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To further present the economic opportunities and introduce the capital market in China to International investors, Shenzhen Stock Exchange (“SZSE”), together with Hong Kong Exchanges and Clearing Limited (HKEX) and China Securities Depository and Clearing Corporation Limited (CSDC), conducted several roadshows on Shenzhen-Hong Kong Stock Connect in Canada and America from September 12 to 19, 2017, and had several conversations respectively with TMX Group, Nasdaq, Inc., CME Group, the New York Branch of Bank of China and other securities exchanges and Chinese-funded overseas financial institutions to explore new modes of cooperation between securities exchanges and promote cooperation among cross-border capital markets.
North America is home to most international institutional investors. After the inclusion of A-shares in the MSCI Emerging Market Index, there is a growing demand on the part of foreign institutional investors for assets allocation in the A-share Market. The roadshows conducted this time were an improvement on the first round successfully run globally last year and were well received, attracting more than 10 major institutional investors from Toronto, New York and Chicago. During the roadshows, presenters introduced the development of the capital market in China and the characteristics of the SZSE market, and had thorough exchanges with foreign investors in respect of market regulation, Shenzhen-Hong Kong Stock Connect Mechanism, corporate governance and investor relations on a one-to-one basis. Most of the foreign investors acknowledged that China’s economy is showing its vitality during the transition period, and that the growth and innovation are sound of companies listed in the Shenzhen market, which represent the new economy in China. For the rapid progress made in corporate governance, information disclosure and investor relation management in the Shenzhen market, foreign investors noted that they shall continue to pay attention to specific stocks in the Shenzhen market.
During the visits, the delegates also conversed with TMX Group, Nasdaq, Inc., and CME Group respectively, introducing the development of the capital market in China and the measures taken by SZSE toward internationalization. Both sides conducted in-depth exchanges and reached consensus on issues concerning promotion of business roadshows, product development, communication of position responsibilities, and establishment of normal communication mechanisms, paving a solid ground for diversified cooperation and cross-border allocation of innovation resources. Furthermore, Shenzhen Securities Information Co., Ltd., a subsidiary of SZSE, has entered into a Cross-border Capital Services Cooperation Memorandum with Bank of China, New York Branch, with an aim to facilitate the integration of entrepreneurship and innovation resources in China and America, and explore and optimize a new system for cross-border investment and financing in characteristic domains where cooperation has been underway between China and developed economies.
Statistics show that the Shenzhen-Hong Kong Stock Connect is operating steadily and orderly in general since it was launched, trading is increasingly bustling. Daily trading volume under the northbound trading rises from CNY1.5 billion in the first month to CNY5 billion, and stays at about CNY4.1 billion on average recently; and daily trading volume under the northbound trading rises from CNY0.5 billion in the first month to CNY2.6 billion, and stays at about CNY2 billion recently. As of September 21, 2017, the accumulated trading volume from northbound trading amounts to CNY577.7 billion, and net purchase volume is CNY125.6 billion; the accumulated trading volume from southbound trading amounts to CNY256.6 billion, and net purchase volume is CNY70.5 billion, with a net inflow of cross-border capital of CNY55.1 billion.
Shenzhen-Hong Kong Stock Connect roadshows are an important step taken by SZSE toward internationalization. By now, SZSE has hosted 20 presentations and 103 ‘one-to-one’ roadshows overseas, with over 600 foreign institutional investors from Asia, Europe, Americas and Oceania involved. Next, SZSE shall, guided by China Securities Regulatory Commission, continue to intensify overseas promotion, perfect the Shenzhen-Hong Kong Stock Connect mechanism, push forward the establishment of a normalized communication mechanism for cross-border institutional investors, actively promote cross-border business communication and cooperation, and further internationalize the capital market in China.
