In the A-share market, the northbound capital refers to the capital that the exchange is the main body, and through the mutual declaration (Shanghai Stock Connect or Shenzhen Stock Connect) between the Shanghai Stock Exchange and the Stock Exchange, Hong Kong capital and international capital can declare the entrusted trading orders to the local exchange through local brokers. The inflow and outflow of northbound capital will have a certain impact on the stock market. What impact will the net outflow of northbound capital have on the stock market?

1. To some extent, it will cause the stock market to fall

Affected by epidemic and other factors, the global stock market has generally fallen. Up to now, the net outflow of funds from the north has exceeded 7 billion, including 4.1 billion from Shanghai Stock Connect and 2.9 billion yuan from Shenzhen Stock Connect. This shows that foreign investors are not optimistic about the upside of A shares in the global environment, thinking that A shares will fall in the later period, and choose to flee. With a large amount of funds flowing out,

2. Aggravate the panic in the market

Most investors in the market are retail investors, who choose investment strategies with the change of funds. When a large amount of funds flow out from the north, it will aggravate the panic of retail investors, throw out a large number of chips in their hands, and increase the empty power in the market, thus further worsening the market, severely depressing investors' investment confidence in the market and keeping the market in a depressed state.

in short, as a kind of "smart" capital, northbound capital will choose to withdraw strategically when the market is not good, looking for a new shelter, and when the market is better, northbound capital will return to the embrace of A shares.