Everything about Hong Kong Exchanges And Clearing totally explained
Hong Kong Exchanges and Clearing Limited (
Chinese: 香港交易及結算所有限公司, also 香港交易所 or 港交所; abbreviated as
HKEx; ) is the
stock exchange of
Hong Kong. HKEx is the
holding company for
The Stock Exchange of Hong Kong Limited (SEHK),
Hong Kong Futures Exchange Limited (HKFE) and Hong Kong Securities Clearing Company Limited. With a total
market capitalization of over
US$2.124 trillion as of as at July 12 2007, the HKEx ranks fifth in the world by
market capitalization of listed companies (see
List of stock exchanges for complete rankings).
History
The history of the securities exchange began formally in the late
19th century with the first establishment in
1891, though informal securities exchanges have been known to take place since
1861. The exchange has predominantly been the main exchange for Hong Kong despite co-existing with other exchanges at different point in time. After a series of mergers and acquisitions, HKSE remains to be the core. From
1947 to
1969 the exchange monopolized the market.
| Association of Stockbrokers in Hong Kong (Founded 1891) |
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| (1914) Renamed to Hong Kong Stock Exchange |
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| (1947) A merger is made after World War II with Hong Kong Stock Exchange retaining the name |
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Hong Kong Stockbrokers Association (Founded 1921) |
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| Hong Kong Stockholders Association Ltd (Founded 1978) allow info sharing between HKSE and other exchanges |
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Far East Exchange Ltd (Founded 1969) |
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Kam Ngan Stock Exchange Ltd (Founded 1971) |
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Kowloon Stock Exchange Ltd (Founded 1972) |
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| (1986) HKSE merges with other exchanges and retain the name but also presented as Stock Exchange of Hong Kong |
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Hong Kong Futures Exchange Ltd (Founded 1976) |
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Hong Kong Securities Clearing Company Ltd (Founded 1989) |
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HKEx was formed in
March 6,
2000 by a merger of its three main constituent companies. The company itself is listed on its own exchange, the HKSE.
The
Hong Kong Government is the single largest shareholder in HKEx, and has the right to appoint six of the thirteen directors to the Board.
Valuation
As at September
2005, the stock exchange had a
market capitalization of
HK$ 7,544 million (
US$ 967mn), making it the second-largest stock exchange in the
Asia Pacific region after
Japan.
As at
2006, with a total
market capitalization of more than HK$10 trillion (US$1.3 trillion), the Hong Kong Stock Exchange ranks 8th in the world by market capitalization of listed companies. As at July 12 2007, the Hong Kong Stock Exchange ranks fifth in the world, with a total market capitalization of over
US$2.124 trillion
Merger speculation
After the
New York Stock Exchange announced in November 2006 that it would open an office in Beijing to work with the
Shanghai Stock Exchange, Hong Kong Exchanges and Clearing chairman Ronald Arculli dampened speculation saying it has no immediate plans to acquire or merge with other exchanges, but would focus on "strengthening our competitiveness and reviewing our listing fees."
Government share purchase
In September 2007, the government revealed that it had increased its stake from 4.41 percent to 5.88 percent. According to market sources, the Government spent HK$2.44 billion to buy 15.72 million shares in the company. The stake would be held by the Exchange Fund as a "strategic asset"..
The move has drawn widespread criticism in Hong Kong and abroad: David Webb said that the government was the second-largest single investor in the Hong Kong market after Beijing, with a portfolio of local equities estimated to be worth about HK$150 billion. He said the purchase violated the government's stated principle of "big market, small government", adding that it increased uncertainty and sends a very negative signal to the market as a whole; the
Civic Party criticised the Government for damaging public confidence in the capital market, and interfering with the stock exchange's independence; A
Wall Street Journal editorial said that the Hong Kong Government is further interfering in the market to "cozy up to China's tightly controlled domestic exchanges". Financial commentator
Jake van der Kamp stated that the
Financial Secretary is caught in a conundrum: The government's interest in increasing the efficiency of the marketplace conflicts with its role as a shareholder, who would prefer as high return as possible.
The Government said that it wanted to play a positive role in the stock exchange's development as a shareholder. Analysts expect the Government will continue to increase its stake, as HKEx is being prepared "for future integration and alliance with mainland exchanges". Another analyst was concerned about the independence of "Independent Chairman" Ronald Arculli, who also sits on the
Executive Council.. In
1993 the exchange launched the "Automatic Order Matching and Execution System" (AMS) that was replaced by the third generation system (AMS/3) in October
2000. Systems as such were added to meet the increased popularity of online Stock trading.
Trading Hours
From 10:00am to 12:30pm and from 2:30pm to 4:00pm
(From 9:00pm to 11:30pm and from 1:30am to 3:00am New York Standard (EST) time)
Further Information
Get more info on 'Hong Kong Exchanges And Clearing'.
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