BEIJING, July 20 (Xinhua) -- Southbound investors under the Stock Connect programs between Chinese mainland and Hong Kong contributed net buying of 16.478 billion Hong Kong dollars of stocks and exchange traded funds (ETFs) on Wednesday, a new high since February 2021, reported Xinhua-run Shanghai Securities News.
Specifically, southbound investors reported net buying of 7.502 billion Hong Kong dollars under the Shanghai-Hong Kong Stock Connect scheme and the net buying under the Shenzhen-Hong Kong Stock Connect scheme stood at 8.976 billion Hong Kong dollars.
Different from the past, southbound investors put a majority of their capital into investment in ETFs on Hong Kong market on Wednesday, with 83.47 percent of their capital flowing into Tracher Fund of Hong Kong and Hang Seng China Enterprises Index ETF (HSCEI ETF).
Industry experts believed that access to ETF trading under the Stock Connect programs changed the trading style of southbound investors and made them pay more attention to trend trading instead of individual stocks to fend off risks.
Yan Zhaojun, a strategist with Zhongtai Financial International Limited said after gaining access to ETFs traded on Hong Kong market under the Stock Connect, southbound investors tended more easily to do trend trading.
Yan attributed their choices to reasons of two aspects, saying that purchasing ETFs tracking indexes can diversify their investment and boast higher ratio of gains in structural trend.
At the same time, index-tracking ETFs are generally more fluid and convenient for large-sum transactions that can hardly affect prices of individual stocks, added Yan. (Edited by Duan Jing with Xinhua Silk Road, duanjing@xinhua.org)
A single purchase
