Complete Guide to Hong Kong IPO Subscription for Mainland Investors
Contents
For many mainland Chinese investors, participating in Hong Kong IPOs feels both familiar and foreign at the same time. Familiar, because everyone has tried A-share IPO subscriptions before. Foreign, because the two markets operate under very different rules โ cross-border account opening, funding channels, and subscription mechanics each require their own learning curve.
This guide is written for investors holding a mainland Chinese ID card who have not yet opened a Hong Kong securities account, or who are just getting started. It covers the full process from account opening to allocation results, without unnecessary detours.
What Is Hong Kong IPO Subscription
Short answer: applying for newly listed shares at the offer price before they start trading on the Hong Kong Stock Exchange. In 2024, 67 companies completed their IPOs on HKEX, raising approximately HKD 87 billion in total โ making Hong Kong one of the most active IPO markets globally.
Before a company lists on HKEX, it opens a public subscription window โ typically five to seven business days โ during which investors can apply for shares at the offer price and wait for the allocation results. That is the entire logic behind what is commonly called "IPO hunting" (ๆๆฐ).
Three key differences from A-share IPOs:
- Not a pure lottery system: In HK IPOs, the higher the oversubscription, the lower the allocation rate. Less popular IPOs with low subscription multiples can actually result in full allocation.
- Funds are frozen during the process: From the application date until the allotment date (generally five to seven days), your subscribed funds are locked and unavailable for other trades.
- Margin financing is available: Some brokers offer IPO financing, allowing investors to leverage up their subscription amount โ which also magnifies the risk.
Hong Kong IPO subscription is not a guaranteed money-maker. First-day share price drops below the offer price (breaking issue price) are not uncommon, especially in weak market conditions. More on this later.
Basic Requirements for Mainland Investors
The threshold is lower than most people expect โ a mainland ID card, around HKD 15,000-20,000, and a Hong Kong securities account are the essentials. According to the Hong Kong Securities and Futures Commission (SFC), there are over 700 licensed securities dealers in Hong Kong, though only a subset currently accept mainland clients.
Mainland residents need to meet the following prerequisites to participate in Hong Kong IPOs:
Identity Requirements
A valid mainland Chinese ID card (ๅฑ ๆฐ่บซไปฝ่ฏ) is sufficient to open an account. A Hong Kong ID or travel record to Hong Kong is not required. Some brokers may also ask for a passport โ confirm the specific document requirements with the broker before applying.
Age Requirement
Generally 18 years or older.
Capital Preparation
The minimum subscription unit in Hong Kong is one lot (ๆ). The number of shares per lot varies by IPO โ common configurations are 1,000 or 500 shares per lot. The offer price range is disclosed in the prospectus. The cost of one lot ranges from a few hundred to tens of thousands of Hong Kong dollars. In practice, most participants subscribe for multiple lots, so a working budget of around HKD 15,000 to 20,000 or more is typical. The more capital you have available, the more strategies you can deploy.
Hong Kong Securities Account
This is a hard requirement. A mainland A-share account cannot be used to subscribe to Hong Kong IPOs. You must open a separate account with a broker that supports HK IPO subscriptions.
Funding Channel
Mainland bank cards cannot be used to top up a Hong Kong securities account directly (Stock Connect only supports RMB for stock trading and does not cover IPO subscriptions). You will need to fund your account in Hong Kong dollars through a Hong Kong bank account or another compliant channel. See the funding section below.
Account Opening: Which Brokers Accept Mainland Clients
Several brokers still actively onboard mainland clients, though the list has narrowed since 2023. Not all Hong Kong brokers accept account openings from mainland Chinese ID holders. Some have tightened their onboarding for mainland clients, while others remain open. The following brokers are generally well-regarded and widely reported to accept mainland clients:
HK IPO Broker Comparison for Mainland Investors
| Broker | Mainland Onboarding | IPO Subscription | Margin Financing | Notes |
|---|---|---|---|---|
| Beibei Securities (ๅฟ ่ด่ฏๅธ) | Supported | Supported | Supported | Focused on mainland clients; strong Chinese-language service |
| CMS Securities (่ดๅฏ่ฏๅธ) | Supported | Supported | Supported | Established HK-backed broker with long Stock Connect history |
| Fosun Securities (ๅคๆ่ฏๅธ) | Supported | Supported | Supported | Mainland-affiliated; relatively smooth funding pathways |
| ZA Securities (ไผๅฎ่ฏๅธ) | Supported | Supported | Supported | Integrated with ZA Bank; convenient for funding |
| Futu Securities (moomoo) | Partially restricted | Supported | Supported | Strong platform experience; new mainland clients may require manual review |
| Tiger Brokers (่่่ฏๅธ) | Partially restricted | Supported | Supported | Similar situation to Futu; mainland access varies by period |
Note: Broker policies change in response to regulatory conditions. Contact customer service directly to confirm current onboarding status before applying.
