
<p>In 2019, The Hong Kong Monetary Authority (“HKMA”) issued 8 virtual banking licenses. So far, 5 of the 8 license holders have launched their services in Hong Kong, marking a new era of digital banking.</p>



<p>As suggested by their name, virtual banks are neobanks that do not have physical retail presence. Their services are 100% digital and the services can range from deposit, personal loan, debit/credit card or even insurance. The virtual banks can be accessed primarily through their websites and mobile applications.</p>



<h2><strong>Comparison of the 5 virtual banks that have been launched</strong></h2>



<p>As of now, virtual banks offer fewer products when compared to traditional banks. Each of the virtual banks is focusing on different value proposition for example Mox Bank launched a numberless bank card that comes with various spending rebate, livi Bank launched a virtual credit card that supports UnionPay QR code.</p>



<p>On the lending sector Airstar Bank is providing a technology backed, fast approval loan with very attractive interest rate. In the meantime, Welab Bank’s parent company is a well-known lending platform so it is expected that Welab Bank will also join the competition with an attractive lending product.</p>



<p>ZA Bank was the first virtual bank to launch in Hong Kong, among other products, ZA is introducing low cost virtual insurance under the ZA Insure brand.</p>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Virtual bank</strong></td><td><strong>Deposit</strong></td><td><strong>Personal  loan</strong></td><td><strong>Debit card</strong></td><td><strong>Payment/ Transfer</strong></td><td><strong>Insurance</strong></td></tr><tr><td><strong>Airstar Bank</strong></td><td>✅</td><td>✅ <br>👉<a href="https://www.planto.hk/en/airstar/">Limited time offer</a></td><td>❌</td><td>✅</td><td>❌</td></tr><tr><td><strong>livi Bank</strong></td><td>✅</td><td>❌</td><td>✅</td><td>✅</td><td>❌</td></tr><tr><td><strong>Mox Bank</strong></td><td>✅</td><td>❌</td><td>✅</td><td>✅</td><td>❌</td></tr><tr><td><strong>Welab Bank</strong></td><td>✅</td><td>❌</td><td>✅</td><td>✅</td><td>❌</td></tr><tr><td><strong>ZA Bank</strong></td><td>✅</td><td>✅</td><td>❌</td><td>✅</td><td>✅</td></tr></tbody></table></figure>



<h2><strong>Comparison of VBs&#8217; promotional offers</strong></h2>



<p>On top of existing traditional banks, Hong Kong is seeing an influx of new virtual banks launching in 2020. Hong Kong virtual banks are giving out attractive offers to attract customers and come out on top of competition.&nbsp;</p>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Virtual bank</strong></td><td><strong>Promotional offers</strong></td></tr><tr><td><strong>Airstar Bank</strong></td><td>– 3.6% annual interest rate for the first HK$20,000 deposit for 1 year <br>– Apply for a personal loan through Planto to enjoy APR as low as 1.85% and receive HK$200 cash reward upon a successful application</td></tr><tr><td><strong>livi Bank</strong></td><td>– Receive HK$100 cash reward after opening an account<br>– Earn HK$100 for each successful referral of up to HK$1,000 0.5% interest rate on the first HK$500,000 deposit <br>– Shake your phone after using UnionPay QR code to receive reward up to 3 times per day</td></tr><tr><td><strong>Mox Bank</strong></td><td>– 1% interest p.a. daily interest on the first HK$1 million <br>– 1% unlimited cashback on eligible spending 5% cashback at Mox’s Founding Merchants (up to HK$1,000 of cash back) before 31 December 2020</td></tr><tr><td><strong>WeLab Bank</strong></td><td>– 8% cash rebate on WeLab Debit Card (up to HK$3,000) until 30 September 2020</td></tr><tr><td><strong>ZA Bank</strong></td><td>– 1% interest on the first HK$500,000 deposit</td></tr></tbody></table><figcaption>The offers are subject to banks’ terms and conditions which may be changing from time to time. Please visit banks’ websites for latest offers.</figcaption></figure>



<h2><strong>Who are the 8 virtual banking license holders?</strong></h2>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Virtual bank</strong></td><td><strong>Shareholders</strong></td></tr><tr><td>Airstar Bank</td><td>Xiaomi Corporation, AMTD Group</td></tr><tr><td>livi Bank</td><td>Bank of China, Jardine Matheson Group, Jingdong Digits Technology</td></tr><tr><td>Mox Bank</td><td>Standard Chartered, HKT, PCCW, Ctrip</td></tr><tr><td>WeLab Bank</td><td>WeLab</td></tr><tr><td>ZA Bank</td><td>Zhong An Insurance</td></tr><tr><td>Fusion Bank</td><td>Tencent, ICBC, Hillhouse Capital</td></tr><tr><td>Ping An OneConnect Bank</td><td>Ping An Insurance</td></tr><tr><td>Ant Bank</td><td>Ant Financial</td></tr></tbody></table></figure>



<h2><strong>Virtual banks vs. traditional banks</strong>: Pros &amp; Cons</h2>



<p>Digital banking service has moved banking online and does not require any physical branches, this helps to reduce rent and manpower costs. The service can also be accessed anywhere and almost anytime making it very suitable for new generation of consumers.</p>



<h4>Virtual bank advantages:</h4>



<ol><li><strong>24-hour mobile banking:</strong> banking service can be accessed anytime and from anywhere without queuing. New customers can swiftly open their accounts by scanning HKID or upload selfie photo</li><li><strong>Lower fees:</strong> virtual banks generally do not impose minimum balance requirement, and they also charge less or no fees across various product lines for example low account balance fee, handling fee or loan early repayment fee</li><li><strong>Increase market competition:</strong> market competition is often good for the consumer. In order to attract/retain customers, both virtual and traditional banks are expected reduce fees and provide attractive offers such as increasing deposit interest and credit card cash rebate</li><li><strong>Promote digital banking:</strong> virtual banks are expected to set the pace of innovation in financial services across areas like mobile banking, virtual credit card, cross-border payment and virtual insurance</li><li><strong>Connection with traditional banks:</strong> virtual banking accounts can send or receive money from traditional banks seamlessly through FPS and real-time transfer which make the 2 ecosystems complementary to each other</li></ol>



<p>While virtual banks have their own strength, they are most likely not going to replace traditional banks entirely as virtual banks also have some shortfalls which include:</p>



<ol><li><strong>No physical branch:</strong> while all virtual banks offer great mobile banking experience, many consumers still prefer to bank offline (for example money withdrawal at a branch) or speak face to face with a banking professional. Furthermore, older generation of consumers would need to learn about new technology in order to enjoy virtual banking service</li><li><strong>Fewer service offering:</strong> traditional banks still have advantage when it comes to the breath and variety of financial products. This is particularly true on some product categories like investment and mortgage which are not being offered by any virtual bank today</li><li><strong>Standardized service:</strong> in general, virtual banks have designed their services for majority of the consumers. However with traditional banks, consumers who require personalization or high-touch service can engage directly with their account manager for direct communication </li></ol>



<p>Ultimately, it is expected that traditional banks will transform themselves in order to keep up with innovation brought on by virtual banks. For example both Payme by HSBC and inMotion by CITIC Bank are both digital products developed by long standing traditional banks. Additionally, many existing banks like HSBC, Bank of China, Standard Chartered and Dah Sing have announced that they will stop charging certain fees in order to stay competitive.</p>



<p>The investment landscape has seen rapid adoption of many new digital platforms such as Futu, SoFi HK and Flexinvest by HSBC. Unless virtual banks are coming up with new investment innovation, there may not be a lot of impact on the market.</p>



<p>Still, Hong Kong consumers should be excited about virtual banking as there are many successful virtual banks around the world. One of the most famous case would be Monzo, a U.K. digital bank which was established in 2015. Monzo’s key selling points include automated saving/accounting as well as free withdrawal from Monzo account around the world. By 2020, Monzo has accumulated approximately 4.5 million users, most of which are under 40 years old (a great indicator that virtual banking service is extremely suitable to young consumers).</p>



<h2><strong>What consumer protection is in place for virtual banking service in Hong Kong?</strong></h2>



<p>Like all banks, virtual banks in Hong Kong are supervised by the HKMA, and they are also participants of the Deposit Protection Scheme. This means up to HK$500,000 of deposit is protected per customer.</p>



<p>Additionally, although virtual banks’ services are online, the banks are still established and have physical office in Hong Kong. Customers can still get in touch with virtual banks physically for matters which cannot be resolved online.</p>



<hr class="wp-block-separator"/>



<p><single-action-item title="Apply for a Personal Loan and Redeem Exclusive $200 Cash Reward!" subtitle=" APR as low as 1.85%. $0 handling fee. 5 minutes to disbursement. To borrow or not to borrow? Borrow only if you can repay!
" link="https://www.planto.hk/en/airstar" button_text="Learn More" lang="zh" type="content"></single-action-item></p>



<h4>Recommended Readings</h4>



<ul><li><a href="https://www.planto.hk/en/blog/overseas-mortgage-interest-expense/">Can personal loan in Hong Kong reduce your mortgage interest expense?</a></li><li><a href="https://www.planto.hk/en/blog/living-cost-hongkong-bangkok/">Hong Kong vs. Bangkok, from a Thai person living in Hong Kong</a></li><li><a href="https://www.planto.hk/en/blog/consolidation-loan-explained/">What is consolidation loan and how it can be useful to you?</a></li><li><a href="https://www.planto.hk/en/blog/personal-loan-APR-comparison/">Do Big Financial Institutions Offer the Lowest Interest Rates?</a></li></ul>



<p></p>


 Virtual banks are neobanks that do not have physical retail presence. Their services are 100% digital and the services can range from deposit, personal loan, debit/credit card or even insurance. Learn more about the welcome offers of Hong Kong virtual banks. 

What is a virtual bank? Comparison of services, promotional offers and key selling points of Hong Kong VBs


<p><strong>Personal loans</strong> offered by banks and financial institutions in Hong Kong are often categorized as “unsecured loan”, that means borrowers do not have to provide any collateral to the financial institutions. A loan application typically only requires an application form, HKID, proof of income and an address. Most recently, some financial institutions start to offer loans without requiring any proof of income or address which helps to greatly simplify the personal loan borrowing process.</p>



<p>One of the most important factors to consider before borrowing money is the Annual Percentage Rate (APR) which is an indicator of interest rate commonly used by HKMA authorized lenders (<a href="https://www.planto.hk/en/blog/personal-loan-interest-rate-factors/">Read more about the impact of interest rate on interest expense</a>). APR indicates total yearly interest expense (without taking into consideration the effect of compounding), so it is important to understand APR offers in the market and consider other key components such as maximum loan amount and the repayment period.</p>



<h2><strong>Personal Loans APR &amp; packages comparison:</strong></h2>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Financial institutions</strong></td><td><strong>Loan package</strong></td><td><strong>Minimum Annual Percentage Rate</strong> (<strong>APR)</strong></td><td><strong>Loan amount (whichever is lower)</strong></td><td><strong>Features / remarks</strong></td></tr><tr><td>Airstar Bank</td><td>Airstar personal loan 👉 <a href="https://www.planto.hk/en/airstar">Learn more</a></td><td>1.85%</td><td>12 times of monthly salary or 1 million</td><td>0$ handling fee,&nbsp; 5 minutes to disbursement, No income / address proof</td></tr><tr><td>Citibank</td><td>Card debt consolidation loan</td><td>4.26%</td><td>21 times of monthly salary or 1.2 million</td><td>The loan is used to clear credit card debt</td></tr><tr><td>AEON</td><td>Flexi personal loan</td><td>4.49%</td><td>8 times of monthly salary or 0.8 million</td><td>No handling fee</td></tr><tr><td>Promise</td><td>Personal loan</td><td>4.49%</td><td>0.6 million</td><td>Get up to 100,000 loan without any income or address proof</td></tr><tr><td>Hang Seng Bank</td><td>Debt consolidation loan</td><td>2.91%</td><td>21 times of monthly salary</td><td>Repayment period can be as long as 72 months</td></tr></tbody></table><figcaption>All loan applications are subjected to financial institutions’ assessment and not all borrowers will be able to get the lowest Annual Percentage Rate (APR) possible.</figcaption></figure>



<h2><strong>Frequently asked questions about Personal Loan</strong>s</h2>



<div class="schema-faq wp-block-yoast-faq-block"><div class="schema-faq-section"><strong class="schema-faq-question">Why is the actual interest rate offered by financial institutions different from the ones advertised?</strong> <p class="schema-faq-answer">The actual interest rate offered to borrowers depends on multiple factors such as borrower’s credit profile, loan amount, and repayment period – as such not all borrowers will be able to get the lowest Annual Percentage Rate (APR) possible as advertised by financial institutions.</p> </div> <div class="schema-faq-section"><strong class="schema-faq-question">What are the key types of personal loan?</strong> <p class="schema-faq-answer">Some of the most common types include installment, revolving and consolidation loans. An <strong>installment loan</strong> is the most common personal loan in Hong Kong, it is characterized by fixed monthly repayment schedule. A <strong>Revolving loan</strong> on the other hand offers more flexibility as the borrowers can decide when to drawdown then payback at their own pace. Lastly, a <strong>consolidation loan</strong> is a type of borrowing to payback one or more other loans – ideally higher interest one(s). <a href="https://www.planto.hk/en/blog/consolidation-loan-explained/">Read more about consolidation loan here</a>.</p> </div> <div class="schema-faq-section"><strong class="schema-faq-question">How long does it usually take to apply for and get a personal loan?</strong> <p class="schema-faq-answer">Traditionally, financial institutions typically take about one week to approve a personal loan application. However, with the aid of online application, application and approval can now be as fast as one day.</p> </div> <div class="schema-faq-section"><strong class="schema-faq-question">What factors should be considered when applying for a personal loan?</strong> <p class="schema-faq-answer">While APR plays an important role, borrowers should also consider other important factors such as repayment ability, handling fee, overdue penalty, early repayment fee and repayment methods.</p> </div> <div class="schema-faq-section"><strong class="schema-faq-question">How to decide on repayment period for your personal loan?</strong> <p class="schema-faq-answer">The repayment period of any personal loan in Hong Kong can range between 3 to 72 months. The repayment period directly impacts the monthly repayment amount and overall interest expense. Longer repayment period means lower monthly repayment, but at the same time it will also increase overall interest expense due to compounding. <a href="https://www.planto.hk/en/blog/personal-loan-interest-rate-factors/">Read more about the relationship between the repayment period and total interest expense here</a>.</p> </div> <div class="schema-faq-section"><strong class="schema-faq-question">What documents are required during a personal loan application?</strong> <p class="schema-faq-answer">Financial institutions generally require documents such as identification documents (HKID/password), proof of address and proof of income. Some institutions allow the borrower to skip some document provision, however maximum loan amount will be lower as well.</p> </div> <div class="schema-faq-section"><strong class="schema-faq-question">What are the consequences of late repayment?</strong> <p class="schema-faq-answer">Failing to repay the loan on time typically results in additional finance charges. Another important consequence is the impact of late repayment on credit score &#8211; having a bad credit score could result in loan disapproval or getting a loan offer but at a higher interest rate.</p> </div> <div class="schema-faq-section"><strong class="schema-faq-question">Can early repayment save money?</strong> <p class="schema-faq-answer">Financial institutions typically request handling fees or interest payback if borrowers want to repay their personal loans earlier. This means early repayment of personal loans may not always result in saving on interest expense so borrowers should discuss this option with their lenders before making any decision.</p> </div> <div class="schema-faq-section"><strong class="schema-faq-question">What is the difference between secured and unsecured loan?</strong> <p class="schema-faq-answer">A secured loan uses collateral as a guarantee for repayment (mortgage is one example of a secured loan). On another hand, unsecured loan like personal loan, tax loan or even credit card do not have any guarantee for repayment, so their interest rate tends to be higher when compared to secured loan.</p> </div> <div class="schema-faq-section"><strong class="schema-faq-question">What is a loan guarantor?</strong> <p class="schema-faq-answer">A loan guarantor’s role is to cover for outstanding loan amount if the original borrower failed to repay the loan. Having a guarantor can help to improve borrower’s chance of getting approval as this helps to reduce risk for financial institutions.</p> </div> <div class="schema-faq-section"><strong class="schema-faq-question">What is a credit report?</strong> <p class="schema-faq-answer">TransUnion (“TU”) is currently the only provider of personal credit report in Hong Kong. A credit report takes into considerations of past credit card, loan and mortgage application / payment information to compute a credit score which ranges from AA to JJ (AA being the best and JJ being the worst). Borrowers who manage number of credit card / loan applications well, while at the same time have good repayment habit tend to have better credit score and should not have any issue when applying for any type of loan.</p> </div> </div>



<p><single-action-item title="Apply for a Personal Loan and Redeem Exclusive $200 Cash Reward!" subtitle=" APR as low as 1.85%. $0 handling fee. 5 minutes to disbursement. To borrow or not to borrow? Borrow only if you can repay!
" link="https://www.planto.hk/en/airstar" button_text="Learn More" lang="zh" type="content"></single-action-item></p>



<h4>Recommended Readings</h4>



<ul><li><a href="https://www.planto.hk/en/blog/overseas-mortgage-interest-expense/">Can personal loan in Hong Kong reduce your mortgage interest expense?</a></li><li><a href="https://www.planto.hk/en/blog/living-cost-hongkong-bangkok/">Hong Kong vs. Bangkok, from a Thai person living in Hong Kong</a></li><li><a href="https://www.planto.hk/en/blog/consolidation-loan-explained/">What is consolidation loan and how it can be useful to you?</a></li></ul>



<p></p>


The most important factor to consider before borrowing money is the Annual Percentage Rate (APR). APR indicates total yearly interest expense so it is important to understand APR offers in the market and consider other key components such as maximum loan amount and the repayment period.

