SGX has just opened an exciting gateway for Singapore investors to access Hong Kong’s biggest blue-chip stocks right from home. With five new Hong Kong SDRs (Singapore Depository Receipts) now trading on SGX, you can invest in major players like Alibaba, Tencent, and HSBC — all in Singapore dollars and with much lower minimum investments.

Dive into this article for a breakdown of how these SDRs work, why they’re game-changing, and a close-up analysis of the top three Hong Kong stocks worth watching. Don’t miss out on this opportunity to expand your portfolio with ease!

The Singapore Exchange (SGX) has launched five new Singapore Depository Receipts (SDRs) for major Hong Kong stocks today, enhancing accessibility for Singapore investors to tap into Hong Kong’s blue-chip equities.

This launch features SDRs for Alibaba, Tencent, HSBC, Bank of China, and BYD Company.

By introducing SDRs on these Hong Kong giants, SGX offers investors a simplified way to invest in these popular stocks in Singapore dollars and during SGX market hours, with minimum investment sums starting at around 2% of typical direct investments on the Hong Kong Exchange (HKEX)​.

Each SDR is backed by the underlying shares on HKEX, with a unique share ratio that reduces the entry cost significantly.

For instance, one SDR for BYD equates to 1/10th of a BYD share, while Alibaba has a 5:1 ratio.

These lower initial investment amounts provide investors greater flexibility and a cost-effective way to diversify into Hong Kong markets without navigating foreign exchange or different trading hours​.

5 Hong Kong SDRs

 I will be analyzing the top 3 HK underlying stocks out of the 5 that are launched. Let’s go!

1) Bank of China Ltd (3988.HK)

Bank of China is one of China’s major state-owned commercial banks, offering a comprehensive range of financial services, including corporate and personal banking, investment banking, insurance, and asset management.

With its extensive presence both domestically and internationally, the bank plays a crucial role in supporting the Chinese economy.

Technically, Bank of China has been showing a steady uptrend since early 2024. The stock recently encountered resistance around the HKD 4.00 (SGD $0.68) level, where sellers emerged, causing a minor pullback.

This level has acted as a significant barrier, marking the next key resistance to watch for a potential breakout.

On the downside, immediate support is observed around HKD 3.60 (SGD $0.61), which aligns with the recent consolidation zone.

A break below this level could see the stock finding support closer to HKD 3.25 (SGD $0.55), where it previously bottomed out. The 20-day moving average (green line) is still sloping up, showing short-term bullish momentum, while the 100-day (red line) and 200-day (blue line) moving averages are trending positively, indicating a solid longer-term uptrend.

So how does one take a position in Bank of China from the HK SDR traded on the SGX?

Well, you can take a position in this SDR, which is named Bank of CN HK SDR 1to1 (HBND) currently priced at S$0.63.

For those looking to enter, a conservative approach would be to wait for a potential retracement towards HKD 3.60 (SGD $0.61) support.

Alternatively, a more aggressive entry could be considered if the stock breaks above the HKD 4.00 (SGD $0.68) resistance, which could open the door to further gains.

A stop loss could be placed slightly below HKD 3.60 (SGD $0.61) to manage downside risk, in case the stock fails to hold above this support.

Note that for Bank of China, the ratio is 1 SDR to 1 underlying stock, so the conversion from HKD to SGD will be to simply multiply by the exchange rate of 0.17.

2) BYD Co (1211.HK)

BYD Company is one of China’s leading electric vehicle and battery manufacturers, renowned for its extensive portfolio in EVs, renewable energy products, and electronics.

The company has been a major player in the global shift towards green energy and sustainable transport solutions.

Technically, BYD has shown a strong uptrend, with the price recently breaking above the HKD 280 (SGD $4.76) support level, calculated with the 10:1 SDR ratio conversion.

The stock is currently consolidating just below the next key resistance at HKD 300 (SGD $5.10).

A successful breakout above this level could signal further upside, with the next resistance sitting around HKD 320 (SGD $5.44), where sellers may emerge.

The 20-day moving average (green line) is still trending up, reflecting short-term momentum, while the 100-day (red line) and 200-day (blue line) moving averages continue to slope upwards, confirming a long-term bullish trend.

This suggests that any pullbacks could present opportunities for accumulation, provided key support levels hold.

So how does one take a position in BYD Co from the HK SDR traded on the SGX?

Well, you can take a position in this SDR, which is named BYD HK SDR 10to1 (HYDD) currently priced at S$5.01.

For entry points, a more conservative approach would be to wait for a retest of the HKD 280 (SGD $4.76) support level, providing a potential buying opportunity if this area holds.

Alternatively, an aggressive entry could be considered on a confirmed breakout above HKD 300 (SGD $5.10). For risk management, a stop loss could be placed below HKD 280 (SGD $4.76) to manage downside exposure.

Note that for BYD Co, there is a ratio of 10 SDR to 1 underlying stock, so the conversion from HKD to SGD will be to multiply by the exchange rate of 0.17, then divided by 10.

3) HSBC Holdings (0005.HK)

HSBC Holdings Plc is one of the largest banking and financial services institutions globally, with a strong presence across Asia, Europe, and the Americas.

The bank provides a wide range of financial products and services, including retail and corporate banking, wealth management, and investment banking.

Technically, HSBC has shown strong upward momentum, recently breaking above the HKD 70.00 (SGD $2.38) support level, calculated based on the 5:1 SDR ratio conversion.

The stock is now trading at HKD 71.40 (SGD $2.43), with the next major resistance at HKD 75.00 (SGD $2.55).

A breakout above this resistance could signal further upside, opening up potential gains as momentum builds.

The 20-day moving average (green line) continues to slope upward, reflecting solid short-term bullish momentum, while the 100-day (red line) and 200-day (blue line) moving averages confirm a steady long-term uptrend.

This alignment of short- and long-term trends suggests the stock remains in a positive phase, with potential buying interest on any pullbacks.

So how does one take a position in HSBC Holdings from the HK SDR traded on the SGX?

Well, you can take a position in this SDR, which is named HSBC HK SDR 5to1 (HSHD) currently priced at S$2.43.

For entry points, a more conservative approach would involve waiting for a pullback to HKD 70.00 (SGD $2.38) to confirm this support level,

while an aggressive entry could be considered on a confirmed breakout above HKD 75.00 (SGD $2.55).

Setting a stop loss slightly below HKD 70.00 (SGD $2.38) would help manage downside risk if the price fails to hold above this key level.

Note that for HSBC Holdings, there is a ratio of 5 SDR to 1 underlying stock, so the conversion from HKD to SGD will be to multiply by the exchange rate of 0.17, then divided by 5.

About the Author - Joey Choy

Joey is Singapore’s renowned mentor on how to make an income by trading the stock market, an author and one of the most-watched, quoted and followed stock trading trainers in Singapore. Over the years, he has conducted numerous full house seminars, enriching thousands to trade more profitably. 

Joey’s come back story from a S$740k debt has been featured in the Business Times and inspired thousands in Singapore. In less than 3 years, he is highly regarded as one of the Top Tier Remisiers (Stock Brokers) and Traders, bagging numerous yearly awards like Top Trading Representative and Top CFD Achiever every year from 2014 to 2023 in Phillip Securities.

More about Joey here

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