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Shenzhen-Hong Kong Stock Connect
Shenzhen-Hong Kong Stock Connect is a securities trading and clearing links programme developed by the Stock Exchange of Hong Kong Limited (SEHK), Shenzhen Stock Exchange (SZSE), Hong Kong Securities Clearing Company Limited (HKSCC) and China Securities Depository and Clearing Corporation Limited (ChinaClear), aiming to achieve a breakthrough in mutual market access between the Mainland and Hong Kong. The programme comprises SZSE northbound trading and southbound trading.
SZSE northbound trading represents that investors are enable to engage Hong Kong brokers to trade prescribed shares listed on the Shenzhen Stock Exchange on their behalf via the SEHK Shenzhen special purpose vehicle who is liable to report to the Shenzhen Stock Exchange for related trading order (order transfer).
The list of eligible stocks is available here
Sell-only SZSE Securities
If an SZSE security is removed from the list of eligible stocks for northbound trading, investors will only be allowed to sell the SZSE security but restricted from further buying. In addition, investors will only be allowed to sell SZSE securities but restricted from further buying if:
Such securities subsequently cease to be a constituent stock of the relevant indices; and/or
such securities, based on any subsequent periodic review, have a market capitalization of less than RMB6 billion; and/or
they are subsequently placed under risk alert; and/or
the corresponding H shares of such securities are subsequently delisted from SEHK, as the case may be.
Remarks:
1. Odd lot trading is only available for sell orders and all odd lots should be sold in one single order. For example, you can only sell 7 shares or 107 shares if you hold 107 SZSE-listed shares in your account.
Set out below are trading hours and arrangements for SZSE northbound trading:
Remarks:
09:20 – 09:25 and 14:57 – 15:00: SZSE will not accept order cancellation (for A shares and ETFs).
09:10 – 09:15, 09:25 – 09:30 and 12:55 – 13:00: Orders and order cancellations can be accepted by SEHK but will not be processed by SZSE until SZSE’s market open.
Any buy or sell orders not executed during the opening call auction session will automatically enter the continuous auction session. Any buy or sell orders not executed during the continuous auction session will automatically enter the closing call auction session.
Trading under the Shenzhen-Hong Kong Stock Connect is subject to quotas in order to control the speed and size of cross-boundary fund flows in the initial stage of the programme.
Remarks:
1. When a buy order is cancelled, rejected by the other exchange or executed at a better bid.
Daily Quota
Daily quota refers to the maximum net buy value of northbound trades via Shenzhen-Hong Kong Stock Connect each day, which means the used quota is calculated on a “net buy value” basis, namely the aggregate buy trades net of aggregate sell trades. Unused daily quota will not be carried over to the following day’s daily quota.
Quota is used on a first-come, first-served basis. Usage of daily quota will be calculated on a real-time basis during the trading session and northbound daily quota balance will be updated every time a northbound order is received and executed.
Daily quota balance = daily quota – buy orders + sell trades + adjustments (when a buy order is cancelled, rejected by the other exchange or executed at a better bid)
In case the daily quota is used up:
During the opening call auction session: new buy orders will be rejected. However, as order cancellation is common during opening call auction, the Northbound Daily Quota Balance may resume to a positive level before the end of the opening call auction. When that happens, SEHK will accept SZSE northbound buy orders again.
During the continuous auction session and closing auction session: buy order input will be suspended for the remaining of the day, but buy orders already accepted by SZSE’s trading system before such suspension will not be affected.
The following trading and settlement-related fees and levies will be applied only to trading of SZSE-listed shares via Shenzhen-Hong Kong Stock Connect:
Remarks: Fees are rounded to the nearest cent.
*Portfolio Fee is calculated by the total market value of SZSE-listed shares in daily investment portfolio, and is charged in Hong Kong dollars and on monthly basis.
The following table illustrates the holiday arrangement for SZSE northbound trading:
If a Northbound trading day is a half trading day in the Hong Kong market, Northbound trading will continue until respective Connect Market is closed. Please refer to the HKEX website for the Northbound trading calendar for Shanghai Connect Northbound trading and Shenzhen Connect Northbound trading.
