Shanghai-HK / Shenzhen-HK Stock Connect

Introduction

Trading Arrangement Overview

To facilitate Hong Kong and overseas investors trading in Shanghai Stock Exchange Securities through Shanghai Connect (i.e. Northbound trading), SEHK has established an SEHK Subsidiary in Shanghai, whose principal function is to receive orders to trade in Shanghai Stock Exchange Securities from SEHK Participants and route them onto Shanghai Stock Exchange’s trading platform for matching and execution on Shanghai Stock Exchange. Upon trade execution, trade confirmation received from Shanghai Stock Exchange will be sent to SEHK Partcipants.

For Shenzhen Connect, SEHK has established another SEHK Subsidiary in Qianhai Shenzhen, whose principal function is to receive orders to trade in Shenzhen Stock Exchange Securities from SEHK Participants and route them onto Shenzhen Stock Exchange’s trading platform for matching and execution on Shenzhen Stock Exchange.

Same as the current arrangement for trading Hong Kong stocks, investors who want to participate in Shanghai and Shenzhen Connect will trade through SEHK Participants. Investors should check with their SEHK Participants on any specific conditions that their SEHK Participants may require them to satisfy before accepting their Northbound orders.

Northbound trades are executed on the Shanghai Stock Exchange/Shenzhen Stock Exchange platform, and therefore follow the Shanghai Stock Exchange/Shenzhen Stock Exchange market practices in general. This Section explains the market practices that are applicable to Northbound and Southbound under Shanghai and Shenzhen Connect.

Shanghai Connect / Shenzhen Connect Information Book

Trading Hours

Northbound trading follows SSE’s and SZSE’s trading hours. However, SEHK will accept Northbound orders from SEHK Participants five minutes before the Mainland market sessions open in the morning and in the afternoon.

  • 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

  • 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

 

Holiday

Until special banking arrangements are established, investors will only be allowed to trade on the other market on days where Hong Kong and Mainland markets are both open for trading, and banking services are available in both Hong Kong and Mainland markets on the corresponding settlement days. This arrangement is essential in ensuring that investors and brokers will have the necessary banking support on the relevant settlement days when they will be required to make payments.

The following table illustrates the holiday arrangement of Northbound trading of SSE/SZSE Securities:

Stock Connect Trading Hour, Trading and Settlement Calendar

Trading Specification

Trading Specification

SSE (Northbound trading) SZSE (Northbound trading) HKStock (Southbound trading)
Qualification
No restriction ChiNext only open to institutional professional investors Institutional investors or holders of personal account with no less than RMB500,000.
Constituent stock of relevant indices
SSE 180 Index and SSE 380 Index All the constituent stocks 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
Hang Seng Composite LargeCap Index and Hang Seng Composite MidCap Index
A+H shares
All the SSE-listed and SZSE-listed A shares that are not included as constituent stocks of the relevant indices but which have corresponding H shares listed on SEHK All the SSE-listed and SZSE-listed A shares that are not included as constituent stocks of the relevant indices but which have corresponding H shares listed on SEHK All H shares that are not included as constituent stocks of the relevant indices but which have corresponding shares in the form of SSE-listed Shares / SZSE-listed Shares
Except
SSE-listed / SZSE-listed shares which are not traded in RMB and SSE-listed / SZSE-listed shares which are included in the “risk alert board" SSE-listed / SZSE-listed shares which are not traded in RMB and SSE-listed / SZSE-listed shares which are included in the “risk alert board" Hong Kong shares that are not traded in Hong Kong dollars (HKD); H shares which have corresponding shares listed and traded on an exchange in Mainland China other than SSE / SZSE; and H shares which have corresponding A shares put under “risk alert”
Daily Quota
The Northbound Daily Quota is set at RMB 13 billion for each of Shanghai Connect and Shenzhen Connect The Northbound Daily Quota is set at RMB 13 billion for each of Shanghai Connect and Shenzhen Connect Southbound Daily Quota is set at RMB 10.5 billion for each of Shanghai Connect and Shenzhen Connect
Number of Tradable Stocks
573 880 SSE : 318
SZSE : 417
Trading Hours
Opening Call Auction 09:15 – 09:25
Continuous Auction (Morning) 09:30 – 11:30
Continuous Auction (Afternoon) 13:00 – 15:00
Closing Call Auction N/A
Opening Call Auction 09:15 – 09:25
Continuous Auction (Morning) 09:30 – 11:30
Continuous Auction (Afternoon) 13:00 – 14:57
Closing Call Auction 14:57 – 15:00
Pre-opening 09:00 – 09:30
Continuous Auction (Morning) 09:30 – 12:00
Continuous Auction (Afternoon) 13:00 – 16:00
Closing Call Auction 16:00 – 16:10
Trading Currency
RMB RMB HKD
Day (Turnaround) Trading
Day trading is not allowed Day trading is not allowed Allowed
Initial Public Offering
Not available Not available Not available
Board Lot Size
100 shares per lot 100 shares per lot Set by listed company
Upper limit for Order size
1,000,000 shares 1,000,000 shares Set by listed company
Price Spread
RMB0.01 RMB0.01 Subject to the stock price
Price Limit
General price limit of ±10% based on previous closing price
Special Price Limit: ±5% for ST and *ST stock
General price limit of ±10% based on previous closing price
Special Price Limit: ±5% for ST and *ST stock
Under Volatility Control Mechanism (VCM), HSI & HSCEI constituent stocks will put into a cooling off period for 5 minutes if the stock price fluctuates more than 10% from the reference price from 5 minutes ago. Maximum of 1 trigger in morning and afternoon session.
Settlement Cycle
Securities settlement on Trade day
Money settlement on T+1 day
Securities settlement on Trade day
Money settlement on T+1 day
Both Securities settlement and Money settlement on T+2 day
Shareholder Voting
Through CCASS’s existing voting functions Through CCASS’s existing voting functions ChinaClear to collect and submit votes

Fees and Levies

Under Shanghai and Shenzhen Connect, Hong Kong and overseas investors will be subject to the following fees and levies imposed by SSE, SZSE, ChinaClear, HKSCC or the relevant Mainland authority when they trade and settle SSE Securities and SZSE Securities:

Items Rate Charged By
Handling Fee 0.00487% of the consideration of a transaction per side SSE / SZSE
Securities Management Fee 0.002% of the consideration of a transaction per side CSRC
Transfer Fee 0.002% of the consideration of a transaction per side ChinaClear Shanghai /
ChinaClear Shenzhen
0.002% of the consideration of a transaction per side HKSCC
Stamp Duty 0.1% of the consideration of a transaction on the seller SAT
Portfolio Fee 0.008% (Charged per month on the basis of the market value of daily portfolio) CCASS

 

Taxes imposed by the State Administration of Taxation (SAT), including stamp duty and dividend tax will also be applied to the Northbound trades and SSE Securities acquired through Shanghai Connect as well as SZSE Securities acquired through Shenzhen Connect. Any additional tax imposed by the SAT, if applicable, will be subject to further clarification with the SAT.