At present, there are commodity futures, foreign exchange, gold and silver, stock index futures, securities lending business and so on.
If short selling is allowed for investment and wealth management products, I think it is generally related to stock index futures and securities lending business; Portfolio that restricts short selling is a variety that can only make more money, such as stocks, bonds, rare and precious metals and so on.
In the case of shorting, of course, some short-selling funds are invested in some futures and other varieties that can be shorted, and others are normally made into some conventional varieties. Portfolio theory is an abstruse and difficult content in the course of financial management. Many students misunderstand the difference between the feasible boundary of portfolio when short selling is allowed and the feasible boundary of portfolio when short selling is not allowed, which leads to misunderstanding of portfolio theory. With the help of Excel software design verification experiment, the feasible boundary of portfolio in two cases is compared, which eliminates students' misunderstanding and enhances the vividness and visualization of teaching.
Experimental design concept
The return rate of portfolio is equal to the weighted average of the return rate of individual assets that make up the portfolio, so there is a certain range of the return rate of portfolio. When short selling is not allowed, the return rate of the portfolio is between the lowest and highest return rate of the individual assets that make up the portfolio. When short selling is allowed, the portfolio yield can break through the above restrictions, and the value can be between infinitesimal and infinite.
In fact, this question is quite professional, and it is related to the set of minimum variance of securities portfolio. It can be understood that when short selling is allowed, all possible strategies for the distribution of various securities weights are obtained, but when investors reject most of these strategies because they can't short selling, they lose many opportunities to reduce variance or increase expected returns, so short selling is not allowed. For short selling, the biggest gain is the price of short selling (for example, if an enterprise goes bankrupt, the value of related stocks is likely to be zero, that is, waste paper), and the biggest loss may be infinite. So when short selling is allowed, its form is that there will be a minimum boundary set on the left and an infinite area on the right.