Local Securities Services - Hang Seng Bank

Investment > Securities Services > Local Securities Services

Securities Services

Investors should note that all investment involves risks. Prices of securities may go up as well as down and may even become valueless. Investors should not only base on this website alone to make any investment decision, but should read in detail the relevant risk disclosure statements.

Local Securities Services


Various Trading Channels & Order Types Wide Choice of Trading Channels & Various Order Types.	Share Margin Services Share Margin Services provide you extra funds and help you capture potential investment opportunities.	Instant Order Confirmation Order execution results and IPO subscription allotment results will be sent to your mobile phone via text messages.

Trading Channels

Order Types

Shares Facilities

More Services

Trading Channels

Wide Choice of Trading Channels

Internet via Hang Seng Personal e-Banking¹ through desktop computers, popular tablets and supported mobile handsets

Automated Securities Trading Automated Securities Trading Hotline: (852) 2166 6888¹

Manned Securities Trading Hotline¹

Designated branches¹

Hang Seng Invest Express mobile app¹

Please note that two-factor authentication is mandatory for online investment services. For details, please visit hangseng.com/2FA.

High Trading Efficiency

Trade with Orion Trading Platform – Securities Market (OTP-C) to attain higher efficiency

Notes:

1.After a securities transaction has been executed, the Bank will make available the essential features of the securities transaction as soon as reasonably possible through such means or medium including but not limited to Hang Seng Personal e-Banking, Hang Seng Invest Express mobile app ,Automated Securities Trading Hotline, Instant Order Confirmation Service or personal call provided by the Bank from time to time and at the Bank's discretion. Customers shall check the essential features of the securities transactions by themselves through such means or medium provided by the Bank

Limit Order

Market Order

Auction Trading

Stop Loss Order

All-in-One Order

Market Order

- 1. What is "Market Order" Service?
"Market Order" Service helps customers to buy or sell securities at the prevailing market price immediately. Market order is an order which client does not set a limit price. Such order will be executed at prevailing market price at time of execution. The executed price may not fall within or largely deviate from client's expected price at the time of order placing especially at the beginning of morning trading session as many accumulated pre-market opening orders have to be handled.
- 2. What channels can be deployed to place "Market Order"?
Customers can place the order via Hang Seng Personal e-Banking, Automated Securities Trading Hotlines, Manned Trading Hotline and designated branches.

3. How is "Market Order" being executed?

The Bank will submit your Market Order to the market (i.e. The Stock Exchange of Hong Kong ("SEHK")) with one try only for auto-matching and execution by matching it up to 10 best price queues at SEHK (i.e. the prevailing best queue and up to the 10th queue at 9 spreads away at the time when the market order is processed by the Bank) and up to a maximum of 20 spreads from the prevailing nominal price (as the case may be). Any unfilled quantity of your market order as a result of the above mechanism will be automatically cancelled immediately.

Examples (for illustration only):
Customer has placed a market order to sell of 500,000 shares of Stock XYZ.

Assume that the prevailing nominal price is HK$5 with price spread of HK$0.01.

Under the condition that the Bank will match the market order up to a maximum of 20 spreads from the prevailing nominal price, the Bank will only execute the order when the price is HK$4.80 or above in this example.

Scenario 1

Bid Price	Volume
$5.00	100,000
$4.99	90,000
$4.98	60,000
$4.97	0
$4.96	20,000
$4.95	80,000
$4.94	50,000
$4.93	20,000
$4.92	30,000
$4.91	100,000
$4.90	200,000

Trade executed (Sell)

100,000 shares @HK$5.00

90,000 shares @HK$4.99

60,000 shares @HK$4.98

20,000 shares @HK$4.96

80,000 shares @HK$4.95

50,000 shares @HK$4.94

20,000 shares @HK$4.93

30,000 shares @HK$4.92

50,000 shares @HK$4.91

Total: 500,000 shares

The market order is fully executed by selling all 500,000 shares in the 10 best price queues.

Scenario 2

Bid Price	Volume
$5.00	100,000
$4.99	0
$4.98	0
$4.97	0
$4.96	80,000
$4.95	100,000
$4.94	0
$4.93	10,000
$4.92	30,000
$4.91	60,000
$4.90	100,000

Trade executed(Sell)

100,000 shares @HK$5.00

80,000 shares @HK$4.96

100,000 shares @HK$4.95

10,000 shares @HK$4.93

30,000 shares @HK$4.92

60,000 shares @HK$4.91

Total: 380,000 shares

Unfilled quantity(Sell)

120,000 shares cancelled

Under the above market situation, the Bank will execute the market order by selling 380,000 shares in the 10 price queues. The unfilled quantity of the order (120,000 shares) will be automatically cancelled. If customer would like to sell the remaining unfilled quantity, he will need to place another order.

Scenario 3 The bid price is far away from the nominal price.

Bid Price	Volume
$4.81	200,000
$4.80	50,000
$4.79	100,000
$4.78	0
$4.77	0
$4.76	0

Trade executed(Sell)

200,000 shares @HK$4.81

50,000 shares @HK$4.80

Total: 250,000 shares

Unfilled quantity(Sell)

250,000 shares cancelled

Under the above market situation, the Bank will execute the market order up to a maximum of 20 spreads lower than the prevailing nominal price of HK$5 ( i.e. execute the order when the price is HK$4.80 or above) by selling 250,000 shares in the 10 price queues. The unfilled quantity of the order (250,000 shares) will be automatically cancelled. If customer would like to sell the remaining unfilled quantity, he will need to place another order.

- 4. Will the outstanding quantity of my market order being queued in the market?
No. Any unfilled quantity of your market order will be automatically cancelled immediately and will not be queued in the market. You may place another order as you wish.
- 5. Any "Good Till Order" options?
No. Only "One Day Order" for "Market Order" is available.
- 6. What are the service hours for “Market Order”?
Our service hours are 9:30 am to 12:00 noon and 1:00 pm to 3:59 pm of each trading day.
- 7. Is odd lot trading applicable to "Market Order"?
Odd lot trading is only applicable to sale orders but not purchase orders via "Market Order". For sale orders via "Market Order" which involve odd lot, the odd lots will be sold at the prevailing odd lot market price, which is usually lower than the prevailing board lot market price. If liquidity of that particular stock in the market is low, final execution price can be even lower.
- 8. What if the funding of the settlement account to settle a "Market Order" is insufficient due to volatile market movement?
Taking into account of customer's background and the credit risk involved, the Bank can, at its absolute discretion, purchase in whole or in part of the market order received and the customer has to settle the shortfall before T+2 days. Otherwise, the Bank has the right to sell the related securities at any time to set off the shortfall without prior notice to the customer.

The Bank will reserve the right to sell the related securities to set off the shortfall at any time with the consideration of customer's background and the credit risk involved.

For more information, please call 2822 0228 during office hours or visit our branches.

Auction Trading to Capture Opportunities

Pre-opening session, which is 30 minutes before the commencement of the morning session of the continuous trading session. The closing auction session commences one minute after the continuous trading session and ends at random closing time between 16:08 and 16:10 on a normal trading day (12:08 and 12:10 on a half trading day) as determined by HKEX system.

During pre-opening session and closing auction session, you can place two types of orders: "At-auction Order" & "At-auction Limit Order". (Please note that "Order Watching Service" option is not applicable)

At-auction Order

A market order without a specified price with higher auction matching priority than At-auction Limit Order. During closing auction session, new at-auction order can only be placed on stocks eligible for closing auction. The executed price / volume will be determined on the final Indicative Equilibrium Price (IEP)* and Indicative Equilibrium Volume (IEV)#. Depending on market conditions, not all At-auction orders can be matched. If the order placed at either pre-opening session or closing auction session is unfilled at the end of that session, the order will be cancelled automatically . Please note that the executed price (i.e. final IEP) is not known at the time of order input and may not fall within or largely deviate from your expected price range, especially for orders executed in pre-opening session. The Bank reserves the right to sell the related securities to setoff the cash shortfall.

