Popular science on Hong Kong stocks: all basic knowledge in one place
Before entering the market: understanding the trading rules of the Hong Kong stock market.
In the previous section, we had a preliminary understanding of the Hong Kong stock market. However, before officially participating in the Hong Kong securities market, we also need to understand the common trading rules of Hong Kong stocks.
1. What is the trading time for Hong Kong stocks?
The regular trading time of the HKEx is mainly divided into three stages:
(1) Opening auction period: 9:00-9:30 am.
(2) Continuous trading period: 9:30 am - 12:00 pm, 1:00 pm - 4:00 pm.
(3) Closing auction period: 4:00 pm - 4:08~4:10 pm.
(1) Opening auction period
It can be divided into four stages.
Inputting the bid-ask quotes period: 9:00-9:15 am. During this period, you can place orders at any time (auction market orders and auction limit orders), and you can cancel orders at any time.
Non-cancelable period: 9:15-9:20 am. During this period, you can place orders at any time, but you cannot cancel orders.
Random pairing period: 9:20-9:22 am. If the pairing is successful during this period, the opening price will be generated, which is also the final auction price. The opening price is limited to a fluctuation range of 15%.
Suspension period: After the pairing is completed - 9:30 am, the auction limit orders during this period will be automatically converted to limit orders and will continue to wait for transactions during the continuous trading period.
(2) Continuous trading period
The continuous trading period is generally 5.5 hours, during which you can place limit orders, market orders and other special order types introduced by Futu. However, for some specific securities (such as some ETFs), there will be an additional one-hour trading period, which is the extended morning trading period from 12:00 pm to 1:00 pm.
In addition, on the day before Christmas, the day before the western new year, and the day before the lunar new year, the Hong Kong stock market only opens for half a day and closes after 12:00 noon.
(3) Closing auction period:
Similar to the opening auction period, it can also be divided into the following four stages.
2. What is the trading mode of Hong Kong stocks?
The Hong Kong stock market adopts intraday trading mode. Stocks or options purchased on the same day can be sold on the same day, commonly known as the T+0 trading mode, and there is no limit on the number of transactions made on the same day.
3. Are there any price fluctuation limits for Hong Kong stocks?
There is no limit on the trading range of securities in the Hong Kong stock market. A stock may rise or fall by 20% or more in one day. Investors need to control risks reasonably based on their financial situation and risk preferences.
However, the Hong Kong Stock Exchange sets limit on the price fluctuation of certain stocks during specific periods. For example, the price fluctuation during the pre-opening auction session cannot exceed 15%.
In addition, a market volatility control mechanism is set up for some large stocks. The mechanism applies to 81 constituent stocks of the Hang Seng Index and the Hang Seng China Enterprises Index, collectively referred to as "market adjustment mechanism securities". If the price of one of these stocks fluctuates by more than 10% within a continuous trading period of 5 minutes, it triggers a cooling-off period that lasts for 5 minutes. During this period, trading can continue, but the trading price is limited to within ±10% of the reference price 5 minutes ago.
The minimum trading unit of Hong Kong stocks is 1 lot, and the number of shares per lot varies. The smallest lot is 10 shares and the largest is over 0.1 million shares. The amount per lot ranges from tens to hundreds of thousands of Hong Kong dollars, of which about 60% are between HKD 1,000 and HKD 10,000.
The minimum price fluctuation of Hong Kong stocks depends on the price range of the stocks. Specifically, it is as follows:
Hong Kong stocks follow a T+2 settlement cycle. The date of selling a stock is T day, and the securities and clearing organizations will settle the funds and securities two trading days after T day. The cash obtained from selling stocks can only be withdrawn freely after settlement.
These are the main market rules of the Hong Kong stock market. In the next section, we will continue to introduce the main trading instruments that you can participate in on the Hong Kong stock market.
The settlement time for the Hong Kong stock market is T+2. The time for selling stocks is defined as T day, and the brokerage and clearinghouse will settle the funds and stocks two trading days after T day. The cash obtained from selling stocks can only be withdrawn freely after settlement.
Those are the major market rules in the Hong Kong stock market. In the next section, we will continue to introduce the main trading varieties that you can participate in the Hong Kong stock market.
