In two days, it will be the 25th anniversary of Hong Kong’s return to China. A list of “big gifts” from the central government has been reported in the market, one of which is that Hong Kong Stock Connect can be directly traded in RMB. If this is the case, it is not only more convenient for mainland residents, but also saves a lot of money, especially for short-term speculators. Because the current arrangement is that Hong Kong stocks are priced in Hong Kong dollars, mainland residents must first convert their renminbi into Hong Kong dollars before buying Hong Kong stocks. When selling in the future, the Hong Kong dollar will have to be converted into RMB. When you buy and sell in this way, you lose the bid-ask spread of the exchange rate. If Hong Kong stocks can be quoted directly in RMB, mainland residents can directly trade Hong Kong stocks on the Southbound Stock Connect list in RMB, which is convenient and saves money. It is believed that transactions will be greatly increased. In the future, mainland residents can also play high-frequency trading, buying and selling Hong Kong stocks thousands of times a day.
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If so, who benefits the most?of courseHKEx (388), followed by BOCHK (2388) and Bank of China (3988). BOCHK is the clearing bank for the renminbi in Hong Kong, which greatly increases the flow of renminbi in Hong Kong.
It can also be cleared to zero after release and isolation
In addition to the “big gift” that has not yet been confirmed, the central government has taken the lead in sending a big gift to Hong Kong and Macau yesterday, that is, the latest immigration control quarantine time has been shortened from “14+7” to “7+3”. This move is bound to benefit Hong Kong’s tourism stocks, hotel stocks, retail stocks, and real estate stocks, as well as Macau casino stocks.
Since the mainland that insists on “clearing” has relaxed the quarantine time, it is believed that the international entry quarantine time in Hong Kong will also be shortened. Recently, many high-level executives of major foreign-invested banks in Hong Kong kept saying that they would move out of Hong Kong and move to Singapore, a city that has long decided to coexist with the virus. It will also be good for Hong Kong if Hong Kong relaxes accordingly. In fact, the goal of “14+7” and “7+3” is still “zero”, but it has changed because of the change in the severity of the epidemic. The principle of “clearing” has not changed. Even if one day, it will be relaxed to the point where you can enter without quarantine as long as you have a 24-hour nucleic acid negative certificate and three shots of the vaccine, it still does not deviate from the “clearing” policy.
Dr. Zeng Yuancang
Zeng Yuancang’s Wealth Management and Investment Page
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This column is published every Wednesday