At-auction Limit Order^Δ

A limit order with a specified price. The executed price / volume will be determined on the final Indicative Equilibrium Price (IEP)* and Indicative Equilibrium Volume (IEV)^#. At pre-opening session, unfilled or partially-filled orders will continue to be processed at your specified price in the continuous trading session.
For stocks eligible for closing auction trading, if the corresponding order cannot be fully executed in the continuous trading session and the order price is within HKEX permissible price limit, the order will be carried forward to the closing auction session by HKEX automatically. During closing auction session, new at-auction limit order can be placed on stocks eligible for closing auction trading but the order price must be within HKEX permissible price limit. When auction matching is completed, unfilled order which expires on the same day will be cancelled while the outstanding multiple day at-auction limit order will be processed in the next pre-opening session. For stocks not eligible for closing auction trading, if the corresponding order cannot be fully executed in the continuous trading session, unfilled orders which expires on the same day will be cancelled after continuous trading session ends while the outstanding multiple day At-auction Limit Order will be processed in the next pre-opening session.

Notes:

Indicative Equilibrium Price (IEP) - Price where maximum number of shares can be traded if order matching occurs at that time. IEP will be calculated only if the highest bid price of the buy At-auction Limit Order is equal to or higher than the lowest ask price of the sell At-auction Limit Order. During the pre-opening session or closing auction session, the IEP and IEV# will be continuously re-calculated every time a new order is entered until the completion of order matching. The final IEP (executed price) is calculated by The Stock Exchange of Hong Kong Limited ("HKEX").

Indicative Equilibrium Volume (IEV) - Quantity of shares that could be matched at the IEP. During the pre-opening session or closing auction session, the IEP and IEV will be continuously re-calculated every time a new order is entered until the completion of order matching.

During pre-opening session, in order to ensure that we can execute At-auction Limit Order with efficiency, Hang Seng Bank Limited will only send the orders within 500 spreads of IEP or Nominal Price or Previous Closing Price as the case may be, if available, to the HKEX for queuing. Note: HKEX system rejects the order price of at-auction limit which deviates 9 times or more from the previous closing price or the nominal price or final IEP (as the case may be), if available. In this case, the Bank will not process your order and your order will become unexecuted. Please check the status of your instruction by order status enquiry function. You can place another new at-auction limit order if you need to. The Bank reserves the right to amend the above operation from time to time without prior notice.

Auction Trading Timetable

To fully capture the opportunities in the pre-opening and closing auction session for trading securities, you can refer to the following timetables for auction trading.

Pre-opening Session Timetable

Time Range for Bank Processing	Period	Order Type
9:00 - 9:14 am	Order Input Period^	At-auction
9:00 - 9:14 am	Order Input Period^	At-auction Limit
9:14 - 9:19 am	Pre-order Matching Period^	At-auction
9:14 - 9:19 am	Pre-order Matching Period^	At-auction Limit
9:19 - 9:28 am	Order Matching Period⁺	At-auction
9:19 - 9:28 am	Order Matching Period⁺	At-auction Limit
9:28 - 9:30 am	Blocking Period	At-auction
9:28 - 9:30 am	Blocking Period	At-auction Limit

Closing Auction Session Timetable

Time Range for Bank Processing	Period	Order Type
4:00 - 4:01 pm (Or 12:00 pm - 12:01 pm on half trading day)	Reference Price Fixing Period	At-auction
4:00 - 4:01 pm (Or 12:00 pm - 12:01 pm on half trading day)	Reference Price Fixing Period	At-auction Limit
4:01 - 4:05 pm (Or 12:01 pm - 12:05 pm on half trading day)	Order Input Period^	At-auction
4:01 - 4:05 pm (Or 12:01 pm - 12:05 pm on half trading day)	Order Input Period^	At-auction Limit
4:05 - 4:08 pm (Or 12:05 pm - 12:08 pm on half trading day)	No-cancellation Period^	At-auction
4:05 - 4:08 pm (Or 12:05 pm - 12:08 pm on half trading day)	No-cancellation Period^	At-auction Limit
4:08 – 4:10 pm (Or 12:08 pm - 12:10 pm on half trading day)	Random Closing Period⁺	At-auction
4:08 – 4:10 pm (Or 12:08 pm - 12:10 pm on half trading day)	Random Closing Period⁺	At-auction Limit

IEP and IEV will be calculated and displayed continuously

HKEX's trading system host will determine the final IEP at this period and orders will be matched with the order type, price and time by order sequence. The result of executed orders will be transmitted to the Exchange Participants.

Various Trading Channels Available for Auction Trading

You can place auction orders through all available trading channels, including:

Hang Seng Personal e-Banking¹

Automated Securities Trading Hotline¹

Manned Hotline¹

Designated branches¹

Notes:

After a securities transaction has been executed, the Bank will make available the essential features of the securities transaction as soon as reasonably possible through such means or medium including but not limited to Personal e-Banking, Automated Securities Trading Hotline, Instant Order Confirmation Service or personal call provided by the Bank from time to time and at the Bank’s discretion. Customers shall check the essential features of the securities transactions by themselves through such means or medium provided by the Bank.

Should you have any queries on the above service, please contact our Customer Service Hotline 2822 0228. For details of the trading mechanism of HKEX during pre-opening session and closing auction session, please visit the website of HKEX: www.hkex.com.hk.

What is Stop Loss Order?

1. Stop Loss Order Feature & Handling Logic

Stop Loss Order is a sale instruction to preset the selling price range, i.e. Stop Loss Price and Lowest Selling Price, for specific securities in your portfolio. Once the current nominal price of the securities hits or lower than your pre-defined Stop Loss Price, your sale order will be placed to market at the prevailing market price (i.e. sale order is triggered). The Bank will try its best to process your order but it may NOT be performed due to fluctuation in stock price, insufficient market liquidity, system failure and any event beyond the control of the Bank. The order may be fully executed, partially executed or unexecuted. The executed price may also be BETTER THAN, EQUAL TO OR WORSE THAN your specified Stop Loss Price but not lower than your Lowest Selling Price. Once the Stop Loss Order is triggered, regardless of the final execution result at the end of the trading day, the order will be lapsed and cancelled and will not be carried forward to next trading day.

If the order is not executed even at the Lowest Selling Price, such Stop Loss Order will be treated as a Normal Limit Order at the Lowest Selling Price and will be placed to the market for queuing. Once the Stop Loss Order is triggered, regardless of the final execution result at the end of the trading day, the order will be lapsed and cancelled and will not be carried forward to next trading day.

For multiple-day order, once your order is triggered regardless of the final execution result, the order will be lapsed and cancelled and will NOT be carried forward to next trading day.

Our securities trading system will check the stock price of the Stop Loss Order continuously and transmit them to OTP-C trading system during continuous trading session in straight-through mode in ascending order input time. However, if the relevant stock has NO BID, such Stop Loss Order will be handled manually.

The acceptance range for Stop Loss Price is defined within 11 spreads and 50 spreads (The Bank reserves the right to change the acceptance range for Stop Loss Price without notice) away from current Nominal Price but it must not be lower than HKD0.01. The Lowest Selling Price can be Lower Than or Equal To the Stop Loss Price but it cannot be lower than HKD0.01. Based on the above arrangement, we do not accept any Stop Loss Order if the current nominal price of such stock is lower than HKD0.02.

To amend Stop Loss Order which is pending for execution, please cancel the order first. Upon the cancellation is duly handled, then place a new order again. Only the outstanding Stop Loss Order can be cancelled.

Only board lot quantity will be accepted.

The Stop Loss Order is not applicable to pre-opening session and closing auction session. But Final Indicative Equilibrium Price (IEP) will be treated as the Nominal Price when market open, therefore the Final IEP (if any), will be used to check against the Stop Loss Price. In case, the Final IEP falls at or below your Stop Loss Price, the Stop Loss Order will be placed to market after the morning trading session starts. Once the Stop Loss Order is triggered, regardless of the final execution result at the end of the trading day, the order will be lapsed and cancelled and will not be carried forward to next trading day.

