Selling Stocks in Hong Kong - Finding Ways to Profit from Chinese Stocks

Stocks in Hong Kong are traded on the local stock exchange, but many such listed shares are also available to trade globally on other exchanges. Multiple exchanges trading stocks in their own currencies makes for tiny variances to try to exploit.

Listing Shares Globally Opens a World of Capital to Asian Multinational Companies
The principal reasoning behind listing shares globally on multiple exchanges is that it provides lower cost of capital access to capital hungry China based companies via deeper investor pocket economies such as the United States and Western Europe. This makes for a happy symbiotic relationship given investors have long wished to get investment skin in the game in China.

Changes in Forex Rates Create Arbitrage Opportunities for Institutional Traders
Although the zero-risk game on stocks in Hong Kong is largely off limits to retail traders, it is worth noting that slight variations in the exchange rates between the Chinese Yuan, the HK dollar, and the US dollar create arbitrage opportunities on multi-exchange listed securities. Even though the exchange rates on these currencies are supposed to be fixed to the US dollar, small variances do occur between them, particularly relative to pricing of stocks listed on exchanges. Furthermore, variances in the Euro and Yen relative to all three create continuous price variances which institutions quickly absorb as profits.

Retail Traders Squeezed Out of Forex Pricing Arbitrage
High frequency trading, more competition, and ever smaller variances - in both time and spread - have squeezed retail traders of stocks in Hong Kong and elsewhere right out of the forex pricing quick profit game. Now retail trading for quick profits has had to move on to other markets and other investment securities. Fortunately as capital needs and economies in Asia grow more types and varieties of securities have become available, reopening trading profit opportunities for retail investors.

One type of security that allows small capital retail investors to earn high returns on investment are binary options on Asian stocks. High rate investments in Asian stocks (up to 85%) are very attractive for these short term investments.