The Hong Kong Stock Exchange (HKEX) announced on Friday that it will launch a new dual counter trading model on June 19. This model will allow investors to interchange securities listed in both Hong Kong dollar and renminbi counters. The bourse operator had previously disclosed plans to amend the existing model of trading in order to simplify the process for U.S.-listed Chinese firms conducting secondary or primary listings in Hong Kong.
The dual counter market making programme is expected to increase the liquidity of renminbi counters and reduce price differences. HKEX CEO Nicolas Aguzin said the new measures will “give issuers and investors more choice, it will enrich Hong Kong’s RMB products ecosystem… and it will support the ongoing internationalization of RMB.”
A number of major companies, including Ping An Insurance Group Co of China Ltd, AIA Group (OTC:AAGIY) and Tencent, have already submitted their applications for a dual currency counter. Testing rounds will be conducted between May and June to prepare for the launch and to support market participants trading under the model.
The dual counter trading model is expected to bring more choice and convenience to investors, as well as support the internationalization of the renminbi.