2. Service Hour

For Hang Seng Personal e-Banking :	24-hours a day except 4:00 pm - 4:10 pm on Trading Day
For Automated Securities Trading Hotline (21666888) :	Trading Day 8:00am to 3:59pm
For Manned Securities Trading Hotline (25323838) :	Trading Day 8:45am to 5:40pm except 4:00pm to 4:10pm
For designated branches :	Trading Day 9:00am to 5:00pm except 4:00pm to 4:10pm

3. Capture example for Stop Loss Order

Current specific securities Nominal Price :	HKD2.27
Price Range between HKD0.50 - HKD10.00 :	HKD0.01 per spread
Stop Loss Price :	Within 11 spreads and 50 spreads away from current Nominal Price, but it must not be lower than HKD0.01
Lowest Selling Price :	Lower than or equal to the Stop Loss Price but it cannot lower than HKD0.01

	Stop Loss Price Range (HKD)	Lowest Selling Price Input Range (HKD)	Order Accept / Reject	Remarks
Case 1	Between HKD2.17 and HKD1.78(11 spreads to 50 spreads away from current Nominal Price)	Between HKD2.17 and HKD0.01	Accept	If the Stop Loss Price is set to HKD2.17, the order will be sent to market for execution if the Nominal Price is fallen to HKD2.17 or lower.
Case 2	Higher than HKD2.17(less than 11 spreads away from current Nominal Price)	Any price	Reject	The defined Stop Loss Price is less than 11 spreads away from Nominal Price.
Case 3	Lower than HKD1.78(more than 50 spreads away from current Nominal Price)	Any price	Reject	The defined Stop Loss Price should not more than 50 spreads away from Nominal Price.
Case 4	Between HKD2.17 and HKD1.78(11 spreads to 50 spreads away from current Nominal Price)	HKD 2.18 (higher than Stop Loss Price)	Reject	Lowest Selling Price must be equal to or lower than Stop Loss Price but it cannot be lower than HKD0.01. Based on the above arrangement, we do not accept any Stop Loss Order if the current nominal price of such stock is lower than HKD0.02.
Case 5	Between HKD2.17 and HKD1.78(11 spreads to 50 spreads away from current Nominal Price)	Lower than HKD0.01	Reject	Lowest Selling Price must be equal to or lower than Stop Loss Price but it cannot be lower than HKD0.01. Based on the above arrangement, we do not accept any Stop Loss Order if the current nominal price of such stock is lower than HKD0.02.

4. Order Triggering and Execution Logic

All-in-One Order

All-in-One Order allows you to place a purchase order and a sale order of same security in one go. Once the purchase order is FULLY executed before the market closes on the specified expiry date, ALL the shares/units bought will be processed automatically according to your preset selling instruction.

You can place your preset selling instruction and experience flexibility in securities trading without focusing on changes on securities price.

All-in-One Order involves 2 order instructions⁽¹⁾:

(1)	Limit Purchase Order	Purchase price cannot be lower than 50% of current ask price.
(2)	Limit Sale Order or Stop Loss Order	Limit Sale Order Selling price cannot be higher than 1 time of current bid price. Stop Loss Order Customers are required to preset the selling price range i.e. Stop Loss Price and Lowest Selling Price: Stop loss price is defined within 11 spreads and 50 spreads away from current nominal price. Lowest selling price can be lower than or equal to stop loss price but it cannot be lower than HK$0.01.

Note: Quantity and expiry date of the purchase order and sale order must be the same. Upon receipt of your instruction, a purchase order reference number will be given to you up-front.

Example on How to Process the All-in-One Order

Assume a customer would like to buy 3,000 shares of Stock A at HK$14 and sell at HK$14.50. The order will be expired on 25 February.

When the purchase order is FULLY executed before the market closes on the specified expiry date (i.e. successfully bought 3,000 shares of Stock A on or before 25 February), the system will process the selling instruction automatically and generate a related sale order (i.e. sell 3,000 shares of Stock A at HK$14.50).

For a multiple day order, regardless of the final execution result, the order will be lapsed and cancelled at the close of market on the expiry day or at the time your cancellation request is duly handled, whichever is the earlier. If the purchase order is FULLY executed before the market closes on the specified expiry date and the related sale order is a Stop Loss Order, once the Stop Loss Order is triggered and sent to the market, this order will be lapsed and cancelled after the market close and will NOT be carried forward to the next trading day.

Handling of All-in-One Order

Amendment is not provided. For All-in-One Order, regardless of whether the purchase instruction or the sale instruction is pending for execution, you cannot amend the order. You can cancel the order and place a new order once the cancellation is duly handled.

Orders are not applicable to pre-opening session and closing auction session. Orders will be processed in the continuous trading session.

Orders have to be processed automatically by the system. We do not accept All-in-One Order placement with exceptions which require manual handling, including but not limited to odd lots, prices below HK$0.01, quantities over 3,000 lots, estimated settlement amount that cannot cover the charges, and orders on securities that do not have a previous closing price etc.

Wide Choice of Trading Channels

Hang Seng Personal e-Banking⁽²⁾

Automated Securities Trading Hotline⁽²⁾

Manned Securities Trading Hotline⁽²⁾

Designated branches⁽²⁾

Notes:

(1)

The Bank reserves the right to change the spreads without prior notice.
All-in-One Order involves 2 instructions, one purchase order and one sale order, both the purchase and sale orders are subject to the brokerage fee and the transaction charges charged by third parties such as Transaction Levy, Stamp Duty and Trading Fee, etc.

(2)

After a securities transaction has been executed, the Bank will make available the essential features of the securities transaction as soon as reasonably possible through such means or medium including but not limited to Hang Seng Personal e-Banking, Automated Securities Trading Hotline, Instant Order Confirmation Service or personal call provided by the Bank from time to time and at the Bank’s discretion. Customers shall check the essential features of the securities transactions by themselves through such means or medium provided by the Bank.

The Bank will try its best to process your order but it might NOT be performed due to fluctuation in stock price, insufficient market liquidity, system failure and any event beyond the control of the Bank. The order may be FULLY EXECUTED, PARTIALLY EXECUTED or UNEXECUTED. The executed price of Stop Loss Order may also be BETTER, EQUAL TO OR WORSE THAN your specified Stop Loss Price but not lower than your Lowest Selling Price.

Important Note:
Customers shall read in detail and understand the special features and handling procedures content before using All-in-One Order.

Share Margin

Overdraft
Facility

Trading Limit

Share Margin

The prices of securities fluctuate, sometimes dramatically. Margin trading in securities involves significant risk and losses may exceed the value of your collateral. Contingent orders may not necessarily limit losses as market conditions may make it impossible to execute contingent orders. Additional margin deposits may be required at short notice. Your collateral may be liquidated without your consent and you will remain liable for any resulting deficit in your account. You should therefore carefully consider whether margin trading in securities is suitable for you in light of your own financial position and investment objectives. It is as likely that losses will be incurred rather than profit made as a result of dealing in securities.

Hang Seng Share Margin Services provide you extra funds and help you capture potential investment opportunities.

Preferential Interest Rate¹

Preferential interest rate is offered and interest will only be charged on the daily outstanding debit balance in the Share Margin Settlement Account, the interest rate per annum can be as low as Prime Rate – 1%.

Enhance Buying Power

The margin ratio is 40% - 60% of marginable stocks² which provides you up to 60% extra funds to buy marginable stocks. No minimum monthly repayment amount is required.

Instant Order Confirmation Service³

Latest order execution results will be sent to you via text messages to your mobile phone

Margin Call / Force-sale⁴

If the price of your marginable stock falls and the Margin Loan-to-Value Ratio reaches:
62% to less than 70%, a text message will be automatically sent to your mobile phone keep you informed of your margin position; 70% or above, the Bank will force sell customer’s stock without prior notice and a text message will be sent to your mobile phone to inform you about the force-sale status of the stock.

Wide Choice of Trading Channels

Internet via Hang Seng Personal e-Banking through desktop computers, popular tablets and supported mobile handsets Automated Securities Trading Hotline Manned Securities Trading Hotline Designated branches

As our Integrated Account customers, you can set up a Hang Seng Share Margin Account ⁵ at our branches.

For more information, please call 2822 0228 during office hours or visit our branches.

Frequently Asked Questions

- 1. General Questions
1.What is margin trading? What are the differences between cash and margin trading?
With margin trading, you only need to put up a fraction of the total cost when you buy shares. Because you have borrowed money to buy shares, these shares would be held as collateral. For cash trading, you must have sufficient funds in your settlement account when you place a buy order.

2.How does leverage work for margin trading?
For example, you want to buy 400 shares of company A at HKD100 each. This will cost you HKD40,000. If you use margin lending facility to purchase these shares and the margin ratio of the stock is 60%, you are only required to pay HKD16,000 to buy 400 shares of company A. If the share price of Company A rises and your shares are sold at HKD110 each, not taking into account of transaction charges and the share margin interest, you can earn a profit of HKD4,000. With a principal amount of HKD16,000, the return is around 25%. Compared with the return of 10% with cash trading, the return is 1.5 times more.

