Hong Kong Stocks Introduction is the Right Time: Why Now Is the Best Window to Invest in the Asian Market

For Taiwanese investors looking to expand their investment portfolio, Hong Kong stocks are no longer an unfamiliar option. Compared to this year’s soaring Japanese stocks and the US stocks nearing all-time highs, the Hong Kong stock market is currently at a relatively low level, making it a treasure trove opportunity in the eyes of value investors.

Why Hong Kong Stocks Are Worth Reconsidering

Hong Kong’s stock market has a trading history of over 150 years and holds a pivotal position in the international financial system. As of the end of May 2025, the total market capitalization of Hong Kong stocks is approximately $5.2 trillion USD, ranking among the top in global securities markets. Its mature market regulation system and clear trading rules make it one of the fairest and most transparent stock markets in Asia.

For Taiwanese investors, the advantages of Hong Kong stocks are obvious. First, the geographical and time zone advantages are significant—Hong Kong and Taiwan have nearly identical trading hours, unlike US stocks which require late-night watching; second, language barriers are minimal, and understanding local policies and corporate developments costs much less than investing in European or American markets; finally, the economic ties among Hong Kong, Macau, and Taiwan are becoming increasingly close, with a deep mutual understanding, making it easier to track company fundamentals.

Quick Overview of Hong Kong Stock Trading Rules

The Hong Kong stock market is divided into the Main Board and the Growth Enterprise Market (GEM). The Main Board hosts large listed companies like Tencent, Alibaba, and HSBC, while GEM mainly features small and medium-sized innovative companies.

From a classification perspective, Hong Kong stocks are divided into blue chips (high-quality companies in the Hang Seng Index), H-shares (Chinese companies listed in Hong Kong), and Red Chips (overseas Chinese companies listed in Hong Kong).

Trading hours are from 9:30 AM to 12:00 PM and 1:00 PM to 4:00 PM Taiwan time, with a 1-hour lunch break. The minimum trading unit is a “lot,” with specific quantities set by each company. Hong Kong stocks adopt a “T+0” trading system, meaning stocks bought on the same day can be sold on the same day, greatly improving capital efficiency; settlement occurs on T+2, i.e., two business days after the trade, with transfer of funds and stocks completed.

It is important to note that Hong Kong stocks have no daily price limit up or down, which means investors need to exercise more cautious risk management, as price volatility can be much greater than in Taiwan or mainland China markets.

Hong Kong Stocks vs. US Stocks: Key Differences Investors Should Know

Overall, the trading mechanisms of Hong Kong stocks and US stocks are similar, but Hong Kong stocks are more “friendly” to Taiwanese investors because trading hours align with local routines, eliminating the need to adjust for US time zones.

Current Investment Opportunities in Hong Kong Stocks

Leading Tech Company: Tencent

As the largest company by market value on the Hong Kong Stock Exchange, Tencent (0700.HK) needs no introduction. Founded in 1998, this internet giant controls a significant share of China’s communications and social media sectors, with numerous internet companies invested behind it.

In 2021, due to gaming regulation and anti-monopoly waves, Tencent’s stock price fell from a high of HKD 775. However, as policy environments stabilize, the stock has rebounded from lows and currently (June 2025) remains in the HKD 400–450 range, with a P/E ratio of about 23, below the five-year average, making it attractive valuation-wise. Its stable social ecosystem, diversified revenue streams, and improving policy environment make it a preferred long-term investment target.

Leading New Energy Vehicle Company: BYD

BYD (1211.HK), founded in 1995 as a battery manufacturer, has grown into a global leader in new energy vehicles. In 2024, BYD’s global sales reached 4.27 million units, surpassing Tesla to become the world’s top seller of new energy vehicles, ranking fourth globally in car brand sales.

Financial performance is also impressive—2024 revenue was approximately USD 107 billion, up 29% year-over-year; net profit was RMB 40.25 billion, up 34%. The per-vehicle gross profit margin was 21.02%, higher than Tesla’s 17.9%. As international expansion accelerates, BYD is establishing production bases in multiple countries, helping to reduce costs and expand market share.

Stable Energy Income: CNOOC

CNOOC (China National Offshore Oil Corporation) is China’s largest offshore oil and gas producer. In 2024, crude oil production was about 530 million barrels, and natural gas output was approximately 115 billion cubic meters. According to IEA forecasts, natural gas demand will grow at an average annual rate of about 2% over the next decade, which is favorable for CNOOC’s gas business. The company has solid financials, making it a good choice for investors seeking stable cash flow.

Risks to watch include global oil price fluctuations, environmental policies shifting toward renewables, and geopolitical uncertainties.

AI Industry Rising Star: Baidu

Baidu (9888.HK), as China’s leading search engine and AI technology leader, reported revenue of about RMB 32.5 billion in Q1 2025, an increase of nearly 3% year-over-year, driven mainly by cloud computing and AI businesses.

The Chinese cloud computing market is expected to grow at an average annual rate of 30%, and Baidu’s autonomous driving platform “Apollo” has attracted cooperation from multiple automakers, laying a foundation for long-term growth. Investors should be aware of increasing market competition (with emerging players like ByteDance) and regulatory policy risks.

Trendy New Toy: Pop Mart

Pop Mart (9992.HK), known for original IP and blind box products, has gained popularity with its Labubu series IP in recent years, with new product stores often attracting long queues. It has over 500 stores worldwide and more than 2,000 vending machines across over 30 countries.

In Q1 2025, revenue increased by 165% year-over-year, with overseas markets growing especially rapidly (up 475%). JPMorgan projects Labubu series sales could reach RMB 14 billion by 2027. Its rapid growth phase and overseas expansion make it a stock to watch closely.

Three Ways to Enter Hong Kong Stocks

Direct Trading via Local Brokers: Most convenient but highest cost

Opening an account with a Taiwanese local broker to trade Hong Kong stocks allows trading in TWD without currency conversion, but only for long positions—no short selling or leverage. Fees are relatively higher.

Hong Kong Brokers: Lower costs but currency risk

Platforms like Interactive Brokers and Futu offer low commissions, but require deposits in HKD or USD. Buying in USD incurs currency conversion costs, and leverage for direct Hong Kong stock trading is limited.

CFDs (Contracts for Difference): Flexible but limited underlying assets

CFDs allow traders to go long or short, use leverage, and open trades at low cost, without facing currency issues. The downside is that CFD platforms typically only offer large-cap stocks; smaller market cap stocks are usually unavailable. For investors seeking flexibility, this is a more adaptable option.

Key Risk Management Points for Hong Kong Stock Investment

Platform selection is crucial — a quality trading platform should have strict alert mechanisms and comprehensive risk controls to protect investors’ principal.

Set reasonable stop-loss points — since Hong Kong stocks have no daily price limits, price swings can be large. Pre-setting stop-loss levels before opening positions is essential to avoid unexpected losses.

Diversify your funds — do not put all your capital into a single stock. Diversification can effectively mitigate risks; concentrated positions can significantly amplify financial risks.

Conclusion

Compared to this year’s high-flying Japanese stocks, near-record US stocks, and stable Taiwan stocks, Hong Kong stocks are currently at a low point, offering more value investment opportunities. Unless one is completely bearish on China’s economic prospects, investing in these leading companies at current valuations is a rare opportunity. The best time to enter Hong Kong stocks is now, with the key being choosing suitable investment methods and timing based on your risk tolerance. High volatility environments bring both risks and opportunities.