Contents
- List of Hang Seng Index Stocks and Companies
- Risk Management
- FAQs about the Hang Seng Index
- Final Thoughts
Some of the largest companies in Hong Kong are listed on the Hang Seng Index stocks list, which includes a total of more than 60 of Hong Kong’s largest companies.
The general consensus towards Hong Kong’s economy heavily relies on the performance of the Hang Seng stock index, mainly since so many of the country’s largest companies are featured within the index.
This particular investment opportunity operates as a free float-adjusted index that is market-cap weighted.
This index is listed on the Hong Kong Stock Exchange and designated with ‘HSI’ as its trading symbol.
The Hang Seng Indexes were established in 1969 and have continuously operated for the last 53 years.
The Hang Seng’s best-performing year was 1993, with a 115% return during the 1993 calendar year.
During the global recession in 2008, the Hang Seng Index had its worst year, with a loss of 48.2%.
The Hang Seng Index is currently on track to finish the year with another loss, already racking up more than 9% halfway through 2022.
While there is an opportunity to rebound, many investors are confident that the Hang Seng Index will finish 2022 with its fourth negative year in the last five.
Now that we’ve covered many of the statistical numbers relating to the Hang Seng Index let’s shift focus and look at the list of companies and stocks included in the Hang Seng Index and the Hong Kong Stock Exchange.
List of Hang Seng Index Stocks and Companies
Each of the companies is consistently evaluated regularly to ensure they still meet all of the qualifications to be listed in the Hang Seng stock index.
Periodically, some companies may be added or removed to rebalance the fund.
Hang Seng Finance Sub-index
- HSBC Holdings plc
- Hang Seng Bank Ltd
- HKEx Limited
- China Construction Bank
- AIA Group Limited
- Industrial and Commercial Bank of China
- Ping An Insurance
- BOC Hong Kong (Holdings) Ltd
- China Life
- Bank of Communications Ltd
- Bank of China Ltd
Hang Seng Utilities Sub-index
- CLP Holdings Limited
- Hong Kong and China Gas Company Limited
- Power Assets Holdings Limited
- Cheung Kong Infrastructure Holdings Limited
Hang Seng Properties Sub-index
- Henderson Land Development Company Limited
- Sun Hung Kai Properties Limited
- New World Development Company Limited
- Sino Land Company Limited
- Hang Lung Properties Limited
- China Overseas Land & Investment Limited
- The Link REIT
- China Resources Land Limited
- CK Property Holdings Limited
- Wharf Real Estate Investment Company Limited
- Country Garden
Hang Seng Commerce & Industry Sub-index
- CK Hutchison Holdings Limited
- Swire Group
- Galaxy Entertainment Group Ltd.
- MTR Corporation Ltd
- Want Want China Holdings Ltd
- Geely Auto
- CITIC Pacific Ltd
- WH Group
- Sinopec Corp
- Techtronic Industries
- Tencent Holdings Limited
- China Unicom (Hong Kong) Limited
- PetroChina Company Limited
- CNOOC Ltd
- China Mobile Ltd
- Hengan International Group Co. Ltd
- China Shenhua Energy
- CSPC Pharmaceutical Group Ltd
- Sino Biopharm
- Sands China
- AAC Tech
- Shenzhou Internationalrese
- Mengniu Dairy
- Sunny Optical
Many of the companies found within the Hang Seng Index are also Chinese companies due to the linkage between Hong Kong and China’s economies.
This particular index to measure Hong Kong’s economy has been profitable over the years and is a benchmark for global investors to consider when evaluating Hong Kong’s internal economy.
Risk Management
The Hang Seng Index has an incredibly positive reputation with investors for being a high-potential investment with limited risk.
By investing in more than 60 of the best companies listed on the Hong Kong Stock Exchange, investors have the opportunity to grow their money safely in companies that have reliability and profitability.
Recent global economic challenges have resulted in the Hang Seng Index going negative in three of the last four years.
Still, it has reliably shown to be a safe investment over the longer term, especially if you consider the economic data from within the Hang Seng Index, dating back over the last thirty years.
FAQs about the Hang Seng Index
Here are some of the answers to the most frequently asked questions about the Hang Seng Index.
Investors should evaluate these questions so that they fully understand the fund before investing in it with their own money.
Is the Hang Seng Index considered to be a risky investment?
The Hang Seng Index is a general metric that can be used to measure the consensus of the Hong Kong economy.
Over the long term, the Hang Seng Index has shown to be a great investment, but it has struggled to grow in recent years due to global economic struggles that have resulted from worldwide events.
There’s always a percentage of risk that comes along with the concept of investing.
With that being said, the Hang Seng Index has been around for many decades and can provide a solid return on an annual basis when the global economy is bullish.
How often does the portfolio composition change in the Hang Seng Stock Index?
Companies are added and removed periodically in the Hang Seng Index.
You might see changes to the index’s portfolio a few times per year, usually around the end of a quarter.
It’s relatively normal for a few companies to be replaced per year, although it can be more or less depending on certain circumstances.
The index has maintained a balance between 50 and 70 constituents in recent years.
What’s the average annual return for the Hang Seng Index over the last ten years?
The average annual return for the Hang Seng Index over the last decade has been approximately 3.42%.
While this isn’t as much of a return as other economies have provided to investors, it still has remained positive, despite the gains and losses being affected negatively in three of the last four years.
The Hang Seng Index returned a loss of more than 13% in 2018, bouncing back with a 9% gain in 2019.
In 2020 and 2021, the Hang Seng Index lost 3.4% and 14.1%, respectively.
How has the Hang Seng Index performed in 2022?
Investors were hoping for a good year in the Hang Seng Index for 2022.
If things don’t turn around, the Hang Seng Index will mark its fourth negative return in the last five years.
The index has lost more than 2,000 points in 2022 alone.
In February of 2022, the Hang Seng Index was trading at a value of 24,900 points and fell dramatically to just over 21,000 points in June of 2022.
As of June 1st, the Hang Seng Index is down 9.4% and looks poised to clock its third negative annual return in a row.
Final Thoughts
The Hang Seng Index could be a long-term investment if you are starting to plan out your financial future.
Due to recent struggles in the global economy, the Hang Seng index has not been a profitable investment in recent years.
2018, 2020, and 2021 were all years where the index ended the year in the red numbers, signaling a negative return.
In 2022, things have not improved, and investors are frustrated with the lack of profitability from investing in the index.
The Hang Seng Index has been around for decades and has continuously listed some of the best companies in Hong Kong and China.
While the Hang Seng Index is generally a very reliable investment, it has proven that it is not immune to economic challenges.
Just like most investments, timing is everything.
Investing in the Hang Seng Index during prosperous times in the global economy can be a great thing.
Between 2003 and 2007, the Hang Seng Index grew more than 125%, averaging a solid 25% growth in each of those years.
The most recent year when the Hang Seng Index resulted in a gain at the conclusion of the year was 2018, with a 9% gain during the calendar year.
Trade safe!
Disclaimer: The information above is for educational purposes only and should not be treated as investment advice. The strategy presented would not be suitable for investors who are not familiar with exchange traded options. Any readers interested in this strategy should do their own research and seek advice from a licensed financial adviser.
