While authorities quadrupled the daily net buying quota through the links, traders have concerns about their capacity to place orders at Hong Kong Exchanges & Clearing Ltd., which manages the southern side of the stock connect.Lyndon Chao, head of equities at the Asia Securities Industry & Financial Markets Association, said one of the worries is from unanticipated orders from clients. He said Asifma has tried to persuade HKEX to loosen its rules and allow easier access for the period around inclusion, with its members resistant to buying extra capacity that may never be used again. Passive funds, which are most likely to buy shares on June 1 to stay close to MSCI’s indexes, prefer auctions, where they can send orders and be assured of buying or selling at the day’s final price. That means investors need to rethink how they approach the closing session and instead trade regularly through the day, said Tanner, who estimated that MSCI inclusion will mean $20 billion to $40 billion of flows into the mainland market. - Bloomberg

Source: The Star May 18, 2018 02:26 UTC