Remark: All the figures on the above example is for illustrative purpose only. Brokerage and other transaction charges are not included. (Please note that it is as likely that losses will be incurred rather than profit made as a result of dealing in securities and losses may even exceed the value of your collateral.)
- 2. Trading
1.What percentages of margin ratio are being offered for your share margin services?
The margin ratio offered by our share margin services is 40%-60% of marginable stocks.

2.Is the settlement day for purchased shares through margin trading at T+2?
Yes.

3.Can I purchase shares with cash through margin trading service?
Yes. But please note that all shares purchased through the margin trading account (whether purchased with margin lending facility or not) will be used as collateral. This means these shares may also be sold during forced liquidation should such situation occur.

4.If I deposit more cash than it is required during purchase of shares, my margin facility amount (i.e. the "Maximum Facility Amount") will not be fully utilised. Can I utilise the unused margin facility amount for my next share purchase?
Yes.
- 3. Margin Top Up
1. Besides SMS, will you call me by phone separately for margin top up?
Besides SMS, Hang Seng Bank will not notify you separately for margin top up. Therefore you should be fully aware of the market situation and your account status. Please note that if the price of the marginable stock falls, the Maximum Facility Amount will be reduced automatically. You should maintain your account at a safety level (for example, debit balance below the Maximum Facility Amount ) because if the Loan-to-Value ratio increases to 70%, we will liquidate your account without prior notice.

2. If I receive a margin call, do I have to make a margin top up? How much time do I have?
Our margin call is to remind you of your current account status and suggest you to make a margin top up. Your account will be liquidated without prior notice when your Loan-to-Value ratio rises to 70%. In addition, you should be fully aware of the market situation and your account status. You should maintain your account balance at a safety level (for example, debit balance below the Maximum Facility Amount) to avoid forced liquidation.

3. Why is it that I sometimes do not receive any SMS?
Your mobile phone must have sufficient Short Message Memory. Otherwise, you will not be able to receive any new SMS. You should delete old messages regularly so your mobile phone will have enough Short Message Memory. In addition, unless your mobile phone has set up SMS diversion service, you will not be able to receive any SMS from us if you transfer the number registered with our Bank to another fixed line phone number or mobile phone number.

4. If I am abroad and have registered for roaming service, will I receive any margin calls?
Under normal situation, you will still receive your SMS. Most telecom service providers will not levy extra charges for SMS via roaming service. Customers should check with their telecom service providers for full details.

5. Can I deposit a cheque or stocks for margin top up?
You should use cash to top up your margin account. Hang Seng Bank will not calculate your Loan-to-Value Ratio with uncleared cheque or unrecognised stock deposit. It is only after the cheque has been cleared and the stocks confirmed before your Loan-to-Value Ratio can be lowered.

6 Through which channels can I top up my account?
Besides all the Hang Seng Bank branches, you can top up your account through ATM, Phone Banking Service and Hang Seng Personal e-Banking.

7. How can I receive margin call messages?
Customers are required to register for the "Instant Order Confirmation" service using a valid mobile phone number (either a Hong Kong or overseas mobile number) and are responsible for any fees and charges which may be levied by the relevant telecom company from time to time. If an overseas mobile number is provided, customers are reminded to check with their telecommunication vendor on the support to receive SMS from Hong Kong.
- 4. Forced Liquidation
1.When my Loan-to-Value Ratio rises to 70% or above, will you liquidate my account immediately?
Hang Seng Bank will conduct a valuation on your shares at around 11:00 am, 12:00 noon, 3:00 pm and after 4:30 pm. If your Loan-to-Value Ratio rises to 70% or above, we will liquidate your account without prior notice. However when the market is volatile, we will conduct a valuation on your shares anytime and if your Loan-to-Value Ratio rises to 70% or above, we will liquidate your account without prior notice. Because valuation and forced liquidation take time, the 70% Loan-to-Value Ratio is not indicative that the liquidated price and valuation price are equivalent.

Notes:
Regarding the securities valuation conducted at noon and in the afternoon, if the Loan-to-Value ratio rises to 70% or above and customer deposits sufficient cash to bring the debit balance down to a level within the Maximum Facility Amount before market opens in the afternoon or before the next trading day, your account will not be liquidated before the market opens in the afternoon or on the next trading day.

2.When will forced liquidation stop?
Hang Seng Bank will sell the shares in your account at their market value in board lot until the debit balance is below the Maximum Facility Amount. Therefore, after forced liquidation, the Loan-to-Value ratio may fall below the margin ratio.

3.Will you notify me before forced liquidation takes place?
No. Therefore you should be fully aware of the market situation and your account status. You should maintain your debit account balance at a safety level (for example, below the Maximum Facility Amount) because if the Loan-to-Value ratio increases to 70%, we will liquidate your account without prior notice.

4.Is it true that if my Loan-to-Value ratio is always below 70%, you will not liquidate my account?
No. If your Loan-to-Value ratio maintains at a level beyond the required margin ratio and not more than 70% for a continuous period of 90 days or such other period as may be prescribed by us in our absolute discretion from time to time, we still need to liquidate your account. However we will normally inform you two weeks beforehand so that you can deposit sufficient cash into your account to bring your debit balance to a level below the Maximum Facility Amount. In addition, if we, in good faith, consider that the market conditions are too unstable or unfavourable or abnormal or are likely to expose you to unacceptable risk or heavy losses, we will also liquidate your account.
- 5. Fees & Charges
1.Why are there two different tiers of interest rate charges?
If the utilized loan exceeds the Maximum Facility Amount, the account will be overdrawn. A higher interest rate (the Bank’s prevailing unauthorized overdraft interest rate) will be applied on the overlimit (the loan amount that is greater than the Maximum Facility Amount).

2.Is the brokerage fee for share margin trading service and securities trading services the same?
Except for interest charges, all fees for Share Margin Trading Account and Securities Account are the same.

3.If I sell the shares purchased on the same transaction date, am I required to pay the interest for this margin trading transaction?
No interest will be charged for this transaction if the sale proceeds can cover the entire overdrawn amount.

Notes:

The Bank reserves the right to revise margin loan interest rates, the list of marginable stocks and the margin ratios from time to time.

Notes:

1.Prime Rate refers to the Hong Kong Dollar Prime Lending Rate as quoted by Hang Seng Bank Limited ("the Bank") from time to time. The Bank reserves the right to revise margin loan interest rates from time to time. All shares purchased through the margin trading account (whether purchased with margin lending facility or not) will be used as collateral.

2.The Bank reserves the right to revise the list of marginable stocks and the margin ratios from time to time.

3.Customers are required to register for the "Instant Order Confirmation" service using a valid mobile phone number (either a Hong Kong or overseas mobile number) . Customers are responsible for any fees and charges which may be levied by the relevant telecom company from time to time. If an overseas mobile number is provided, customers are reminded to check with their telecommunication vendor on the support to receive SMS from Hong Kong. Once the Instant Order Confirmation Service is applied and taken effect, you will be notified through this service of the execution results of your purchase / sale orders for local securities and IPO subscription allotment result.

4. The Bank will perform at least 4 real-time stock revaluations every day to calculate the Margin Loan-to-Value Ratio to determine whether customers require to cover the excess.

Formula for calculation of Margin Loan-to-Value Ratio: Margin Loan ÷ Total Market Value of your Marginable Stocks

If Margin Loan-to-Value Ratio rises to 70% or above, the Bank reserves the right to sell customer's securities without prior notice in order to restore the original margin ratio.

The Bank will calculate the Margin Loan-to-Value Ratio based on customer's available balance. It is recommended that customers should deposit cash into their settlement accounts when a reminding margin call is received.

Example:

If your margin loan is HKD50,000 and the market value of your marginable stocks is HKD100,000, the Margin Loan-to-Value Ratio is 50,000 ÷ 100,000, i.e. 50%.

Suppose the market value of your marginable stocks falls to HKD70,000, your Margin Loan-to-Value Ratio increases to 71.4% and the Bank has the right to sell your securities in order to restore the original Margin Loan-to-Value Ratio

5.Share Margin Account is only available to customers with Hong Kong residential and correspondence addresses.

Important Note:
Hang Seng Share Margin Services are provided subject to the Terms and Conditions for Share Margin Services. Particulars of the Services shall be subject to the said Terms and Conditions.