On Having a Hong Kong Bank Account
A Hong Kong bank account is strongly recommended for anyone participating in HK IPOs, for three reasons:
- Funding is significantly faster โ often near-instant
- Refunds from unsuccessful applications are returned to a local account, avoiding international transfers
- Some brokers (such as ZA Securities) are directly integrated with local bank accounts, making the subscription experience smoother
Mainland residents have two main ways to open a Hong Kong bank account without travelling to Hong Kong: some mainland branches of certain banks (such as Bank of China Hong Kong and HSBC Hong Kong) offer Hong Kong account opening services at select mainland locations; alternatively, Hong Kong virtual banks can be opened remotely.
ZA Bank is one such option โ the entire process is online, no trip to Hong Kong required, and you can open an account using your mainland phone number and ID card. Referral code XL82N9 is available for account opening benefits. ZA Bank is a licensed virtual bank regulated by the Hong Kong Monetary Authority (HKMA), and deposits are protected under the Hong Kong Deposit Protection Scheme up to HKD 1,000,000 per account.
This is just one option. If you already have an account with HSBC, Bank of China Hong Kong, Standard Chartered, or another traditional bank, you can use that directly. If speed of opening is your priority, a virtual bank is worth considering. If you prefer the credibility of a traditional institution, going through a bank branch is the alternative.
Funding: Getting Money Into Your Account
There are several main routes for moving mainland capital into a Hong Kong securities account:
Route 1: Mainland Bank โ Hong Kong Bank Account โ HK Broker
This is the most straightforward compliant route and is the one most investors ultimately use.
Steps:
- Use your mainland bank's international remittance service to convert RMB to HKD and wire the funds to your Hong Kong bank account
- Once the HKD arrives in your Hong Kong bank account, transfer it to your HK securities account
Quota note: Mainland individuals have an annual foreign exchange quota equivalent to USD 50,000. Amounts beyond this require additional approval. IPO-related fund transfers generally fall within this limit.
Route 2: International Bank Card Direct Top-Up
Some brokers accept Visa or Mastercard international credit or debit cards for funding. Be aware: funding a securities account with a credit card is typically treated as a cash advance by the card issuer, which incurs fees. This is generally not recommended.
Route 3: Cross-Border ATM Withdrawal and Deposit
Low efficiency and high fees. Only viable as an emergency option; not recommended for regular use.
Route 4: E-Wallet Transfers
Some mainland investors use tools such as Alipay HK as an intermediary. Exchange rates may be unfavourable, and platform policies can change. Verify feasibility each time before using this method.
Practical experience: Most mainland investors who have Hong Kong bank accounts report that wire transfers from mainland banks typically arrive within one to two business days. Transfers from a Hong Kong bank account to a broker account within Hong Kong usually settle on the same day. Since IPO subscription windows can be as short as a few days, having your funds ready in advance is critical.
The Subscription Process: From Application to Allocation
Knowing the operational rhythm matters more than knowing the theory. A Hong Kong IPO typically goes through the following stages from listing announcement to first day of trading:
Stage 1: Subscription Period (typically 5-7 business days)
The prospectus is published on the HKEX website, disclosing the offer price range, issue size, financial information, and other details. This is the best window for research.
Key prospectus sections to review:
- Offer Price Range: determines your subscription cost
- Public Tranche allocation: typically 10-15% of total shares offered; can be clawed back to 50% if heavily oversubscribed
- Cornerstone Investors: institutional backing generally signals stronger market confidence
- Risk Factors: mandatory reading โ these are the risks the company itself has disclosed
Stage 2: Subscription Application
In your broker's IPO subscription section, select the IPO, enter the number of lots you wish to subscribe, and confirm the amount to be frozen.
