Let me get this straight: bad for retail investors, good for the stock market and institutions! If the short-selling mechanism is fully open to retail investors, then there is no doubt that retail investors will definitely participate when they see the short-selling mechanism!
This is not a good thing, it is a bad thing!
The reason is very simple, you can't make money by doing more, and you can only lose more by shorting! Although it seems that the A-share bear market is short-lived, shorting does not actually make money.
Why did many people lose money during the US 10 bull market? One of them is shorting, which is a mistake in judging the general trend.
Therefore, most retail investors' judgments on the general trend are actually wrong. Being short and long is naturally prone to mistakes and even speculation! Opening the short channel only gives retail investors another way to lose money.
For the market and institutions, it is a major positive! For institutions, there can be a short-selling mechanism to weigh risks and form a hedge.
For the market, if you want to get out of the slow-moving market, you must improve and fair the long-short system, because only by meeting the most basic "zero-sum law" of the market can the market go far and be healthy.
(What is zero sum? That is, profit+loss = zero. At present, the long-term mechanism is complete and the short-term mechanism is immature. So most people, including institutions, can only earn more money if they do more. So everyone makes money in the middle and late period of the bull market. Who loses money to hedge? The result is a fast cow and a slow bear! )
What will happen? Go retail!
Gradually leave long-term mature investors and funds who know how to invest in value!
Is the only way in the future!
I don't think it will be launched in the short term, at least after the full registration system, it depends on the landing of T+0. Otherwise, it is a bit "cruel" to force the short-selling mechanism to involve retail investors.
If short selling is allowed, what will happen to A shares? This must first understand what is short.
The so-called short, first of all, can be sold because of "bearish stock price" and buy back shares after reaching the goal of falling stock price. The main methods are "naked short selling" and "borrowing short selling". But most countries in the world are "short selling by borrowing shares", which is similar to but not equal to China's "securities lending business".
Second, shorting stocks and shorting indexes are different in meaning and method. At present, there is only one way to short stocks in China. The short index is short by buying "put options" (corresponding to call options) or buying SSE 50, CSI 300 and CSI 500 futures.
At present, due to various reasons, China is in the current situation of "restricting short selling", "not completely shorting individual stocks" and "there is a threshold limit for participating in stock index futures".
If we assume that China can sell short freely, compare the short selling behavior in Hong Kong and the United States:
First, all stocks can be short, or most major stocks can be short.
Second, everyone can be short. There is no threshold difference.
And what happens if this "full freedom" short selling can be realized?
That's the result of Hong Kong, that is, you can not only buy the rising stock market to make money, but also find junk companies and fake companies to make money! In other words, junk stocks become fairy stocks, and most stocks are illiquid. No one will participate in junk stocks, fairy stocks and zombie stocks and lose their liquidity. Blue chips have become the main trading varieties in the market. There are hundreds of billions and trillions of blue-chip stocks in the market, while the market value of fairy stocks is less than 100 million, and the daily turnover is less than 10 thousand yuan.
However, the number of new shares issued will not affect the rise and fall of the index (or have no substantial impact-this is different from the determinants of new shares now). The index will focus on high-quality blue-chip stocks, because most stocks have no trading liquidity. The trend of the index is mainly influenced by blue-chip stocks and constituent stocks.
However, it should be noted that all-round and free shorting must have strict "preconditions", that is, the market must crack down on counterfeiting, manipulate stock prices by information, or withdraw from the market for compensation. Without such support, there will be a similar "fuse mechanism"-a very effective and mature mechanism in the United States, but if it is placed in the cancer unit, it will be a disaster, because the supporting mechanism is perfect so far:
For example, listed companies can buy back, increase their holdings, reorganize, or issue similar false announcements to achieve the "skyrocketing" factor of stock prices, thus cracking down on short-selling investors. Not being punished illegally and bearing legal pressure is the main feature of our current cancer stock-no matter how big the illegal act is, it is only a penalty of three cups!
Then, manipulating the stock price through false information to crack down on the stock price of short-selling companies and realize the profits of listed companies or related stakeholders will become a high-risk means of new illegal activities of listed companies under short-selling conditions.
Under the truly perfect supporting mechanism of market system, stocks and indexes can be completely shorted freely, which can play the following roles: First, an efficient market mechanism to combat counterfeiting, fraud and zombie companies, and make them return to zero or close to zero without restrictions-the market value is only several million, and the daily turnover does not exceed 10,000 yuan, thus losing the significance of listing and the conditions of "reduction" and "equity pledge". Secondly, market funds can be efficiently allocated to the most needed funds of the real economy and the best listed companies, thus greatly improving the capital efficiency of the market and supporting the real economy to the greatest extent-not the opposite of the current endless money!