Hong Kong Exchange Fund Q3 Profit Plunges 74% YoY, HK Stocks Drag First Three Quarters Into Loss
nashnova research
Hong Kong's Exchange Fund earned just HK$18.6 billion in Q3, down 74% year-on-year; its local-equity book posted a HK$2.7 billion loss over the first three quarters as the Hang Seng slid more than 9% — shrinking the buffer that backstops the city's currency peg.
What happened in the third quarter?
The Exchange Fund made HK$18.6 billion in Q3, versus HK$70.8 billion a year earlier — a near three-quarter drop.
This means → the same pool of money, run by the same team, saw its earning power slashed by market volatility.
Cumulative profit for the first three quarters hit HK$171.9 billion, down 39.6% year-on-year.
Where did the Hong Kong equity losses come from?
The fund's Hong Kong stock portfolio booked a HK$2.7 billion loss over the first nine months — the weakest segment of the entire fund.
The Hang Seng Index fell more than 9% in the first ten months, weighed down by interest-rate uncertainty and a cloudy corporate-earnings outlook.
In plain terms = local stocks kept falling, so the slice of the fund invested in them kept losing money.
What is the Exchange Fund, and why does its loss matter?
The Exchange Fund is the HKMA's core reserve pool for defending the Hong Kong dollar peg — effectively the city's financial ammunition depot.
This means → lower earnings shrink the buffer available to absorb sudden shocks.
The HKMA has warned that market-volatility risks have not faded, and pressure in coming quarters should not be underestimated.
市场有风险，内容仅供研究参考，不构成投资建议。