The journey was short and sweet. On August 20, China unveiled plans for a “through train” allowing Chinese mainland investors to buy Hong Kong-listed shares. The Hong Kong market surged in anticipation, gaining 37 per cent between then and last Friday. Now, barely two and a half months later, the “through train” has changed track. At the weekend, Premier Wen Jiabao spoke about an indefinite deferral.

Hong Kong shares wilted on the news, closing down 5 per cent on Monday. So far, however, Beijing does not appear bent on blocking all channels of portfolio outflows. Chinese banks and insurers, which received the green light for outbound investment last year, are accumulating overseas equities. Four overseas-invested mutual funds have launched in recent months, each raking in US$4bn, and another six are set to follow. In total, according to the official China Daily, some $42bn of the quota for so-called qualified domestic institutional investors (QDII) had been awarded by the end of September; one quarter of which has been invested.