Key operational details:
- Subscription amount is calculated at the upper end of the offer price range (for range-priced IPOs); any difference is refunded once the final price is set
- Only one application per IPO per ID card number is valid โ multiple accounts using the same ID will not receive multiple allocations
- Applications can be withdrawn, but most brokers set a deadline, typically before the close of the final day of the subscription period
Stage 3: Pricing and Allocation (approximately 2 business days after close of subscription)
The underwriter announces the final offer price and allocation results. Rules for the public offer (retail) tranche:
- Allocation rate is inversely proportional to the oversubscription multiple
- For retail investors subscribing multiple lots, the allocation rate per additional lot decreases progressively
- Under-subscribed IPOs may result in full allocation; hot IPOs can see allocation rates below 5%
Stage 4: Refund and Payment
Frozen funds for unallocated shares are released and returned after the allotment date. For allocated shares, payment is typically deducted automatically from the frozen funds by the broker within the designated timeframe.
Stage 5: First Day of Trading
Usually about one week after the allotment date, the stock begins trading on HKEX. On the trading day immediately before the official listing, some brokers support grey market (ๆ็) trading โ see below.
The Single-Lot Strategy: Minimum Capital Required
The "single-lot strategy" (ไธๆๅ ) is a common approach in HK IPO subscription. The core logic: subscribing for just one lot may yield a higher per-lot allocation rate in heavily oversubscribed IPOs, because the allocation mechanism prioritises ensuring every applicant receives at least one lot.
Why the single-lot strategy works:
The Hong Kong retail allocation mechanism is designed to guarantee at least one lot per qualifying applicant before distributing additional lots proportionally. When the oversubscription multiple is very high โ say 50x or more โ the marginal allocation rate for additional lots beyond the first drops sharply, but the one-lot applicant's single lot is nearly guaranteed.
What does one lot actually cost:
Offer prices range from a few HKD to dozens of HKD, with typical lot sizes of 500 to 2,000 shares. Rough estimates:
- Low-priced IPOs: one lot approximately HKD 500-2,000
- Mid-priced IPOs: one lot approximately HKD 3,000-15,000
- High-priced IPOs: one lot may exceed HKD 20,000
If you are running the single-lot strategy across multiple IPOs simultaneously, the overlapping fund freezes mean you need enough HKD liquidity on hand. A working reserve of HKD 20,000 or more is a reasonable starting point to cover two or three concurrent subscriptions.
Limitation of the single-lot strategy: If an IPO has a high allocation rate (meaning it was not heavily subscribed), and the stock drops on listing day, single-lot and multi-lot subscribers lose the same percentage of their investment. The strategy does not provide downside protection.
Margin Financing for IPOs: The Case For and Against Leverage
The appeal is clear but the risk is real โ according to Wind Financial Terminal data, over 40% of Hong Kong IPOs in recent years have traded below their offer price on the first day. Leverage amplifies both outcomes.
Some brokers offer IPO margin financing, allowing investors to borrow against their capital to increase their subscription size. For example, with HKD 50,000 of your own money and 5x leverage from the broker, you could subscribe for HKD 250,000 worth of shares.
The Upside Case
If the stock rises on listing day, leverage amplifies absolute returns:
- Subscribe HKD 250,000 at the offer price
- If the stock rises 10% on day one, the gain is approximately HKD 25,000
- After deducting financing interest (typically charged daily, with annualised rates around 6-15%), net returns can still be meaningful if the holding period is short
The Risks
Break-issue risk: If the stock falls below the offer price on listing day, leverage amplifies losses. If you subscribe HKD 250,000 and the stock falls 10%, you lose HKD 25,000 on a HKD 50,000 principal โ a 50% loss on your own capital.
Forced liquidation: If losses exceed the margin threshold, the broker will force-close the position, locking in the loss.
Interest costs: The longer you hold, the more interest accumulates. If you plan to wait for a better selling price, interest compounds against you.
Margin financing for IPOs is better suited to investors who already have experience with HK IPO subscriptions and have a clear conviction on a specific IPO. It is not recommended for first-time participants.
Grey Market Trading: Opportunity Before Official Listing
The grey market (ๆ็) is a mechanism unique to Hong Kong IPOs. It takes place on the trading day before a new stock's official HKEX listing, conducted over-the-counter through certain brokers.
Basic rules of the grey market:
- Grey market prices are entirely determined by supply and demand; there is no reference price
- Investors who received an allocation can sell in the grey market to lock in gains (or cut losses) early
- Investors who did not participate in the IPO can also buy in the grey market, though at higher risk
- Not all brokers support grey market trading โ Beibei Securities and Futu are among those that do; HSBC and Bank of China do not
What grey market prices tell you:
Grey market pricing generally reflects short-term market sentiment toward the new stock. A strong premium suggests bullish sentiment; a grey market price below the offer price is a warning signal โ though not conclusive, since grey market liquidity is thin and a single large order can move prices dramatically.
