ExclusiveHong Kong’s exchange is looking at ways to spur trading in unloved stocks to bolster turnover
- Proposals under study include lowering trading costs and adding some small companies to stock connect schemes
Hong Kong Exchanges and Clearing (HKEX), which operates the third largest stock market in Asia, is exploring different ways to boost share turnover of smaller companies in an effort to bolster the city’s role as a fundraising hub, according to two people familiar with the situation.
Potential plans under study include lowering trading costs as well as adding some smaller companies to the stock connect schemes, the source said.
Among the city's 2,315 listed companies as of the end of December, 80 per cent of turnover is concentrated in 1,146 H shares and other mainland enterprises, according to HKEX data.
“We are constantly exploring ways to enhance the competitiveness of our markets,” a HKEX spokeswoman said without providing a timetable for the changes.
Last month the HKEX unveiled a three-year plan to become the world’s go-to market during Asian trading hours by wooing top Asia-Pacific companies while bolstering its gateway role for mainland investment.
In January, Francis Leung Pak-to, chairman of The Chamber of Hong Kong Listed Companies, urged the stock exchange to seek ways to improve liquidity among small to medium sized companies, or face reputational damage.