Introduction

Shanghai-Hong Kong Stock Connect (“Shanghai Connect”) is a securities trading and clearing links programme to be developed by Hong Kong Exchanges and Clearing Limited (HKEx), Shanghai Stock Exchange (SSE) and China Securities Depository and Clearing Corporation Limited (ChinaClear), aiming to achieve a breakthrough in mutual market access between the Mainland and Hong Kong.

The establishment of Shanghai-Hong Kong Stock Connect is a ground-breaking initiative to both Mainland and Hong Kong as it will, for the first time, enable mutual market access by investors in the two markets through an orderly, controllable and expandable channel.

Shenzhen-Hong Kong Stock Connect (“Shenzhen Connect”) is a securities trading and clearing links programme to be developed by Hong Kong Exchanges and Clearing Limited (HKEx) and Shenzhen Stock Exchange (SZSE), the establishment of mutual stock market access between the Mainland and Hong Kong for trading eligible stocks. To further enrich the variety of traded products and provide more investment opportunities and convenience for domestic and overseas investors.

The expansion of mutual stock market access represents yet another milestone towards strengthening the interconnectivity between the stock markets in Hong Kong and the Mainland as well as consolidating Hong Kong’s position as a major offshore renminbi centre.

Eligible Stocks

Shanghai Connect
Under Shanghai Connect, SSE Securities that are eligible for trading by Hong Kong and overseas investors include all the constituent stocks from time to time of the SSE 180 Index and the SSE 380Index, and all the SSE-listed A shares that are not included as constituent stocks of the relevant indices but which have corresponding H shares listed on SEHK.


List of Eligible SSE Securities


Shenzhen Connect

Under Shenzhen Connect, SZSE Securities that are eligible for trading by Hong Kong and overseas investors include all the constituent stocks from time to time of the SZSE Component Index and the SZSE Small/Mid Cap Innovation Index which have a market capitalization of not less than RMB 6 billion, and all the SZSE-listed A shares which have corresponding H shares listed on SEHK.

At the initial stage of Shenzhen Connect, investors eligible to trade shares that are listed on the ChiNext Board of SZSE under Northbound trading will be limited to institutional professional investors. Subject to resolution of related regulatory issues, other investors may subsequently be allowed to trade such shares.

List of Eligible SZSE Securities
Quota

Trading under Shanghai and Shenzhen Connect will be subject to a Daily Quota. There is no Aggregate Quota for Shanghai and Shenzhen Connect as the Aggregate Quota for Shanghai Connect was abolished since 16 August 2016 and none will be introduced for Shenzhen Connect.

Northbound trading and Southbound trading are respectively subject to a separate set of Daily Quota, which is monitored by SEHK, SSE and SZSE respectively.

The Daily Quota is applied on a “net buy” basis. Based on that principle, investors are always allowed to sell their cross-boundary securities regardless of the quota balance.

Daily Quota

The Daily Quota limits the maximum net buy value of cross-boundary trades under each of Shanghai and Shenzhen Connect each day. The Northbound Daily Quota is set at RMB 13 billion for each of Shanghai Connect and Shenzhen Connect, and the Southbound Daily Quota is set at RMB 10.5 billion for each of Shanghai Connect and Shenzhen Connect.


Mechanism of Daily Quota

If the Northbound Daily Quota Balance drops to zero or the Daily Quota is exceeded during the opening call auction session, new buy orders will be rejected. However, as order cancellation is common during opening call auction, the Northbound Daily Quota Balance may resume to a positive level before the end of the opening call auction. When that happens, SEHK will again accept Northbound buy orders.

Once the Northbound Daily Quota Balance drops to zero or the Daily Quota is exceeded during a continuous auction session, no further buy orders will be accepted for the remainder of the day. The same arrangement will be applied to the closing call auction of SZSE. It should be noted that buy orders already accepted will not be affected by the Daily Quota being used up and will remain on the order book of SSE and SZSE respectively unless otherwise cancelled by relevant SEHK Participants.



Daily Quota Balance = Daily Quota – Buy Orders + Sell Trades + Adjustments

The Daily Quota will be reset every day. Unused Daily Quota will NOT be carried over to next day’s Daily Quota.



Note:Above information is for reference only. The information will be updated from time to time as the implementation progresses and investors can refer to the HKEx website for the latest development of Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect.

Trading Hours
Northbound trading will follow SSE/SZSE’s trading hours. However, SEHK will accept Northbound orders from Exchange Participants (“EP”) five minutes before the Mainland market session opens in the morning and in the afternoon.

SSE Trading Hours:
SSE Trading Session SSE Trading Hours Time for EPs to input Northbound orders
Opening Call Auction 09:15-09:25 09:10-11:30
Continuous Auction
(Morning)
09:30-11:30
Continuous Auction
(Afternoon)
13:00-15;00 12:55-15:00
  • 09:20-09:25: SSE will not accept order cancellation
  • 09:10–09:15; 09:25–09:30; 12:55–13:00: Orders and order cancellations can be accepted by SEHK but will not be processed by SSE until SSE's market open
  • Orders that are not executed during the opening call auction session will automatically enter the continuous auction session


SZSE Trading Hours:
SZSE Trading Session SZSE Trading Hours Time for SEHK Participants to input Northbound orders
Opening Call Auction 09:15-09:25 09:10-11:30
Continuous Auction(Morning) 09:30-11:30
Continuous Auction(Afternoon) 13:00-14:57 12:55-15:00
Closing Call Auction 14:57 – 15:00
  • 09:20–09:25, 14:57–15:00: SZSE will not accept order cancellation
  • 09:10–09:15; 09:25–09:30; 12:55–13:00: Orders and order cancellations can be accepted by SEHK but will not be processed by SZSE until SZSE's market open
  • Any buy or sell orders not executed during the opening call auction session will automatically enter the continuous auction session. Any buy or sell orders not executed during the continuous auction session will automatically enter the closing call auction session
Stock Settlement Date
Investors buying SSE and SZSE Securities on T-day can only sell the shares on and after T+1.
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