[Investing for Beginners] Introduction to HK stocks – Banks vs Securities Firms Fee Comparison

Buying a stock is the first step towards investing. But before you can do that, you need to open a securities account. There's quite a lot of choice between banks and securities firms – so how do you choose?

Planto will help you compare the most popular Hong Kong stock accounts, show you their fees and share some basic knowledge about Hong Kong stocks to help you get off to a good start.

How to start investing in 3 steps

Open an account

You can open an account with most brokers 100% online and it only takes about 10 minutes. In most cases, you will need your HKID and address proof and that's about it.

Transfer money in

Once your account is opened, you can transfer money through bank transfers or even FPS. You'll need to deposit HKD 10,000 if you want to verify your account online (but otherwise, you can visit them in person!). Your money will usually be received within the same day.

Start investing

Once the broker receives the money and your account is verified, you can start investing - that's literally it!

Comparison of Hong Kong stock investment account fees

HK Market

US Market

Robo Advisors

Futubull

Other Fee

N/A

Avg. Trade Cost

HKD 15

Welcome Offer: Enjoy up to HK$1,800 welcome offer Register a new account on or before 30th September 2024 by using Planto exclusive promo code “PLANTO” can enjoy the below rewards: 1. Planto exclusive offer : Enter promo code “PLANTO” BEFORE account opening can enjoy HK$200 cash coupons 2. Lifetime commission-free for HK stocks and US stock LV2 real-time streaming quotation services 3. Open an account, deposit a total of HK$10,000 or above into the Futu HK account. Maintain 60 days daily average asset* of HK$10,000 or above to receive : Alibaba (NYSE:BABA) - 1 share or HK$400 supermarket e-voucher or HK$600-equivalent BTC 4. Open an account, deposit a total of HK$80,000 or above into the Futu HK account. Maintain 60 days daily average asset* of HK$80,000 or above to receive : Nvidia (NYSE:NVDA) – 1 share or HK$1,000 equivalent BTC Redemption procedures : Download Futu app; Register an account and go to Activity Centre; Enter “PLANTO” in redemption centre before account opening. Detailed procedures can refer to: https://www.planto.hk/zh/blog/futu-brokers-review/ All rewards can be stacked. As of the closing price on 11 June 2024, Alibaba (NYSE: BABA) stock price was US$77.97/share As of the closing price on 15 May 2024, Nvidia (NYSE: NVDA) stock price was US$125.2/share Asset calculation method: Sum of the everyday assets/60 days; Including Cash/ Stocks/ Funds/ Options/ Futures Investment involves risks. The fund price may move up or down. Investor should thoroughly study the funds' offering documents and other related documents (including risk disclosure statements).

Terms and conditions apply

Pros & Cons

Basic Info

Transaction Fees: Commission-free for HK stocks and Cryptocurrency. HKD 15 / trade as a platform fee only. For a HKD 10,000 trade, that's: HKD 15 per transaction (excl. mandatory costs by the HK Exchange, etc.). Tiered pricing also available for people with larger number of trades (min. HKD 1 / trade)
Futu will provide users with free LV1 real-time streaming quotation services (including Hong Kong stocks, options, and futures)
Products Available: HK, US and China stocks and ETFs and Crypto Currency. Selected funds available via Futu MoneyPlus.
Cryptocurrency: support direct trade with HKD and USD without USDT exchange before trading
Margin Trading: Annual interest rate as low as 3.98% (for advanced investors)
License: Registered member of the HKEX and licensed by the SFC (Type 1, 2, 4, 5, 7, 9)

Read full review

Futubull

Other Fee

N/A

Avg. Trade Cost

HKD 15.5

Terms and conditions apply

Pros & Cons

Basic Info

Transaction Fees: For US stocks, commissions of US$0.0049 per share (min. US$0.99), and platform fees of US$0.005 per share (min. US$1). For a US$1,000 trade with 5 shares, that's about: US$2 (excl. mandatory costs by the SEC, etc.). Tiered pricing also available for people with larger number of trades
Products Available: HK, US and China stocks and ETFs. Selected funds available via Futu MoneyPlus.
Margin Trading: Annual interest rate as low as 3.98% (for advanced investors)
License: Registered member of the HKEX and licensed by the SFC (Type 1, 2, 4, 5, 7, 9)

Read full review

Webull

Other Fee

N/A

Avg. Trade Cost

HKD 10

Welcome Offer: New customers can receive up to HK$1,888 worth of Apple stock by successfully opening a Webull account through the Planto website link! - Successfully open an account, deposit HK$10,000, and maintain the funds for 60 days to receive Apple stocks worth HK$600. - Successfully open an account, deposit HK$80,000 and maintain the funds for 60 days to receive extra Apple stocks worth HK$1,288. - Trade 50 or more option contracts to enjoy 0 commission and 0 platform fees on option trading. Terms and conditions apply.

