Hong Kong Reopening Select Index +5.4% in July, down 2.6% MTD in August

High certainty equals valuation premium

Please note: any index mentioned here is for information and illustrative purposes only. An index itself does not constitute any actual fund, portfolio, trading strategy or financial product. It is not possible to invest directly in an index. We make no recommendation or offer to buy/sell any securities, portfolios of securities, investment schemes or trading strategies here. Past performance does not guarantee future results.

Our Hong Kong Reopening Select Index is a collection of stocks expected to benefit from the reopening of Hong Kong and Macau. Full constituents of the Index can be found at the end of this post.

The Index gained 5.4% in July, beating MSCI Hong Kong by 3.2% and lagging the Hang Seng Index by 0.7%. The underperformance versus Hang Seng was mainly due to strong performance of Chinese Big Tech stocks, which we had minimal exposure to. FYI, the Hang Seng Tech Index skyrocketed 16.3% in July.

Reopening Index is down 2.3% month-to-date as of August 11, while the Hang Seng Index declines by 5%. This is a reminder that the Hong Kong market is still quite fragile and volatile.