$XIAOMI-W(01810.HK)

First, the conclusion:

- Hong Kong stock market turnover is indeed low, but it's not 'rotten'; it's a liquidity issue caused by a combination of structure, environment, and mechanisms.

- According to January 2026 data:

- Hong Kong stocks rank 5th to 6th globally in exchange turnover (stock spot)

- Total market cap ranks 4th globally, IPO fundraising ranks 1st globally

I. First, a direct comparison (January 2026, RMB)

- US stocks (NYSE+NASDAQ): Daily average ≈ 7.4 trillion RMB (≈ 1.03 trillion USD)

- A-shares (Shanghai & Shenzhen): Daily average ≈ 3.3 trillion RMB

- Hong Kong stocks (Main Board): Daily average ≈ 240 billion RMB (≈ 272.3 billion HKD)

👉 Hong Kong stocks ≈ 7% of A-shares, 3% of US stocks, a huge gap

II. Core reasons for low Hong Kong stock turnover (not 'rotten', but structural)

1. Investor structure: Institutional dominance, very few retail investors

- Institutions account for ≈80%, low turnover, long-term bias; A-shares have many retail investors, high turnover

- Hong Kong stock turnover rate is only 1/5 of A-shares, naturally low volume

2. High transaction costs

- Stamp duty 0.13% on both sides (relatively high globally), less high-frequency trading

3. Severe liquidity stratification

- Top 10 stocks (Tencent, Alibaba, etc.) account for ≈60% of Main Board turnover

- Many small and mid-cap stocks have daily turnover < 100,000 HKD, even zero turnover

4. Offshore market nature

- Heavily influenced by Fed interest rates, USD liquidity, with large foreign capital inflow/outflow volatility

- Southbound capital is the main force, but net inflows are unstable

5. Traditional industry structure

- High weighting in finance, real estate, limited appeal of new economy sectors

III. Hong Kong stocks' real global ranking (January 2026)

1. Stock spot turnover (daily average, RMB)

1. US stocks (NYSE+NASDAQ): 7.4 trillion RMB

2. A-shares (SSE+SZSE): 3.3 trillion RMB

3. Tokyo Stock Exchange: ≈ 1.2 trillion RMB

4. London Stock Exchange: ≈ 0.8 trillion RMB

5. HKEX: ≈ 0.24 trillion RMB

👉 5th globally

2. Total market cap (end of January 2026)

- HKEX: 50.8 trillion HKD ≈ 44.7 trillion RMB

- Global ranking: 4th (after US stocks, A-shares, Pan-Europe)

3. IPO fundraising (2025)

- Hong Kong IPO fundraising ≈ 280 billion HKD, number one globally

IV. One-sentence summary

- Low turnover and poor liquidity in Hong Kong stocks are facts, but it's not a rotten market; it's the result of institutional dominance + offshore nature + costs + structure.

- It remains a top 5 global exchange, Asia's number one IPO market, and the main offshore listing venue for Chinese companies.