Stock Connect

Shenzhen-Hong Kong Stock Connect kicks off three-week test ahead of November launch

If trial successful, the new cross border share trading scheme expected go live on November 21, say officials

PUBLISHED : Monday, 17 October, 2016, 8:28am
UPDATED : Monday, 17 October, 2016, 9:41am

Hong Kong and Shenzhen stock exchanges will start a three-week systems test on Monday to prepare for the launch of the new cross-border share trading link between the cities, which could go live as early as November 21.

The test, running from October 17 to November 9, marks a significant step in the new Stock Connect scheme which will allow international investors to trade 880 Shenzhen listed stocks while mainland investors will be allowed to trade 417 Hong Kong stocks.

“All stockbrokers in Hong Kong and Shenzhen preparing to trade using the Stock Connect scheme will need to join the three-week testing,” Benny Mau, chairman of Hong Kong Securities Association, told South China Morning Post.

The testing would be run within normal trading hours, but will be conducted via a separate system.

“This is to make sure normal trading will not be affected by the test,” he said. “Each day different aspects of trading will be tested, including placing orders, executing cross border trades, receiving trading and corporate information, handling dividend payments or splitting of shares,” he added.

Mau said similar testing was held prior to the launch of the existing Shanghai-Hong Kong Stock Connect launched in 2014, to give brokers a clear idea of how it works.

If problems do crop up, then another week could be added to the test period, he added..

“However, I believe the new stock link should still be launched on November 21, if all goes smoothly.”

Hong Kong Exchanges and Clearing chief executive Charles Li Xiaojia last Thursday said the connect scheme will be introduced in a Monday after mid November, indicating November 21 as the possible date.