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HKSAR Gained HK$1 Billion
The Hong Kong Special Administrative Region has cashed in a total of HK$119 billion for selling the Tracker Funds. Apart from the principal amount that was invested, which is HK$118 billion yuan, the government has earned as much as HK$1 billion.
In August 1998 when the Asian Financial Crisis went on, international punters were madly selling the Hong Kong shares in a bid to gain startling profits, leading the Hang Seng index plummeted under the historical level to around 6000 points.
The HKSAR had to intervene by entering the market with its forex funds reserves worth of HK$118 billion to drove international punters away. Shares bought by the Hong Kong government were mainly Hang Seng sub-index shares that had been managed by forex funds investment company.
According to the financial secretary of HKSAR Donald Tsang Yum kuen, the government still holds about HK$110 billion worth of Tracker Funds, of which the forex funds will keep HK$50 billion as the investment reserves for Hong Kong dollars while the rest HK$60 billion will be sold out at the speed of HK$12 billion for each quarter.
Source: Panorama
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