Financial regulators in Beijing and Hong Kong announced the launch of the Shenzhen-Hong Kong Stock Exchange Connect, slated for December, giving foreign investors access to the world's eighth largest exchange and more importantly China's high growth equity market, writes Anthony Cragg, senior portfolio manager on the Wells Fargo China Equity fund.
The Connect represents the second out of three major milestones for the opening up of China's domestic stock market. The first was the November 2014 launch of the Shanghai-Hong Kong Connect and the final milestone is A-share inclusion in the MSCI emerging market indices. Expansion of the Connect program was widely expected, given less than 18% of the aggregate southbound quota from the Shanghai program was still available. Going forward, aggregate quota will be removed and replaced by a daily quota of RMB13bn and HK$10.5bn for north and southbound flows for each of the Shanghai an...
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