A joint survey conducted by the Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) revealed a 14% increase in total transactions of non-exchange-traded investment products by licensed corporations (LCs) and registered institutions (RIs) in 2023.
The total transaction amount reached $4,338 billion, up from $3,799 billion in 2022, signaling a recovery in market sentiment as the global economy emerged from the pandemic, inflationary pressures eased, and expectations grew for an end to monetary tightening by major economies.
The number of firms involved in selling investment products rose to 380 in 2023, up from 371 the previous year.
Approximately 68% of firms reported year-on-year increases in transaction volumes, while 29% expanded their sales teams by 50% or more to accommodate rising business demands.
The number of clients participating in the market also grew by 15%, surpassing 940,000.
The growth in transaction volumes was largely driven by an increase in the sales of collective investment schemes (CIS), which grew by $394 billion, debt securities, which increased by $80 billion, and structured products, which rose by $59 billion.
The survey highlighted the strong demand for lower-risk products, with money market funds accounting for 76% of total CIS sales reported by large firms, up from 61% in 2022.
Sales of sovereign bonds also grew significantly, representing 44% of all debt securities sold in 2023, compared to 29% the previous year.
Structured products remained the most popular investment product, accounting for 46% of total transactions, or $1,980 billion. CIS followed with 29% ($1,278 billion), while debt securities made up 17% ($728 billion).
Equity-linked products accounted for $1,206 billion, representing 61% of all structured products sold, with the internet, automotive, and technology sectors dominating the underlying equities.
The survey also noted an upward trend in the use of online platforms for distributing investment products. The number of firms using online channels grew by 11%, with 92 firms offering products online in 2023, compared to 83 in 2022.
Online sales made up 12% of the total transaction amount, up from 7% in 2022, with CIS accounting for 72% of online sales and debt securities representing 25%.
The findings from the survey indicate a strong recovery in Hong Kong’s investment market, supported by increased investor participation and a diversified range of product offerings.
