In fact, it is to sell valuation futures contracts that match the spot quantity. The amount of a contract is the contract price *300, but only a small deposit is needed.

For example, if you sell an IF 1404 contract, the price is 2272, and the contract assets are 2272*300=68 1600 yuan, and you need to pay a deposit of 681600 * 20% =136320 yuan. The value of the pairable stock portfolio is 68 1600 yuan.

Such an operation can hedge systemic risks, but the hedging effect is also affected by the basis difference between the stock portfolio and the Shanghai and Shenzhen 300 Index. If the portfolio can outperform the Shanghai and Shenzhen 300 Index, then no matter whether the market is down or up, such a portfolio can stably obtain alpha returns, which is also called alpha strategy.