Personal Loans Annual Percentage Rate (APR) Comparison: Do Big Financial Institutions Offer the Lowest Interest Rates?


<p>Consolidation loan or the concept of debt consolidation in general is a process of taking one single loan to replace multiple loans or a loan with high interest rate (for example credit card debt). This can effectively help to reduce total cost from high interest rate or finance charge.</p>



<p>As mentioned previously, consolidation loan is useful for replacing one or multiple high interest loans which may include:</p>



<ul><li>Finance charge on credit card debt (if you do not pay credit card on time)</li><li>Finance charge on credit card cash advance (if you withdraw cash using credit card and do not pay on time)</li><li>Overdraft facility</li></ul>



<p>Interest expense from these types of borrowing can be high as they tend to have high interest rate (up to 30%+ APR) or their finance charges accrue on a daily basis.&nbsp;</p>



<h3><strong>Benefits of consolidation loan and who it is suitable for</strong></h3>



<p>In general, consolidation loan provides the following benefits:</p>



<ul><li><strong>Reduce total interest expense and finance charge</strong>. Given total loan repayment amount is a combination of principal and interest expense, this will help to reduce overall loan repayment so that you can pay off your debt earlier or reduce burden on your monthly cashflow</li><li><strong>Simplify payment process</strong>. Keeping track of and paying for a single loan is simpler than doing so for multiple loans. More importantly, it also reduces the risk of missing repayment (which can help you to avoid various finance charges)</li></ul>



<p>Consolidation loan tends to have lower interest when compared to other more expensive types of borrowing listed above. So how do you know if consolidation loan is right for you?</p>



<ul><li>You are paying for one or more high interest loans</li><li>You still have a good enough credit score to qualify for loan with lower interest than your current ones</li><li>Your cashflow in the next 12 &#8211; 36 months will allow you to pay off the new consolidation loan</li></ul>



<h3><strong>Illustration of how consolidation loan can benefit you</strong></h3>



<p>In this example, we will be looking at a consumer who is paying for one credit card debt and one overdraft facility every month, however both loans are accruing interest on a daily basis.</p>



<figure class="wp-block-table"><table><tbody><tr><td><br></td><td><strong>Credit card debt</strong></td><td><strong>Overdraft facility</strong></td></tr><tr><td><strong>Outstanding balance</strong></td><td>HK$40,000</td><td>HK$150,000</td></tr><tr><td><strong>Interest</strong></td><td>25% APR accruing daily</td><td>15% APR accruing daily</td></tr><tr><td><strong>Current monthly repayment</strong></td><td>~HK$7,170</td><td>~HK$9,370</td></tr><tr><td><strong>Total interest expense</strong></td><td>~HK$3,000</td><td>~HK$18,550</td></tr><tr><td><strong>Est. time until total repayment</strong></td><td>6 months</td><td>18 months</td></tr></tbody></table></figure>



<p>Following the above calculation, this consumer is spending HK$16,540 in loan repayment every month. It will take about 18 months for all debt to be paid back and total interest expense during this period will be HK$21,550.</p>



<p>If this consumer is to take a consolidation loan of equal balance with similar monthly repayment amount however, the consumer will be able to reduce interest expense as well as become debt-free sooner.</p>



<figure class="wp-block-table"><table><tbody><tr><td><br></td><td><strong>Existing loans</strong></td><td><strong>Consolidation loan with 10% APR which accrue monthly for 12 months</strong></td></tr><tr><td><strong>Balance</strong></td><td>HK$190,000</td><td>HK$190,000</td></tr><tr><td><strong>Monthly repayment</strong></td><td>HK$16,540</td><td>HK$16,704</td></tr><tr><td><strong>Total interest expense</strong></td><td>HK$21,550</td><td>HK$10,450</td></tr><tr><td><strong>Est. time until total repayment</strong></td><td>18 months</td><td>12 months</td></tr></tbody></table></figure>



<p>This example illustrates how consolidation loan can help a consumer who is paying for multiple high interest loans by reducing total interest expense and repayment timeline while keeping a similar level of monthly repayment amount.</p>



<p>*Note: calculations above follow a standard formula and may differ from calculations used by financial institutions</p>



<p><strong>Things to watch out for before taking a consolidation loan</strong></p>



<p>While the benefits of taking a consolidation loan can be quite clear, there are still a few things to take into consideration:</p>



<ul><li>Like any other types of loan, consolidation loan requires timely repayment. Missing of payment can lead to additional interest and finance charge&nbsp;</li><li>If high monthly repayment will place a burden on your cashflow, consider a consolidation loan with longer repayment (Although this will lead to higher overall interest expense. Read more about the relationship between repayment plan and total interest expense <a href="https://www.planto.hk/en/blog/personal-loan-interest-rate-factors/">here</a>)</li><li>If your existing loans’ outstanding balances are small enough and you have enough saving for emergency situations, paying off the loans or making early repayment could be a better alternative than consolidation loan (However do watch out for early repayment fee)</li></ul>



<p>It is advisable that you do research and plan ahead of any borrowing. If you are looking for more resources around borrowing, feel free to visit the <a href="https://www.ifec.org.hk/web/en/moneyessentials/debts-and-borrowing/index.page">Investor and Financial Education Council</a> or the Chin family’s website.</p>



<hr class="wp-block-separator"/>



<p><single-action-item title="Apply for a Personal Loan and Redeem Exclusive $200 Cash Reward!" subtitle=" APR as low as 1.85%. $0 handling fee. 5 minutes to disbursement. To borrow or not to borrow? Borrow only if you can repay!
" link="https://www.planto.hk/en/airstar" button_text="Learn More" lang="zh" type="content"></single-action-item></p>



<h4>Recommended Readings</h4>



<ul><li><a href="https://www.planto.hk/en/blog/overseas-mortgage-interest-expense/">Can personal loan in Hong Kong reduce your mortgage interest expense?</a></li><li><a href="https://www.planto.hk/en/blog/living-cost-hongkong-bangkok/">Hong Kong vs. Bangkok, from a Thai person living in Hong Kong</a></li></ul>



<p></p>


Consolidation loan or the concept of debt consolidation in general is a process of taking one single loan to replace multiple loans or a loan with high interest rate (for example credit card debt). This can effectively help to reduce total cost from high interest rate or finance charge.

What is consolidation loan and how it can be useful to you?


<p>For anyone who might have been thinking about emigration and overseas retirement &#8211; Planto recently featured an article <a href="https://www.planto.hk/zh/blog/taiwan-hongkong-living-compare">comparing the cost of living between Hong Kong and Taiwan</a>. This month, Planto’s Founding Member &#8211; Apinun Narkhan, is going to compare costs of living in the two cities.&nbsp;</p>



<p>Having spent many years in Hong Kong and Bangkok, I find that both cities are vibrant &amp; full of opportunities and things to explore – but how do income and costs of living compare? Lets find out!</p>



<h2><strong>House rental</strong></h2>



<p>UBS’s <a href="https://www.ubs.com/microsites/prices-earnings/en/">2018 Prices &amp; Earnings</a> reported rental cost for standardized 2 furnished bedroom or 3 unfurnished bedroom apartments in Hong Kong to be US$3,947 (~HK$31,000) and Bangkok to be US$766 (~HK$6,000), that is about 5 times cheaper than Hong Kong.</p>



<p>To put this into perspective, lets take a look at a few apartments in Asoke, a prime shopping/office location intersected by both MRT and BTS trains. Fully furnished, 2 bedroom apartments (~600sqft) in this area which are within walking distance from both train stations generally cost around HK$8,000 to HK$9,000 per month!</p>



<figure class="wp-block-image"><img src="https://lh4.googleusercontent.com/y7zYAai0dOBGhRDiVcCpWDOYZkgmXofB3YQgwNQlYkyu4GTIknpm9IpkIwCZce1OTOeddy1P-AQiHBkxh5JTtqIyWXfPpRD6_HjIsXXHkT3CoxGG9pN1m-jqoZsf9CGkVdLEVX5c" alt=""/></figure>



<figure class="wp-block-image"><img src="https://lh5.googleusercontent.com/VmHmuQQlyFfj27oTDiieb7UXEKT9P635JRjNb5KC1mZyWWjiVZefRGLzu24ZOswcBwOaGB_uZ04qsRr84QjFOPfu3OUwbhrOEM5aqiKQxvx47zz_oeek9-iINdPZp4kP5v1X4S9h" alt=""/></figure>



<figure class="wp-block-image"><img src="https://lh4.googleusercontent.com/V43IOkBiJNm8nkTSJnJ_ZIDEYzgZ5CdkNxu5v-ZDfjSq6w0rx9ILxkPTGx_UobsmFTm7Ck7XU1USliP-YX0UNZRxyMUgdVl4wI75ahbGPNQ1wGVfEjlCH3Y-hbT298-e3zsGQMUR" alt=""/></figure>



<h2><strong>Food and beverages</strong></h2>



<p>Instead of referring to any survey or benchmark, I will drive right into cost comparisons between specific dishes!</p>



<h4>Everyday food</h4>



<p>Kra pao, or stir fried minced pork with basil leaf rice – a very common Thai dish that you can find anywhere in Bangkok typically cost around THB35 – THB 40 (HK$10). In Hong Kong, BBQ pork rice or 2-choice rice can easily cost HK$30 – HK$40.</p>



<figure class="wp-block-image"><img src="https://lh3.googleusercontent.com/iLaqRCp4-8ka_H3spCbCvMT5srrYwg-2JAgVIX1Tur8kCYXSSr4gF0qVOZa7dsxOtZQ6DK5fOmzrJyjMQEMBgV9DDyaiqJtmU2f-ve92qoAGVJ5-tNhGmvzULK_xnxow0weBaHnk" alt=""/></figure>



<figure class="wp-block-image"><img src="https://lh4.googleusercontent.com/6iFiYibgPKQPXa9PNS9XDIj9FEStq6Ev_4dmxOZOrFAt6mv-ctSoq30h6v4oBmNKfmEnn9QHC1bskdzNWweYRlrCfR9LOu_oczs32K_QE58Cs6fLycFUXWnGVPCJ_oWJVfSMcuqc" alt=""/></figure>



<h4>Noodle</h4>



<p>Pad Thai is probably one of the most well-known Thai dishes globally – in Bangkok a plate of Pad Thai typically costs between THB40 – THB60 (~HK$15 – although this could also goes up to HK$40 or HK$50 with a serving of large river prawn). In Hong Kong, I typically pay HK$30 – HK$40 for 港式乾炒牛河 at local eateries without drinks.</p>



<figure class="wp-block-image"><img src="https://lh4.googleusercontent.com/I8XIvcl8dAhxt2keG_JAqzNQvlGqklAEESqMdzkMytA-tjFxXQxmwbMeWsRfjNpcu8NglKVE4YGCKAvBqaxPog46sSDiBdGdID2DC9rkB1KopROopd0F4TidZxWBDQch7do7Cchk" alt=""/></figure>



<figure class="wp-block-image"><img src="https://lh4.googleusercontent.com/BlCaTSG5KDkaMGIhvbz_cO25Yc-wpG1PwtDRnUElyHaISViXGRfAmh4NEjzxdsqzHJ1I6xeLhENfMplUx_FbcsKe3Xy3zYNYR0aSJQebq_rFZl3ga5ZFBEJATlfn8tDAKhzjlW4P" alt=""/></figure>



<h4>Milk tea</h4>



<p>For many (including mine), life is dull without bubble milk tea. If you are a fan of Thai milk tea, you can have a cup of milk tea (with or without bubbles) from a popular Thai chain, Cha TraMue for about HK$10. In Hong Kong, there are a wide range of bubble tea options like Sharetea, ComebuyTea, and Ten Ren which typically cost around HK$20+ per cup.</p>



<figure class="wp-block-image"><img src="https://lh3.googleusercontent.com/0AEbuHfVAu8a_dUewt_GOAwcsWGjl3kD4XxzWJV8L4o2rEZvGR7IE-II4o6y252z1l9ysI5rTOqXD2qtIRaIo9PvhEZ9NOqpQJjWYFXCJKMRASb0e6ABGdvyjb1i0Olhh8tBguNm" alt=""/></figure>



<figure class="wp-block-image"><img src="https://lh5.googleusercontent.com/wMBCftsSWHGddKHo-k6_Nyzx_6_KrXW-vdv4pQOqn2uUWXt3fru9hsompgdXwtVxsJX_GuRkkcGrQQ0Ib5cm87HTABRba0mt03v3pIhtfUX5lKFSzIk_BcNyo5ofxkmJizxgi4ci" alt=""/></figure>



<h4>Dessert</h4>



<p>The price of coconut ice cream in Bangkok and soft serve in Hong Kong (for example Mister Softee) are surprisingly similar (around HK$7-8) so we will move slightly up scale for dessert – shibuya honey toast, my absolute favorite.</p>



<p>When it comes to honey toast, AfterYou is a must-visit in Bangkok (its popularity is justified by its IPO status with HK$3bn market cap). A classic honey toast at After You cost about THB 200 (~HK$50), this is sufficient for 2 people. In Hong Kong, we often see long lines in front of TeaWood cafes, honey toast there cost about HK$78, not much higher than Bangkok’s price.</p>



<figure class="wp-block-image"><img src="https://lh4.googleusercontent.com/eFcbdFsp83jvFoTed_djp5_-nUt65UYQFeVskvnRrfh2S_QyWxp2t8Ybd3W7Jg4wDsT0gxCk2S3zXZCSXptxKYuxPmwzfsthiF4i1PDzyXi8YPUzxM_MX8MH8lUKLJhnftz1hLex" alt=""/></figure>



<figure class="wp-block-image"><img src="https://lh6.googleusercontent.com/2U-EPhvivYyfUb6XByWt8FIzKkWbLqssF0HJeGHwty513BcNwgxf3pcuHK6HDRiVRU0aGQwkMLPqES72zdMSIsqaqFThFqC4qhVBBEQjsDaGNndcomO3YiTWSMLoHIum985EPn_k" alt=""/></figure>



