The index is compiled according to certain stock selection rules. The purpose of index compilation is to reflect the overall average situation of a certain market or sector. Therefore, a specified number of representative stocks will be selected according to certain standards to form the constituent stocks of the index. The market changes in real time, and individual stocks also rise and fall. In order to make the index reflect the market situation more accurately, it is necessary to adjust the constituent stocks of the index in time. For example, some stocks have become smaller. Or there are problems in the operation of listed companies, which will drag down the development of the index and need to be transferred from the list of index constituent stocks in time. Some stocks will be selected as index constituent stocks when their scale increases. This process is called exponential swap.

Therefore, the transfer of index includes two processes, namely, the replacement of some index components.

Position adjustment time

The adjustment of index stocks can be divided into periodic adjustment and temporary adjustment. The periodic adjustment of the index will stipulate the periodic adjustment of the index constituent stocks in the index preparation plan. For example, the Shanghai and Shenzhen 300 Index shows that constituent stocks are adjusted twice a year, which is the second Friday or Monday in June and 65438+February, and it will be postponed if it is a legal holiday. There are also Growth Enterprise Market Index, Shenzhen Stock Exchange Index, SSE 50, CSI 1000 and CSI 500, all of which are adjusted twice a year, in June and 65438+February respectively, and the dividend index is adjusted once a year, in 65438+February.

Influence of index adjustment

Many investors will worry that after the index adjustment, the index fund will not affect the net value of the fund, thus affecting their investment income. In fact, as investors, we don't need to worry too much about this problem. First of all, the adjustment of index funds is the operation of fund managers, and investors do not need to do additional operations. Secondly, the adjustment of index fund positions will not have much impact on the net value of the fund, because most index regular adjustment rules will indicate that the sample proportion of each adjustment is generally not more than 10%, and some indexes even set sample adjustment buffers to reduce the adjusted sample stocks.

Significance of index adjustment

We use an example to illustrate the significance of index adjustment: the famous Dow Jones index in the United States has a history of 100 years, and the average value of 12 stocks was first published, which symbolizes the most important industry in the United States. So far, among the 12 constituent stocks, only General Electric remains in the index. Other 1 1 are all replaced. If you bought any stocks of Dow Jones Index Fund before 100, you only have an 8.3% chance to buy GE, which means you only have an 8.3% chance to survive. However, if you bought the Dow Jones index fund more than 100 years ago, the wealth created for you in these years is huge, so the index fund has immortal characteristics. Therefore, the adjustment of the index is for long-term and better development.