With new index launched, Hong Kong seeks to attract more tech firms

The Hang Seng Tech Index tracking tech giants listed in Hong Kong was launched on Monday as the world’s top fund-raising center is striving to attract more tech firms and reinforce its position amid global volatility.

The new index of Hang Seng Indexes Company closed 1.28 percent lower to 6,774.78 points on its debut.

The tech index follows the performance of the 30 largest Hong Kong-traded tech firms in sectors including Internet, financial technology and e-commerce. Internet conglomerate Alibaba, making its secondary listing in Hong Kong last November, has the biggest weighting of 8.53 percent in the index, followed by Tencent and Meituan Dianping.

According to back-testing data, the tech Index would have jumped 36.2 percent and 35.3 percent for the full year of 2019 and the first half of 2020, respectively.

The launch of the tech index came as tech firms have started to play an increasingly bigger role on Hong Kong’s stock market.

The number of tech companies listed on the main board of the Hong Kong exchange has increased from 137 at the end of 2017 to 163 in June 2020. The share by market capitalization of tech companies have also risen from 14.6 percent to 33.2 percent from 2017 to June 2020. The new index will better reflect the performance of top Hong Kong-listed technology companies.