<h4><strong>Public transportation</strong></h4>



<p>In Hong Kong, my 20-minute journey to work on the MTR costs HK$8.5 when I pay with Octopus. A similar train ride on Bangkok’s BTS would cost about THB44 (~HK$11), which is more expensive than Hong Kong!&nbsp;</p>



<p>On the other hand, taxi’s starting fare in Bangkok is THB35 (~HK$8), this is cheaper when compared to HK$24 in Hong Kong.</p>



<h4><strong>Income</strong></h4>



<p><a href="https://hk.jobsdb.com/en-hk/wp-content/uploads/sites/2/static/salary-report/2019/190124_student_PR_eng.pdf.pdf">JobsDB</a> reported average fresh graduate salary in Hong Kong to be at HK$16.9k. While in Thailand, <a href="https://th.jobsdb.com/th-th/articles/%e0%b8%88%e0%b9%8a%e0%b8%ad%e0%b8%9a%e0%b8%aa%e0%b9%8c%e0%b8%94%e0%b8%b5%e0%b8%9a%e0%b8%b5%e0%b9%80%e0%b8%9c%e0%b8%a2%e0%b9%80%e0%b8%87%e0%b8%b4%e0%b8%99%e0%b9%80%e0%b8%94%e0%b8%b7%e0%b8%ad%e0%b8%99">JobsDB</a> quoted average fresh graduate salary to be between THB25.2k to THB29.9k (~HK$6.3 – 7.5k), close to 3x lower than Hong Kong. However, unlike Hong Kong where finance and banking jobs pay the most – jobs like business consultants and lawyers are the best paying jobs for fresh graduates in Thailand.</p>



<h4><strong>Verdict and other considerations</strong></h4>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Category</strong></td><td><strong>When compared to Hong Kong, Thailand is …</strong></td></tr><tr><td>Housing</td><td>5x cheaper</td></tr><tr><td>Food</td><td>2x – 4x cheaper</td></tr><tr><td>Transportation</td><td>1x – 3x cheaper</td></tr><tr><td>Salary</td><td>3x lower</td></tr></tbody></table></figure>



<p>If you are considering emigration, the cost of living is definitely lower in Bangkok, but getting 3x pay cut will mean your absolute earning/saving amount will decrease as well – this could impact your future if you decide to move back to Hong Kong or a more expensive city. Other considerations to keep in mind include Thailand’s country personal income tax rate as well as emerging country’s cost inflation which tend to be higher than developed economy in a longer run.</p>



<p>If overseas retirement is in your mind, saving up in Hong Kong for retirement in Bangkok is also an option. Extra considerations apart from costs, language and cultural differences are healthcare quality and getting long-term visa. For long-term visa, you can obtain investment visa in Thailand by for example buying an apartment worth THB10million (~HK$2.5million), in this case your family will also be eligible to apply for visa as well.</p>



<p>Personally, I have had the privilege of working in Hong Kong while spending most of my holiday time in Thailand – this has been extremely economical. In a long run, I am looking to return home and enjoy early retirement there!</p>



<p>If you have any questions about emigration consideration or retirement saving feel free to have a chat with us on Planto app’s livechat or email us at hello@planto.hk!</p>



<hr class="wp-block-separator"/>



<p><single-action-item title="Apply for a Personal Loan and Redeem Exclusive $200 Cash Reward!" subtitle=" APR as low as 1.85%. $0 handling fee. 5 minutes to disbursement. To borrow or not to borrow? Borrow only if you can repay!
" link="https://www.planto.hk/en/airstar" button_text="Learn More" lang="zh" type="content"></single-action-item></p>



<h4>Recommended Readings</h4>



<ul id="block-040a54b7-293d-482b-a06f-74bc77d41108"><li><a href="https://www.planto.hk/en/blog/overseas-mortgage-interest-expense/">Can personal loan in Hong Kong reduce your mortgage interest expense?</a></li><li><a href="https://www.planto.hk/en/blog/personal-loan-interest-rate-factors/">how interest rate and payment term impact overall interest expense</a></li><li><a href="https://www.planto.hk/en/blog/property-ownership-internal-transfer/">HK Homeowners Gain Tax Advantages by Transferring Property Ownership. Here’s How it Works and the Risks</a></li><li><a href="https://www.planto.hk/en/airstar">Airstar Bank Personal Loan〡 Instant Approval Online〡Exclusive Cash Rebate</a></li></ul>


Cost of living comparison: Hong Kong vs. Bangkok, from a Thai person living in Hong Kong


<p>According to a <a href="https://www.transunion.com/blog/financial-hardship-study/Hong-Kong">recent consumer financial hardship study</a> published by TransUnion, between 30% to 40% of Hong Kong consumers are concerned about their ability to pay back personal loan and <a href="https://www.planto.hk/en/blog/credit-card-compare-recommend">credit card</a>. The repayment of such financial products include both principal and interest (personal loan interest, credit card overdraft etc.).</p>



<p>In this article, we will examine the impact on overall interest expense from key factors such as interest rate and payment term.</p>



<h4>Highlights: </h4>



<ul><li><a href="#What-factors-determine-your-personal-loan-interest-rate">What factors determine your personal loan interest rate?</a></li><li><a href="#Longer-payment-term-generally-results-in-higher-interest-expense">Longer payment term generally results in higher interest expense</a></li><li><a href="#3-scenarios-showing-interest-expense-impact-from-interest-rate-and-payment-term">3 scenarios showing interest expense impact from interest rate and payment term</a></li><li><a href="#personal-loan-offer">Learn about the personal loan offer from a Hong Kong virtual bank</a></li></ul>



<h2 id="What-factors-determine-your-personal-loan-interest-rate">What factors determine your personal loan interest rate?</h2>



<pre class="wp-block-preformatted"><strong>Interest rate varies depending on your credit score, loan type and the lender</strong>.</pre>



<p>There are a wide range of lending products available in Hong Kong including personal loan, tax loan, overdraft, credit card advance and others. Depending on your credit profile, loan type and the lender, your interest rate can vary between 2% to 30%+</p>



<ul><li><strong>Credit score</strong>: In Hong Kong, your credit score is typically measured by TransUnion credit score which range from AA (super prime) to JJ (Subprime) in alphabetical order. In general, consumers with better credit score (closer to AA) will get lower interest rate<br></li><li><strong>Loan type</strong>: Personal loan and tax loan tend to have much lower interest rate than overdraft and credit card advance&nbsp;<br></li><li><strong>The lender</strong>: Risk assessment tends to vary from one lender to another, this means same consumer is likely to get offer with different interest rates from different lenders</li></ul>



<h2 id="Longer-payment-term-generally-results-in-higher-interest-expense"><strong>Longer payment term generally results in higher interest expense</strong></h2>



<p>Interest is generally measured and offered in Annualised Percentage Rate (APR) which indicates actual yearly interest expense without taking into consideration the effect of compounding. Personal loan tends to compound on a monthly basis which is inline with monthly payment schedule.</p>



<p>In general, loan with longer payment term will have higher interest expense due to longer exposure to compounding effect.</p>



<h2 id="3-scenarios-showing-interest-expense-impact-from-interest-rate-and-payment-term">3 scenarios showing <strong>interest expense impact from interest rate and payment term</strong></h2>



<p>To visualize the impact in numbers, we have prepared 3 calculations below:</p>



<h3><strong>Scenario 1: HK$150k personal loan with the same payment term but different interest rate</strong></h3>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Mortgage &#8211; Overseas package</strong><br>&#8211; Interest rate: 3%<br>&#8211; Term: 3 years</td><td><strong>Personal loan &#8211; Hong Kong package</strong><br>&#8211; Interest rate: 9%<br>&#8211; Term: 3 years</td></tr><tr><td>Monthly repayment: HK$4,362</td><td>Monthly repayment: HK$4,770</td></tr><tr><td><strong>Total interest expense: HK$7,039</strong></td><td><strong>Total interest expense: HK$21,719</strong></td></tr><tr><td>Total repayment: HK$157,039 <br>&#8211; Principal 96%<br>&#8211; Interest 4%</td><td>Total repayment: HK$171,719<br>&#8211; Principal 87%<br>&#8211; Interest 13%</td></tr></tbody></table></figure>



<p>As illustrated in the calculation above, higher interest rate will result in higher interest expense which generally come back in a form of higher monthly repayment. In this case, 3x higher interest rate will mean 3.1x higher in total interest expense due to compounding effect.</p>



<h3><strong>Scenario 2: HK$150k personal loan with the same interest rate but different payment term</strong></h3>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Mortgage &#8211; Overseas package</strong><br><br>&#8211; Interest rate: 3%<br>&#8211; Term: 2 year</td><td><strong>Personal loan &#8211; Hong Kong package</strong><br><br>&#8211; Interest rate: 3%<br>&#8211; Term: 4 years</td></tr><tr><td>Monthly repayment: HK$6,447</td><td>Monthly repayment: HK$3,320</td></tr><tr><td><strong>Total interest expense: HK$4,732</strong></td><td><strong>Total interest expense: HK$9,367</strong></td></tr><tr><td>Total repayment: HK$154,732<br>&#8211; Principal 97%<br>&#8211; Interest 3%</td><td>Total repayment: HK$159,367<br>&#8211; Principal 94%<br>&#8211; Interest 6%</td></tr></tbody></table></figure>



<p>Longer payment term will generally lower monthly repayment requirement, however the total interest expense will be higher as the interest gets compounded over a longer period of time. In this case, while the payment term is 2x longer, total interest expense only increase by 1.9x as the principal reduces over time due to monthly repayment.</p>



<h3><strong>Scenario 3: HK$150k personal loan with different interest rate and payment term</strong></h3>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Mortgage &#8211; Overseas package</strong><br><br>&#8211; Interest rate: 3%<br>&#8211; Term: 2 year</td><td><strong>Personal loan &#8211; Hong Kong package</strong><br><br>&#8211; Interest rate: 9%<br>&#8211; Term: 4 years</td></tr><tr><td>Monthly repayment: HK$6,447</td><td>Monthly repayment: HK$3,733</td></tr><tr><td><strong>Total interest expense: HK$4,732</strong></td><td><strong>Total interest expense: HK$29,172</strong></td></tr><tr><td>Total repayment: HK$154,732<br><br>&#8211; Principal 97%<br>&#8211; Interest 3%</td><td>Total repayment: HK$179,172<br><br>&#8211; Principal 84%<br>&#8211; Interest 16%</td></tr></tbody></table></figure>



<p>When higher interest rate is combined with longer payment term, the increase in total interest expense will naturally be more prominent. In scenario 3 above, while the principal remains the same at HK$150k, the difference in total interest expense is as high as ~HK$25k.</p>



<h3><strong>Key takeaways</strong></h3>



<p>While an ideal scenario for every consumer would be to take loan at lower interest rate and shortest payment term possible – in reality, there are many restrictions such as your credit score or monthly income/saving which may prevent you from paying back your loan quickly. It is advisable that you:</p>



<ul><li><strong>Understand your credit score</strong>: Consumers with better credit score tends to get lower interest rate. You can check your credit score by getting a TransUnion report or apply for loan with a digital lender like <a href="https://www.planto.hk/en/airstar">Airstar</a> who shows your credit score as part of the journey (note that every loan application will impact your credit score)<br></li><li><strong>Understand your monthly cashflow</strong>: Having a good understanding of your monthly cashflow and saving will allow you to clearly calculate payment term. It is advisable that personal loan should only be considered if A) you have emergency saving and B) you are still able to save money after regular expenses and repayment on a monthly basis. If you do not have a clear understanding of your monthly cashflow, mobile app like <a href="https://www.planto.hk/en/">Planto</a> can help you to automatically calculate and keep track of your income and spending on a monthly basis</li></ul>



<hr class="wp-block-separator" id="personal-loan-offer"/>



<p><single-action-item title="Apply for a Personal Loan and Redeem Exclusive $200 Cash Reward!" subtitle=" APR as low as 1.85%. $0 handling fee. 5 minutes to disbursement. To borrow or not to borrow? Borrow only if you can repay!
" link="https://www.planto.hk/en/airstar" button_text="Learn More" lang="zh" type="content"></single-action-item></p>



<h4>Recommended Readings</h4>



<ul><li><a href="https://www.planto.hk/en/blog/property-ownership-internal-transfer/">HK Homeowners Gain Tax Advantages by Transferring Property Ownership. Here’s How it Works and the Risks</a></li><li><a href="https://www.planto.hk/en/airstar">Airstar Bank Personal Loan〡 Instant Approval Online〡Exclusive Cash Rebate</a></li></ul>



<p>To borrow or not to borrow? Borrow only if you can repay!</p>


What factors determine your personal loan interest rate? In this article, we will examine the impact on overall interest expense from key factors such as interest rate and payment term.

Hong Kong personal loan: how interest rate and payment term impact overall interest expense


<p>Overseas property investment is a popular topic among many Hong Kong consumers who are attracted to their (relative) affordability, rental yield, or the potential prospect of future emigration.&nbsp;</p>



<p>There are many things to consider when it comes to a large decision like property investment. For those of you who have decided on a city/country and have found your ideal overseas property, one of the last steps is to think about cost and mortgage options, in which the mortgage interest expense is a vital factor in your decision-making process. </p>



<p>In this article, we will be exploring a potential role that personal loans in Hong Kong can play in overseas property investment.</p>



<h2>Overseas <strong>mortgage interest rates can be </strong>much higher than those in Hong Kong</h2>



<p>Mortgage interest rate varies from one country to another. In general, fast growing countries (also typically countries with higher rental yield) tend to have a higher mortgage interest rate when compared to Hong Kong.</p>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Countries</strong>/<strong>Regions</strong> <strong>with</strong> <strong>High / Low interest rate</strong></td><td><strong>Rental yield</strong></td><td><strong>Mortgage interest rate</strong></td></tr><tr><td><strong>Low interest rate: <br></strong>Taiwan, Japan, Malaysia, Canada</td><td>2% to 4%</td><td>2% to 4%</td></tr><tr><td><strong>High interest rate: <br></strong>Thailand, Vietnam, Indonesia</td><td>4% to 7%</td><td>Up to 8%</td></tr></tbody></table><figcaption>Rental yield data from <a href="https://www.globalpropertyguide.com/">GlobalPropertyGuide</a></figcaption></figure>



<p>Mortgage interest rates in certain countries like Thailand, Vietnam and Indonesia can be as high as 8% – this is more than double of Hong Kong’s typical fixed-rate mortgage of 2% to 3%.</p>



<h2><strong>Potential role of Hong Kong personal loan in overseas property investment</strong></h2>



<p>Depending on your credit profile, interest on banks’ and <a href="https://www.planto.hk/en/airstar">virtual banks’ personal loans</a> in Hong Kong can be as low as 1.8%. This opens up the possibility of taking a cheaper loan to free up your savings for property investment. For example, you could increase your down payment in order to reduce overseas mortgage amount OR simply replace overseas mortgage all together if the property value is low enough / you have enough savings.</p>



<p><strong>Impact of mortgage interest rate difference on your overall expense</strong></p>



<p>While it is logical that lower interest rate will result in lower interest payment, but by how much?</p>



<p>There are multiple factors that impact total interest expense, the 2 major factors are interest rate and payment period. <a href="https://www.planto.hk/en/blog/personal-loan-interest-rate-factors/">Check out another article that talks about these 2 factors in more detail.</a></p>



<p>To illustrate the potential impact of Hong Kong personal loan in overseas property investment, 2 calculations are provided below:</p>