Limitations of the grey market:
Trading volume in the grey market is far lower than on formal listing day, bid-ask spreads are wide, and execution can be inconsistent. If you plan to trade in the grey market, set your stop-loss levels in advance and ensure your margin is in order.
FAQ: Common Questions About HK IPO Subscription
Q1: Can mainland investors participate without a Hong Kong bank account?
Technically yes โ some brokers accept international wire transfers from mainland bank accounts. In practice, not having a HKD account makes the funding process more cumbersome each time, and funds take longer to arrive. It is advisable to sort out a Hong Kong account before actively participating in IPOs.
Q2: Do mainland investors pay tax on HK IPO gains?
Hong Kong does not levy capital gains tax on stock trading profits. Gains from selling allocated IPO shares are not taxable in Hong Kong. Mainland tax residents' obligations to declare overseas investment income are governed by mainland tax law โ consult a tax professional for guidance.
Q3: Can I subscribe to the same company's IPO on both A-share and HK platforms simultaneously?
The A-share and HK markets are entirely separate mechanisms. If a company lists on both markets (A+H shares), you can subscribe to the A-share portion through your A-share account and the HK portion through your HK account. They are independent applications and do not affect each other.
Q4: Can I abandon my allocation after being assigned shares?
Yes. The consequence is that your funds are returned and you do not participate in that IPO. There is no formal penalty in Hong Kong for declining an allocation, though some brokers may record it and it could affect future financing limits or service priority. Unlike the A-share market where abandonment is tracked and can affect future subscription eligibility, the HK mechanism is more flexible. That said, habitually declining allocations suggests insufficient research before subscribing โ it is better to think carefully before applying.
Q5: Is it easier to make money with HK IPOs or A-share IPOs?
Direct comparison is difficult โ market conditions, company fundamentals, and timing all matter. HK IPOs have one advantage: there is no market-value holding requirement (unlike A-shares, which require continuous holding of a minimum portfolio value to receive subscription quotas). The subscription logic is also more transparent. The disadvantages: break-issue rates in HK are higher than A-shares, especially in bear markets; the entry barriers (account opening, funding, language) are higher; and you need Hong Kong dollar liquidity.
Q6: Can I use the funds in my HK securities account for other stock trades while they are not frozen for an IPO?
Yes. Funds not frozen for an active IPO subscription can be used freely for other trades. During an active subscription period, the frozen portion is unavailable. It is good practice to keep some free capital in reserve during active IPO periods to avoid missing other trading opportunities.
Q7: Where can I find historical HK IPO allocation rate data?
The HKEX website (hkex.com.hk) publishes the subscription results announcement for every IPO, including the oversubscription multiple and final allocation rates by subscription tier. Data platforms such as AAstock, Futu, and Tiger Brokers also compile historical IPO data in a more searchable format.
Summary
Participating in Hong Kong IPOs as a mainland investor follows a straightforward core process:
- Open a Hong Kong securities account with a broker that accepts mainland clients
- Fund the account in HKD through a Hong Kong bank account or another compliant channel
- Submit your subscription through the broker platform during the subscription window
- Wait for the allocation results; for allocated shares, either hold or sell in the grey market, then plan your approach for the official listing day
Before doing any of this, there is one more important thing: understand the company you are subscribing to. A meaningful proportion of Hong Kong IPOs have traded below their offer price on the first day of listing in every year on record. Whether you make money from IPO subscriptions ultimately depends far more on stock selection and market timing than on execution mechanics.
If this is your first time exploring HK IPO subscriptions, starting with the single-lot strategy, keeping individual subscription amounts manageable, and getting comfortable with the full process before moving to multi-lot or margin subscriptions is a sensible approach.
Related reading on LowRiskTradeSmart:
- HK IPO Subscription Without a Bank Card: 3 Funding Alternatives
- Hong Kong Stock Broker Comparison
- HK IPO Guide: Groups, Allocation Rates, and Strategy
Disclaimer: This article is for informational and educational purposes only and does not constitute investment advice. Hong Kong IPO subscription carries the risk of financial loss, including loss of principal from first-day price drops below the offer price. All investment decisions should be made based on your own judgment; seek professional advice where appropriate. The ZA Bank account opening link is a referral partnership link and does not affect the editorial content of this article.
Fee and policy information is current as of February 2026. Refer to each institution's latest announcements for up-to-date details.