Hong Kong is a bustling city and a country situated right below China. Also, it is around the size of Singapore. Probably bigger.
Despite that, the Hong Kong stock exchange has at least 2,500 companies listed in the market, 2.5 times of companies listed in Bursa Malaysia. It is also the 3rd largest Asia stock exchange in market capitalization and one of the oldest stock exchanges in Asia, founded in 1891.
If you are interested in trading Hong Kong stocks in Malaysia, I have good news for you.
Now we can trade Hong Kong stocks easily using a Rakuten Trade account. Yay!
What is Rakuten Trade
In case you have no idea, Rakuten Trade is a broker that allows Malaysians to invest in Malaysia and US stocks. And now it includes (some) Hong Kong stocks as well. I always recommend Rakuten Trade for beginners because you can open an account within 1 hour and start trading stocks.
Interested to sign up for a Rakuten Trade account? Use my referral link below to claim free 1,000 Rakuten Points (worth RM10)
In the last few days, I played around with the Hong Kong stock exchange in Rakuten Trade. So I would like to share my honest feedback on its new exchange.
Not to mention that I am new to the Hong Kong stock exchange. So feel free to correct me if the information given is incorrect. I’m always open to learning more about stocks.
Disclaimer: As an affiliate for Rakuten Trade, I will get some commissions from Rakuten if you use my referral link to register a new account, at no extra cost to you.
The Transaction Fee for HK Stock Trading
This is the best highlight for Rakuten’s HK stock exchange. You can trade HK stocks with brokerage fees as low as RM7 (as advertised).
There’s a trick though. You need to trade HK stocks with MYR to enjoy the low brokerage fees. If you use HKD, you will be charged at least HKD 35, which translates to around RM19.
Here’s a table of the brokerage fees between MYR and HKD.
The table above is the brokerage fees charged per stock traded. However, it is not the total transaction fees. There are other fees when you trade a stock:
- Clearing fee: 0.0002% of the trading value (HK$2 min, HK$100 max)
- Stamp duty: RM1.50 for every RM1k trading value
- 6% GST on brokerage fee
So here is another table that shows the actual transaction fee for some trading value samples:
Still the Basic Stock Search Engine
I find it tough to search for HK stock with the basic search engine in Rakuten. It works fine if you only cover the MY and US markets. But with HK joining in, the search result is hard to navigate.
Adding a search filter will definitely improve the user experience. Even a basic filter of the MY, US, or HK market will definitely be useful for investors to search for stocks.
Currency Exchange Page
The page to convert currency has all the basic functions needed, but it still has many things to improve.
One thing I find bothersome is the balance is missing if I only choose “Convert From”. I need to choose “Convert To” to see the available balance.
Here are my suggestions to improve the page:
- Combine “Convert From” and “Convert to” into one selection named “Conversion”. It saves users time by selecting only the conversion and inputting the total amount to convert.
- Provide a simple chart or table of the historical conversion rates. I believe most investors would love to know if the current rate is worth changing now.
- Show all the available balances on the page when we opened it. It shouldn’t have any dependency on the user input.
The Currency Spread for MYR and HKD
If you try to convert Ringgit to Hong Kong dollar, then back to Ringgit, you will notice that you won’t get back the same amount.
The difference is called a currency spread.
Rakuten Trade has a 2.54% spread for HKD currency exchange, compared to the USD currency exchange’s spread, which is only 1.3%.
In other words, it costs you RM254 if you exchange RM10,000 from RM to HKD and back to RM. But for USD, it costs RM130.
Is it because the peanut spread from Hong Kong is more premium than the US one? Hmm.
For market rate comparison, Rakuten currency charges around 1% higher than the market currency. And it is updated on a daily basis.
Having said that, you don’t need to worry about this if you are using MYR to trade HK stocks. We already highlighted the difference in transaction fees between these two currencies.
Tips: To get a better currency rate, exchange your currency during business days. Non-business days seem to have a worse rate.
Limited Stocks Available
As Rakuten Trade just started including the HK stock exchange in their platform, they don’t have the whole list of HK shares, yet.
There are many interesting Hong Kong companies and ETFs that I couldn’t find in the app.
Here are some examples:
- JD.com Inc (9618)
- Trip Com Group Ltd (9961)
- Hang Seng Investment Management Tech Index ETF (3032)
- HK Tracker Fund of Hong Kong (TraHK, 2800)
So far Rakuten only has 301 out of 2,500 HK shares available on the HK stock exchange. Hopefully, Rakuten will provide more HK shares to trade in the future.
Here’s the list of available HK shares in Rakuten (Updated on 2nd Jan 2023)
Update on 16 Jan 23: Rakuten Trade just emailed me that they have added 11 HK stocks into its HK exchange. I can see JD.com Inc (9618) and Trip Com Group Ltd (9961) in Rakuten Trade now.
The HK ETFs are still not yet added, but I’m glad to see that the Rakuten Team is willing to make change based on user’s feedback.
Here’s the latest list of HK shares in Rakuten.
Extra: The HK Exchange Board Lot
This has nothing to do with Rakuten. But I want to mention it, especially for those who are new to the Hong Kong stock exchange.
Unlike Bursa, the share quantity of 1 board lot for every HK stock is different. 1 board lot can vary from 50 units to 2000 units, determined by the issuers (listed company). This will be confusing for investors who are new to HK Exchange.
If you are a seasonal investor in Hong Kong stocks, feel free to share your opinion on this as well.
You can read more about the HK Exchange board lot at this link: HKEX FAQ
As Rakuten just recently add the HK stock exchange as their third market, there will surely be many improvements needed to provide a better user experience.
Having said that, we can definitely see the Rakuten team is trying its best to make more markets easily accessible to Malaysians.
I’m looking forward to the day when Rakuten covers more markets and becomes the most recommended brokerage for Malaysians.
In the meantime, I also hope Rakuten will look into the highlights I mentioned and improve its platform.
If you are interested to sign up for a Rakuten account, you can use my referral link to get free 1000 Rakuten Points worth RM10, which can use to rebate brokerage fees.