<h3><strong>Scenario 1: property investment in high interest rate country that requires HK$750,000 of personal loan or mortgage</strong></h3>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Mortgage &#8211; Overseas package</strong><br><br>&#8211; Interest rate: 6%<br>&#8211; Term: 20 years</td><td><strong>Personal loan &#8211; Hong Kong package</strong><br><br>&#8211; Interest rate: 2%<br>&#8211; Term: 3 years</td></tr><tr><td>Monthly repayment: HK$5,373</td><td>Monthly repayment: HK$21,482</td></tr><tr><td><strong>Total interest expense: HK$539,576</strong></td><td><strong>Total interest expense: HK$23,350</strong></td></tr><tr><td>Total repayment: HK$1,289,576<br>&#8211; Principal 58%<br>&#8211; Interest 42%</td><td>Total repayment: HK$773,350<br>Principal 97%<br>Interest 3%</td></tr></tbody></table></figure>



<p>In this scenario where the overseas mortgage package has a high interest rate, potential saving from personal loan in Hong Kong can be staggering as the difference could be as high as HK$500,000. As an example, an investment of HK$1m million in Vietnam could end up being HK$1.5 million when factoring in interest expense from mortgage (of course this would likely come with higher value appreciation and rental yield of a fast growing economy).&nbsp;</p>



<h3><strong>Scenario 2: property investment in low interest rate country that requires HK$750,000 of personal loan or mortgage</strong></h3>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Mortgage – Overseas package</strong><br>&#8211; Interest rate: 2%<br>&#8211; Term: 20 years</td><td><strong>Personal loan – Hong Kong package</strong><br>&#8211; Interest rate: 2%<br>&#8211; Term: 3 years</td></tr><tr><td>Monthly repayment: HK$3,794</td><td>Monthly repayment: HK$21,482</td></tr><tr><td><strong>Total interest expense: HK$160,590</strong></td><td><strong>Total interest expense: HK$23,350</strong></td></tr><tr><td>Total repayment: HK$910,590<br>&#8211; Principal 82%<br>&#8211; Interest 18%</td><td>Total repayment: HK$773,350<br>&#8211; Principal 97%<br>&#8211; Interest 3%</td></tr></tbody></table></figure>



<p>On another hand, if the overseas mortgage package has a low interest rate, potential saving from personal loan in Hong Kong will not be significant.</p>



<p>One very important point to note is about monthly repayment. Long term borrowing like a mortgage will have a much lower monthly repayment when compared to short term personal loan. In the scenario above, a personal loan option may not be worth considering due to the limited saving potential that comes with a high monthly repayment requirement.</p>



<p><strong>Other key personal finance considerations</strong></p>



<ul><li><strong>Monthly repayment:</strong> taking a large personal loan means high monthly repayment which will place a heavy burden on your monthly cashflow. Personal loan should only be considered if A) you have emergency saving and B) you are still able to save money after regular expenses and repayment on a monthly basis&nbsp;<br></li><li><strong>FX rate: </strong>taking a loan in Hong Kong dollar while the property value and rental return are denominated in foreign currency means any currency movement against Hong Kong dollar will lower your investment return<br></li><li><strong>Tax: </strong>Every country has a different taxation system and it may increase the cost of your investment or reduce eventual investment return<br></li><li><strong>Local mortgage offer: </strong>local banks may have mortgage offers that help to reduce overall interest costs. This could come in many forms such as deposit of excess saving or step-up repayment plan</li></ul>



<p>Property investment, no matter in what country is a big decision. It is advisable to do research well ahead of time. If you are looking for more information, feel free to check out the <a href="https://www.ifec.org.hk/">Investor and Financial Education Council</a> or the Chin family for more resources.</p>



<hr class="wp-block-separator"/>



<p><single-action-item title="Apply for a Personal Loan and Redeem Exclusive $200 Cash Reward!" subtitle=" APR as low as 1.85%. $0 handling fee. 5 minutes to disbursement. To borrow or not to borrow? Borrow only if you can repay!
" link="https://www.planto.hk/en/airstar" button_text="Learn More" lang="zh" type="content"></single-action-item></p>



<h4>Recommended Readings</h4>



<ul><li><a href="https://www.planto.hk/en/blog/property-ownership-internal-transfer/">HK Homeowners Gain Tax Advantages by Transferring Property Ownership. Here’s How it Works and the Risks</a></li><li><a href="https://www.planto.hk/en/airstar">Airstar Bank Personal Loan〡 Instant Approval Online〡Exclusive Cash Rebate</a></li><li><a href="https://www.planto.hk/en/blog/invest-in-gold/">Investing in gold, gold ETF and paper gold: Pro, con and low barrier to entry alternatives</a></li></ul>



<p style="font-size:16px"><strong>Important information:</strong></p>



<p style="font-size:16px">Investment involves risks. This information is intended to be educational and is not tailored to the investment needs of any specific investor. This information does not constitute investment advice and should not be used as the basis for any investment decision nor should it be treated as a recommendation for any investment or action. Past performance is no guarantee of future results. The value of investments and the income from them can go down as well as up, so you may not get back what you invest.</p>



<p>To borrow or not to borrow? Borrow only if you can repay!</p>


In this article, we will be exploring a potential role that personal loans in Hong Kong can play in overseas property investment. Learn how to reduce mortgage interest expense of buying an overseas property through a personal loan in Hong kong.

Overseas property investment: Can personal loan in Hong Kong reduce your mortgage interest expense?


<p>Amid global economic uncertainties, investors are becoming cautious when it comes to making new investment. While the safest route is to leave assets as bank deposits, the asset value would be depreciating over time in the face of inflation. Depending on the situation, investing in gold can be a safe alternative – this also explains why gold price has recently been increasing at a steady pace (and exceeded US$2,000 per ounce at one point). Despite some up and down, the gold price has repeatedly hit new record highs over the course of 2020, causing analysts and banks to revise their forecasts consequently.</p>



<p>Investors who are interested in gold can choose to purchase physical gold or explore alternatives such as gold ETF and paper gold.</p>



<figure class="wp-block-image size-large"><img loading="lazy" width="1024" height="322" src="http://34.92.68.73/wp-content/uploads/2020/08/image-1024x322.png" alt="" class="wp-image-11610" srcset="https://cms.planto.io/wp-content/uploads/2020/08/image-1024x322.png 1024w, https://cms.planto.io/wp-content/uploads/2020/08/image-300x94.png 300w, https://cms.planto.io/wp-content/uploads/2020/08/image-768x242.png 768w, https://cms.planto.io/wp-content/uploads/2020/08/image-1200x378.png 1200w, https://cms.planto.io/wp-content/uploads/2020/08/image.png 1484w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>Gold price has been on the rise in the past year. Source: TradingView</figcaption></figure>



<h2><strong>Physical gold: proper maintenance is required to preserve the value</strong></h2>



<p>Physical gold comes in various forms such as gold nuggets, gold bars and jewelries/accessories. One advantage of physical gold investment over other options is the fact that investors get to own something that they can see and touch.</p>



<p>Investors from the older generation like to visit gold shops to purchase or make accessories for the purpose of investment or value preservation, however purchasing gold jewelries or accessories typically include additional fees such as design, making and wastage charges.</p>



<p>One convenient way to invest in physical gold is to invest directly through retail banks. Many banks in Hong Kong such as Bank of China, Hang Seng Bank, Wing Lung Bank, Shanghai Commercial Bank etc. offer physical gold trading service. However, investors should be mindful that not all bank branches stock gold so it would be best to make a phone call before making a visit.</p>



<p>Physical gold also requires storage and proper maintenance as any damage would affect the gold’s value. Investors may explore vault service for storage and safety.</p>



<h2><strong>Paper gold: low barrier to entry but be cautious when selecting service provider</strong></h2>



<p>Gold passbook account or paper gold is an alternative for investors who do not wish to deal with physical assets. While investors can trade gold on a passbook account, there is no actual buying or selling of physical gold – this also means physical gold can not be withdrawn from the account either. The passbook accounts only record gold deposits and trades, hence the investors will not be getting any interest income from the bank. The only way to make money from paper gold investment is through price appreciation as the price of paper gold fluctuates with the gold market. One other benefit of paper gold investment is its low barrier to entry as the minimum transaction amount can be very low.</p>



<p>The value of paper gold depends entirely on the gold passbook account, this makes the credibility of financial institutions or banks who offer this service extremely important. For example, in an unlikely event of bankruptcy, the value of paper gold held in the passbook account may return to nothing. &nbsp;</p>



<h2><strong>Gold ETF: Low barrier to entry, high transparency and liquidity, watch out for management fee</strong></h2>



<p>Investors who are interested in both gold and the stock market can choose to either invest in gold related companies or explore gold ETFs. Gold ETFs are gold related funds which offer high transparency and liquidity when it comes to gold investment. Gold ETFs that are currently available on the Hong Kong Stock Exchange include SPDR Gold ETF (2840), Value Gold ETF (3081) and Hang Seng RMB Gold ETF (83168). Gold ETFs are backed by gold commodity, this means when an investor purchases gold ETF, the issuer will buy physical gold of corresponding value and place it in a high security vault.</p>



<p>Apart from being listed in Hong Kong, SPDR Gold ETF is also listed in the U.S. and Japan which are considered more international markets. Value Gold ETF is issued by a Hong Kong asset management company called Value Partners. The Hang Seng RMB Gold ETF is issued by Hang Seng Investment Management, however this requires RMB for trading.</p>



<figure class="wp-block-image size-large is-resized"><img loading="lazy" src="http://34.92.68.73/wp-content/uploads/2020/08/image-1.png" alt="" class="wp-image-11611" width="305" height="392" srcset="https://cms.planto.io/wp-content/uploads/2020/08/image-1.png 610w, https://cms.planto.io/wp-content/uploads/2020/08/image-1-234x300.png 234w" sizes="(max-width: 305px) 100vw, 305px" /><figcaption>Price of SPDR Gold ETF (2840) is rising following the rise in gold price. Source: SoFi HK</figcaption></figure>



<p>According to the price on 18<sup>th</sup> August 2020, Value Gold ETF costs about HK$48 per share, and 1 lot consists of 100 shares – which means HK$4,800 per lot. On the U.S. exchange, GLD ETF share price in the same period is US$186.5 per share with no lot restriction. With gold ETFs, casual or new retail investors can participate in the gold market with funds as low as HK$1,000. One thing to note however is ETFs generally have management fees, but they typically do not exceed 1%.&nbsp;</p>



<p>Participation in the stock market always involves risk. Gold ETFs in Hong Kong do not have hedging mechanisms so whenever gold price drops, the price of gold ETFs will also follow.</p>



<h2><strong>Explore overseas Gold ETFs</strong></h2>



<p>While there may only be a few gold ETFs in Hong Kong, the concept of gold backed ETFs have been popular in the U.S. and Europe for the past decade. There are close to 100 gold ETFs registered around the world and Hong Kong investors can easily explore them through some of the local and international brokerage platforms.&nbsp;</p>



<hr class="wp-block-separator"/>



<h2><strong>Free stock offers from brokerages</strong></h2>



<p>Many investors invest in gold ETFs through the Hong Kong or U.S. stock exchanges to take advantage of high liquidity. The following are some of the popular welcome offers from stock brokerages:</p>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Securities Firm</strong></td><td><strong><a href="https://www.planto.hk/en/blog/SoFi-Hong-Kong-Broker-Review/">SoFi HK</a></strong></td><td><strong><a href="https://www.planto.hk/zh/blog/uSMART-brokers-review/">uSMART Securities</a></strong></td><td><strong>9F Securities</strong></td><td><strong><a href="https://www.planto.hk/zh/blog/futu-brokers-review/">Futu Securities</a></strong></td></tr><tr><td><strong>Free Stock Offers and Conditions</strong></td><td>Earn 20 SoFi points after account opening. Get more points through various activities and exchange them for free SnapChat, Twitter or Coca Cola shares.</td><td>1 share of Jiumaojiu after account opening<br><br>2 shares of Peijia Medical if first-time deposit &gt; HK$20,000<br><br>2 shares of Ping An Good Doctor if first transaction is over HK$500 and assets under management amount reach HK$100,000 or above within 30 days upon account activation</td><td>Get 2 and up to 10 shares of CLP Holdings after depositing a minimum of HK$20,000</td><td>Get 1 share of HSBC and Tencent each after depositing HK$20,000 or more</td></tr><tr><td><strong>Other Offers</strong></td><td>⭐️No commission and platform free for U.S. and Hong Kong stock trading</td><td>⭐️Zero commission plan for U.S. and Hong Kong stock trading</td><td>⭐️0 platform fee and transaction fee for HK stocks.<br><br>⭐️Free 30-day trial for LV2 streaming.</td><td>⭐️HK$100 supermarket gift voucher<br>Life long commission free Hong Kong stock trading</td></tr><tr><td><strong>More Details</strong></td><td><a href="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoiZWlnaHRzZWN1cml0aWVzX3NvZmkiLCJ0eXBlIjoiaW52ZXN0bWVudF9icm9rZXIiLCJhcHBseVVybCI6Imh0dHBzOi8vZ28ub25lbGluay5tZS8xdFZvP3BpZD1QbGFudG8mYz1QbGFudG9fU29GaUhvbmdLb25nJmFmX3dlYl9kcD1odHRwcyUzQSUyRiUyRnd3dy5zb2ZpLmhrJTJGd2ViJTJGemgtaGFudCUyRm9wZW4tYWNjb3VudCUyRiUzRnV0bV9zb3VyY2UlM0RQbGFudG8lMjZ1dG1fbWVkaXVtJTNEQWZmaWxpYXRlcyUyNnV0bV9jYW1wYWlnbiUzRFBsYW50byIsImZyb20iOiJicm9rZXIgd2VsY29tZSBvZmZlciB0YWJsZSB0YWJsZSJ9">Visit Broker</a></td><td><a href="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoidXNtYXJ0X2Jyb2tlciIsInR5cGUiOiJpbnZlc3RtZW50X2Jyb2tlciIsImFwcGx5VXJsIjoiaHR0cHM6Ly91c21hcnRzZWN1cml0aWVzLmNvbS9BZmZpbGlhdGUvdC9OciIsImZyb20iOiJicm9rZXIgd2VsY29tZSBvZmZlciB0YWJsZSB0YWJsZSJ9">Visit Broker</a></td><td><a href="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoiOUZfYnJva2VyIiwidHlwZSI6ImludmVzdG1lbnRfYnJva2VyIiwiYXBwbHlVcmwiOiJodHRwczovL3d3dy45ZnN0b2NrLmNvbS9uZXctb3Blbi1zdG9jay5odG1sP2NoYW5uZWxJZD01NTUmdXRtX3NvdXJjZT0zcmQtemh1Y2UmdXRtX21lZGl1bT1wbGFudG8iLCJmcm9tIjoiYnJva2VyIHdlbGNvbWUgb2ZmZXIgdGFibGUgdGFibGUifQ==">Visit Broker</a></td><td><a href="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoiZnV0dV9zZWN1cml0aWVzIiwidHlwZSI6ImludmVzdG1lbnRfYnJva2VyIiwiYXBwbHlVcmwiOiJodHRwczovL3Bhc3Nwb3J0LmZ1dHU1LmNvbS9zZW0vaGs/bGFuZGluZ0lkPTMmY2hhbm5lbD02NDIiLCJmcm9tIjoiYnJva2VyIHdlbGNvbWUgb2ZmZXIgdGFibGUgdGFibGUifQ==">Visit Broker</a></td></tr></tbody></table><figcaption>The above offers are limited time offers and they are subjected to periodical updates. Latest offer information can be found on securities firm’s websites.</figcaption></figure>



<h4>Recommended Readings</h4>



<ul><li><a href="https://www.planto.hk/en/blog/free-stocks-brokers-welcome-offer/">Welcome Offer Comparison: Get Free Blue-Chip Stocks With New Investment Accounts</a></li><li><a href="https://www.planto.hk/en/blog/Portfolio-Diversification-Investment/">Investment Strategy Guide to building a diversified portfolio</a></li><li><a href="https://www.planto.hk/en/blog/Valuable-Capital-Broker-Review/">Valuable Capital Review:&nbsp;Commission-free HK stock trading, free real-time quotes</a></li><li><a href="https://www.planto.hk/en/blog/futu-brokers-review/">Futu Securities Review</a></li><li><a href="https://www.planto.hk/en/blog/saxo-bank-review-offshore-account/">Saxo Bank Review: A Simple Offshore Banking &amp; Trading Solution for Hong Kongers</a></li></ul>



<p style="font-size:16px"><strong>Important information:</strong></p>



<p style="font-size:16px">Investment involves risks. This information is intended to be educational and is not tailored to the investment needs of any specific investor. This information does not constitute investment advice and should not be used as the basis for any investment decision nor should it be treated as a recommendation for any investment or action. Past performance is no guarantee of future results. The value of investments and the income from them can go down as well as up, so you may not get back what you invest.</p>


Investors who are interested in gold can choose to purchase physical gold or explore alternatives such as gold ETF and paper gold.