To align with the Hong Kong Stock Exchange (HKEX) implementation of Severe Weather Trading with effect from 23 September 2024, Haitong International will maintain the following services on Severe Weather Trading (SWT) day:
? Hong Kong securities (including Northbound Trading under China Connect) and derivatives markets trading, clearing and settlement services on a severe weather trading day will remain the same as on a regular trading and settlement day;
? Electronic fund deposit, withdrawal, internal transfer and currency exchange services of client’s funds;
? Deposit, withdrawal and internal transfer services of client’s securities (excluding physical stocks deposit or withdrawal);
? The instruction of corporate action will be proceeded;
? Maintain services after login to Haitong International's APP and online trading platform;
? Haitong International's Customer Service Hotline and Client Advisor would remain at your service.
Please note:
1. Haitong International office and Customer Service Center will be closed on SWT day.
2. If the client's net asset value decreases due to market volatility and falls below the margin level, Haitong International will collect margin and interest in accordance with the margin terms and conditions.
3. The above services are subject to the arrangement of Haitong International Service Provider.
Under the current PRC rules, when an investor holds or controls up to 5% of the issued shares of an SZSE-listed issuer, the investor is required to disclose his interest to the CSRC or related exchange in writing within three working days and inform related listed issuer. Such investor may not buy or sell the shares in the listed issuer within the said three-day period.
For such investor, every time when there is an increase or decrease in his shareholding by 5%, disclosure is required to be made within three working days (to the same parties and in the same manner as mentioned above).From the day the disclosure obligation arises to two working days after the disclosure is made, the investor may not buy or sell the shares in the listed issuer.
If a change in shareholding of the investor is less than 5% but results in the shares held or controlled by him falling below 5% of the total issued shares of the listed issuer, the investor is also required to disclose the relevant information within three working days.
Under current PRC rules, a single foreign investor’s shareholding in a listed company (regardless of the channels through which shares in such listed company are held, including through QFII, RQFII and Shanghai/Shenzhen Connect) is not allowed to exceed 10% of the company’s total issued shares, while all foreign investors’ shareholding in the A shares of a listed company is not allowed to exceed 30% of its total issued shares. SZSE listed ETFs are not subject to shareholding restrictions.
When the aggregate foreign shareholding of an individual A share reaches 24%, SZSE will publish a notice on its website (https://www.szse.cn/disclosure/deal/qfii/index.html)
When aggregate foreign shareholding exceeds the 30% threshold, the foreign investors concerned will be requested to sell the shares on a last-in-first-out basis within five trading days.
Foreign investors are defined as investors who are the Qualified Foreign Institutional Investor (QFII), RMB Qualified Foreign Institutional Investor (RQFII) or trade shares via the Shenzhen-Hong Kong Stock Connect programs
After the implementation of Shenzhen-Hong Kong Stock Connect, when aggregate foreign shareholding of an individual A share reaches 28%, SEHK will stop accepting further buy orders on that A share, until shareholding lowers to 26%.
If the 30% threshold is exceeded due to Shenzhen Connect, HKEX will identify the relevant SEHK Participant and require it to follow the forced-sale requirements. Even if the aggregate shareholding exceeds 30%, investors are allowed to sell A shares. If the aggregate foreign shareholding drops below the 30% threshold due to trading within five trading days, the exchange participants who have been requested to force-sell related shares can apply to the SEHK for a forced-sale exemption.
Customer is required to read and understand the Stock Connect Supplement of terms & conditions and Risk Disclosure and other information. For details, please refer to below documents:
Contact Us
Email: [email protected]
Enquiry Form: Please click below Enquiry Form
Hotlines
- Customer Service Hotline: (852) 3583 3388
- 400 001 1822
- Complaint Hotline: (852) 2801 6128
Letter
Write to us by mail or fax to our
Customer Service Department
15/F, One Island South, 2 Heung Yip Road
Wong Chuk Hang, Hong Kong
Fax: (852) 2530 1689
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