Its general economic conditions, economic freedoms and world-class trading make Hong Kong a favorable place for investors and traders to trade on the Hong Kong Stock Exchange (SEHK).
Open an account with a reputable broker to trade stocks in Hong Kong. Keep in mind that not all brokerages are created equal, so be sure to consider your needs carefully before opening an account.
Best Stock Brokers in Hong Kong
Finding the best online brokerage largely depends on your needs as an investor or trader. If you are actively trading and doing your own research, a discount broker with low commissions would probably be the most beneficial.
If you’re relying on outside investment research and advice, a full-service broker might make more sense.
Best for Beginners: Charles Schwab
Our choice for beginners offers a wide range of educational materials for new traders. Based in the United States, Charles Schwab has an office in Hong Kong and is a member of the SEHK. The stockbroker is also registered with the HKSFC, in addition to a large number of other international regulators.
To take advantage of Schwab’s educational resources and trade SEHK-listed stocks, all you need to do is open a Schwab brokerage account. The Schwab brokerage account used for domestic transactions in the United States can be used to trade securities internationally through the Schwab Global Investing Services office.
If you are based in Hong Kong, opening a Schwab account allows you to trade US stocks, fixed income securities and offshore mutual funds. You can also trade American Depository Receipts (ADRs) so you can invest in thousands of companies headquartered outside the United States.
Schwab’s comprehensive trading platform is known as StreetSmart Edge. This desktop trading software features live streaming quotes, a newsfeed, and sophisticated charting and technical analysis capabilities. A web version of the platform and mobile apps for iOS and Android devices are also available.
Schwab Hong Kong customer service is available to customers by phone, email and through a form on their website. A fairly high minimum of 10,000 USD is required to open an account, while stock trading on the SEHK costs at least 250 HKD online and 600 HKD with phone support, which can be high for many traders.
Read Charles Schwab’s full review of Benzinga
Global and Active Traders
- Access to foreign markets
- Detailed mobile app that simplifies trading
- Wide range of available account types and tradable assets
Best for Day Traders: Interactive Brokers
Interactive Brokers is a major international broker based in the United States. Interactive Brokers has an office in Hong Kong, is a member of SEHK and is regulated by HKSEC, as well as many other international regulators.
Interactive Brokers also has some of the lowest commissions for trading stocks in the industry, including Hong Kong stocks, making it the best broker for day traders looking to trade Hong Kong stocks. Hong Kong stock trading commission is HKD 18 per trade, the lowest we could find for SEHK members.
The integrated investment account gives you access to trading a wide variety of listed assets on over 120 global exchanges. In addition to SEHK stocks, you can trade ETFs, currencies, metals, futures, options, funds, bonds, and structured products.
Interactive Brokers’ trading platforms include an easy to use platform called the Client Portal which is ideal for less experienced traders. The broker also offers a professional Trader Workstation (TWS) platform with many features that experienced traders may find useful. Interactive Brokers also offers a web-based platform known as IBKR WebTrader.
An IBKR mobile app is available for Android and iOS tablets and smartphones. A hands-free access app, IBot, can also be downloaded for use with the Customer Portal.
Read Benzinga’s full review on Interactive Brokers
Trading stocks in Hong Kong
Securities trading began in Hong Kong in 1866, but there was no formal stock market until the opening of the Hong Kong Stock Exchange (SEHK) in 1914, evolved from the Securities Dealers Association, founded in 1891.
Since gaining independence as a British Dependent Territory from the United Kingdom in 1997, Hong Kong has become one of the world’s leading financial centers due to its low tax rates and free trade agreements. This makes SEHK one of the easiest international markets to invest and trade.
According to the Heritage Foundation, China’s Hong Kong Special Administrative Region ranks first among countries in the world for financial freedom with a score of 90.2. The SEHK is ranked fourth in Asia and fifth in the world by market capitalization of just under $4 trillionnm
The SEHK is supervised by the Securities and Futures Commission of Hong Kong (HKSFC), which is an independent agency responsible for regulating the securities and futures markets in Hong Kong. The agency also supervises market participants such as brokers, fund managers and investment advisers. Regulation by the HKSFC is important when selecting a stockbroker to trade local stocks in Hong Kong.
SEHK trading hours begin with a pre-opening session from 9:00 a.m. to 9:30 a.m. and the opening price of the securities is announced at 9:20 a.m. A continuous session takes place from 9:30 a.m. to 12:00 p.m. At noon, an extended one-hour trading session takes place, called the “lunch break”. Another continuous trading session takes place from 1:00 p.m. to 4:00 p.m.
Since November 2014, Hong Kong traders and investors can trade more than 2,000 eligible stocks on the Shanghai and Shenzhen stock exchanges through a program called “Stock Connect”.
Characteristics of a Great Stock Broker
There are several things to consider before deciding to open an account to trade stocks in Hong Kong. They include:
Regulatory and Exchange Adherence
To trade stocks on the SEHK, you need to go through a broker registered with the HKSFC. Securities brokers doing business in Hong Kong must also be members of the stock exchange in order to act as intermediaries for traders and investors.
The HKSFC protects the interests of investors and requires that all financial intermediaries doing business on the SEHK comply with the rules and regulations of the HKSFC.
Your potential broker should ideally have an electronic trading platform for you to place trades on the SEHK
Fundamental traders and investors often rely on information provided by a good research department.
Full-service brokers generally charge more, but provide higher quality market research and other features that cheaper discount brokers don’t.
Commissions and fees
Active traders generally pay commissions per trade more often than inactive traders and investors. Since keeping costs low will improve your bottom line, you may want to select a discount broker with low transaction fees.
Most traders, especially those who are inexperienced, will appreciate the assistance provided by good customer service. A customer service should be able to help you with trading-related issues. You can reasonably expect any decent stockbroker to give you access to customer service by phone, email and live chat.
Trading stocks on the SEHK can be quite easy and secure, especially if you open an account with a reputable broker. Your particular requirements will define the best type of broker for you, and this includes your level of experience and the number of funds you can commit to your trading account.
Frequently Asked Questions
What are the different ways I can buy shares in Hong Kong?
What are the different ways I can buy shares in Hong Kong?
Jay and Julie Hawk
You can use a broker with access, ADR, mutual funds or ETFs.