Investing in gold, gold ETF and paper gold: Pro, con and low barrier to entry alternatives


<p>Investment services have continuously been shifting online in recent years. With the help of mobile investing experience, stock portfolio trading is now simpler and more convenient than ever before. However, having access to simplified investment experience does not necessarily translate to better investment performance.</p>



<p>Common difficulties faced by new and casual retail investors include limited access to market information, inability to assess investment opportunities, and lack of knowledge/tools to analyze complicated data and keep their portfolios well-managed.</p>



<p>Fortunately, there are several stock apps out there that come in handy when making or managing investments.</p>



<h2><strong>Stock Trackers Help you Understand Investment Performance</strong></h2>



<h4>Recommended Free Tools: Excel / Google Sheet, Ticker, Planto</h4>



<p>The most traditional stock tracker is Excel or Google sheet. You can manually add data such as stock name, ticker, number of shares, buying/selling price, and fees/commissions, these data will then allow you to calculate the return of each investment. </p>



<p>While Excel / Google sheet option is the most manual and time-consuming, it also gives you the flexibility to include and sort information in any way that you prefer or think is the most useful. Once all the information and calculations are in place, you can do further analysis or plot out trends and examine whether the return is in line with your expectations.</p>



<p>👉<a href="https://docs.google.com/spreadsheets/d/13GeYeG7s4NBT_ZA7HB8rHdJN37tmIHSO7bJb4pd-UPQ/edit">Download and try the stock tracking Google Sheet we have made.</a></p>



<p>For investors who do not want to manage a spreadsheet or prefer an automated stock tracker, a mobile app called “Ticker” is a popular option among many local investors. With Ticker, users only need to enter information like the ticker, number of shares, buying/selling price, and fees of each transaction, Ticker app will then calculate the realized and unrealized profit of your portfolio automatically. One drawback of the Ticker app however is that it does not provide tracking for U.S. stocks.</p>



<p>If you are looking for the ultimate convenience, <a href="https://www.planto.hk/en/">Planto app</a> helps you to automatically track all kinds of investment assets including stocks and MPF – simply link your securities or investment accounts to Planto, then the system will automatically convert your Hong Kong and U.S. stock portfolio into charts, making it easy for you to understand your performance at a glance. </p>



<p>Planto app currently supports more than 20 investment providers including <a href="https://www.planto.hk/en/blog/SoFi-Hong-Kong-Broker-Review/">SoFi HK</a>, <a href="https://www.planto.hk/en/blog/futu-brokers-review/">Futu</a>, <a href="https://www.planto.hk/en/blog/aqumon-breakdown-and-performance-review/">Aqumon</a>, Interactive Brokers, HSBC, Citi Bank, Bank of China (Hong Kong), and many more.</p>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Stock tracking tool</strong></td><td><strong>Adding of transaction(s)</strong></td><td><strong>Supporting instrument</strong></td><td><strong>Ease of use</strong></td></tr><tr><td>Excel / Google sheet</td><td>Manual</td><td>Hong Kong stocks, U.S. stocks and any other asset</td><td>Relatively complex</td></tr><tr><td>Ticker</td><td>Manual</td><td>Hong Kong stocks</td><td>Simple</td></tr><tr><td>Planto</td><td>Automatic</td><td>Hong Kong stocks, U.S. stocks, time deposit, MPF etc.</td><td>Simple</td></tr></tbody></table></figure>



<figure class="wp-block-image size-large is-resized"><img loading="lazy" src="http://34.92.68.73/wp-content/uploads/2020/08/Ticker-app-tracking-portfolio-495x1024.jpg" alt="" class="wp-image-11458" width="248" height="512" srcset="https://cms.planto.io/wp-content/uploads/2020/08/Ticker-app-tracking-portfolio-495x1024.jpg 495w, https://cms.planto.io/wp-content/uploads/2020/08/Ticker-app-tracking-portfolio-145x300.jpg 145w, https://cms.planto.io/wp-content/uploads/2020/08/Ticker-app-tracking-portfolio-768x1589.jpg 768w, https://cms.planto.io/wp-content/uploads/2020/08/Ticker-app-tracking-portfolio-742x1536.jpg 742w, https://cms.planto.io/wp-content/uploads/2020/08/Ticker-app-tracking-portfolio-990x2048.jpg 990w, https://cms.planto.io/wp-content/uploads/2020/08/Ticker-app-tracking-portfolio.jpg 1125w" sizes="(max-width: 248px) 100vw, 248px" /><figcaption>Ticker is a stock tracking app that is popular among Hong Kong stock investors.<br></figcaption></figure>



<figure class="wp-block-image size-large is-resized"><img loading="lazy" src="http://34.92.68.73/wp-content/uploads/2020/08/Planto-tracking-investment-performance-493x1024.jpg" alt="" class="wp-image-11459" width="247" height="512" srcset="https://cms.planto.io/wp-content/uploads/2020/08/Planto-tracking-investment-performance-493x1024.jpg 493w, https://cms.planto.io/wp-content/uploads/2020/08/Planto-tracking-investment-performance-768x1595.jpg 768w, https://cms.planto.io/wp-content/uploads/2020/08/Planto-tracking-investment-performance-740x1536.jpg 740w, https://cms.planto.io/wp-content/uploads/2020/08/Planto-tracking-investment-performance-986x2048.jpg 986w, https://cms.planto.io/wp-content/uploads/2020/08/Planto-tracking-investment-performance.jpg 1125w" sizes="(max-width: 247px) 100vw, 247px" /><figcaption>Planto provides automatic solutions for stock tracking (supports both Hong Kong and U.S. stock). The app goes beyond a stock tracker by automatically recording and analyzing deposits, MPF, insurance and credit card expenditure.</figcaption></figure>



<h2><strong>Access News &amp; Information on the Stock Markets</strong></h2>



<h4>Recommended Tools: Futu Securities and other Major Financial Information App</h4>



<p>Hong Kong investors typically use AASTOCK, HKET, and other apps/websites for information on the market and stock trends, however contents on such channels mostly focus on local trends and opinions. While the primary function of mobile applications from securities brokers such as Futu Securities and Valuable Capital is to facilitate stock trading, these mobile applications are also equipped with comprehensive news, intelligence, and stock screening features. Such mobile apps also have social features that allow investors to communicate and learn from each other, making them convenient platforms for accessing information.</p>



<p>For investors who mainly focus on the U.S. stock market, they may find local information platforms lacking as information is typically updated less frequently during trading hours which is caused by time zone difference. If you are looking for a reliable source of real-time information on the U.S. market, international platforms that focus on the global financial market may be more suitable for you. </p>



<p>If you do not mind paying subscription fees, Bloomberg can offer real-time information, news, and content on the financial markets globally. Bloomberg also has a Watchlist feature which can help you to build and track stocks in Hong Kong, U.S., Japan, U.K. and many more, this feature from Bloomberg is free and is easy to use. Bloomberg’s alternatives include Reuters and Investing.com.</p>



<figure class="wp-block-image size-large is-resized"><img loading="lazy" src="http://34.92.68.73/wp-content/uploads/2020/07/Bloomberg-502x1024.jpg" alt="" class="wp-image-11116" width="251" height="512" srcset="https://cms.planto.io/wp-content/uploads/2020/07/Bloomberg-502x1024.jpg 502w, https://cms.planto.io/wp-content/uploads/2020/07/Bloomberg-147x300.jpg 147w, https://cms.planto.io/wp-content/uploads/2020/07/Bloomberg-768x1566.jpg 768w, https://cms.planto.io/wp-content/uploads/2020/07/Bloomberg-753x1536.jpg 753w, https://cms.planto.io/wp-content/uploads/2020/07/Bloomberg-1004x2048.jpg 1004w, https://cms.planto.io/wp-content/uploads/2020/07/Bloomberg.jpg 1125w" sizes="(max-width: 251px) 100vw, 251px" /><figcaption>Apart from news and market trends, Bloomberg also has a Watchlist feature which helps investors to track stocks from many markets.<br></figcaption></figure>



<hr class="wp-block-separator"/>



<h2>Compare U.S. Investment Brokers</h2>



<p><broker-comparison-page articlename="HK Stock Investing Article" country="US" language="en"></broker-comparison-page></p>



<p>Recommended Readings:</p>



<h4>Recommended Readings</h4>



<ul><li><a href="https://www.planto.hk/en/blog/free-stocks-brokers-welcome-offer/">Welcome Offer Comparison: Get Free Blue-Chip Stocks With New Investment Accounts</a></li><li><a href="https://www.planto.hk/en/blog/Portfolio-Diversification-Investment/">Investment Strategy Guide to building a diversified portfolio</a></li><li><a href="https://www.planto.hk/en/blog/Valuable-Capital-Broker-Review/">Valuable Capital Review:&nbsp;Commission-free HK stock trading, free real-time quotes</a></li><li><a href="https://www.planto.hk/en/blog/futu-brokers-review/">Futu Securities Review</a></li><li><a href="https://www.planto.hk/en/blog/saxo-bank-review-offshore-account/">Saxo Bank Review: A Simple Offshore Banking &amp; Trading Solution for Hong Kongers</a></li></ul>



<p style="font-size:14px"><strong>Important information:</strong><br><br>Investment involves risks. This information is intended to be educational and is not tailored to the investment needs of any specific investor. This information does not constitute investment advice and should not be used as the basis for any investment decision nor should it be treated as a recommendation for any investment or action. Past performance is no guarantee of future results. The value of investments and the income from them can go down as well as up, so you may not get back what you invest.</p>


Finding a free stock tracker? There are several stock portfolio tracking apps and tools that come in handy when managing U.S. and HK stock investments. Check out how Excel / Google Sheet, Ticker and Planto help you track your investment performance. 

Essential Tools for Stock Portfolio Tracking and Understanding Investment Performances


<p>A lot of low-fee securities brokers have entered the market and it&#8217;s hard to be competitive by simply being commission-free. Valuable Capital Limited (VBKR) stands out by offering not just the usual commission-free trading of HK stocks, US stocks, A-shares, warrants, margin loans for IPO subscriptions and other services but also integrating the latest news from its parent company (Sina Group). It&#8217;s effectively a one-stop investment platform where you can trade, research and talk to fellow investors in their community. New users can also get free real-time quotes if you deposit a certain minimum which is great for day traders!</p>



<p><strong>Welcome Offers for September 2020</strong><br>From September 7th to 30th, Valuable will give new customers the following welcome offers upon fulfilling the below requirements:</p>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Requirements</strong></td><td><strong>Items to be allocated by Valuable Capital</strong></td></tr><tr><td>Completion of registration</td><td>• HK$30 stock voucher</td></tr><tr><td>Completion of online account opening</td><td>• Trade without commission<br>• HK$100 cash coupon<br>• HK$300 stock voucher</td></tr><tr><td>First-time deposit of HK$20,000</td><td>• Real-time streaming quotes (worth HK$288/m) for HK stocks for 30 days<br>• After 30 days, the real-time streaming quotes continue if your average assets or month-end assets reach HK$50,000, and you have traded 10 times per month in the HK market</td></tr><tr><td>Open futures account and trade designated CME products during the applicable period</td><td>• An Octopus card of HK$500</td></tr><tr><td>Trade designated CUS futures</td><td>• An Octopus card of HK$200</td></tr><tr><td>IPO subscription</td><td>• 90% margin service with least 1.6% interest rate</td></tr></tbody></table></figure>



<broker-comparison-page market="hk" language="en" show_review="false" selectedbroker="valuablecapital"></broker-comparison-page>



<h2>10 reasons why you should consider VBKR</h2>



<p>1. <strong>One-stop investment platform:</strong> Invest in HK, US, China stocks and ETFs, subscribe to IPOs, purchase warrants, CBBCs, funds and margin trading services<br><br>2.&nbsp;<strong>Easy account opening:</strong> It&#8217;s 100% online and your account can be opened in 3 minutes<br><br>3.&nbsp;<strong>Low-cost trading: </strong>HK stocks are commission-free, while US stocks can be bought for as little as $1.99 USD / transaction<br><br>4.&nbsp;<strong>Free real-time quotes:</strong> Get one month free real-time quotes, and if your account balance is over HKD 50,000, it&#8217;s free <br><br>5. <strong>IPO subscriptions:</strong> Margin subscription rates that are low and up to 10x leverage<br><br>6.&nbsp;<strong>Convenient and fast deposit and withdrawals:</strong> You can deposit online and convert currencies within an hour<br><br>7.&nbsp;<strong>Large amounts of information: </strong>Financial news and columns are updated real-time and the stock analyses are informational and useful. Currently provided in Chinese only<br><br>8.<strong>Intelligent analysis:</strong> VBKR&#8217;s intelligent investment advisor can quickly create a diversified portfolio for you<br><br>9.&nbsp;<strong>Learning tools: </strong>For novices, paper trading and classrooms are available to help you learn how to invest better<br><br>10. <strong>Safe and reliable:</strong> VBKR&#8217;s licensed by the Securities and Futures Commission for Types 1, 2, 4 and 9</p>



<h2>VBKR online account opening process:</h2>



<p>Opening an account on the VBKR website or mobile app is very simple. When the Planto team tried it out, it only took a few minutes to complete the full application:</p>



<ol><li>Fill in basic account opening information such as name, contact number, address, risk preference, etc.</li><li>Upload identification document and proof of address</li><li>Deposit funds via Internet Banking, FPS or cheque</li></ol>



<figure class="wp-block-image size-large"><img loading="lazy" width="1024" height="450" src="http://34.92.68.73/wp-content/uploads/2020/04/Group-5-1-1024x450.jpg" alt="" class="wp-image-9836" srcset="https://cms.planto.io/wp-content/uploads/2020/04/Group-5-1-1024x450.jpg 1024w, https://cms.planto.io/wp-content/uploads/2020/04/Group-5-1-300x132.jpg 300w, https://cms.planto.io/wp-content/uploads/2020/04/Group-5-1-768x338.jpg 768w, https://cms.planto.io/wp-content/uploads/2020/04/Group-5-1-1536x675.jpg 1536w, https://cms.planto.io/wp-content/uploads/2020/04/Group-5-1-1200x528.jpg 1200w, https://cms.planto.io/wp-content/uploads/2020/04/Group-5-1.jpg 1747w" sizes="(max-width: 1024px) 100vw, 1024px" /></figure>



<p>Among the different deposit methods, FPS was the fastest. Just take a screenshot of the FPS receipt and upload it into the VBKR app and your funds will show up in as little as an hour! The only drawback is this only works for HKD currency transfers.</p>



<planto-button link="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoidmFsdWFibGVfYnJva2VyX0p1bHkiLCJ0eXBlIjoiaW52ZXN0bWVudF9icm9rZXIiLCJhcHBseVVybCI6Imh0dHBzOi8vaGsudmJrci5jb20vaGQvcHJvbW90aW9uLWZvci1zZWN1cml0aWVzLWFjY291bnQtcmVnaXN0cmF0aW9uIiwiZnJvbSI6IlZhbHVhYmxlIEp1bHkgT2ZmZXIgV2Vic2l0ZSJ9">Download VBKR</planto-button>



