Recently, a friend asked me how to invest in Hong Kong stocks, and I realized that many people are still somewhat unfamiliar with the Hong Kong stock market. Actually, investing in Hong Kong stocks isn’t that complicated. Today, let’s talk about this topic.

The Hong Kong stock market is one of the world’s top financial hubs. There are already more than 2,600 companies listed on the Hong Kong Stock Exchange (HKEX), with a total market capitalization of up to 38 trillion HKD. Companies we use every day—such as Tencent, Alibaba, and BYD—are all listed in Hong Kong, which in itself shows the value of Hong Kong stocks.

First, let’s talk about trading rules. The HKEX has three trading sessions per day: from 9:00 to 9:30 a.m. is the opening auction; from 9:30 a.m. to 12:00 p.m. and from 1:00 to 4:00 p.m. is continuous trading; and from 4:00 to 4:10 p.m. is the closing auction. The trading model is the same as the US stock market. It supports T+0—meaning stocks bought on the same day can be sold on the same day, with no limit on the number of times. However, settlement is T+2: stocks sold on Monday can only be withdrawn on Wednesday.

What’s interesting is that Hong Kong stocks have no daily price limit. But to prevent excessive market volatility, a “cooling-off” mechanism has been set for large constituent stocks such as the Hang Seng Index and China Enterprises Index. If the price moves up or down by more than 10% within 5 minutes, trading will be paused for 5 minutes, and trading is only allowed within a specified price range. The minimum trading unit is 1 lot, but the number of shares per lot is decided by each listed company. For example, Tencent is 100 shares per lot. Some companies may have 100,000 shares per lot.

When it comes to ways to invest in Hong Kong stocks, I think there are mainly three options. The first is buying individual stocks directly, which is suitable for people who are bullish about certain companies. Hong Kong stock codes start with 0 and are divided into the Main Board and the Growth Enterprise Market (GEM). GEM stock codes start with 08. Main Board companies are generally more mature and stable, while GEM carries relatively higher risk. Beginners are advised to start with the Main Board. Hong Kong stocks also support short selling. If you believe a decline is coming, you can also make money from it—though it’s only available for certain eligible margin-trading stocks, numbering at roughly 1,000.

The second option is investing in Hong Kong indices or ETFs. This may be more friendly for beginners. There are mainly three major indices in the Hong Kong market: the Hang Seng Index, the Hang Seng China Enterprises Index, and the Hang Seng Tech Index. Among them, the Hang Seng Index is the most representative. It includes the companies with the largest market caps and the most active trading. It has 83 constituent stocks, and their combined total market capitalization accounts for nearly 70% of the total market cap of Hong Kong stocks. There are two ways to invest in an index: one is index futures, but the threshold is higher and it requires at least 50,000 HKD to get started; the other is ETFs, which are more accessible—traded at brokers just like buying stocks. Examples include Tracker Fund of Hong Kong and the iShares Hang Seng Index.

The third option is Contracts for Difference (CFD), which is suitable for people who want to trade short term. CFDs track stock prices. They’re a bit like futures, but with more flexible leverage. There’s also a $0 minimum threshold, and you can go long or short. Compared with traditional brokers, the advantage of CFDs is that the fee is low—only the spread cost—and leverage is also more flexible. The leverage for individual stocks can reach 30x, and for indices it can even reach 200x. For example, normally buying 1 lot of Tencent requires more than 30,000 HKD, but with CFD you might be able to enter with less than 5 USD, greatly reducing investment costs. Of course, leverage also means greater risk: losses can be amplified as well, so you need to be careful.

As for where to open an account, if you’re buying stocks or ETFs, you can choose Hong Kong securities brokers such as Futu, Tiger, or Huasheng. Their safety is relatively well guaranteed. If you’re trading CFDs, you can use platforms like Mitrade. It is regulated by Australia ASIC, is simple to register, and also offers a demo account to practice—your virtual funds are 50,000 USD.

When it comes to which Hong Kong stocks to choose, I recommend prioritizing blue-chip stocks—mature, established companies with large scale and stable operations. Tencent, Xiaomi, Ctrip, BYD, HSBC—these are all good choices. Last year, the performance of these stocks was also quite solid: Tencent rose 39%, Xiaomi doubled, and Ctrip also had a gain of nearly 95%.

If you truly want to start investing in Hong Kong stocks, the process is actually very simple. Take Mitrade as an example. First, you register an account and you’ll get access to a demo account for practice, with virtual funds so you can familiarize yourself with how to operate. When you’re ready, deposit funds. It supports multiple methods, and using a credit card has the lowest cost. Then, in the search bar, enter the stock name or code—for example, search for Tencent or 0700—and you can find it. After you set your buy/sell direction, quantity, leverage, and stop-gain/stop-loss (take-profit and stop-loss) orders, you can place the trade. The entire process can be completed in just a few minutes, and it’s quite convenient.

The threshold for investing in Hong Kong stocks really is much lower than before. The key is to understand market rules, and choose the right investment tools and platform. If you also want to try investing in Hong Kong stocks, you can start by using a demo account to get a feel for the market’s rhythm, and once you’re familiar, move on to putting real money on the line.