Hong Kong Financial Services Council: Proposed introduction of a “bookmaker system” for more than 2,000 small-cap Hong Kong stocks to activate liquidity

Zhitong Finance App learned that Tung Yat-yue, the director and head of the Hong Kong Financial Services Council (Policy Research), said that among the companies currently listed in Hong Kong, only 50-150 shares have a large trading volume every day, and the remaining 2,000 or more have very little trading volume. Therefore, he suggested introducing a “bookmaker system” with liquidity providers for these listed companies with small market capitalization. This will increase the appeal of companies to go public in Hong Kong.

Dong Yiyue said that although some international insurance or famous brand companies are currently listed in Hong Kong, trading is not active due to the small number of shares listed in Hong Kong. Therefore, he suggested that whether “Southbound Connect” can expand to non-blue chip companies, or how to increase the issuance of shares by these companies in Hong Kong, is worth studying. If the trading volume of these international companies increases, it will help attract more international companies to go public in Hong Kong.

Dong Yiyue believes that Hong Kong should optimize the listing mechanism. It is easier for companies with “the same shares and different rights” to go public. At the same time, he also hopes to expand the scope of connectivity, so that domestic and foreign investors can more easily invest in the mainland and Hong Kong markets.

Dong Yiyue said that he has visited the Middle East, Southeast Asia and Central Asia in the past few months, and many companies are willing to go public. He hopes that in addition to listing locally, these companies can also attract them to go first or second in Hong Kong, and reach out to mainland Chinese investors through listing in Hong Kong. This is important today, when geopolitical issues are getting worse, and it can spread risk.