Overdraft Facility

You can pledge¹your securities to obtain a standby overdraft facility of up to 50% of the market value of your securities for added investment flexibility

Notes:

1.The Bank will have absolute discretion to prescribe and change the type of stocks and the respective overdraft limit.

Trading Limit

Invest in a more flexible way

Share Trading Limit Service¹ provides you with a trading limit to buy securities even if there are insufficient funds in your settlement account at the time of order placement that brings you with more financial flexibility.

Provided that the total settlement amount (including brokerage fee, securities deposit charges and any third party transaction charges such as Transaction Levy, Stamp Duty and Trading Fee, etc ) for purchasing the securities does not exceed the total buying power, which is calculated on the aggregate total of the following items (1) the approved Share Trading Limit, (2) the sale proceeds from securities sold through the Bank and pending for settlement, and (3) the total available funds of your account, the Bank will accept the purchase orders. Subsequently, you have to deposit the total settlement amount (including the relevant fees and charges) of the securities purchase orders into your settlement account on or before securities settlement date (i.e. on or before T + 2 days)².

Increase Buying Power

Share Trading Limit Service increases your total buying power by allowing you to use the limit granted to buy securities in addition to your own funds. Prestige Banking customers may apply for a minimum limit of HK$500,000; whereas Preferred Banking customers may apply for a minimum limit of HK$100,000. Once your application is approved, you may use the Share Trading Limit to buy securities immediately.

Free Service

No service fee is charged for applying for the Share Trading Limit Service.

Instant Order Confirmation Service

You are required to apply for Instant Order Confirmation Service³ at the same time of applying Share Trading Limit Service. The Bank will send the text message to your mobile phone regarding Share Trading Limit Service (e.g. message about force liquidation). Besides you will also be notified the execution results of your securities orders and IPO subscription allotment result via the text messages to your mobile phone.

Please visit our branches to apply for the Share Trading Limit Service.

For more information, please call 2822 0228 during office hours or visit our branches.

Frequently Asked Questions

- 1. What is Share Trading Limit Service?
Share Trading Limit Service provides a more flexible securities trading service to customers of the Bank. When a customer places Hong Kong dollars settled local securities’ purchase orders through the Bank, he is not required to have sufficient funds in his settlement account at the time of the order placing , he may use the Share Trading Limit granted to place the buy order first. Provided that the total settlement amount (including brokerage fee, securities deposit charges and any third party transaction charges such as Transaction Levy, Stamp Duty and Trading Fee, etc ) for purchasing the securities does not exceed the total buying power (which is calculated on the aggregate total of the following items (1) the approved Share Trading Limit, (2) the sale proceeds from securities sold through the Bank and pending for settlement, and (3) the total available funds of the customer's account), the Bank will accept the purchase orders. Subsequently, the customer has to deposit the settlement amount and relevant fees and charges (including brokerage fee, securities deposit charges and any third party transaction charges such as Transaction Levy, Stamp Duty and Trading Fee, etc) into the settlement account on or before the securities settlement date (i.e. on or before T + 2 days). If customer fails to deposit the required amount of the purchase orders into the settlement account on time, the customer is required to pay the interest accrued (charged at the Bank’s prevailing unauthorized overdraft interest rate) from the settlement date until full repayment of the outstanding balance (excluding the date of full repayment).
- 2. Is it necessary to apply for Share Trading Limit Service beforehand?
Yes, customers can apply the service through our branches. At this stage, the service is only applicable to Prestige Banking and Preferred Banking customers who must reside in Hong Kong with a Hong Kong correspondence address. They must open a Prestige Banking/ Preferred Banking Integrated Account and activate its securities account , complete the "Application Form of Share Trading Limit Service" and confirming the acceptance of the relevant terms and conditions that are in force from time to time at our branches. Customers are also required to register for our Instant Order Confirmation Service in order to apply for the Share Trading Limit Service. The Bank will handle the application in accordance with our normal approval process upon customers' applications received.

3. How much is the Share Trading Limit amount (“Limit”) to be granted to the customer?

- 4. Will customers be charged any fees if they apply for the Share Trading Limit Service?
No service fee is charged for application for the Share Trading Limit Service.
- 5. How does the Bank calculate the buying power of customers' securities accounts?
The buying power of each securities account is calculated on the aggregate total of the following items:
1. Approved Limit
2. The sale proceeds from securities sold through the Bank and pending for settlement
3. Total available funds in the customer's account
(Remark: Required amount for purchase of securities will be put on hold in the same sequence as mentioned above at the time of placing purchase order for securities by the customer).
- 6. Can the Limit be used to buy any kinds of securities?
At present, it can only be utilized for purchasing local securities which are settled in Hong Kong dollars. Nonetheless, it is not applicable to Callable Bull/Bear Contracts (CBBCs), warrants, right shares, Exchange Traded Fund (settled in non-HKD currencies), iShares (settled in non-HKD currencies), Hong Kong Linked retail bonds, Government of HKSAR retail bonds/ibonds & locally traded overseas stocks(e.g. Local Listed NASDAQ stocks). The Bank has the discretion to make any adjustments without prior notice to customers.
- 7. What action will be taken by the Bank if the customer fails to settle the amount payable for purchasing the securities before settlement on T + 2 days?
If any unauthorised overdraft occurs due to a default in payment of the settlement amount and the relevant fees and charges of the purchase order on T + 2 days, customer will be charged with an overdraft interest (charged at the Bank’s prevailing unauthorized overdraft interest rate). The Bank has the right to cancel all the pending purchase orders which have been made with the Limit before the stock market opens in the morning trading session on T + 3 days and the provision of the Share Trading Limit Service shall be suspended. Before the end of the morning trading session on T + 3 days, if the default amount remains unsettled by the customer or the customer fails to sell such shares with sale proceeds sufficient to cover the default amount, the Bank has the right to perform forced liquidation after the stock market opens in the afternoon trading session on T + 3 days. Upon the completion of the forced liquidation process, the Bank may terminate the provision of the Share Trading Limit Service to the relevant customer at any time.
- 8. Will the Share Trading Limit Service be cancelled due to market conditions?
The Bank has the discretion to terminate the provision of the Share Trading Limit Service to all customers under any conditions (for example, the Bank considers that there is a high risk of loss to the Bank and/or the customer in view of the prevailing market condition being unfavorable or adverse). A SMS will be sent to customers’ mobile phone number registered for the Instant Order Confirmation Service with the Bank notifying the termination of the Share Trading Limit Service. For all purchase orders (include pending & executed purchase orders), sufficient funds must be available for settlement. The Bank has the discretion to cancel any pending purchase orders if available funds are insufficient.
- 9. Do customers enjoy perceptual unconditional access to the Share Trading Limit Service after approval?
The Bank will conduct a review on each customer's account from time to time. If the minimum requirement cannot be met (e.g. the total asset balance of the customer is less than 1 time of the Limit granted or other conditions which are determined by the Bank from time to time), the Bank has the discretion to terminate the provision of the Share Trading Limit Service , reduce the Limit granted to the relevant customer or make any other arrangement as the Bank considers appropriate at any time without prior notice.

The Share Trading Limit Service will be terminated with immediate effect if customer is no longer a Prestige / Preferred Banking customer for whatever reason (including, without limitation, the change of account status).　 Please note that, the maximum Limit granted to Preferred Banking customers is HKD1,500,000, so if customer changed the integrated account type from Prestige Banking to Preferred Banking, the Limit granted may be reduced.

	Prestige Banking customers	Preferred Banking customers
Minimum Limit	HKD500,000	HKD100,000
Total asset balance requirement	HKD500,000	HKD100,000
Ratio of the total asset balance requirement to the Limit	1x	1x

Notes:

1.Share Trading Limit Service is only applicable to Prestige Banking and Preferred Banking customers for their application and usage. You must reside in Hong Kong with a Hong Kong correspondence address, open a Prestige Banking/ Preferred Banking Integrated Account and activate its securities account at our branches in order to apply for Share Trading Limit Service.

2.If you fail to deposit the settlement amount and relevant fees and charges (including brokerage fees, securities deposit charges and any third party transaction charges such as Transaction Levy, Stamp Duty and Trading Fee, etc ) into the settlement account on or before the securities settlement date (i.e. on or before T+2 days), you are required to pay the interest accrued from the settlement date till full repayment of the outstanding balance (excluding the date of full repayment).

