Hong Kong Capital Market Exchange Ecosystem Market Size

Hong Kong Capital Market Analysis

The Hong Kong capital markets exchange ecosystem has generated a revenue of USD 20 billion in the current year and is poised to register a CAGR of 8% for the forecast period. Capital markets may involve trading other financial securities, including derivative contracts, such as options, various loans and other debt instruments, and commodity futures. Some capital markets are available to the public directly, while others are closed to everyone except large institutional investors. Private trading, mostly between large institutions with high-volume trades, occurs via secured computer networks at very high speeds. Both stock and bond markets make up a very significant portion of the total volume of capital market trades.

Capital markets are composed of primary and secondary markets. The majority of modern primary and secondary markets are computer-based electronic platforms. The primary markets are the ones where newly issued stocks and bonds are traded. Companies and governments use these to raise money; investors buy directly from the issuer.Governments issue only bonds, whereas companies often issue both bonds and equity.

These securities are known as primary offerings or initial public offerings (IPOs). When a company goes public, it sells its stocks and bonds to large-scale and institutional investors, such as mutual funds, hedge funds, pension funds, and sovereign wealth funds. The secondary markets, on the other hand, are the ones where existing stocks and bonds are traded. The variety of offered assets is much wider here. Issuing companies do not have a part in the secondary market.