Hong Kong is behind in the AI race, at least when it comes to giving investors exposure to it.
Rewind a couple of decades and Hong Kong was wildly successful at attracting Chinese internet companies. Tencent listed there and, to this day, trades in Hong Kong rather than the Mainland or the US. Alibaba isn’t listed in the Mainland either. It went public in the US first, then did a secondary listing in Hong Kong. Many of these Chinese internet names headed to Hong Kong as they faced growing scrutiny in the US. It was a boon for HKEX.
But we’re in the AI era now, not the internet or mobile era. Times have changed, and HKEX hasn’t managed to attract enough China AI plays, especially in hardware.
Hong Kong got a brand-new tech benchmark last year, the HKEX Tech 100 Index.
Quick clarification first, because people mix these up. The HKEX Tech 100 is not the Hang Seng Tech Index. They come from different companies. The former is from HKEX, the exchange operator. The latter is from Hang Seng Bank’s index arm.
The Hang Seng Tech Index has been popular with investors for years, and there are already plenty of ETFs tracking it. So why does Hong Kong need another tech index?
Beats me too.
I suppose it comes down to competition. Every stock exchange today wants a slice of the index business. The London Stock Exchange Group bought out FTSE about 15 years ago. SGX rolled out its own iEdge index series. And the gold standard here is the Nasdaq Composite. Created by the Nasdaq exchange back in 1971, it has grown into one of the world’s most-watched market barometers. So every exchange figures it has a shot at building the next great index franchise. HKEX wants in on the party.
But here’s the problem. The HKEX Tech 100 is supposed to span six tech themes.
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AI
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Robotics
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EV & Smart Driving
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Internet
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IT
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Biotech & Pharma
And yet AI is badly underrepresented, with just 7 stocks. Meanwhile Internet, IT, and Biotech & Pharma get outsized weight. It reads like a snapshot of the aged tech economy, not the AI era.
Even more telling, the top 20 constituents by index weight don’t include a single AI stock.
The Hang Seng Tech Index is in the same boat. Only a handful of its members, namely SenseTime and Horizon Robotics, are pure AI plays. The rest are mostly internet platforms. You could argue that Lenovo, Hua Hong Semiconductor and SMIC have AI exposure, and they’ve indeed been among the index’s top performers year-to-date. But that’s about it.
The irony is that Hong Kong does have some red-hot AI names. They’re just sitting outside both indices. Knowledge Atlas (better known as Zhipu AI) has surged more than 1,000% year-to-date. MiniMax, another LLM play, is up almost 100% this year too.
Both indices are now playing catch-up.
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Hang Seng Tech is dropping Kingdee and Kingsoft and bringing in MiniMax and Knowledge Atlas, effective after the market close on 5 June 2026.
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HKEX Tech 100 is reshuffling too, effective after the close on 12 June 2026.
But I still don’t think it’s enough.
It’s a structural issue. Both Hang Seng and HKEX can only pick from the AI stocks that actually list in Hong Kong. And unlike the internet companies of the last cycle, many of the AI hardware names are choosing to list in Shanghai and Shenzhen instead.
The GPU and AI-chip players, namely Cambricon, Moore Threads, MetaX and Hygon, all went public in China.
The optical names like Eoptolink and Innolight are listed in Shenzhen.
You simply can’t add these to the Hang Seng or HKEX indices, because they don’t trade on HKEX. So this shortage of AI hardware in Hong Kong is going to persist, and these tech indices will keep underweighting the very plays investors want most.
And the performance gap shows it. Year-to-date, Hang Seng Tech is down around 11%. Meanwhile the STAR 50 (Shanghai) and the STAR & ChiNext 50 (spanning both Shanghai and Shenzhen) are up more than 30%. The AI trade is very much alive in China, just not in Hong Kong.
So if you only look at China tech through the lens of the Hong Kong market, you might conclude it’s lagging the US. But I hope you now see the real story. It’s the underrepresentation of AI hardware in Hong Kong that’s creating that impression.
Look at the STAR and ChiNext names instead, and you get a completely different picture. The AI race with the US is real, and investor enthusiasm for these stocks is running at the same nosebleed levels you’ll find anywhere else in the world.
Most foreign investors I know who want China exposure stick to Hong Kong-listed stocks. They rarely venture into the A-share market, maybe out of unfamiliarity, or a belief that Hong Kong is friendlier to foreign investors. Fair enough. But if there’s one thing I’d want you to take away from all this, it’s that the most innovative AI plays aren’t in Hong Kong at all. They’re in the A-share market. And that alone might be a good reason to start widening your horizon.
