An Analysis of the Reasons for the Absence of Short-term Wealth Management Products in Hong Kong

Abstract

This paper aims to analyze the factors contributing to the limited availability of short-term financial products in Hong Kong. Firstly, it examines the characteristics of the Hong Kong market, including its level of financial industry development and the operating models of financial institutions. This examination serves as a foundation for further analysis. Secondly, the study explores the demand and supply dynamics of short-term financial products in the Hong Kong market. Investigating the preferences and demands of Hong Kong residents and analyzing the product offerings of financial institutions it reveals the insufficient supply of short-term financial products at present. Lastly, the paper analyzes the underlying reasons for this phenomenon. From the perspective of financial institutions, the scarcity of short-term financial products in Hong Kong is primarily attributed to the prevalent traditional long-term investment mentality and model deeply embedded in the market. Additionally, regulatory policies impose certain constraints on the innovation and development of short-term financial products. Consequently, the paper proposes recommendations, including the need for financial institutions to give attention to residents' demand for short-term financial products and for the government and regulatory bodies to implement measures that encourage innovation and development in this area. Through a comprehensive analysis, this paper provides insights into the factors contributing to the limited availability of short-term financial products in Hong Kong and offers recommendations to stimulate market growth.