Introduction of cross-currency purchasing power

Why is cross-currency purchasing power needed?

• Opening Positions Conveniently: Clients can open positions first and then conduct currency exchange. (Before this feature is available, Clients must exchange currency in advance to trade.)

• Day Trading: Clients can engage in day trading with minimal need for currency exchange. (Before this feature is available, Clients must exchange currency in advance to trade.)

• Automated Calculations: Supports automated currency exchange calculations, making it easier for Clients to operate. (Before this feature is available, Clients must calculate exchange amounts themselves.)

2. Operational Details

• Applicable Accounts: Currently only available for margin accounts.

• Currency Support: Supports cross-currency purchasing power in HKD, USD, and RMB, with real-time reflection in the trading system, allowing Clients to see purchasing power in other currencies simultaneously.

• Trading Scope: Usable for Hong Kong and US stock trading; A-shares are currently not supported (HKD and USD cannot support RMB buying power).

• Trading Alerts: If an order involves cross-currency purchasing power, the system will provide a pre-trade alert message.

• Exchange Options: Clients can choose either immediate manual exchange or to defer to the next day for automatic exchange based on their budget.

• Daily Automatic Currency Exchange: Every day at 09:05 HKT, the system will automatically check the minimum requirements for initial margin (IM) in various currencies. If there is a shortfall, the system will perform an automatic currency exchange to restore it to the minimum required level. Clients can also choose to exchange the full amount themselves. In the absence of open position, if a certain currency shows a negative balance, the system will also perform an automatic currency exchange to cover that negative value. If there is a shortfall in HKD or USD IM, the system will first exchange between USD and HKD to restore the minimum requirement. If this is still insufficient, the system will then exchange from RMB.

• Integration with MMF: Can be used in conjunction with money market funds (MMF); the system will automatically redeem the necessary shares if there is insufficient HKD or USD.

• Margin Management: If a margin call occurs, the system will automatically exchange from another currency to cover the shortfall, avoiding margin calls.

• Feature Activation: We are gradually opening these upgraded features to Clients. If you have any related questions, please feel free to contact our online customer service.

3. Example

• A client initially holds 1,200 HKD and 10 USD.

• The client wishes to purchase one share of stock ABC, which is valued at 300 USD (assuming a 50% margin requirement of 150 USD).

• Since he only has 10 USD, they need an additional 140 USD to open the position.

• Before executing the trade, the system will prompt whether to use cross-currency purchasing power or to manually exchange currency in advance.

• If he agrees to utilize cross-currency purchasing power, the system will successfully purchase one share of stock ABC.

• If the client is only engaging in day trading and closes the position before market close* (e.g., selling stock ABC at 310 USD), the account will not require automatic currency exchange.

• Conversely, if the position is closed before market close* (e.g., selling stock ABC at 298 USD), the account will automatically exchange currency (assuming an exchange rate of 7.8:1), converting 15.6 HKD (2*7.8) into 2 USD to cover the negative balance.

• If the client does not close the position before market close* and the closing price of stock ABC is 300 USD, they must maintain a margin of 150 USD. Since the account only holds 10 USD, the system will convert 1092 HKD (140*7.8) into 140 USD (assuming an exchange rate of 7.8:1) to ensure the required margin for settlement.

• *The market closing time generally refers to post-market closing: 08:00 AM HKT during daylight saving time or 09:00 AM HKT during standard time, as per the exchange's announcement.