Recently, the author came across a very interesting question: What would China’s stock market look like if there were no retail investors? We must understand that the influence of retail investors in China's stock market is much greater than that of the stock markets in mature countries. In the A-share market, retail investors account for more than 70%, while institutional investors account for less than 30%. If there are no retail investors in the Chinese stock market, then the performance of securities firms will decline significantly, and many stocks There will be little trading volume, and most stocks will have a one-way trend.

However, these are nothing. What is really scary is that if the market is full of institutions playing games, the main force will make money by "arrangement in advance, releasing good news, raising the stock price, retail investors following up, and shipping at high prices" The model is useless. Because everyone knows in their hearts, we are all peers, and each other understands these tricks. In addition, if retail investors stop trading, then the main institutions will not be able to cut leeks, so we don’t care whether there are retail investors in other countries, but in the A-share market, it is best to have as many retail investors as possible, and it is best to do it in batches Entering is the most beneficial to the main force.

In the stock markets of mature countries, investors account for less than 30%, while institutional investors account for as much as 70%. This does not mean that investors have left the market, but that most people choose to buy stocks. Build a democratic fund. In this way, you don't have to expend energy every day, staring at the stock market, and you can devote more time to your own business.

But what will happen if the proportion of retail investors in the Chinese stock market is reduced to 30%?

First of all, it must be that there will be much less obstruction to the gradual advancement of stock market reform measures such as the registration system and the delisting system, because if most of the market is institutional investors, they will be given the hedging of stock index futures. Tools, institutions will have stronger ability to resist risks. For retail investors, they need to learn the ability to identify the quality of listed company stocks, and at the same time, they must bear the burden of being delisted if they buy the wrong stock. Therefore, more retail investors will withdraw in the future, and they will mainly flow to the public fund market. In the future, the financial strength of institutional investors will become stronger and stronger.

Secondly, retail investors do not all trade. As long as there are still 30% of retail investors in the market, the fluctuations of individual stocks and stock indexes will be relatively stable, and the entire A will completely become a value investment market.

Some people estimate that if retail investors do not trade, the stock market transactions will fall sharply, but in fact, institutional investors need retail investors, and retail investors also need to enter the market to game, and there will be no situation where no trading occurs. However, in the future, the proportion of retail investors directly gaming in the capital market will gradually decrease, and some retail investors will change from stock investors to basic citizens. Of course, you can also want to be a lifelong retail investor. As long as you can survive under the registration system, there will be no problem.