<h2>One app for all your trading needs</h2>



<p>Many people feel that trading requires a level of concentration that can&#8217;t be achieved on a smaller screen &#8211; luckily for you, VBKR offers iOS, Android, Windows and MacOS apps as well! </p>



<p>The VBKR app provides detailed analysis, data and charts on individual stocks, indexes and warrants. After selecting a stock, you can easily check the current price, turnover, market value, dividend rate, capital flow and other practical information. Selecting  the&#8221;Trade&#8221; tab to enter the trading page and start investing. It&#8217;s simple and easy for new investors!</p>



<figure class="wp-block-image size-large"><img loading="lazy" width="800" height="300" src="http://34.92.68.73/wp-content/uploads/2020/04/華盛通.jpg" alt="" class="wp-image-9700" srcset="https://cms.planto.io/wp-content/uploads/2020/04/華盛通.jpg 800w, https://cms.planto.io/wp-content/uploads/2020/04/華盛通-300x113.jpg 300w, https://cms.planto.io/wp-content/uploads/2020/04/華盛通-768x288.jpg 768w" sizes="(max-width: 800px) 100vw, 800px" /><figcaption>VBKR integrates real-time quotations, data analysis, and trading services. In addition to the mobile app, MacOS and Windows versions of the program are also provided to make it easy to study the market on a bigger screen</figcaption></figure>



<p>After opening an account, if you deposit more than HKD20,000, you can enjoy one month of free real-time quotes. For perpetual free real-time quotes, you&#8217;ll need to have deposits of at least HKD50,000. The threshold is not high and may be useful for investors who are active traders. In addition, like most other online brokers, VBKR does not charge a handling fee for their IPO subscriptions.</p>



<figure class="wp-block-image size-large"><img loading="lazy" width="1024" height="450" src="http://34.92.68.73/wp-content/uploads/2020/04/valuble-stock-level-tracking-2-1024x450.jpg" alt="" class="wp-image-9804" srcset="https://cms.planto.io/wp-content/uploads/2020/04/valuble-stock-level-tracking-2-1024x450.jpg 1024w, https://cms.planto.io/wp-content/uploads/2020/04/valuble-stock-level-tracking-2-300x132.jpg 300w, https://cms.planto.io/wp-content/uploads/2020/04/valuble-stock-level-tracking-2-768x337.jpg 768w, https://cms.planto.io/wp-content/uploads/2020/04/valuble-stock-level-tracking-2-1536x674.jpg 1536w, https://cms.planto.io/wp-content/uploads/2020/04/valuble-stock-level-tracking-2-1200x527.jpg 1200w, https://cms.planto.io/wp-content/uploads/2020/04/valuble-stock-level-tracking-2.jpg 1747w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>VBKR has detailed information on individual stocks and warrants with a simple interface so new investors can get started easily.</figcaption></figure>



<p>Buying and selling stocks in VBKR is similar to that of ordinary banks or investment brokers. Just select the order type, confirm the number of shares you&#8217;d like to buy and the price; if you want to buy and sell Hong Kong stock odd lots, you can go through the &#8220;Fold Limit Order&#8221; section. This feature makes it easier to sell odd lot stocks with low liquidity, and also helps novice investors with little principal to buy high-quality stocks with a lower investment amount.</p>



<h2>Sina Finance &amp; Community [Chinese only]</h2>



<p>Many securities brokers have tried to provide financial news in their mobile apps, and VBKR, as a product of Sina Group, integrates financial content from Sina and Weibo. Open the &#8220;Community&#8221; section of the VBKR mobile app and you can read a large number of financial news reports, analysis columns and investment experts sharing their experiences on social platforms. The content is updated 24 hours a day, and you can also get instant news of US stocks in the middle of the night.</p>



<p>In addition, in the &#8220;VBKR Classroom&#8221;, users can watch teaching videos, broadcasts and articles about Hong Kong and US stocks, covering basic knowledge of stocks, introduction to CBBCs, market analysis, etc., they even have the famous financial KOL Shi Fu (Shi Hongyi) teaching as well! The lessons are short and easy to understand &#8211; both novices and veterans could learn something from them!</p>



<p>There is no shortage of cost-effective investment brokers in the market, but the informational content in VBKR stands out. Even if you invest with other securities firms, you may wish to use VBKR to keep up with the latest stock market news and data.</p>



<figure class="wp-block-image size-large"><img loading="lazy" width="800" height="300" src="http://34.92.68.73/wp-content/uploads/2020/04/華盛通資訊.jpg" alt="" class="wp-image-9705" srcset="https://cms.planto.io/wp-content/uploads/2020/04/華盛通資訊.jpg 800w, https://cms.planto.io/wp-content/uploads/2020/04/華盛通資訊-300x113.jpg 300w, https://cms.planto.io/wp-content/uploads/2020/04/華盛通資訊-768x288.jpg 768w" sizes="(max-width: 800px) 100vw, 800px" /><figcaption>VBKR provides a lot of financial information and investing lessons &#8211; unfortunately the content is only available in Chinese</figcaption></figure>



<p>VBKR also has robo-advisory functionality &#8211; if you&#8217;re not sure how to invest, you can invest in a diversified portfolio composed of ETFs with one click. The system will prompt you to adjust positions when the market conditions change, making investment simple whilst helping you build a good habit. Whether the performance of the robo-advisory algorithm is better than humans is hard to say &#8211; but it can be a good way to enter the market while you&#8217;re doing your own research!</p>



<p>If you&#8217;re scared of investing in the market, or have different strategies you want to try, another way you can test these is with VBKR&#8217;s simulated stock trading functions. You get a virtual initial capital of HKD 1 million and you can practice paper-trading before diving into the real thing.</p>



<figure class="wp-block-image size-large"><img loading="lazy" width="800" height="300" src="http://34.92.68.73/wp-content/uploads/2020/04/華盛證券網上客服.jpg" alt="" class="wp-image-9699" srcset="https://cms.planto.io/wp-content/uploads/2020/04/華盛證券網上客服.jpg 800w, https://cms.planto.io/wp-content/uploads/2020/04/華盛證券網上客服-300x113.jpg 300w, https://cms.planto.io/wp-content/uploads/2020/04/華盛證券網上客服-768x288.jpg 768w" sizes="(max-width: 800px) 100vw, 800px" /><figcaption>VBKR also has an online account manager to answer inquiries about account opening or how to use the app. The response rate during our test was quite fast &#8211; but they also have WhatsApp and phone call centers if you need help.</figcaption></figure>



<broker-comparison-page market="hk" language="en" show_review="“false&quot;" selectedbroker="valuablecapital"></broker-comparison-page>



<p></p>


Through Valuable Capital Limited, a subsidiary of Sina Group, users can invest in Hong Kong, US and China stock markets on a single platform with services like IPO subscription, warrants and margin trading. If you open a Valuable Broker account via the Planto website, you can enjoy new offers like free real-time quotes!

Valuable Capital Limited (VBKR) Review: Commission-free HK stock trading, free real-time quotes


<p>Due to heated competition between investment service providers, various securities brokers are competing for new customers. In recent months, securities brokers are going above and beyond competing with services, and account opening welcome offers are becoming a norm among <a href="https://www.planto.hk/en/blog/invest-hk-stocks-broker-bank-accounts/">securities brokers in Hong Kong</a>.</p>



<p>Consumers are opening securities accounts for investment, and no welcome offer would prove to be more attractive than having blue-chip stocks in the newly opened account, for free!</p>



<p>Welcome offers from providers like <a href="https://www.planto.hk/zh/blog/futu-brokers-review/">Futu Securities</a>,<a href="https://www.planto.hk/en/blog/SoFi-Hong-Kong-Broker-Review/"> SoFi HK (Formerly 8 Securities)</a>, <a href="https://www.planto.hk/zh/blog/uSMART-brokers-review/">uSMART Securities</a> and 9F Securities are currently among the most attractive in the market. Find out how you can get free stocks in your new securities account below:</p>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Securities Firm</strong></td><td><strong><a href="https://www.planto.hk/en/blog/SoFi-Hong-Kong-Broker-Review/">SoFi HK</a></strong></td><td><strong><a href="https://www.planto.hk/zh/blog/uSMART-brokers-review/">uSMART Securities</a></strong></td><td><strong>9F Securities</strong></td><td><strong><a href="https://www.planto.hk/zh/blog/futu-brokers-review/">Futu Securities</a></strong></td></tr><tr><td><strong>Free Stock Offers and Conditions</strong></td><td>Earn 20 SoFi points after account opening. Get more points through various activities and exchange them for free SnapChat, Twitter or Coca Cola shares.</td><td>1 share of Jiumaojiu after account opening<br><br>2 shares of Peijia Medical if first-time deposit &gt; HK$20,000<br><br>2 shares of Ping An Good Doctor if first transaction is over HK$500 and assets under management amount reach HK$100,000 or above within 30 days upon account activation</td><td>Get 2 and up to 10 shares of CLP Holdings after depositing a minimum of HK$20,000</td><td>Get 1 share of HSBC and Tencent each after depositing HK$20,000 or more</td></tr><tr><td><strong>Other Offers</strong></td><td>⭐️No commission and platform free for U.S. and Hong Kong stock trading</td><td>⭐️Zero commission plan for U.S. and Hong Kong stock trading</td><td>⭐️0 platform fee and transaction fee for HK stocks.<br><br>⭐️Free 30-day trial for LV2 streaming.</td><td>⭐️HK$100 supermarket gift voucher<br>Life long commission free Hong Kong stock trading</td></tr><tr><td><strong>More Details</strong></td><td><a href="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoiZWlnaHRzZWN1cml0aWVzX3NvZmkiLCJ0eXBlIjoiaW52ZXN0bWVudF9icm9rZXIiLCJhcHBseVVybCI6Imh0dHBzOi8vZ28ub25lbGluay5tZS8xdFZvP3BpZD1QbGFudG8mYz1QbGFudG9fU29GaUhvbmdLb25nJmFmX3dlYl9kcD1odHRwcyUzQSUyRiUyRnd3dy5zb2ZpLmhrJTJGd2ViJTJGemgtaGFudCUyRm9wZW4tYWNjb3VudCUyRiUzRnV0bV9zb3VyY2UlM0RQbGFudG8lMjZ1dG1fbWVkaXVtJTNEQWZmaWxpYXRlcyUyNnV0bV9jYW1wYWlnbiUzRFBsYW50byIsImZyb20iOiJicm9rZXIgd2VsY29tZSBvZmZlciB0YWJsZSB0YWJsZSJ9">Visit Broker</a></td><td><a href="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoidXNtYXJ0X2Jyb2tlciIsInR5cGUiOiJpbnZlc3RtZW50X2Jyb2tlciIsImFwcGx5VXJsIjoiaHR0cHM6Ly91c21hcnRzZWN1cml0aWVzLmNvbS9BZmZpbGlhdGUvdC9OciIsImZyb20iOiJicm9rZXIgd2VsY29tZSBvZmZlciB0YWJsZSB0YWJsZSJ9">Visit Broker</a></td><td><a href="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoiOUZfYnJva2VyIiwidHlwZSI6ImludmVzdG1lbnRfYnJva2VyIiwiYXBwbHlVcmwiOiJodHRwczovL3d3dy45ZnN0b2NrLmNvbS9uZXctb3Blbi1zdG9jay5odG1sP2NoYW5uZWxJZD01NTUmdXRtX3NvdXJjZT0zcmQtemh1Y2UmdXRtX21lZGl1bT1wbGFudG8iLCJmcm9tIjoiYnJva2VyIHdlbGNvbWUgb2ZmZXIgdGFibGUgdGFibGUifQ==">Visit Broker</a></td><td><a href="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoiZnV0dV9zZWN1cml0aWVzIiwidHlwZSI6ImludmVzdG1lbnRfYnJva2VyIiwiYXBwbHlVcmwiOiJodHRwczovL3Bhc3Nwb3J0LmZ1dHU1LmNvbS9zZW0vaGs/bGFuZGluZ0lkPTMmY2hhbm5lbD02NDIiLCJmcm9tIjoiYnJva2VyIHdlbGNvbWUgb2ZmZXIgdGFibGUgdGFibGUifQ==">Visit Broker</a></td></tr></tbody></table><figcaption>The above offers are limited time offers and they are subjected to periodical updates. Latest offer information can be found on securities firm’s websites.</figcaption></figure>



<p><strong>Free stocks are especially great for new investors</strong></p>



<p>From experienced investors’ perspective, receiving a few free shares may not have any impact on their overall portfolio, however this may not be the case for new investors. According to a survey done by Hong Kong Investor Education Center, over 62% of their survey respondents want to increase their wealth through investment, but they are afraid of losing money.&nbsp;</p>



<p>First time experiences are often scary, and they intensify when money is at stake. New investors may be concerned about making the right investment choice or they feel unfamiliar with the buying/selling process of investment which ultimately lead to the fear of losing money.</p>



<p>Free stocks solve this problem for new investors by giving them stocks to manage for free as soon as they open an account. They can experience the up and down of investment, then try selling off stocks for profit before they invest their own money.&nbsp;</p>



<p>Furthermore, securities firms like Futu and 9F do not charge any custodian fee so new investors can take their time and experience investment process free of charge. Since welcome offers typically give out popular blue-chip shares, new investors can also use this chance to get to know these companies and their performance before consider investing their own money.</p>



<p><strong>Odd lots</strong></p>



<p>Most welcome offers will give out 1 or 2 share(s), which will be considered an odd lot because it amounts to less than 1 single board lot (For example 1 single HSBC lot size contains 400 shares). According to HKEX, odd lots are not accepted by the Exchange’s trading system for auto-matching, but there is a special lot market in the system for odd lots trading. In general, share prices of odd lots are slightly lower than that of the same security in the board lot market due to their lower liquidity.</p>



<p>Given the welcome offer’s odd lots are free in the first place and their selling price could increase in the future, a slight discount in share price should not be a big consideration. Although odd lots are typically eligible for dividend, if the number of shares is too small, any dividend could be offset by handling or platform fee.</p>



<p>The concept of odd lot does not apply if you receive U.S. stock as part of the welcome offer since the lot system is unique to the Hong Kong market. U.S. stocks are traded on per share basis so welcome offer shares will have the same liquidity as any other shares.</p>



<p><strong>Welcome offer comparison and more details</strong></p>



<p>Securities firms in Hong Kong are offering a wide range of welcome offers to new customers. Find out more and compare them below:</p>



<p><broker-comparison-page articlename="HK Stock Investing Article" country="HK" language="en"></broker-comparison-page></p>



<h4>Recommended Readings</h4>



<ul><li><a href="https://www.planto.hk/en/blog/Portfolio-Diversification-Investment/">Investment Strategy Guide to building a diversified portfolio</a></li><li><a href="https://www.planto.hk/en/blog/Valuable-Capital-Broker-Review/">Valuable Capital Review:&nbsp;Commission-free HK stock trading, free real-time quotes</a></li><li><a href="https://www.planto.hk/en/blog/futu-brokers-review/">Futu Securities Review</a></li><li><a href="https://www.planto.hk/en/blog/saxo-bank-review-offshore-account/">Saxo Bank Review: A Simple Offshore Banking &amp; Trading Solution for Hong Kongers</a></li></ul>



<p style="font-size:14px"><strong>Important information:</strong><br><br>Investment involves risks. This information is intended to be educational and is not tailored to the investment needs of any specific investor. This information does not constitute investment advice and should not be used as the basis for any investment decision nor should it be treated as a recommendation for any investment or action. Past performance is no guarantee of future results. The value of investments and the income from them can go down as well as up, so you may not get back what you invest.</p>


How to get free stocks from brokers in Hong Kong? Welcome offers from providers like Futu Securities, SoFi HK, uSMART Securities and 9F Securities are currently among the most attractive in the market. Find out how you can get free stocks in your new securities account.