3.Customers are required to register for the "Instant Order Confirmation" service using a valid mobile phone number (either a Hong Kong or overseas mobile number) . Customers are responsible for any fees and charges which may be levied by the relevant telecom companies from time to time. If an overseas mobile number is provided, customers are reminded to check with their telecommunication vendor on the support to receive SMS from Hong Kong. Once the Instant Order Confirmation Service is applied and taken effect, you will be notified through this service of the execution results of your purchase / sale orders for local securities and IPO subscription allotment result.

Instant Order
Confirmation

RMB Securities

e-Statement
/e-advices

Other Information

All investments involve risks (including the possibility of loss of the capital invested). Prices of securities and investment products may go up as well as down and may even become valueless. Past performance information presented is not indicative of future performance. The risk disclosure statements and the offering documents of the relevant securities and investment products should be read in detail before making any investment decision.

Instant Order Confirmation Service allows you to receive the most up-to-date information via text messages sent to your mobile phone, including:

Execution results of your Securities, Investment Funds and SimplyFund trading orders

IPO subscription allotment result
Bank will send execution status update on securities order by SMS to designated customer segment as pre-defined by the Bank from time to time including but not limited to customer who maintains an Integrated account with securities account and is a registered Personal e-Banking user with a valid mobile phone number provided to the Bank (“designated customers”). No charge is applied and no pre-registration is required for these designated customers. Other non-designated customers can also enroll for the service through various channels:

Designated branches

Automated Securities Enquiry Hotline 2166-6822 (applicable to Securities Service only

For more information, please call 2822 0228 during office hours or visit our branches.

Notes:

Customers are required to register for the "Instant Order Confirmation" service using a valid mobile phone number (either a Hong Kong or overseas mobile number) . Customers are responsible for any fees and charges which may be levied by the relevant telecom companies from time to time. If an overseas mobile number is provided, customers are reminded to check with their telecommunication vendor on the support to receive SMS from Hong Kong.

Once the Instant Order Confirmation Service is applied and taken effect, you will be notified through this service of the execution results of your purchase / sale orders for local securities and IPO subscription allotment result.

Risk of Investing in RMB Securities

RMB Securities Trading Services

Customers can trade RMB securities listed in Hong Kong Exchanges and Clearing Limited ("HKEX") via us.

Transactions of RMB denominated products are settled in Renminbi. You must maintain an integrated account and have activated both Renminbi savings account and securities sub-account under the same Integrated Account. You can place orders using normal order, stop loss and at auction limit order type.

RQFII A-share ETF

Renminbi Qualified Foreign Institutional Investor (RQFII) A-share exchange traded fund (ETF) is a renminbi-denominated physical A-share ETF. Through the RQFII investment quota granted by Mainland authorities, a RQFII A-share ETF seeks to track the performance of an A-share index by channelling the renminbi raised outside mainland China to invest directly in a portfolio of A-shares.

RQFII A-share ETFs are traded on the Stock Exchange of Hong Kong (SEHK) like stocks. Like other ETFs listed on the SEHK, RQFII A-share ETFs must be authorized by the Securities and Futures Commission (SFC) before they can be offered to the investing public.

Before investing in any RQFII A-share ETF, you should read its offering document including the product key facts statement (Product KFS) carefully to understand its key features and risks.

For more details about the RQFII A-share ETFs, please refer to the SFC website.

Dual Tranche Dual Counter (DTDC) / Dual Counter Trading Model

The DTDC trading model allows the same listed company / Exchange Traded Fund (ETF) issued two tranches of shares/units, HKD-traded shares/ETF units and RMB-traded shares/ETF units, (i.e one in RMB and one in HKD) which can be traded under two separate trading counters (i.e. two different stock codes) at HKEX, the trades of the respective counters will be cleared and settled separately. HKD-traded shares/ETF units are settled in HKD. RMB-traded shares/ETF units are settled in RMB. All shares/ETF units from the two tranches are of the same class with identical shareholders'/unit holders' rights. In principle, transferability between the two tranches of shares/ETF units is allowed. For details, please refer to the website of Hong Kong Exchanges and Clearing Ltd.

RMB Equity Trading Support Facility

The RMB Equity Trading Support Facility ("TSF") is designed by HKEX to serve as a back-up facility to enable investors who wish to buy RMB-denominated shares in the secondary market with HKD if they do not have sufficient RMB or have difficulty in obtaining RMB from other channels. For more details about the TSF, please refer to the HKEX website.

Please click below for related frequently asked questions

- RMB products listed in HKEX
1.

What kind of accounts do I need to maintain if I want to trade RMB denominated products listed in HKEX?

Transactions of RMB denominated products are settled in Renminbi. You must open an Integrated account and have activated both RMB savings account (your transactions of RMB denominated products will be settled through this account (RMB settlement account)) and securities sub-account under the Integrated Account.

2.

Can I trade RMB denominated products using my existing securities account?

Yes. You can trade RMB denominated products if your existing securities account is a sub-account of an integrated account with RMB savings account activated. The settlement and charges of RMB denominated product transactions are paid in Renminbi. You will receive the contract note of your securities transactions and monthly statements of your securities account which list out the quantities and the market value of your securities holdings (including RMB denominated securities).

3.

Can I trade RMB denominated products if my existing securities account is not a sub-account under an Integrated account?

No. If you want to trade RMB denominated products, you must maintain an Integrated account with its securities sub-account and RMB savings account activated.

4.

I already have an integrated account and securities account but have not yet activated my RMB savings account under the integrated account, can I trade RMB denominated products immediately after successful activation?

Yes, you can trade RMB denominated products immediately if there are sufficient funds in your RMB account.

5.

I have opened an integrated account successfully and activated securities account and RMB savings account under the integrated account on the same day, can I trade RMB denominated products immediately after account opening?

Yes, you can trade RMB denominated products immediately after you have activated both the securities account and RMB savings account.

6.

Can I use the receivable funds from selling a RMB denominated product to buy a stock which is not denominated in RMB?

No. You can only use the receivable funds to buy a product denominated in the same currency.

7.

What order types are supported for RMB denominated products?

You can place orders using normal order, stop loss and at auction limit order type.

8.

How can I check my buying power of RMB settlement account ?

Please click "My Buying Power" button in the order input page to enquire your buying power of HKD settlement account or RMB settlement account if activated. The information is for reference. The buying power of RMB settlement account may include the floating cheque amount which is not eligible for securities trading.

9.

Can I use my HKD settlement account to settle the transaction of RMB denominated products ?

No. The transactions of RMB denominated products is settled in Renminbi. You must maintain an integrated account with its securities sub-account and RMB savings account activated. Please note that no overdraft facility is offered in respect of any Renminbi account. You must maintain sufficient Renminbi funds for settlement of RMB denominated product transactions.

As long as you are still holding the RMB denominated products in your securities sub-account you must continue to maintain your RMB savings account for subsequent selling or any entitlement such as dividend payment ,etc.

10.

What are the charges for trading RMB denominated products via HKEX?

Same as the HKD denominated securities, you have to pay :
a. third-party transaction charges such as stamp duty, transaction levy and trading fee.
b. bank charges such as brokerage fees(any preferential brokerage or brokerage exemption is not applicable to RMB denominated products)and deposit charge from purchase orders.

The charges are collected by the Bank in Renminbi. If there are insufficient funds in your RMB settlement account to settle the related fees and charges, the Bank shall have the right to collect such fees and charges in HKD from any of your HKD account. Please note that the stamp duty, transaction levy and trading fee collected from customers in RMB will be paid to the relevant authorities in HKD based on the exchange rate prescribed by the relevant authorities. For details, please refer to the Securities Services Charges Table.

11.

Where can I find the exchange rate for calculation of non-HKD stamp duty, transaction levy and trading fee pay to the relevant authorities?

The exchange rates for each trading day are made available on the HKEX website.

12.

Where can I verify if Hang Seng Bank Limited and Hang Seng Securities Limited have confirmed to HKEX their readiness for dealing and/or clearing transactions in RMB denominated Securities?

Hang Seng Bank Limited and Hang Seng Securities Limited are the participants who have confirmed to the HKEX the readiness for dealing and/or clearing transactions in RMB securities. Customer can check the relevant list on the HKEX website.

13.

Where can I obtain more information on RMB denominated products?

