Malaysia x Hong Kong: New Index Could Unlock Regional Investment Boom

Hong Kong Exchanges and Clearing Limited (HKEX) has announced the signing of a Memorandum of Understanding (MOU) with Bursa Malaysia Berhad, marking a significant step towards strengthening collaboration and enhancing capital market connectivity between Hong Kong and Malaysia. The partnership is expected to deepen cooperation across several key areas, including dual listings, exchange-traded funds (ETFs), joint development of indices and investment products, Shariah-compliant securities, as well as carbon market initiatives.

As an early outcome of this collaboration, both exchanges have jointly launched the HKEX–Bursa Malaysia Large Cap Index, a co-branded benchmark designed to improve cross-market access for investors. The index tracks the performance of the 60 largest listed companies by market capitalisation across both markets, comprising 30 constituents from Hong Kong and 30 from Malaysia. The weighting is structured to reflect approximately 60 per cent exposure to Hong Kong-listed companies and 40 per cent to Malaysian-listed companies, offering a balanced representation of both markets.

HKEX Chief Executive Officer Bonnie Y Chan highlighted that the partnership reflects a shared commitment to strengthening regional capital market integration. She noted that Malaysia plays a strategic role within Southeast Asia, a region recognised for its strong growth potential, particularly in sectors such as innovation, consumer markets and natural resources. At the same time, HKEX continues to position itself as a leading international marketplace in Asia, providing unique access to opportunities in Mainland China. She added that expanding regional engagement remains a key strategic priority, particularly in the current environment of heightened global uncertainty, where diversified investment opportunities are increasingly sought after.

Bursa Malaysia Chief Executive Officer Dato‘ Fad’l Mohamed emphasised that internationalisation is becoming an essential driver of growth as global capital flows shift more dynamically across regions. He explained that the collaboration with HKEX aligns with Bursa Malaysia‘s broader efforts to enhance market vibrancy, expand opportunities for public listed companies and investors, and strengthen Malaysia’s position within the global investment landscape. He further highlighted Malaysias strong domestic institutional investor base and its leadership in the Islamic capital market, which together position Bursa Malaysia as an important gateway connecting corporates and Shariah-compliant investments with regional and international capital.

The introduction of the HKEX–Bursa Malaysia Large Cap Index is seen as an important milestone under this partnership, aimed at increasing the visibility of Malaysian listed companies among regional investors while showcasing the diversity of sectors within the local market. It also reflects HKEXs broader strategy of developing an exchange-led index ecosystem to support both primary and secondary market growth, while meeting rising demand for diversified regional investment products.

Currently, HKEX hosts 30 Malaysian companies among its listed issuers, forming part of a wider group of 103 Southeast Asian companies listed on the exchange. The new collaboration is expected to further strengthen these cross-border linkages and create more opportunities for capital market participation between the two regions.