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Non Day Trading - Buying stocks on one day and selling of stocks in the day after or hold for longer period in an attempt to profit from long-term price movements.
Day Trading - Day trading is suitable for short-term investors who buy and sell stocks on the same day (9am - 4pm).
Monthly Stock Investment - Investors could buy a number of selected listed stocks and funds with a monthly contribution amount of as low as HK$1,000 per month.
Initial Public Offering - When a privately-held company makes its shares available for trading on public markets, individuals are free to buy its stock through banks or securities firms.
From 1 April, 2003, brokers could charged clients freely for the commission. Generally, banks charge higher commission than securities firms and phone trading commission would be higher than online trading commission.
Besides, commission for day trading would be higher than other normal trading. For example, the commission charge for day trading is 0.02% higher than normal trading for CHIEF securities trading service. The minimum commission charge for day trading is also HK$15 higher than normal trading service.
After buying stocks, securities firms and banks might charge custody fee for keeping the stocks. However, most of the securities firms have waived the fee, only some banks will charge the fee now.
Stamp duty payable to the HKSAR government on transfer of Hong Kong Stock is charged at 0.1% of the amount of the consideration or of its value on every sold note and every bought note. (Where the stamp duty calculated includes a fraction of $1, round-up the duty to the nearest $1.)
Effective 1 November 2014 , a Transaction Levy of 0.0027% (rounded to the nearest cent) is charged per side of the consideration of a transaction, and the amount is collected for the SFC. There is no Transaction Levy on Securities Market Maker (SMM) transactions.
A exchange trading fee of 0.005% (rounded to the nearest cent) is charged per side of the consideration of a transaction, and the amount is collected for the SEHK. There is no exchange trading fee on Securities Market Maker (SMM) transactions.
A trading tariff of HK$0.50 is payable to the Exchange on each and every purchase or sale transaction, most of the securities firms will not pass the trading tariff on to investors.
CCASS stock settlement fee is 0.002% of the transaction amount (minimum HK$2 and maximum charges is HK$100), some banks or securities firms will charge higher amount of fee.
If you want to buy a stock with a total value of HK$50,000, how much do you have to pay in total?
No matter you buy the stock through securities firms or banks, you have to pay for below fees. The total fixed transaction cost amounts to HK$56.35 with the breakdowns as follows:
|Description of fees||Details of fees||Amount|
|Government stamp duty||0.1% of transaction amount||$50|
|SFC transaction levy||0.0027% of transaction amount||$1.35|
|SEHK trading fee||0.005% of transaction amount||$2.5|
|SEHK trading tariff||$0.05 per transaction||$0.5*|
|CCASS stock settlement fee||0.002% of transaction amount (minimum $2, maximum $100)||$2|
*Most of the banks and securities firms will waive the SEHK trading tariff
Apart from the fixed costs, you have to pay for other variable costs such as brokerage commission as well. For example, if you buy a stock with HK$50,000 and the commission rate is 0.2%, then you will have to pay HK$100 for commission fee.
The total transaction cost amounts to HK$156.35 for this transaction.
|Description of fees||Details of fees||Amount|
|Fixed Cost||Government stamp duty/ SFC transaction levy/ SEHK trading fee/ SEHK trading tariff/ CCASS stock settlement fee||$56.35|
|Variable Cost||Brokerage commission||$100|
Now you understand about the nature of these fees and charges of trading stocks, compare with us to understand more about the commissions and services of different banks and securities firms in Hong Kong.