You can obtain the general information on RMB denominated products at the SFC website www.InvestEd.hk. Issuers of the relevant RMB denominated products will usually also issue public materials disclosing information on their products, such as prospectuses and other offering documents, website information, leaflets, brochures, etc.

14.

What are the key risks of investing in Renminbi denominated products?

Please click here to read the key risks of investing in RMB denominated products.

15.

What is RMB Equity Trading Support Facility (TSF)?

The RMB Equity Trading Support Facility (TSF), operated by Hong Kong Securities Clearing Company Limited (HKSCC), is designed to serve as a back-up facility to enable investors who wish to buy RMB-denominated shares in the secondary market (excluding the initial public offering or post-listing fund raising activities such as rights subscription) with Hong Kong Dollar (HKD) if they do not have sufficient RMB or have difficulty in obtaining RMB from other channels. For more details about TSF, please refer to the HKEX website www.hkex.com.hk.

16.

Can I use RMB Equity Trading Support Facility (TSF) through Hang Seng Bank?

Hang Seng Bank currently does not offer TSF, yet you can exchange RMB with our Bank to buy RMB-denominated shares based on your needs.

17.

Can I deposit RMB denominated securities purchased via RMB Equity Trading Support Facility (TSF) into my securities account maintained with Hang Seng Bank?

No. Hang Seng Bank currently does not offer TSF, therefore we do not accept Receipt Instructions for RMB denominated securities bought via TSF from customers.

RQFII A-share ETF

The frequently asked questions below are adopted with reference to SFC InvestEd website.

What is a Renminbi Qualified Foreign Institutional Investor (RQFII) A-share exchange traded fund (ETF)?

RQFII A-share ETF is a renminbi-denominated physical A-share ETF. Through the RQFII investment quota granted by Mainland authorities, an RQFII A-share ETF seeks to track the performance of an A-share index by channelling the renminbi raised outside mainland China to invest directly in a portfolio of A-shares. The information in the following FAQs is applicable to SFC-authorized RQFII A-share ETFs that are available to public investors.

RQFII A-share ETFs are traded on the Stock Exchange of Hong Kong (SEHK) like stocks. Like other ETFs listed on the SEHK, RQFII A-share ETFs must be authorized by the SFC before they can be offered to the investing public.

Before investing in any RQFII A-share ETF, you should read its offering document including the product key facts statement (Product KFS) carefully to understand its key features and risks.

What are the key differences in structure and trading between RQFII A-share ETFs and other A-share ETFs currently traded on the SEHK?

	RQFII A-share ETFs	Other A-share ETFs
Investment strategy and replication/ tracking method	Physical full replication or representative sampling Direct investment in the Mainland securities markets through RQFII investment quota Invest directly in A-shares that replicate or represent the composition of the underlying A-share index	Synthetic replication No direct investment in or holding of Mainland securities Invest in derivative instruments to replicate the underlying index performance
Trading currency	Renminbi and possibly in some cases HK dollar as well (Note)	HK dollar

Note: The manager of individual RQFII A-share ETF may choose to adopt the dual counter model to simultaneously offer ETF units in different trading currencies (i.e. renminbi and HK dollar).

What transaction costs are involved in RQFII A-share ETF trading?

RQFII A-share ETFs, being listed renminbi-denominated securities, are generally subject to:

brokerage commission, SFC levy, SEHK trading fee, stamp duty, and other fees and charges.

An RQFII A-share ETF may apply for stamp duty remission through the Stamp Office of the HKSAR Government. If the application is successful, investors will not be required to pay stamp duty for trading that ETF. You can check with your brokerage or bank whether you need to pay stamp duty for trading a particular ETF, or you can refer to the list of securities which are not subject to Hong Kong stamp duty on the HKEX website.

For more details for brokerage commission, please refer to Q10 under the FAQ for "RMB products listed in HKEX".

Can I trade RQFII A-share ETFs on margin?

Although investors may be able to get margin financing in HK dollar from brokerages or banks for stock trading, under the current agreement between banks and the Clearing Bank for Renminbi Business in Hong Kong, banks are not permitted to lend renminbi to personal customers.

Will I be able to trade RQFII A-share ETFs even if the stock exchanges on the Mainland are closed?

As RQFII A-share ETFs are traded on the SEHK, you will be able to trade their units during trading hours of the SEHK, even if the stock exchanges on the Mainland are closed. However, there are risks associated with the differences in trading days or hours between stock exchanges on the Mainland and the SEHK. For details, please refer to the "Trading differences risk" in Q6 below.

What are the key risks involved in RQFII A-share ETFs?

RQFII A-share ETFs are subject to the risks which are applicable to ETFs in general. For details, please refer to the SFC website. In addition, RQFII A-share ETFs are also subject to the following key risks unique to this new class of products.

Risks relating to the novelty of the product
RQFII A-share ETF is the first renminbi physical A-share ETF issued outside mainland China to invest directly in the Mainland A-share market which is inherently a market with restricted access. The novelty and untested nature of such products make them riskier than traditional ETFs investing directly in markets other than the Mainland.

Risks relating to the RQFII regime
The RQFII programme is still at a pilot stage. The relevant policy and rules have only been recently announced by the relevant Mainland authorities and there may be uncertainties as to its implementation. Such policy and rules are subject to change and interpretation by Mainland authorities. The uncertainty and change of the laws and regulations on the Mainland (including the RQFII policy and rules) may adversely impact the RQFII A-share ETFs. The limit of RQFII investment quota may cause units of RQFII A-share ETFs to trade at a significant premium to their NAV. For details, please refer to Q7 below.

Renminbi currency risk
Renminbi is currently not freely convertible and is subject to exchange controls and restrictions. Since RQFII A-share ETFs are denominated in renminbi, non-renminbi based investors are exposed to fluctuations in the renminbi exchange rate against their base currencies. Like any currency, the exchange rate of renminbi may rise or fall. Investors who choose to convert the redemption proceeds or dividends paid by the RQFII A-share ETF or sale proceeds into a different currency may incur substantial capital loss due to foreign exchange risk.

Risks relating to Mainland markets and concentration risk
RQFII A-share ETFs primarily invest in securities in the Mainland markets and are subject to concentration risk. Investing in the Mainland markets involve certain risks and special considerations as compared with investment in more developed economies or markets, such as greater political, tax, economic, foreign exchange, liquidity and regulatory risks.

Risks relating to renminbi trading and settlement of units
It is likely that not all intermediaries are prepared to carry out trading and settlement of renminbi-denominated securities. In addition, the liquidity and trading price of the units of RQFII A-share ETFs may be adversely affected by the limited availability of renminbi outside mainland China and the restrictions on the conversion between foreign currency and renminbi.

Although the SEHK has launched the renminbi Equity Trading Support Facility (TSF) to enable investors who have insufficient renminbi to buy renminbi-traded shares, the TSF only supports secondary trading of renminbi shares currently and not other types of securities. Therefore, you cannot use this facility to buy RQFII A-share ETFs.

Risks relating to the Mainland tax regime
There are risks and uncertainties associated with the current Mainland tax laws applicable to capital gains realised by RQFIIs through their investments on the Mainland. Although RQFII A-share ETFs may have made a tax provision in respect of potential tax liability, the provision may be excessive or inadequate. Any shortfall between the provisions and actual tax liabilities may be covered by the RQFII A-share ETF's assets and may therefore adversely affect the RQFII A-share ETF's net asset value (NAV).

Trading differences risk
The trading days or hours of the Mainland and Hong Kong stock markets are not exactly the same. For example, there may be occasions when A-share markets are open while SEHK is closed and RQFII A-share ETFs are not traded. As such, the value of the securities in the RQFII A-share ETF's portfolio may change but investors are not able to purchase or sell the units of the RQFII A-share ETF.

On the other hand, if a Mainland stock exchange is closed while the SEHK is open, the market price of underlying securities may not be updated while the RQFII A-share ETF is still trading, which may affect the level of premium/discount of the trading price of the ETF's units to its NAV.

While A-shares are subject to trading bands which restrict increases and decreases in the trading price, trading of RQFII A-share ETFs listed on the SEHK is not subject to such restrictions. This difference may affect the level of premium or discount of the trading price of the ETF's units to its NAV.

