Online brokers want the stock exchange to cut its charges for providing stock quotation information to their clients. They plan to commission a local university study comparing Hong Kong Exchanges and Clearing's charges with seven other stock markets, Peter Wong Shiu-hoi, managing director of Tai Fook Securities said. Mr Wong took a prominent role in establishing the Hong Kong Online Brokers Association. The exchange's income from information services has grown by more than 50 per cent in the wake of the growth in online broking services. Under present rules, HKEx charges online brokers for each of the broker's customers.
Brokers can choose one of three charging structures, depending on how much information they want.
Because comprehensive trading information is seen as a unique competitive edge for online brokers, many offer clients the most expensive scheme. Some brokers absorb the cost and supply their clients with the service free of charge, because they want to establish a viable customer base as quickly as possible. They fear that unless HKEx reduces its charges, their costs will continue to increase as online trading is expected to grow significantly in the coming years. After the recent formation of the online brokers association, it conducted a preliminary study which showed Hong Kong's charges appear to be the highest among eight markets. Mr Wong suggested one solution was a ceiling on the number of customers being charged.