Trading platforms / social trading platforms / signal following
FinTechs belonging to this category operate trading platforms or online marketplaces for investment opportunities or certain financial contracts – e.g. securities, factoring etc. and sometimes furthermore provide contact to financial experts and tools for the decision-making.
FinTech-signalling and social trading platforms provide users with the opportunity to exchange opinions on financial investments and offer signal providers and traders the possibility to make their securities portfolio publicly visible. This way the portfolios can be linked to and followed by other traders via the platform automatically, so that the trading and investment strategy of the followed traders can be copied.
The platform often cooperates with a financial services provider or a credit institution where both the trader and the follower hold their securities accounts, and which execute the orders both of the trader and the follower and to which the platform passes on the trading decisions.
Attitude of the country towards trading, social trading or signalling platforms
Social trading platforms have been developing in Hong Kong for some time, although they have not become very widely used or adopted.
Obligations and requirements to provide trading, social trading or signalling platforms described above
To the extent a social trading platform allows users to trade securities, the usual regulatory requirements, and obligations applicable to a traditional licensed broker under the SFO, including the licencing requirements, apply. Please refer to the section on “Financial advisory and broking services including robo advisory and auto-trading” above.
The sharing of investment strategies and portfolios socially, without carrying on a business, does not require any license or trigger any regulatory requirements if that does not amount to advertising of investment products.
Additional comments regarding the legal situation for trading, social trading or signalling platforms or what FinTech’s must be aware of in this business area
Market size for trading, social trading or signalling platforms and biggest companies in this business area
There is no publicly available information.
Additional comments regarding the economic situation for trading, social trading or signalling platforms or what FinTech’s must be aware of in this business area