Mainland brokerage risk
Only one brokerage can be appointed for each market (the Shenzhen Stock Exchange and the Shanghai Stock Exchange) to execute transactions (i.e. trading of A-shares) for the RQFII A-share ETF in mainland China. As such the RQFII A-share ETF will rely on only one brokerage for each market, which may be the same brokerage. If the manager of the RQFII A-share ETF is unable to use its designated brokerage in mainland China, the operation of the RQFII A-share ETF will be adversely affected and may cause the units of the RQFII A-share ETF to trade at a premium or discount to the RQFII A-share ETF's NAV or the RQFII A-share ETF may not be able to track the underlying index.

Government intervention and restrictions risk
The operation and market making activities of RQFII A-share ETFs may be affected by interventions by the governments and regulators in the financial markets, such as an imposition of trading restrictions, a ban on "naked" short selling or the suspension of short selling for certain stocks.

New manager and reliance on parent company risk
The manager of RQFII A-share ETFs may not be experienced in managing ETFs and may heavily leverage on the expertise and systems of its Mainland parent company to support the RQFII A-share ETF's investments in the A-share markets. Any disruption in the assistance from the Mainland parent company may adversely affect the operations of the RQFII A-share ETF.

Reliance on market maker risk
Market makers may not be as interested in making a market in ETF units denominated in renminbi. Any disruption to the availability of renminbi may adversely affect the capability of market makers in providing liquidity for the units of RQFII A-share ETFs. The liquidity of the ETF may be adversely affected if there is no market maker for the fund or if the market making activities are not effective.

Is there any specific condition on RQFII A-share ETFs that may lead to the suspension of new unit creation?

RQFII A-share ETFs may suspend the creation of new units when, among others:

the RQFII investment quota is used up, and the RQFII holder cannot obtain additional quota in a timely manner.
In such event, the units of RQFII A-share ETFs may trade at a significant premium to their NAV.

What are the key differences between RQFII A-share ETFs and other existing RQFII retail funds currently available to Hong Kong investing public?

	RQFII A-share ETFs	RQFII retail funds
RQFII quota requirement
Listing on SEHK
Underlying investment	A-shares traded in the Mainland markets	At least 80% in renminbi bonds and bond funds issued in mainland China, not more than 20% in China A-shares and other equity investments

What should investors consider before investing in an RQFII A-share ETF?

You should read carefully the offering document including the Product KFS to fully understand the nature, investment objective and strategy, key features, major risks and dividend policy of an RQFII A-share ETF.

Assess whether the product is suitable for you in light of your investment objectives, the amount of investment required and your risk appetite.

An RQFII A-share ETF may not necessarily give you the benefits of appreciation in renminbi (if any).

Dual Tranche Dual Counter (DTDC) / Dual Counter Trading Model

What is Dual Tranche, Dual Counter (DTDC) trading model?

The same listed company / Exchange Traded Fund (ETF) issued two tranches of shares/units, HKD-traded shares/ETF units and RMB-traded shares/ETF units, (i.e one in RMB and one in HKD) which can be traded under two separate trading counters (i.e. two different stock codes) at HKEX, the trades of the respective counters will be cleared and settled separately. HKD-traded shares/ETF units are settled in HKD. RMB-traded shares/ETF units are settled in RMB. All shares/ETF units from the two tranches are of the same class with identical shareholders'/unit holders' rights. In principle, transferability between the two tranches of shares/ETF units is allowed. For details, please refer to the website of Hong Kong Exchanges and Clearing Ltd.

If I am holding HKD-traded shares/ETF units, can I sell the HKD-traded shares/ETF units via RMB trading counter instantly?

Currently, we do not offer instant selling of DTDC shares/ETF units of which the shares/ETF units transfer between the two tranches has not been completed. Customers should firstly request the Bank to transfer the HKD-traded shares/ETF units to RMB-traded shares/ETF units. Upon the completion of the transfer, customers may sell their transferred shares/ETF units as usual. The arrangement for selling RMB-traded shares/ETF units via HKD trading counter is the same.

If I am holding HKD-traded shares or ETF units / RMB-traded shares or ETF units, how can the shares/ETF units be transferred to RMB-traded shares or ETF units / HKD-traded shares or ETF units?

Customers should provide the Bank a transfer instruction via our designated branches that provide securities service to authorize the Bank to convert their HKD-traded shares/ETF units to RMB-traded shares/ETF units or vice versa. The processing time for the requested transfer is at least 2 trading days from instruction received by the Bank.

Example:

	Scenario 1	Scenario 2	Scenario 3	Scenario 4
Monday	Transfer Instruction Received (1st Trading Day)	Transfer Instruction Received (1st Trading Day)	Transfer Instruction Received (1st Trading Day)
Tuesday	Transfer process completed no later than 2:00pm on the 2nd Trading Day	Holiday	2nd Trading Day but not a Settlement Day, therefore, transfer instruction cannot be handled
Wednesday		Transfer process completed no later than 2:00pm on the 2nd Trading Day	Transfer process completed no later than 2:00pm on the 3rd Trading Day
Thursday
Friday
Saturday				Day of Transfer Instruction submitted (Non-Trading Day)
Sunday				Holiday
Monday				Transfer Instruction Received (1st Trading Day)
Tuesday				Transfer process completed no later than 2:00pm on the 2nd Trading Day

Remarks:
1) If the trading days involved for the transfer is not a settlement day, one more trading day is required for the transfer processing. 2) For the DTDC shares/ETF units transfer request from HKD-traded shares/ETF units to RMB-traded shares/ETF units , the customer must have maintained a RMB savings account of their Integrated Account with the Bank. 3) On the day of the transfer instruction received, there must be sufficient settled shares/ETF units for the transfer. 4) "Trading day but not settlement day" - Normally, this refers to a half-trading day or the trading day is not a settlement day due to typhoon / rainstorm warning etc as announced by HKEX.

Under what situations, my DTDC shares/ETF units transfer request will be rejected?

Customers' DTDC shares/ETF units transfer request will be rejected under the following circumstances:

a) Upon receipt of DTDC shares/ETF units transfer request, the Bank will process the shares/ETF units transfer on the next trading day. If there are insufficient settled shares/ETF units held in the designated securities account of the customer for DTDC shares/ETF units transfer when the Bank is processing the shares/ETF units transfer, the request will be rejected immediately. b) CCASS does not accept our DTDC shares/ETF units transfer request. c) Customers do not maintain a RMB savings account of their Integrated Account with the Bank (only applicable for transfer request from HKD-traded shares/ETF units to RMB-traded shares/ETF units)

Is there any service fee required for DTDC shares / ETF units transfer request?

DTDC shares / ETF units transfer request involves bank charges, please refer to the prevailing securities services charges table for details.

Will dividend be paid in HKD or RMB?

Dividend policy will be subject to the announcement issued by Issuer or ETF fund manager. The Issuer or ETF fund manager may offer an option to all shareholders / ETF unit holders to select to take a dividend in RMB or in an alternative currency. In case the dividend is paid in RMB only and customers have not activated RMB savings account under their Integrated Account, customers may have to bear the fees, charges and conversion spread associated with the conversion of cash dividend from RMB into HKD or any other currency.

For more details about RMB denominated products & related information, please visit HKEX website at http://www.hkex.com.hk

Order Watching Services

Set your order expiry date from the list of dates provided by the Bank and set the instruction prices¹

Flexible Trading before Settlement

Boost your securities buying power by using the sale proceeds of sale orders which are pending to be settled. Securities purchased can also be sold before settlement and the deposit charges related will be waived

Direct Debit/Credit Funds

Settlement is done automatically through your designated Hang Seng Bank account

Physical Scrip Deposit

Accept physical scrip deposit at designated Hang Seng Bank branches

Comprehensive Custodian Services

We will collect the share dividends, bonus shares and interests for you, as well as keep you informed of the relevant company activities such as takeovers, mergers and stock splits

Setup Account with Ease

You can set up Securities Account through Hang Seng Personal e-Banking² or our branches

Notes:

1.You may set your order expiry date from the list of dates provided under the "Good Till" function of Securities Trading Services. Only orders within 24 spreads of the current market bid/offer prices will be sent to the Stock Exchange for queuing. The Bank reserves the right to amend the above arrangement without prior notice.

2.Account opening via Hang Seng Personal e-Banking is only applicable to Hang Seng Integrated Account customers and not applicable to joint accounts customers.

Contact Us
E-mail Us
24-hour hotline 2822 0228
Visit Our Branches