The Stock Exchange
Hong Kong's stock market is one of the world's largest in terms of market capitalization. With a total market cap of $4,727 billion, the Hong Kong stock market ranked tenth in the world and second in Asia in 1999. At the end of the year, 701 public companies were listed on the Stock Exchange of Hong Kong Ltd (SEHK). The 31 newly listed companies raised a total of $15.6 billion of capital. Besides new share issues, funds were also tapped through rights issues and private placements.
In 1999, the launching of the Tracker Fund of Hong Kong (TraHK) by the Exchange Fund Investment Limited was greeted with much fanfare from the public. Established in October 1998 to manage the Hang Seng Index (HSI) constituent stocks acquired by the Hong Kong Government in the same year, the initial offer of TraHK took place in October 1999 and received very positive response from the market. The government believes that the successful launching of this new product will be conducive to the development of the unit trusts and mutual funds in Hong Kong.
Only members of the SEHK and the Hong Kong Futures Exchange (HKFE) are allowed to trade on these two markets respectively. At end of 1999, the SEHK had 571 corporate and individual members while the HKFE had 137 members.
In November 1999, the SEHK launched the Growth Enterprise Market (GEM) aimed at providing startups without a record of profitability an avenue for raising capital for business development. Many of those companies listed on the GEM are technology-based or Internet companies. In regulating the new market, the Stock Exchange emphasized the importance of disclosure with investors being made aware of the higher risks involved in investing in such stocks.
Hong Kong has almost 700 securities and futures companies, with many of the largest being branches or associates of international firms, which take the lion's share of the business. Hong Kong-based securities firms all handle everything from new listings to secondary market retailing. Business hours normally fall from 9 a.m. to 6 p.m.
Full details of the companies and their services can be found on the Web site of the Hong Kong Stock Exchange. In terms of volume of business, the largest include:
