One change: large institutional investors sell stocks.
The most important function of stock index futures is to hedge risks for large enterprises and institutions. The hedging positions of the three major stock index futures correspond to the stock quotas with the same market value held by large enterprises and institutions in the stock market.
In this context, when the stock market falls, large enterprises and institutions can hold shares and rely on the profits of shorting stock index futures to hedge the losses of falling stocks. Once the stock index futures are cancelled and the stock market falls, even if it falls by only one point, large enterprises and institutions will shrink by one million. So they had to sell their shares. Will the stock market go up at this time? I'm afraid it's not optimistic For example, during the stock market crash, in order to stabilize the A-share restricted futures index, some active funds in the spot market will inevitably reduce stock operations or even withdraw because of insufficient hedging means.
The second change: spot arbitrage disappears.
However, whenever the trading prices of the stock market and the futures market deviate greatly-whether the futures price is higher than the spot price or the spot price is higher than the futures price, there will be an influx of arbitrage, selling varieties with high bids and buying varieties with low prices at the same time. The objective effect of this risk-free spot arbitrage is to make the abnormal spot spread quickly return to normal, effectively offsetting the behavior that may disrupt the market or even cross-market manipulation. After the cancellation of stock index futures, the market function of spot arbitrage naturally does not exist.
The third change: foreign QFII is not encouraged.
According to international practice, when introducing foreign capital, countries' markets should strictly limit their speculation and market manipulation, and at the same time ensure their reasonable investment income. China requires QFII, a qualified foreign investment institution, to enter the stock market by hedging, so as to standardize operations and hedge risks. If QFII can neither hedge nor cash out shares on a large scale, it can only be a "living Lei Feng" to "let China investors go first" and finally get away with it when the stock market falls. How many such "Lei Feng" are there? I am afraid it is also a mystery.
The fourth change: offshore futures index is hot.
Offshore futures index may be one of the most successful financial innovations in Singapore. In September, 1986, SIMEX, Singapore International Finance Exchange, launched the Nikkei 225 index futures. Because Japanese law prohibited securities traders from investing in stock index futures at that time, institutional investors in the United States and Europe used Singapore's Nikkei 225 stock index futures contract to hedge their investments in Japanese stocks. Two years later, Osaka Stock Exchange finally launched its own Nikkei 225 index futures. Subsequently, from1September 1998 to 165438+ year1October, Singapore, which tasted the sweetness, pursued the victory and successively launched stock index futures such as Singapore, Dow Jones Malaysia, Dow Jones Thailand, MSCI Hong Kong and MSCI Taiwan Exchange. On September 5th, 2006, Singapore took the lead in launching A50 stock index futures, and all its 50 constituent stocks are the core resources in the Shanghai and Shenzhen 300 Index. Relying on these offshore futures products, more than 80% of Singapore's derivatives transactions come from international investors outside the mainland.
If China cancels stock index futures, it will undoubtedly be a "pie in the sky" for Singapore, Chicago Mercantile Exchange and Brunei International Exchange, which also own A-share stock index futures. Because a large number of domestic A-share stock index futures traders will have to move to the offshore market. As for whether these funds will consciously only go long when going abroad and limit shorting A-share stock index futures? I'm afraid the host country's regulators will not take "maintaining the stability of China's stock market" as their responsibility.
At present, there are more than 200 stock index futures in 37 countries and regions in the world, but I haven't heard of any country canceling stock index futures. The three major stock index futures in the United States have been suspended due to the fuse mechanism, and China is learning from the successful experience of foreign countries. On July 8 this year, 1400 A shares were suspended, and nearly a thousand shares had to continue to fall because of "no reason to suspend trading". It can be seen that the establishment of market-oriented scientific fuse rules to limit excessive speculation and the suspension of fuse trading to deal with abnormal fluctuations will become a normalized hedging mechanism that the two cities generally expect.