Skip to content Skip to Search
Skip navigation

Hong Kong plans fund on Saudi stock exchange

King Leung of InvestHK says Middle East investors are 'scooping up high quality, positive cash flow generating assets at very, very attractive valuations' Wam
King Leung of InvestHK at the Dubai Fintech summit. He said Middle East investors are 'scooping up high quality assets at very, very attractive valuations'
  • ETF will track Hong Kong stock indices
  • Investment negotiations ongoing
  • Chinese assets are ‘very attractive’

Officials in Hong Kong are planning to set up an exchange-traded fund with Saudi Arabia’s stock exchange, as Middle East investors increasingly go “bargain hunting” in the Asian city state to take advantage of lower valuations.

An exchange-traded fund (ETF) is an investment fund traded on regulated stock exchanges, much like individual stocks are bought and sold. 

The ETF will track Hong Kong stock indices at a time when the special administrative region is trying to enhance its global appeal.



Increasing geopolitical tensions with countries in the west have been stifling investment.

The value of an ETF rises and falls as the underlying asset increases or decreases in price. It allows investment in an asset, such as gold or an index of stocks, without having to buy the asset itself.

The fund provider owns the assets and sells shares to investors.

Michael Wong, Hong Kong’s deputy financial secretary, speaking at the inaugural international Capital Markets Forum in Hong Kong on Thursday, said formal negotiations were also under way for an investment promotion and protection agreement with Saudi Arabia.

Wong said that the Hong Kong government was also considering establishing an economic and trade office in Riyadh.

Saudi Arabia listed its $1 billion ETF on the Hong Kong stock exchange in November last year, allowing investors to trade the constituent stocks of the Saudi stock market directly in the Hong Kong market through the ETF in Hong Kong dollars or renminbi.

“The friendship and partnership between Hong Kong and Saudi Arabia will go very far and will endure the test of time,” Wong said.

Bargain hunters

The Hang Seng Index, the main indicator of the overall market performance in Hong Kong, is down almost 36 percent over the past five years, although it is up more than 9 percent in the year to date.

Accessories, Bag, Handbag The Hong Kong Tourist Board is keen to attract visitors from the Gulf Benny Marty/Alamy via Reuters Connect
The Hong Kong Tourist Board is keen to attract visitors from the Gulf

King Leung, head of financial services and fintech at InvestHK, the government department responsible for foreign direct investment, blamed negative press for the dip in valuations. However he maintained that investors from the Middle East were among a plethora of interested parties looking to capitalise.

“This year, just a few months ago, they said ‘look, the valuation of a lot of the Chinese assets, these are high quality assets generating very good positive cash flow’,” he said.

“But because of some of the media the valuation got beaten down quite badly. And they’re like, ‘you know what, we are coming in to do bargain hunting’.”

Leung is part of a 40-strong delegation from InvestHK, which has been in the UAE this week looking to strengthen ties between companies based in the Chinese mainland who operate through Hong Kong and the emirates.

He said Middle East investors including the region’s sovereign wealth funds and family offices were “scooping up high quality, positive cash flow generating assets at very, very attractive valuations compared with the other high-flying stock markets around the world”.

Latest articles

UK Prime Minister Rishi Sunak said the pledge ' sets a precedent for global standards on AI safety'

UAE joins AI safety pledge at UK-South Korea summit

Two artificial intelligence companies from the UAE have signed up to a new AI safety pledge and have committed to safe development of the technology. Abu Dhabi’s Technology Innovation Institute and G42 are among 16 names on the safety pledge that also includes Amazon, Google, IBM, Meta, Microsoft, OpenAI and Samsung. The announcement was made […]

Bruno Le Maire said France was also ready to help the UAE develop its own nuclear power plants

France ‘open’ to UAE investing in its nuclear plants

The French government is open to the UAE investing in the country’s nuclear power sector, its economy minister has said. Bruno Le Maire spoke to journalists in Abu Dhabi ahead of talks with Sultan Al Jaber, the UAE minister of industry and advanced technology, and Khaldoon Al Mubarak, chief executive of investment fund Mubadala and […]

Dhahran is home to the King Abdulaziz Center for World Culture. Retal will build almost 2,000 homes in the city

Retal wins $770m contract to build in Dhahran

The Saudi builder Retal has signed a SAR2.9 billion ($770 million) contract to design and build nearly 2,000 residential units in Dhahran, Eastern Province, for the giga-project developer Roshn.  Retal “will develop and design the detailed master plan, design and execute the infrastructure, landscape, construct 1,962 residential units and public amenities building in Aldanah project,” […]

GACA president Abdulaziz Al-Duailej said licences would be announced soon for more low-cost flights from regional Saudi airports

More low-cost airline routes planned for Saudi Arabia

Plans to privatise domestic airports have been announced by Saudi Arabia as part of an aviation expansion strategy, which includes imminent licences for more low-cost airline routes, the kingdom’s civil aviation authority said this week.  The General Authority of Civil Aviation has signed an agreement with a consortium led by the Turkish airport operator TAV […]