Welcome Offer Comparison: Get Free Blue-Chip Stocks With New Investment Accounts


<p>Many Hong Kong consumers who feel uncertain about the country’s prospect have been looking to move a portion of their asset overseas in order to reduce geographical risks within their portfolio. When it comes to investment assets, <strong>Firstrade</strong> is a commission free, offshore platform that Hong Kong investors can easily apply for.&nbsp;</p>



<p>Within this article, <strong>Planto</strong> will be reviewing pro &amp; con of investing with <strong>Firstrade</strong> as well as providing a step-by-step guide on how to open a <strong>Firstrade</strong> account.</p>



<hr class="wp-block-separator"/>



<h4>Editor’s choice</h4>



<ul><li><a href="https://www.planto.hk/en/blog/saxo-bank-review-offshore-account/">Saxo Bank Review: A Simple Offshore Banking &amp; Trading Solution for Hong Kongers</a></li><li><a href="https://www.planto.hk/en/blog/uSMART-brokers-review/">Review: uSMART Securities</a></li><li><a href="https://www.planto.hk/en/blog/SoFi-Hong-Kong-Broker-Review/">Review: SoFi Hong Kong</a></li></ul>



<hr class="wp-block-separator"/>



<planto-button link="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoiZmlyc3R0cmFkZSIsInR5cGUiOiJpbnZlc3RtZW50X2Jyb2tlciIsImFwcGx5VXJsIjoiaHR0cHM6Ly9hZmZpbGlhdGUuZmlyc3RyYWRlLmNvbS9hZmZpbGlhdGUvaWRldmFmZmlsaWF0ZS5waHA/aWQ9NzU3IiwiZnJvbSI6IkZpcnN0IHRyYWRlIG9wZW4gYWNjb3VudCJ9">Open a Firstrade Account</planto-button>



<h2><strong>Pro and Con of Firstrade</strong></h2>



<figure class="wp-block-table"><table><tbody><tr><td><strong>Pro</strong></td><td><strong>Con</strong></td></tr><tr><td>0 transaction, custodian, or platform fee</td><td>Relatively high cost of fund deposit or remittance. It would be more cost effective to remit a larger sum in one go</td></tr><tr><td>Wide range of investment options including stocks, ETF, options and more than 11,000 mutual funds</td><td>Debit card withdrawal outside of the U.S. will be charged 3% per transaction</td></tr><tr><td>Among one of the easiest offshore account to open for Hong Kong investors. After a completely online account opening process, investors can start trading within a few days after making deposit</td><td>Relatively expensive margin interest</td></tr><tr><td>Assets are protected by Securities Investor Protection Corporation (SIPC). If the broker fails financially, investors can be compensated up to US$500,000.</td><td>No welcome or account opening rewards when compared to other Hong Kong based brokers like <a href="https://www.planto.hk/en/blog/futu-brokers-review/"><strong>Futu</strong> </a>or <a href="https://www.planto.hk/en/blog/uSMART-brokers-review/"><strong>uSmart</strong></a></td></tr><tr><td>No minimum deposit requirement</td><td></td></tr><tr><td>Both product interface and customer service are available in English and Chinese</td><td></td></tr><tr><td>Users can apply for <strong>Firstrade</strong>’ Visa debit card which can be used around the world</td><td></td></tr></tbody></table></figure>



<h3><strong>Opening an account with Firstrade</strong></h3>



<p><strong>Firstrade</strong>’s online account opening process is very simple and can be completed within a few minutes.</p>



<ol><li>Open an account via <strong>Firstrade</strong>’s website</li><li>Upload identification document (Support both HKSAR Passport or BNO)</li><li>Fill in basic information such as name, address, email, employment status and investment preference</li><li>Set up electronic signature and submit the application</li></ol>



<p>A confirmation email will be sent immediately after the application is submitted successfully. When the Planto team tested the account opening process, our account was approved and opened 5 hours after we received the confirmation email – this speed is pretty much the same as opening <a href="https://www.planto.hk/en/blog/US-Stock-Account-Compare/">an U.S. brokerage account in Hong Kong</a>.</p>



<p>Once the account is opened, one remaining step is to deposit money and start trading.</p>



<figure class="wp-block-image"><img src="https://lh6.googleusercontent.com/lJn09hlKL55GhhuYx_heWSHdW4nGPBnWFaWo_1UX0IXupDMjGfIbAoYif0QDL2R3A17IxauVo6We_NhUf85CEMIDdTIkM0Yb2cgKoD41GELLz82rTtd9EJuYyFNS-f_XJ8OHQts" alt=""/><figcaption>It only takes a few minutes to apply and the account is generally approved within one day.</figcaption></figure>



<h3><strong>Deposit transfer and withdrawal fees vary across different banks</strong></h3>



<p>Depositing funds into <strong>Firstrade</strong> account follows a similar process as any other brokerages, however fund deposit for <strong>Firstrade</strong> will be done through an international transfer. The transfer can be made via online banking platform or at bank branches, and it generally requires information such as name of the receiving bank, SWITFT code, payee account name, account number and the user’s full name in English.&nbsp;</p>



<figure class="wp-block-image size-large"><img loading="lazy" width="1024" height="775" src="http://34.92.68.73/wp-content/uploads/2020/07/WIRE-FUNDS-INTO-YOUR-FIRSTRADE-ACCOUNT-1024x775.png" alt="" class="wp-image-11233" srcset="https://cms.planto.io/wp-content/uploads/2020/07/WIRE-FUNDS-INTO-YOUR-FIRSTRADE-ACCOUNT-1024x775.png 1024w, https://cms.planto.io/wp-content/uploads/2020/07/WIRE-FUNDS-INTO-YOUR-FIRSTRADE-ACCOUNT-300x227.png 300w, https://cms.planto.io/wp-content/uploads/2020/07/WIRE-FUNDS-INTO-YOUR-FIRSTRADE-ACCOUNT-768x581.png 768w, https://cms.planto.io/wp-content/uploads/2020/07/WIRE-FUNDS-INTO-YOUR-FIRSTRADE-ACCOUNT-1200x908.png 1200w, https://cms.planto.io/wp-content/uploads/2020/07/WIRE-FUNDS-INTO-YOUR-FIRSTRADE-ACCOUNT.png 1470w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>Users have to pay for the cost of international wire transfers. Exchange rates and transfer fees vary across different banks.</figcaption></figure>



<p>When the <strong>Planto</strong> team inquired about fund withdrawal cost, we were told that <strong>Firstrade</strong> will not charge any additional handling fee to Hong Kong users who choose to use bank transfer, however banks usually charge transfer fee of about US$35 (approximately HK$270) – but the actual fee may vary from one bank to another.</p>



<p>If the user choose to use <strong>Firstrade</strong>’s Debit Card for fund withdrawal, a fee of 3% of transaction amount will be charged each time. However users with asset more than US$10,000 in their account are eligible for free withdraw of up to US$1,000 once every month. In general, the users should avoid making frequent withdrawal in order to avoid unnecessary fees.</p>



<planto-button link="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoiZmlyc3R0cmFkZSIsInR5cGUiOiJpbnZlc3RtZW50X2Jyb2tlciIsImFwcGx5VXJsIjoiaHR0cHM6Ly9hZmZpbGlhdGUuZmlyc3RyYWRlLmNvbS9hZmZpbGlhdGUvaWRldmFmZmlsaWF0ZS5waHA/aWQ9NzU3IiwiZnJvbSI6IkZpcnN0IHRyYWRlIG9wZW4gYWNjb3VudCJ9">Visit Broker</planto-button>



<h4>Recommended Readings</h4>



<ul><li><a href="https://www.planto.hk/en/blog/Portfolio-Diversification-Investment/">Investment Strategy Guide to building a diversified portfolio</a></li><li><a href="https://www.planto.hk/en/blog/Valuable-Capital-Broker-Review/">Valuable Capital Review:&nbsp;Commission-free HK stock trading, free real-time quotes</a></li><li><a href="https://www.planto.hk/en/blog/futu-brokers-review/">Futu Securities Review</a></li><li><a href="https://www.planto.hk/en/blog/saxo-bank-review-offshore-account/">Saxo Bank Review: A Simple Offshore Banking &amp; Trading Solution for Hong Kongers</a></li></ul>



<p style="font-size:14px"><strong>Important information:</strong><br><br>Investment involves risks. This information is intended to be educational and is not tailored to the investment needs of any specific investor. This information does not constitute investment advice and should not be used as the basis for any investment decision nor should it be treated as a recommendation for any investment or action. Past performance is no guarantee of future results. The value of investments and the income from them can go down as well as up, so you may not get back what you invest.</p>


Firstrade is a commission free, offshore platform that Hong Kong investors can easily apply for. Planto will be reviewing pro & con of investing with Firstrade as well as providing a step-by-step guide on how to open a Firstrade account.

Offshore Securities Brokerage: Firstrade Account Opening Considerations for Hong Kong Consumers


<p><strong>SoFi</strong>, a FinTech unicorn from the U.S. recently acquired Hong Kong’s homegrown online securities firm,<strong> 8 Securities</strong> – <strong>SoFi </strong>subsequently launched a new securities trading app called <strong>SoFi Hong Kong</strong> (“SoFi HK”). </p>



<p>The new<strong> SoFi HK</strong> app features the same commission free U.S. and Hong Kong stock trading as 8 Securities app, with additional features in the pipeline including margin financing and frictional share U.S. stock trading.</p>



<broker-comparison-page market="hk" language="en" show_review="false" selectedbroker="sofihk"></broker-comparison-page>



<h2><strong>Open an SoFi HK account in 5 minutes using online application and e-signature</strong></h2>



<ol><li>Fill in basic information such as your name, phone number, address, work, financials, investment preference etc.</li><li>Upload proof of address and identity (HKID/Passport)</li><li>Provide e-signature through your mobile, deposit HK$10,000 via bank transfer then upload your transfer proof</li><li>The account will typically be opened within 2 to 3 working days, you will be able to start investing immediately afterward</li></ol>



<planto-button link="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoiZWlnaHRzZWN1cml0aWVzX3NvZmkiLCJ0eXBlIjoiaW52ZXN0bWVudF9icm9rZXIiLCJhcHBseVVybCI6Imh0dHBzOi8vZ28ub25lbGluay5tZS8xdFZvP3BpZD1QbGFudG8mYz1QbGFudG9fU29GaUhvbmdLb25nJmFmX3dlYl9kcD1odHRwcyUzQSUyRiUyRnd3dy5zb2ZpLmhrJTJGd2ViJTJGemgtaGFudCUyRm9wZW4tYWNjb3VudCUyRiUzRnV0bV9zb3VyY2UlM0RQbGFudG8lMjZ1dG1fbWVkaXVtJTNEQWZmaWxpYXRlcyUyNnV0bV9jYW1wYWlnbiUzRFBsYW50byIsImZyb20iOiJTb2ZpIFJldmlldyJ9">Download SoFi HK</planto-button>



<p>Some consumers have inquired about the validity and necessity of the HK$10,000 deposit during the account opening process – this is actually a requirement by the SFC as a standard practice for opening a securities account online so it is a common practice and there is nothing to worry about!</p>



<figure class="wp-block-image size-large"><img loading="lazy" width="1024" height="297" src="http://34.92.68.73/wp-content/uploads/2020/07/SoFI-commission-free-1024x297.png" alt="" class="wp-image-11099" srcset="https://cms.planto.io/wp-content/uploads/2020/07/SoFI-commission-free-1024x297.png 1024w, https://cms.planto.io/wp-content/uploads/2020/07/SoFI-commission-free-300x87.png 300w, https://cms.planto.io/wp-content/uploads/2020/07/SoFI-commission-free-768x222.png 768w, https://cms.planto.io/wp-content/uploads/2020/07/SoFI-commission-free-1536x445.png 1536w, https://cms.planto.io/wp-content/uploads/2020/07/SoFI-commission-free-2048x593.png 2048w, https://cms.planto.io/wp-content/uploads/2020/07/SoFI-commission-free-1200x348.png 1200w, https://cms.planto.io/wp-content/uploads/2020/07/SoFI-commission-free-1980x573.png 1980w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption><strong>SoFi HK</strong> is the lowest fee trading platform in Hong Kong. </figcaption></figure>



<h2><strong>SoFi HK app, the newly introduced SoFi points and soon-to-come fractional share trading</strong></h2>



<p>The <strong>SoFi HK</strong> app’s interface is similar to the<strong> 8 Securities</strong>’ app, however the color theme has been changed to <strong>SoFi</strong>’s refreshing sky blue but you can still pick between light and dark modes. </p>



<p>Within the app, users can choose to trade from 15,000+ <a href="https://www.planto.hk/en/blog/US-Stock-Account-Compare/">U.S. stocks</a>, <a href="https://www.planto.hk/en/blog/invest-hk-stocks-broker-bank-accounts/">Hong Kong stocks</a> as well as <a href="https://www.planto.hk/en/blog/etf-explained/">ETF</a> funds – with $0 commission, $0 platform fees and no other hidden fees. </p>



<p>If you are an existing <strong>8 Securities</strong>’ app user, you will notice a newly added section within the <strong>SoFi HK</strong> app called “<strong>SoFi Points</strong>”, a newly introduced reward system where users can earn points by completing various tasks within the app including open an account (20 points), log-in daily (1 point), invite friend (20 points), open an account through referral (20 points) etc.</p>



<p><strong>SoFi Points </strong>can be used to redeem free shares, for example 80 points can be exchanged for 1 free share of <strong>SnapChat (SNAP)</strong>. If you are an active app user who keeps a close eye on the stock market, you would be able to earn a few free shares throughout the year – a rewarding experience for loyal or active users which is uncommon in Hong Kong where most securities platforms only give out rewards to new users. Although the users should keep in mind that SoFi points will expire at the end of each year.</p>



<figure class="wp-block-table"><table><tbody><tr><td><strong>SoFi Points</strong></td><td><strong>Rewards (and US dollar value equivalent as at 13 July 2020)&nbsp;</strong></td></tr><tr><td>80</td><td>1 share of SnapChat (SNAP, US$24.27 per share)</td></tr><tr><td>220</td><td>1 share of Twitter (TWTR, US$33.82 per share)</td></tr><tr><td>440</td><td>1 share of Coca Cola (KO, US$42.25 per share)</td></tr></tbody></table></figure>



<p>Additionally,<strong> SoFi HK</strong> was the first player in Hong Kong to announce fractional share trading as part of their future pipeline, this feature will allow investors in Hong Kong to invest in U.S. stock with as little as US$10 (or HK$78). U.S. stocks are typically traded on a per share basis, however even 1 blue chip share could be worth as much as HK$10,000 – for example 1 share of Alphabet (GOOGL), the parent company of Google, is worth more than US$1,500 or approximately HK$11,625 as of July 9<sup>th</sup>. </p>



<p>The fractional share trading feature will allow a “fraction” of 1 share to be purchased and sold. In other words, even with just tens of US dollars, you can become a shareholder of one or multiple blue chip companies in the U.S. such as Amazon (AMZN), Tesla (TSLA) and Apple (AAPL).</p>



<p>However, <strong>SoFi HK</strong>’s fractional share trading is still subject to regulatory approval, this means <strong>SoFi HK</strong>’s users will have to wait a little longer before they can enjoy this feature.</p>



<figure class="wp-block-image size-large is-resized"><img loading="lazy" src="http://34.92.68.73/wp-content/uploads/2020/07/image.png" alt="" class="wp-image-11098" width="610" height="231" srcset="https://cms.planto.io/wp-content/uploads/2020/07/image.png 940w, https://cms.planto.io/wp-content/uploads/2020/07/image-300x114.png 300w, https://cms.planto.io/wp-content/uploads/2020/07/image-768x291.png 768w" sizes="(max-width: 610px) 100vw, 610px" /><figcaption><strong>SoFi</strong> has added a new section for <strong>SoFi Points</strong>, while its leaderboard and other stock related screens are mostly the same as the <strong>8 Securities</strong>’ app. More updates will be coming soon.</figcaption></figure>



