Shanghai-Hong Kong Stock Connect is expected to see booming trade in 2024, with trading volume for northbound ETFs tripling.

The review of the Stock Connect in 2024 showed that the trading volume in the Shanghai and Shenzhen Hong Kong markets was prosperous. The average daily trading volume under the Northbound Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect in 2024 was approximately RMB 150.1 billion, an increase of 39% from the previous year. The average daily trading volume under the Southbound Hong Kong Stock Connect was about HKD 48.2 billion, an increase of 55% from the previous year. In July last year, the eligibility expansion of ETFs under the Shanghai and Shenzhen Hong Kong Stock Connect further enriched the investment choices for mainland and Hong Kong investors. In 2024, the average daily trading volume of Northbound ETF Connect was about RMB 2 billion, nearly triple the amount from the same period in 2023. On October 8, 2024, the single-day trading volume of the Northbound Shanghai-Hong Kong Stock Connect, Shenzhen-Hong Kong Stock Connect, and Southbound Hong Kong Stock Connect all reached historic highs, reaching RMB 510.1 billion, HKD 280.2 billion, and HKD 24 billion, respectively. The Northbound ETF Connect set a new single-day trading record of RMB 14.1 billion on October 8, while the Southbound ETF Connect set a new single-day high of HKD 17.5 billion on December 4. 2024 marks the tenth anniversary of the Shanghai and Shenzhen Hong Kong Stock Connect. Over the past decade, HKEx has closely collaborated with the Shanghai and Shenzhen exchanges, mainland clearinghouses, regulators, and global market participants to optimize the mechanism. Starting with mainly equity securities, the mutual access mechanism has now expanded to include bonds, exchange-traded funds (ETFs), and interest rate swap products. Last year, more optimization measures were implemented, including the expansion of eligible ETFs under the Shanghai and Shenzhen Hong Kong Stock Connect, as well as the introduction of new trading types and services under the swap Connect. It is expected that more optimization measures will be implemented in the future, including the inclusion of Real Estate Investment Trusts (REITs) in the Shanghai and Shenzhen Hong Kong Stock Connect, as well as the introduction of RMB counters for Hong Kong Stock Connect, further promoting two-way capital flows between the two regions and consolidating Hong Kong's role as a super-connector between the mainland and global capital markets.