The crowding-out effect of stock index futures on the stock market is limited. The initial listing of stock index futures may have a certain capital crowding-out effect on the stock market, especially for some speculators who are sensitive to the index, which will transfer some funds invested in the stock market. Judging from the amount of funds, the trading volume of stock index futures may exceed the trading volume of the stock market, but stock index futures are traded through margin. Even if the trading volume of stock index futures is twice that of spot, the actual trading volume is only 20% of the stock market according to the margin of 10%. The crowding-out effect of stock index futures on the stock market is very limited. Carrying out stock index futures trading will help attract off-exchange investment funds to enter the market and increase the amount of funds. With the introduction of risk management tools such as stock index futures, the scale of insurance funds and social security funds investing in the stock market will continue to expand in the future. Due to the continuous expansion of institutional investors, the demand for large-cap blue-chip stocks is also increasing, and the China stock market will enter a virtuous circle. At the same time, overseas funds will be more willing to invest in China A-share market, because they have relevant hedging tools to increase their interest in investing in China market. In this way, with the growth of domestic institutional investors and the influx of foreign funds, the proportion of assets invested and managed by institutional investors will increase significantly, which can broaden the sources of funds in the stock market, expand the scale of the stock market and increase the liquidity of the stock market.
Spot arbitrage has increased the demand for new spot transactions and enhanced the liquidity of the market. Based on the judgment of the difference between stock index futures and spot prices, investors sell overvalued stock index futures (spot) and buy undervalued spot (stock index futures) through bilateral transactions, so as to realize risk-free arbitrage trading between stock index futures and stock index futures and obtain stable income. In emerging markets, the market efficiency of stock index futures is low at the beginning, and the basis between futures and spot tends to widen, so investors can get almost risk-free profits through spot arbitrage. In addition, the existence of arbitrage can quickly restore distorted market prices, improve the pricing efficiency of the secondary market and promote the healthy development of the secondary market.
To sum up, stock index futures can provide effective hedging tools for stock market investors and attract funds, and its "crowding out effect" on the stock market is limited. At the same time, the existence of arbitrage mechanism can also increase the liquidity of the market, promote the lasting activity of the stock market and improve the effectiveness of the market. The active secondary stock market is not only the foundation of the primary market with financing function, but also plays a positive role in the flow of social resources to high-quality listed companies, accelerating industrial upgrading and improving the governance level of listed companies. Therefore, the development of China's financial derivatives market and the timely introduction of stock index futures under the premise of "high standards and strict requirements" are the inherent requirements for giving full play to the functions of China's securities market and improving the efficiency of social resource allocation.