Retail investors short A-shares through securities lending, options and stock index futures.

1. Securities Lending

1. Definition: Margin trading-short or Selling stock short is a term in securities trading. Investors lend shares to securities dealers and sell them. When applying for stock loans from securities finance companies or securities companies that have opened credit transactions, according to current laws and regulations, you must first pay about 90% of the sales amount (price) as a deposit, and the price is deducted from the securities tax and securities company After brokerage fees and bond borrowing fees, the remaining price will be deposited with the securities lending institution as collateral.

2. The operation of securities lending

1. Investors invest in the sale of securities, use the margin as collateral, and then return the securities within the specified time. After investors borrow and sell securities, they can repay the borrowed securities to the securities company by buying the securities to repay the securities or directly repaying the securities.

2. Buying bonds and returning bonds means that investors declare to buy bonds through their credit securities accounts, and the purchased securities are directly transferred to the member’s special securities account for securities lending during settlement.

2. Options

1. Definition: Option is a financial instrument based on futures.

2. Meaning:

(1) In essence, options essentially price power and obligations separately in the financial field, so that the transferee of power can Within the stipulated time, it exercises its power to determine whether to proceed with the transaction, and the obligated party must perform it.

(2) When trading options, the party who purchases the option is called the buyer, and the party who sells the contract is called the seller; the buyer is the assignee of the power, and the seller must fulfill the buyer’s obligations. The person with an obligation to exercise power.

3. Settlement method:

(1) Stock settlement method

In stock trading, if an investor wants to buy a certain number of stocks, he or she will The full fee must be paid immediately to obtain the stock. Once the stock price rises after buying the stock, the investor must also sell the stock to obtain the spread profit. Therefore, the settlement requirement is that the transaction must be paid immediately in cash, and the profit or loss must be realized when the underlying asset is no longer held after the transaction is completed. In the options market, the settlement method for stocks is very similar.

The basic requirements of the stock settlement method are: the option premium must be paid immediately in cash, and as long as the position is not hedged, profit or loss cannot be realized. This settlement method is mainly used in stock options and stock index options transactions. The settlement procedure of the option contract is roughly the same as that of the underlying asset.

(2) Futures settlement method

The settlement method of futures loans is very similar to the settlement method of the futures market, and also adopts a daily settlement system. Futures markets usually use this settlement method.

However, due to the greater risk of using futures settlement methods, many exchanges only use futures loan settlement methods in futures and options transactions, while still using stock options in stock options and stock index options transactions. Class settlement method. In this way, the settlement procedures for options trades can be greatly simplified as the settlement procedures for options and their underlying assets are the same.

3. Stock Index Futures

1. Definition: The full name of Stock Index Futures (SPIF) is stock price index futures, which can also be called stock price index futures and futures. Refers to the futures type with the stock price index as the underlying object.

2. Meaning: Transactions are the same as ordinary commodity futures transactions, have the same characteristics, and are a type of financial derivatives. As a type of futures trading, stock index futures trading has basically the same characteristics and processes as ordinary commodity futures trading.

3. Features: Stock index futures trading has the characteristics of T+0 and margin leverage trading, so it is more risky than ordinary stock trading. It is recommended that novices trade under the guidance of professional analysts to achieve ideal results. return on investment. This is particularly important for stock investors:

(1) Futures contracts have an expiration date and cannot be held indefinitely

After buying stocks, you can always hold them. Under normal circumstances The number of shares will not be reduced. However, stock index futures have a fixed expiration date, and positions must be closed or delivered upon expiration. Therefore, trading stock index futures cannot be like buying and selling stocks, where you forget about it after the transaction. You must pay attention to the contract expiration date to decide whether to close the position or wait for the contract to expire for cash settlement and delivery.

(2) Futures contracts are margin transactions and must be settled daily

Stock index futures contracts are traded on margin. Generally, you only need to pay about 10-15% of the face value of the contract to buy or sell a contract. A contract, on the one hand, increases the profit potential, but on the other hand, it also brings risks, so profits and losses must be settled daily. After buying a stock and before selling it, the book profits and losses are not settled. But stock index futures are different. After trading, the contracts in hand must be settled at the settlement price every day. Book profits can be withdrawn, but book losses must be made up (i.e., margin calls) before the market opens the next day. And because it is margin trading, the loss may even exceed your investment principal, which is different from stock trading.

(3) Futures contracts can be sold short

Stock index futures contracts can be sold short very conveniently and then bought back after the price falls. Short selling can also be done in stock lending transactions, but it is relatively difficult. Of course, once the price rises instead of falling after short selling, investors will face losses.

(4) Market liquidity is high

Research shows that the liquidity of the index futures market is significantly higher than that of the stock spot market. For example, in 2013, the trading volume of CSI 300 stock index futures on the China Financial Futures Exchange reached 140.7 trillion yuan, a year-on-year increase of 85%, which was 2.5 times the GDP of the same period. In 2013, the trading volume of CSI 300 stock index was 16.6 trillion yuan.

(5) Stock index futures implement cash delivery

Although the futures index market is a derivative market based on the stock market, the futures index delivery is carried out in the form of cash, that is, in During delivery, only profits and losses are calculated without transferring physical objects. During the delivery period of futures index contracts, investors do not have to buy or sell corresponding stocks to fulfill contract obligations. This avoids the phenomenon of "crowding" in the stock market during the delivery period.

(6) Stock index futures focus on macroeconomics

Generally speaking, the stock index futures market focuses on buying and selling based on macroeconomic data, while the spot market focuses on buying and selling based on individual company conditions. transactions carried out.

(7) Stock index futures implement T+0 trading, while stocks implement T+1 trading

T+0 means buying on the same day and selling on the same day. There is no time or frequency limit. T+1 means buying on the same day and selling on the next day. You cannot sell on the day you buy. Current futures transactions all implement T+0 transactions. Stock transactions in most countries are also T+0. Due to the history of my country’s stock market The T+1 trading system is implemented for various reasons.