Hong Kong Brokerages Eye Virtual Asset Business Amid Earnings Surge

Guotai Junan Securities has released a research report indicating that more brokerages in Hong Kong are likely to enter the virtual asset business in the coming future. This development comes as the market enters the earnings season, with brokerage firms expected to surpass earnings expectations. The stable stock market environment is prompting recommendations to seek opportunities in undervalued and under-allocated weighted stocks, with a shift from fundamental thinking to a risk-return ratio approach.

Guotai Junan International, a leading brokerage firm, has made history by becoming the first Chinese-funded brokerage to obtain a virtual asset trading license in Hong Kong. This achievement has set off a chain reaction, with several other major mainland brokerages reportedly following suit by applying for similar licenses. The move highlights a growing acceptance of regulated crypto trading within the region, as authorities aim to balance innovation with regulatory oversight. The approval of Guotai Junan International's license is viewed as a testbed for new financial services, potentially opening the door for broader adoption of virtual asset trading. This development underscores the increasing interest in digital assets and the potential for further integration of virtual asset trading into mainstream financial services.

According to the analyst's forecast, as the market has gradually entered the earnings season, brokerage firms are expected to outperform earnings expectations. Against the backdrop of a stable stock market, it is recommended to continue seeking opportunities in undervalued and under-allocated weighted stocks, with non-bank weighted stocks transitioning from a "marginal thinking of fundamentals" to a "total thinking of risk-return ratio." Especially under the recent policies encouraging red-chip and H-share listings back to A-share, Hong Kong's non-bank weighted stocks are expected to benefit more.