Hong Kong Exchanges and Clearing Limited (HKEX), which rode to the top among global destinations for initial public offerings on a wave of equity sales last year, will add a mixture of new-economy and old-world financial instruments to its arsenal, in its quest to become a global financial marketplace. The bourse operator is betting that the Chinese government will gives its nod to a cross-border investment channel known as the Connect scheme, which will let global investors buy and sell ferrous, as well as precious metal contracts on Chinese exchanges via Hong Kong. Another addition, outlined last week by HKEX chief executive Charles Li Xiaojia in his three-year strategic plan , is to add currencies, fixed-income products and other financial derivatives to its offerings. Hong Kong is already a major centre for trading offshore renminbi contracts, since the yuan itself is not freely convertible into hard currency onshore. “Given the increased volatility of [offshore] yuan, it is essential for corporate clients to use hedging tools to mitigate currency risk, [so] yuan derivatives will attract a lot of attention, especially from companies doing business with China,” said Simon Blyth, director and head of EBSHK Forex in Hong Kong. “Hong Kong would be able to capitalise on the robust economic growth in Asia with currency products, which would also help enhance the position of Hong Kong as Asia’s regional financial hub.” Forays into commodities trading had been on hold since Li first proposed the Commodities Connect in 2014. Instead, the Chinese securities regulator tested the waters with equity investors, first approving a Stock Connect between Shanghai and Hong Kong in 2014, followed by a similar cross-border channel with Shenzhen two years later. Simultaneously, commodities exchanges on the mainland opened their doors to global traders, allowing them to buy and sell crude oil futures in either foreign currencies or yuan. Admittedly, the push for a Commodities Connect may be a “one-sided love affair,” where the Chinese authorities had yet to respond in kind to Hong Kong’s serenades, Li said last week. “There is no response to our love,” said the chief executive during a press conference to outline his three-year strategic plan. “But I believe our love will eventually be returned in the longer term.” The HKEX had put £1.39 billion (US$2.2 billion) behind its bet, with its 2012 takeover of the London Metal Exchange (LME), the world’s largest marketplace for trading metals. While the LME purchase has been a good investment, adding about 15 per cent to HKSE’s revenue every year, it had not transformed Hong Kong into a metals trading hub. The exchange launched a small number of LME contracts to trade iron ore, aluminium, zinc, copper, lead, nickel and tin, but their daily transactions amounted to seven contracts, among the least traded products on the bourse. By comparison, stock options topped the daily transactions last year with 517,395 contracts changing hands everyday, followed by 511,547 equity index futures, 7,235 offshore yuan futures, and 1,430 gold futures. Part of the problem is Hong Kong only trades for 16 hours a day, unlike the CME Group’s partnership with the Singapore Exchange, which trades around the clock. “HKEX needs to extend its trading hours and cut down the transaction cost if it wants to compete,” said Glory Sky Group’s chairman Alfred Yeung Ping-kwan, who trades equities in Hong Kong but trades metals and currency futures at the CME.