Pros & Cons

Basic Info

Transaction Fees: No commissions - just a HKD 10 platform fee per trade. For a HKD 10,000 trade, that’s: HKD 10 per transaction
Products Available: Hong Kong and US stocks, A shares, ETFs, warrants, IPOs and odd lot shares
Real-time market information: Free real-time quotes for Hong Kong stocks (BMP quotes) and quotes from major global exchanges
Margin Trading: Unavailable
License: Licensed with the Securities and Futures Commission of Hong Kong (CE No. BNG700) for carrying out type 1 regulated activity (“dealing in securities”).

Read full review

Webull

Other Fee

N/A

Avg. Trade Cost

HKD 0

Pros & Cons

Basic Info

Transaction Fees: No commissions - just a HKD 10 platform fee per trade. For a HKD 10,000 trade, that’s: HKD 10 per transaction
Products Available: Hong Kong and US stocks, A shares, ETFs, warrants, IPOs and odd lot shares
Real-time market information: Free real-time quotes for Hong Kong stocks (BMP quotes) and quotes from major global exchanges
Margin Trading: Unavailable
License: Licensed with the Securities and Futures Commission of Hong Kong (CE No. BNG700) for carrying out type 1 regulated activity (“dealing in securities”).

Read full review

Tiger Brokers

Other Fee

Avg. Trade Cost

HKD 0

Welcome Offer: Successfully open an account through Planto’s exclusive link then complete certain tasks until 30th September 2024 to enjoy up to HK$2,300 worth of reward: - Exclusive HK$400 supermarket vouchers from Planto after depositing HK$10,000 , plus: 1. Time-limited Commission-Free Rewards* - 0 Commission for HK stock trading (Lifetime) - 0 Platform fee for HK stock trading (until 30th September 2024) - NYSE Arca Level 2 Deep Quote streaming for US stocks (until 30th September 2024) - 0 Commission for US stock option trading (until 30th September 2024) - US Stock Option Lv1 Real-time Quotes (until 30th September 2024) 2. New clients account opening awards, fund more for 45 consecutive days to get more (please refer to T&Cs for detailed quolifications) - Net deposit* HK$10,000 or US$1,500 or above : to activate HK$300 stock voucher (3x HK$100 vouchers) and 3-month free HK Stock Lv1 streaming quote - Net deposit* HK$50,000 or above : to activate HK$600 stock vouchers (6x HK$100 vouchers) - Net deposit* HK$100,000 or above : to activate HK$1,200 stock vouchers (12x HK$100 vouchers) 3. Complete 5 non-forex trades with each trade amounting to or exceeding HK$100 within 60 days after successful account opening (applicable to both Hong Kong and US stocks) : to activate HK$700 stock voucher (7x HK$100 vouchers) * Net deposit = deposit amount - withdrawal amount, excluding the part of asset increase or decrease due to normal transactions. ^Daily cumulative net deposits = (from the account opening date) cumulative deposit amount - (from the account opening date) cumulative withdrawal amount, excluding asset fluctuations caused by normal trading activities

*Subject to T&Cs

LONGBRIDGE

Other Fee

N/A

Avg. Trade Cost

HKD 15

Welcome Offer: On or before 30 September 2024, apply via Planto and use the promo code「614701」, successfully open an account and deposit HK$10,000 to receive up to HK$2,100 worth of rewards: Planto exclusive HK$200 supermarket coupon and HK$100 stock cash coupon Choose from one of the below 2 offers : A. Up to HK$1,400 : 1) APR offer for deposit with 6% + 5% (up to HK$1,200) and 2) total worth of HK$200 stocks cash coupon) B. Total worth up to HK$1,800 : 1) Total worth of HK$800 stocks cash coupon and 2) Total worth of HK$1,000 cash rebate (upon 15 tradings) New customers who transfer the stock to LongBridge can get an iPad mini 6 or the newest model of iPhone * Total worth of HK$1,000 cash rebate (upon 15 tradings) Terms and conditions