<h4><strong>Other useful services</strong></h4>



<ul><li><strong>US dollar exchange:</strong> SoFi users can seamlessly exchange their HKD into USD within the mobile app. One point to note is that the exchange rate displayed on the app is for reference only, the actual exchange rate may differ slightly from the displayed value. Users can also purchase U.S. stock directly without exchanging currencies in advance</li><li><strong>Leaderboard</strong>: SoFi’s anonymous leaderboard allows its users to learn or follow investment strategies of the most successful investors within the platform</li><li><strong>Academy:</strong> Investment academy feature provides multiple videos to answer questions like “What is a stock”, “What is asset allocation”, “What is diversification” and many more </li></ul>



<p>In terms of fees, <strong>SoFi HK</strong> is undoubtedly the best in Hong Kong market, however if you are looking for functionality, some of the popular features like streaming quotes or news and analysis features may still be lacking. </p>



<p>There are other online brokerages like <a href="https://www.planto.hk/en/blog/uSMART-brokers-review/"><strong>uSMART</strong></a> and <a href="https://www.planto.hk/en/blog/futu-brokers-review/"><strong>Futu</strong></a> that offers more features so one strategy you could consider is to make use of 2 platforms – one for tracking, analysis and alert features while another is primarily for making trades – this way you could take the most advantage of <strong>SoFi</strong> <strong>HK</strong>’s low cost trading without missing out or anything.</p>



<h3><strong>Existing 8 Securities customers are required to update their old mobile app</strong></h3>



<p>If you are one of 8 Securities’ existing customers, you can start using the new <strong>SoFi HK </strong>app immediately after a quick update which will replace your old 8 Securities app with the new <strong>SoFi HK</strong> app.</p>



<p><strong>SoFi HK</strong> stated that during this transition period, users may receive notifications or other forms of communications from 8 Securities Limited or “8 SL”, but this will eventually become<strong> SoFi Securities (Hong Kong) Limited </strong>or “<strong>SoFi HK</strong>” in the future.</p>



<h3><strong>The parent company, SoFi in the U.S. has more than 1 million users</strong></h3>



<p>Mike Cagney, a Stanford University business school student founded SoFi in 2011. Headquartered in San Francisco, SoFi was selected by Forbes as one of the top 5 fintech companies in the U.S.. The company has a valuation of over US$4.4 billion (approximately HK$34.4 billion), with many renowned investors like Softbank and Qatar Investment Authority as its shareholders. SoFi’s acquisition of 8 Securities was their first step into international market expansion.</p>



<h4><strong>Key fees and charges</strong></h4>



<p>While <strong>SoFi HK</strong> offers trading at 0 fees and commissions, the users will still need to pay taxes and other fees to the government (this is the same across all brokerages). </p>



<figure class="wp-block-table"><table><tbody><tr><td>Hong Kong stock exchange and government fee</td><td>U.S. stock exchange and government fee</td></tr><tr><td>Stamp duty: 0.1% (fees lower than HK$1 will be rounded up to HK$1)</td><td>Securities commission fee (sell): 0.00221% (minimum of US$0.01)</td></tr><tr><td>Transaction levy: 0.0027% (round to nearest cent)</td><td>Transaction levy (sell): US$0.000119 per share (minimum of US$0.01 and maximum of US$5.95)</td></tr><tr><td>HKEX transaction fee: 0.005% (round to nearest cent)</td><td><br></td></tr><tr><td>Clearing and settlement fee: 0.002% (minimum of HK$2 and maximum of HK$200)</td><td><br></td></tr><tr><td>Trading tariff: HK$0.5 per trade</td><td><br></td></tr><tr><td><br></td><td><br></td></tr><tr><td>Other charges</td><td>Other charges</td></tr><tr><td>Hosting fee: free</td><td>Hosting fee: free</td></tr><tr><td>Stock transfer fee: HK$0.2 per lot</td><td><br></td></tr><tr><td>Dividend fee: 0.5% (minimum of HK$28)</td><td>Dividend fee: free</td></tr><tr><td>Bonus share entitlement: HK$1 per lot (minimum of HK$28)&nbsp;</td><td><br></td></tr><tr><td>IPO: HK$88 (no charge If unsuccessful)</td><td><br></td></tr><tr><td>Deposit / withdraw: Free for HSBC / BOC HK$15 or US$2 for non HSBC / BOC Overseas transfer at cost (min US$35)</td><td>Deposit / withdraw: Free for HSBC / BOC HK$15 or US$2 for non HSBC / BOC Overseas transfer at cost (min US$35)</td></tr></tbody></table><figcaption><a href="https://www.sofi.hk/forms/Pricing_EN.pdf">Link to the full pricing list</a></figcaption></figure>



<planto-button link="https://www.planto.hk/en/redirect/?params=eyJwcm9kdWN0IjoiZWlnaHRzZWN1cml0aWVzX3NvZmkiLCJ0eXBlIjoiaW52ZXN0bWVudF9icm9rZXIiLCJhcHBseVVybCI6Imh0dHBzOi8vZ28ub25lbGluay5tZS8xdFZvP3BpZD1QbGFudG8mYz1QbGFudG9fU29GaUhvbmdLb25nJmFmX3dlYl9kcD1odHRwcyUzQSUyRiUyRnd3dy5zb2ZpLmhrJTJGd2ViJTJGemgtaGFudCUyRm9wZW4tYWNjb3VudCUyRiUzRnV0bV9zb3VyY2UlM0RQbGFudG8lMjZ1dG1fbWVkaXVtJTNEQWZmaWxpYXRlcyUyNnV0bV9jYW1wYWlnbiUzRFBsYW50byIsImZyb20iOiJTb2ZpIFJldmlldyJ9">Visit SoFi HK&#8217;s Website</planto-button>



<h4>Recommended readings: </h4>



<ul><li><a href="https://www.planto.hk/en/blog/Portfolio-Diversification-Investment/">Investment Strategy Guide to building a diversified portfolio</a></li><li><a href="https://www.planto.hk/en/blog/Valuable-Capital-Broker-Review/">Valuable Capital Review: Commission-free HK stock trading, free real-time quotes</a></li><li><a href="https://www.planto.hk/en/blog/futu-brokers-review/">Futu Securities Review</a></li></ul>



<p style="font-size:14px"><strong>Important information:</strong><br><br>Investment involves risks. This information is intended to be educational and is not tailored to the investment needs of any specific investor. This information does not constitute investment advice and should not be used as the basis for any investment decision nor should it be treated as a recommendation for any investment or action. Past performance is no guarantee of future results. The value of investments and the income from them can go down as well as up, so you may not get back what you invest.</p>


Trade U.S. and Hong Kong stock at 0 fee & commission! Check out SoFi HK's Account Opening Guideline and Money Saving Tips on U.S. Stock Trading. Learn how to redeem free stocks using SoFi Points!


SoFi HK Review: Trade U.S. & HK Stock at $0 Commission and Get Free Stocks Using SoFi Points

Saxo Bank is the parent company of Saxo Capital Markets Hong Kong. Any Hong Kong resident can easily apply for a Danish offshore account to hedge their risk as well as invest in popular markets like Hong Kong, the U.S., the U.K., Japan, Singapore and many more. Learn More about how to open a Saxo Bank European offshore account!

Saxo Bank Review: A Simple Offshore Banking & Trading Solution for Hong Kongers


<p>We all love traveling. This is why our review this time is on DBS&#8217;s Black World Mastercard, which is famous for its air miles and travel perks! </p>



<credit-card-comparison-page language="en" creditcardtype="asia_miles" particularcard="dbs_black_world_master"></credit-card-comparison-page>



<h2>Key Features</h2>



<ul><li>Can earn up to 50,000 miles with their limited-time welcome offer of HK$0.5 = 1 mile</li><li>Can redeem reward programs such as Asia Miles, Avios, KrisFlyer and PhoenixMiles with your DBS$</li><li>Local Spending HK$6 = 1 Mile  </li><li>Overseas Spending HK$4=1mile  </li><li>DBS$ never expire so you can slowly plan your next trip</li><li>No charges on the conversion from DBS$ to miles</li><li>You can get DBS$ for your e-Wallet spending e.g. Octopus, PayMe, WeChat, etc.</li></ul>



<h2 id="迎新優惠">Welcome Offer</h2>



<p>Limited time only!  From 1 April 2020 to 30 June 2020, you can enjoy as low as HK$0.5 = 1 mile when you successfully apply for a new card!</p>



<figure class="wp-block-image size-large"><img loading="lazy" width="716" height="366" src="http://34.92.68.73/wp-content/uploads/2020/03/Screenshot-2020-03-31-at-8.33.16-PM.png" alt="" class="wp-image-9301" srcset="https://cms.planto.io/wp-content/uploads/2020/03/Screenshot-2020-03-31-at-8.33.16-PM.png 716w, https://cms.planto.io/wp-content/uploads/2020/03/Screenshot-2020-03-31-at-8.33.16-PM-300x153.png 300w" sizes="(max-width: 716px) 100vw, 716px" /></figure>



<h2 id="迎新優惠">Mileage Rate</h2>



<p>Between  1 Apr – 31 Jun 2020</p>



<ul><li>Local Spending: HK$ 6 = 1 mile</li><li>Overseas Spending: HK$ 4 = 1 mile</li><li>eWallet Spending: HK$ 6 = 1 mile</li></ul>



<h2>Basic Information</h2>



<ul><li>Annual salary requirement: HK$ 240,000</li><li>Annual fee: HK$ 2,000</li><li>Overdue payment fees: up to HK$ 300</li><li>Foreign currency transaction fee: 1.95%</li></ul>



<h2>Disadvantages</h2>



<ul><li>Online payment spending doesn&#8217;t apply to the welcome offer</li><li>PayMe, Alipay HK, Wechat Pay spending does not apply to the welcome offer</li><li>Octopus AAVS is only HK$ 12 = 1 mile</li></ul>



<h2>Is the DBS Black World Mastercard right for you?</h2>



<p>The DBS Black World Mastercard earns flight miles whether you&#8217;re spending on eating out, drinks or shopping, and there is no mileage conversion fee.&nbsp;You can use the Planto app to link your existing credit card and analyze your past spending &#8211; if you spend a lot and want to spend less time managing cards, the DBS Black World Mastercard can help you effortlessly accumulate Asia Miles. Since the DBS$ points have no expiration date, you don&#8217;t even have to worry about your points expiring and can plan your travels with ease!</p>



<next-steps-list lang="en">
        <next-steps-list-item type="content" link="https://www.planto.hk/en/blog/credit-card-compare-recommend/" title="Compare cash-back credit cards"></next-steps-list-item>
</next-steps-list>


We all love traveling. This is why our review this time is on DBS's Black World Mastercard, which is famous for its air miles and travel perks! This card offers you HK$6 = 1 mile on local spending and HK$4 = 1 mile on overseas spending, hotel booking discounts, online travel tax refund rebate, welcome offers up to 80,000 miles and much more! 

[Credit Card Review] DBS Black World Mastercard: As low as HK$0.5 = 1 Mile!


<p>It&#8217;s important to ensure you&#8217;re not taking too much risk when you&#8217;re investing. You do it all the time in everyday life if you buy insurance, wearing a seatbelt in a car or even when going for a run. It&#8217;s not that you can avoid risk entirely but you want to give yourself the best chance of succeeding &#8211; whether it comes to your health or growing your investments.</p>



<p>The surest way to reduce risk when it comes to investing is to ensure your portfolio is diversified. There&#8217;s two main categories of risk:</p>



<ol><li><strong>Systematic risk</strong>: This means macro-economic risks in the broader market, geographies or asset classes e.g. the recent China-US trade war, or the dot com bubble in the early-2000s</li><li><strong>Unsystematic risk</strong>:  This means risks specific to your investments e.g. video games regulation in China affecting Tencent, or data security concerns over Facebook</li></ol>



<h2>What is diversification</h2>



<p>In short, diversification is the concept of &#8220;don&#8217;t put all your eggs in one basket&#8221;. However, an even better way is thinking about it like a fruit market.</p>



<p>If you were running a fruit market, rather than selling only one kind of fruit, you&#8217;d want to sell many different kinds. If a natural disaster occurs which means mangoes are no longer available, you&#8217;d want to make sure you have other fruits to sell as well! </p>



<p>The natural disaster here is a systematic risk and the different fruits would be asset classes.</p>



<p>To go a step further, rather than buying all your mangoes from the same supplier, you&#8217;d want to have multiple suppliers in case one goes out of business, increases their price (among the many other reasons) &#8211; this would be an example of &#8216;unsystematic risk&#8217;.</p>



<h2>How do you use diversification in a portfolio</h2>



<p>The first step for any investor is to diversify between asset classes: equities (e.g. stocks), fixed income (e.g. bonds, money market funds, etc.) and alternatives (e.g. art, commodities, etc.).</p>



<p>The next step would be, for each asset class, to invest in different geographies, and then choosing different company sizes and industries.</p>



<p>Lastly, you would diversify away from &#8216;single&#8217; companies by buying mutual funds, <a href="https://www.planto.hk/en/blog/etf-explained/">ETFs</a> or a large number of individual securities.</p>



<p>Different asset classes, company sizes and sectors have their own risks and their own returns so each investor needs to think about their own risk tolerance when creating their portfolio. A younger couple may want to invest with higher risk to get higher returns, while someone closer to retirement would want stable returns with low risk.</p>



<single-action-item title="Robo-advisors can build a diversified portfolio for you with just a few clicks" subtitle="" button_text="Learn More" type="robo_comparison"></single-action-item>



<h2>Why regular rebalancing matters</h2>



<p>Once you have determined what your portfolio should look like, it&#8217;s important to make sure it remains the same over time. It can be very tempting to chase &#8216;high return&#8217; stocks but if you think about past events e.g. dot com bubble or the 2008 financial crisis, investors who were primarily in tech or financial services stocks suffered huge losses compared to more diversified investors.</p>



<p>Over time, if you have determined your ideal portfolio is 80% stocks and 20% bonds portfolio, it&#8217;s quite likely according to historical data that your stocks would get higher returns and thus become a larger part of your portfolio e.g. 90% stocks and 10% bonds instead. At times likes this, you need to rebalance your portfolio back to match your original risk tolerance (80% stocks, 20% bonds).</p>



<h2>Summary</h2>



<p>Building a diversified portfolio can seem like a lot of work &#8211; and it is if you want to do it right! Signs of good diversification are that that your investments work well together (if your riskier investments go down, your less risky investments shouldn&#8217;t go down as much), and that your portfolio matches your risk tolerance and goals.</p>



<next-steps-list lang="en">
    <next-steps-list-item type="content" link="https://www.planto.hk/en/blog/US-Stock-Account-Compare" title="Compare US Investment Brokers" subtitle="Understand the basics of investing in the US market"></next-steps-list-item>
    <next-steps-list-item type="robo_comparison" title="Want someone to do the investing for you?" subtitle=" Consider a robo-advisor instead!"></next-steps-list-item>
    <next-steps-list-item type="content" link="https://www.planto.hk/en/blog/low-risk-investment-tools" title="Looking for a safe place to park your cash?" subtitle="Do better than a savings account with these low risk investments"></next-steps-list-item>
</next-steps-list>



<p style="font-size:14px"><strong>Important information:</strong><br><br>Investment involves risks. This information is intended to be educational and is not tailored to the investment needs of any specific investor. This information does not constitute investment advice and should not be used as the basis for any investment decision nor should it be treated as a recommendation for any investment or action. Past performance is no guarantee of future results. The value of investments and the income from them can go down as well as up, so you may not get back what you invest.</p>


It's important to ensure you're not taking too much risk when you're investing. The first step for any investor is to diversify between asset classes: equities, fixed income and alternatives. The next step would be, for each asset class, to invest in different geographies, and then choosing different company sizes and industries.