The Shanghai Composite has more than doubled over the past 12 months, making China the best performing market in the world and drawing the attention of fund managers everywhere. China’s stock trading fever is spreading to Hong Kong’s job market, as banks and brokers scramble to sign up analysts capable of bridging the gap between China and the global investment community.
Though some investment banks — such as UBS and Goldman Sachs — have long operated joint-ventures that produce both Chinese and English-language research, the opening late last year of the Shanghai-Hong Kong Stock Connect has prompted many others to rethink the way they cover Asia’s second largest stock market. HSBC is in the middle of hiring 10-15 new analysts to cover Chinese stocks, something William Bratton, the bank’s head of Asia-Pacific equity research, believes could be just the beginning as the dynamics of investing in the region shift further towards China.
The Stock Connect — a cross-border share trading link — has given foreign investors access to hundreds of Shanghai-listed stocks without the need for a licence. More shares are set to join the list with the anticipated launch of a similar tie-up between the Hong Kong and Shenzhen stock exchanges later this year.
Meanwhile, Chinese brokerages, insurers and asset managers are looking to build their capabilities outside the mainland, creating an extra source of demand for bilingual analysts and bankers with international experience. Huatai Securities recently hired Lu Ting, former China economist at Bank of America Merrill Lynch, as head of research, just one of a number of new additions ahead of its planned Hong Kong flotation.
The challenge for those looking to hire has been finding the right people. “They want to find someone they can put in front of investors in Boston or San Francisco without losing any of that Chinese expertise,” said Marlon Sanchez, head of Asia prime finance distribution at Deutsche Bank.