Pros & Cons

Basic Info

Transaction Fee: For HK stocks, commissions of 0.03% per trade (min HK$3), and platform fees of HK$15 per trade (0 commission during promotion period) For a HKD 10,000 trade, that's: HKD 15 per transaction (excl. mandatory costs by the HK Exchange, etc.).
Product available: HK and US stocks and ETFs
Margin trading: Annual interest rate of 6.5%
License: Licensed by the SFC (Type 1, 4, 9)

LONGBRIDGE

Other Fee

N/A

Avg. Trade Cost

HKD 8

Pros & Cons

Basic Info

Transaction Fee: For US stocks, commissions of US$0.0049 per share (min. US$0.99), and platform fees of US$0.005 per share (min. US$1) - 0 commission during promotion period. For a US$1,000 trade with 5 shares, that's about: US$2 (excl. mandatory costs by the SEC, etc.).
Product available: HK and US stocks and ETFs
Margin trading: Annual interest rate of 4.8%
License: Licensed by the SFC (Type 1, 4, 9)

uSMART Securities

Other Fee

N/A

Avg. Trade Cost

HKD 8

Welcome Offer: April special offer, Open an account with uSmart to earn: • 2024 promotion : US$1.5 transaction fee per trade for US stock, 0 commission and platform fee for HK stock • Real-time streaming quotation for HK stocks (Terms and conditions apply)• Lifetime free U.S. stock commission (only for standard accounts) • HK$20 cash coupons X8 #For HK stocks, you can enjoy 0 commission and platform fee by trading the designated 16 ETF. For US stocks, you can enjoy US$1.5 transaction fee per trade when the value of each trading of main board stocks equals or higher than US$100.

* Terms and conditions

Pros & Cons

Basic Info

Transaction Fees: 0% commission rate per US stock transaction for Standard Account users only, with a fixed US$0.005 platform fee per share
Investment product available:: HK, US and China stocks, ETFs and warrants. Selected funds available via Smart Fund platform.
Investment service available:: Discretionary Investment Management Account, Professional Investment Advisory
Margin Trading: 2.98% margin rate
License: Licensed by the SFC (Type 1, 4, 9)

Read full review

Interactive Brokers

Other Fee

N/A

Avg. Trade Cost

0.05% of Trade Value

Welcome Offer: Earn up to 4.83% annual interest rate on positive settled cash balance for accounts with total NAV of US$100,000 or higher. *Accounts with NAV of less than US$100,000 receive interest at rates proportional to the size of the account **Interest rate if for reference only, it may change any time according to market condition

Interactive Brokers

Other Fee

N/A

Avg. Trade Cost

US$0.005 / share

(min. from US$0.35)

Pros & Cons

Basic Info

Transaction Fees: For US stocks, commission fee of US$0.005 / share to US$0.0005 / share
Product available: Stocks, options, futures, currencies, bonds from 150 exchanges in 34 regions including the U.S., Canada, Mexico, Israel, Germany, Netherlands, Japan, Hong Kong, Taiwan, Singapore and India
Margin Trading: as Low as 5.3%
Hong Kong SFC license: SFC license Type 1,2,3

Syfe

Account Funding Requirements

HKD 10,000

Fees

0.35%-0.65% AUM

Stashaway

Account Funding Requirements

HKD 10,000

Fees

0.2%-0.8% AUM

Welcome Offer: New customers who successfully open a StashAway account via Planto’s link can enjoy 3 months of free management for up to HK$50,000.

Aqumon

Account Funding Requirements

HKD 10,000

Fees

0.5%-0.8% AUM

Custodian Fee

Avg. Trade Cost

BOC Hong Kong

HKD 100 - 150

per half year

0.18% - 0.25%

(min. HKD 100)

BOC Hong Kong

Custodian Fee

HKD 100 - 150

per half year

Avg. Trade Cost

0.18% - 0.25%

(min. HKD 100)

HSBC

HKD 25 - 30

per month

0.25%

(min. HKD 100)

HSBC

Custodian Fee

HKD 25 - 30

per month

Avg. Trade Cost

0.25%

(min. HKD 100)

Citibank

Free

HKD 100 if inactive for 6 months

0.18% - 0.25%

(min. HKD 100)

Citibank

Custodian Fee

Free

HKD 100 if inactive for 6 months

Avg. Trade Cost

0.18% - 0.25%

(min. HKD 100)

Trading with brokers is cheaper, opening an account can be done 100% online and the user experience of their apps is often better – there's no reason not to use them.

