Over 40pc of HK brokers see city as top investment market this year

More than 40 percent of Hong Kong brokerage firms see the city as the most attractive investment market this year, according to a survey conducted by the Hong Kong Securities Association, even as firms grapple with rising costs, intense competition and regulatory pressures.

The survey, conducted between January 13 and 23 and based on 152 responses, showed that more than half of respondents were optimistic about Hong Kong equities this year, including 8 percent who described themselves as very optimistic.

Chinese mainland ranked as the second-most attractive investment market after Hong Kong, cited by about 30 percent of respondents, while nearly 60 percent said the US carries the highest investment risk.

More than 40 percent of respondents said their firms broke even over the past year, while 28 percent reported losses, mainly in brokerage operations as well as asset and wealth management businesses. Nearly half of respondents said competition and declining revenue were their biggest challenges, followed by regulatory and compliance pressure.

Looking ahead, 56 percent of respondents said geopolitical risks represent the biggest source of uncertainty for Hong Kong’s financial markets this year.

Despite the challenges, firms remain focused on expansion. About 70 percent of respondents expect to increase headcount this year, with nearly half of the planned hires involving information technology-related roles.

The survey also showed that nearly 40 percent of respondents said wages accounted for the largest share of operating costs, while 20 percent cited information technology as their biggest expense.