Key facts
- Hong Kong and Malaysia have signed a Memorandum of Understanding (MoU) to enhance capital market connectivity.
- The agreement aims to streamline dual listings and expand eligible products for mutual recognition.
- Non-Islamic ETFs and real estate investment trusts (REITs) are among the products to be widened.
- A new co-branded benchmark, the HKEX Bursa Malaysia Large Cap Index, has been launched.
- The index comprises 30 large-cap companies from Hong Kong and 30 from Malaysia.
Hong Kong and Malaysia are collaborating to broaden cross-market access and attract international investment through enhanced capital market connectivity. Securities regulators from both regions have signed a Memorandum of Understanding (MoU) aimed at streamlining initial public offering dual listings and expanding the range of products eligible for mutual recognition, including non-Islamic exchange-traded funds (ETFs) and real estate investment trusts (REITs).
As a key initiative under this collaboration, Bursa Malaysia and HKEX have launched the HKEX Bursa Malaysia Large Cap Index. This co-branded benchmark is designed to strengthen integration between the Malaysian and Hong Kong capital markets and facilitate future cross-market investment opportunities. The index measures the performance of the 60 largest companies listed in Hong Kong and Malaysia, with 30 constituents drawn from each market. Hong Kong-listed companies will have an approximate 60% weighting in the index, while Malaysian-listed companies will account for approximately 40%.
Officials from both exchanges highlighted the strategic importance of this partnership. Datuk Fad’l Mohamed, CEO of Bursa Malaysia, emphasized Malaysia's strengths in domestic institutional investors and its leadership in the Islamic capital market, positioning it as a gateway to ASEAN growth markets. Bonnie Y Chan, CEO of HKEX, noted Malaysia's strategic location in Southeast Asia and its vibrant sectors, while HKEX offers connectivity to the Chinese mainland, aiming to draw global liquidity to Asia.