Hong Kong Exchanges and Clearing Limited (HKEX)

Definition and key takeaways

• HKEX is a publicly traded holding company that operates major financial markets, including the Hong Kong Stock Exchange (HKEX/SEHK) and the London Metal Exchange (LME).
• Core services: listing, trading, clearing, market data, reference prices, and connectivity.
• Core markets: equity exchange, futures exchange, and the LME—anchoring HKEX in both Hong Kong and London.
• HKEX functions as an operator and an overseer of trading activity for listed companies and market participants.

Overview and history

HKEX was formed in 2000 by merging the Hong Kong Stock Exchange, the Hong Kong Futures Exchange, and the Hong Kong Securities Clearing Company. The consolidation aimed to improve oversight and competitiveness. In 2012 the group expanded its global footprint by acquiring the London Metal Exchange.

The exchange group positions itself as a bridge between China and global capital markets, providing issuers access to investors worldwide and offering a broad product mix across equities, bonds, ETFs, REITs, derivatives, currency futures and commodities.

Primary services and products

• Equities, bonds, ETFs, REITs, warrants, mutual funds and equity-linked instruments
• Listed derivatives and exchange-traded futures and options
• Commodities trading via the LME
• Clearing and settlement across multiple clearinghouses
• Market data, reference prices and connectivity services for intermediaries and market infrastructure

Clearing infrastructure and regulatory role

HKEX operates four clearinghouses that handle central clearing and settlement as well as over-the-counter (OTC) derivatives clearing:

• Hong Kong Securities Clearing Company: central clearing and settlement for securities
• SEHK Options Clearing House and HKFE Clearing Corporation: clearing for listed derivatives
• OTC Clearing Hong Kong: clearing for OTC derivatives

Beyond operating markets and clearinghouses, HKEX enforces listing rules and market regulations for companies and trading participants on its platforms, aiming to maintain an orderly and transparent marketplace.

Listing requirements (main board)

Companies seeking listing on HKEX’s main board must meet one of three financial tests and other ongoing requirements:

• Profit test: three-year aggregate profit threshold (see HKEX rules for exact figures)
• Market cap + revenue test: recent revenue requirement and minimum market capitalization thresholds
• Market cap + revenue + cash flow test: revenue and market cap thresholds plus positive three-year aggregate cash flow

Other conditions typically include management continuity (three years), a minimum number of shareholders (usually 300), and regular financial reporting (generally semi-annual). Exact figures and rule details should be confirmed against HKEX’s official listing rules.

Scale and global context

• As of Jan. 31, 2024, HKEX reported a market capitalization of about $28.1 trillion and around 2,610 listed companies.
• Regional and global comparisons: India’s combined market value surpassed Hong Kong’s in January 2024; the Shanghai Stock Exchange and the New York Stock Exchange are among the world’s largest exchanges by market capitalization.

Bottom line

HKEX is one of the world’s largest exchange groups, combining equity, derivatives and commodities markets across Hong Kong and London. It provides comprehensive listing, trading, clearing and market data services while acting as the primary market overseer for participants on its platforms—serving as a key conduit between China and international capital markets.