How much do you save by investing with a broker?

Assuming investors put HKD 20,000 each month to invest in stocks and trade on average five times a month. The mainstream banks would cost you ~ HKD 525 each month. If you use the securities brokers mentioned above, the monthly transaction fee is only about HKD 100 per month.

This difference of 425 HKD each month adds up really fast. In 10 years, it becomes HKD 51,000 in expenses (HKD 425 x 12 months x 10 years)!

In fact, if you were to invest this difference with an annual return of 6%, you'd be missing out on almost HKD 70,000!

Using a securities broker obviously reduces the fees – so even though trading with a bank offers some convenience and maybe even some extra credibility, it's hard to argue whether it's worth paying that much in fees for. Especially given these brokers are all regulated (licensed by the Securties and Futures Commission of Hong Kong) and are often successful businesses (like Futu which has even IPO'ed)!

Hong Kong stock basics

After completing the opening of the investment account and depositing funds, technically you can start investing immediately. However, it'll serve you well to know the basics of stocks before making a trading decision.

What is a stock?

A listed company issues shares to investors, and stocks are the evidence that investors own shares. After buying stocks, investors become shareholders of the company, can receive dividends, attend general meetings, and bear the risks caused by stock price fluctuations.

Hang Seng Index

The Hang Seng Index is an indicator of the performance of the Hong Kong stock market. It consists of 50 constituent stocks, mainly in the financial services, public, real estate and industrial and commercial sectors. The Hang Seng Index constituent stocks are often known as "blue chip stocks".

Hong Kong stock trading unit

Hong Kong stocks are traded on a per-lot basis – this translates to something like: "one lot of shares X share price + handling fee". As an example, the MTR Corporation (00066) has 500 shares in one lot. If the stock price is HKD 45.1, the minimum amount you'd have to invest is HKD 22,500 (1 lot x 500 shares x HKD 45.1).

Hong Kong stocks trading fees

In addition to the stock market price, the following fees must be paid to the Hong Kong Government, the Securities and Futures Commission or the Hong Kong Stock Exchange:

Brokerage commission: Basically what the bank / securities firm is charging – securities firms generally charge less tha banks
SFC transaction levy: 0.0027% of transaction amount
HKEX trading fee: 0.005% of transaction amount
Stock stamp duty: 0.1% of transaction amount
Trading system usage fee: HKD 0.5 per transaction (most firms exempt you from this fee, or charge separately!)
Central Clearing Shares Payment: 0.002% of the transaction amount (minimum HKD 2)

Hong Kong stock trading hours

The Hong Kong stock market trades on Mondays to Fridays (except public holidays) in the following periods:

	Time
Opening Session	9:00am – 9:30am
Morning Session	9:30am – 12:00pm
Lunch	12:00pm – 1:00pm
Afternoon Trading Session	1:00pm – 4:00pm
Extended Hours	4:00pm – 4:10pm

Exchange Traded Funds (ETF)

ETFs are funds that simulate an index as an investment target, such as Tracker Fund (2800) which matches the performance of the Hang Seng Index. ETF-linked indices can cover single or cross-stock markets, commodities or even different asset classes.

Real Estate Investment Trusts (REITs)

REITs are another investment vehicle that primarily invest in real estate projects in Hong Kong, Mainland China or overseas. The main source of income comes from rent and the net earnings are mandated to be distributed back to shareholders. A list of REITs can be found here.

Robot Investment Advisor (Robo Advisor)

Robo advisors use algorithms to analyze the client's investment objectives, risks and preferences, and develop a portfolio of investments. They often includes ETFs from Hong Kong, the US or around the world. The advantage of robo-advisors is that they are completely automated, so the fees and minimum investment thresholds are much lower than traditional human investment consultants.

If you need help making a portfolio, maybe a robo-advisor is right for you

Important information: 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.