There is hope that the 33-year tradition will be rewritten, with the Hong Kong stock market's "T+1" settlement reform potentially increasing the fund turnover rate by 20%.

As the Hong Kong stock market continues to recover, the Hong Kong Stock Exchange has published a discussion paper on shortening the settlement cycle of the Hong Kong stock spot market. Industry insiders believe that the 33-year-old "T+2" settlement cycle of Hong Kong stocks is likely to transition to "T+1". In the eyes of industry insiders, the transition of the Hong Kong stock market to a "T+1" settlement cycle presents both opportunities and challenges: the impact of stablecoin payments settlements in Hong Kong on financial infrastructure is becoming evident, and the industry is calling for an improvement in fund turnover efficiency and liquidity in the stock market; at the same time, the shortened settlement cycle poses higher requirements for securities firms, custodian banks, and settlement institutions, and institutional investors' arbitrage strategies and derivative hedging strategies are also facing challenges.