The financial landscape is constantly evolving, and one of the latest developments is the opportunity for Middle Eastern traders to invest in Hong Kong stocks through two exchange-traded funds (ETFs). These ETFs will be listed on the Saudi stock exchange at the end of this month, marking a significant milestone in the linkage between the capital markets of Hong Kong and Saudi Arabia.
Financial Secretary Paul Chan Mo-po will lead a delegation to the FII conference in Riyadh, where the launch of the ETFs will be celebrated. Julia Leung Fung-yee, CEO of the Securities and Futures Commission (SFC), highlighted the importance of these ETFs in strengthening the connections between the two markets.
ETFs are investment vehicles that bridge the gap between mutual funds and stocks, offering individual and institutional investors an easy and convenient way to trade these instruments. The Saudi Exchange, or Tadawul, with a market capitalization of US$2.6 trillion, has approved the listing of the Albilad CSOP MSCI Hong Kong China Equity ETF by local asset manager AlBilad Investment. Additionally, another ETF tracking a key benchmark in Hong Kong is in the works, although details have not been disclosed yet.
The relationship between Hong Kong and Saudi Arabia has been flourishing since the listing of the first Saudi ETF in Hong Kong last November. The CSOP Saudi Arabia ETF has seen a 5% increase since its launch, reflecting the growing interest in cross-border investments.
The SFC is committed to expanding connect schemes with mainland China and collaborating with regulators in the Middle East and Southeast Asia to strengthen Hong Kong’s position as an international financial center. The regulator will also focus on promoting fintech and regulating virtual asset trading in the future.
As Hong Kong cements its position as Asia’s top financial center, the SFC’s role in ensuring market integrity and investor protection becomes even more critical. With a rich history spanning 35 years, the SFC has navigated through financial crises and market fluctuations, all while upholding its mission of safeguarding investor interests and enhancing Hong Kong’s financial landscape.
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