Shanghai-Hong Kong Stock Connect: New short selling rules

With the launch of the Shanghai-Hong Kong Stock Connect ("Stock Connect") in November of last year, foreign investors now have direct trading access to many shares listed on the Shanghai Stock Exchange ("SSE"). One feature that was not introduced at the time of launch is the ability for Stock Connect investors to engage in short selling. Hong Kong Exchanges and Clearing Limited ("HKEx") have recently announced that short selling will commence on 2 March 2015 pursuant to amendments to the rules of the Stock Exchange of Hong Kong Limited ("SEHK") that have been approved by the Securities and Futures Commission.

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