Hong Kong Stock Exchange

Hong Kong Exchanges and Clearing serves as a geographic arbitrage gateway between China's closed capital markets and the international financial system. Over 80% of revenue derives from mainland Chinese companies, a dependency that works precisely because China's capital account remains restricted. Stock Connect links to Shanghai and Shenzhen drive record trading volumes, and geopolitical pressures on US-listed Chinese firms have turned HKEX into the default offshore listing venue. The structural risk is symmetrical: if China opens its capital account, HKEX's intermediary value evaporates; if US-China decoupling deepens, international investors flee. HKEX is publicly traded on its own exchange — a self-referential structure that compounds governance complexity. The 2020 National Security Law altered the investment calculus for institutional investors, embedding a political risk premium in Hong Kong-listed valuations that didn't previously exist.