or alternatively they may just let their fellow brokers trade for their clients during the storms after the new rule is implemented.”
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The bourse operator, Hong Kong Exchanges and Clearing (HKEX), will allow trading of stocks and derivatives to continue during typhoons and torrential rain starting from September 23, Chief Executive John Lee Ka-chiu announced on Tuesday.
The move will scrap the 70-year-old practice of halting trading on the stock and futures markets or shutting them entirely when the observatory issues a No 8 typhoon signal or black rainstorm alert.
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The history of deadly Hong Kong typhoons that caused widespread devastation
The history of deadly Hong Kong typhoons that caused widespread devastation
HKEX will require all brokers to ensure their systems are ready to support their traders and staff members working from home during severe weather. They will also need to allow investors to trade online.
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