Fidessa’s Shenzhen-Hong Kong Stock Connect solution has been in use for 17 Hong Kong-based brokers since the link went live on 5 December.
The solution is intended to address the complexities faced by brokers that want to use stock connect, providing tools and processes across the middle and back office to help brokers take advantage of the connection.
It includes Financial Information Exchange order capture capabilities, monitoring of client order performance, trade analytics and pre- and post-trade risk management.
According to Fidessa, the new mandates follow the success of its Shanghai-Hong Kong Stock Connect solution, which launched to support the programme in 2014. A total of 50 brokers are now using the stock connect solution.
The announcement comes, however, after the new stock connect recorded lacklustre volumes in its first three days of trading.
The programme allows international investors to trade 881 stocks listed on the Shenzhen exchange, trading Northbound. Chinese investors can also trade southbound on 417 Hong Kong shares.
However, on Shenzhen-Hong Kong Stock Connect’s first day, on 5 December, it saw a turnover of RMB 2.7 billion ($392.1 million) in northbound trades, just 21 percent of its RBM 13 billion ($1.9 billion) daily quota. The second day’s turnover dropped to RMB 2.2 billion ($319.5 million), and 7 December saw a turnover of RMB 1.9 billion ($276 million).
By comparison, on the launch date of the Shanghai Hong Kong Stock Connect, international investors used the entire RMB 13 billion quota before the first day’s trading closed.
Eva Fu, product marketing manager at Fidessa, said, however: "There’s an understanding that Shenzhen Connect is a must-have, and high expectations about the potential to trade small-cap, mid-cap and 'innovation' stocks."
She added: "Connecting to Shenzhen is a natural step, particularly for those already connected to Shanghai."
