In this uncertain world, every subtle dynamic can trigger market volatility. Recently, the complete suspension of the lending of restricted shares has attracted widespread attention in the market. This is not only a policy adjustment, but also a test of the mentality of market participants. So, what's the story behind this?
When the lending of restricted shares was completely suspended, some investors were worried that the bonds that had been lent and had not yet matured might form selling pressure, which would have a certain impact on the market. Such fears are not unfounded. After all, for some savvy investors, securities lending can indeed be a means of making a profit. They may sell a large amount of restricted shares during the term of the contract, collect chips at a low price, and wait until the contract expires to return the shares. In this way, you can not only earn interest on the loan, but also have more chips at a low level.
However, does this possibility really exist? A number of interviewees told reporters that there is indeed such a possibility in theory, but in practice the possibility of such an operation is small. On the one hand, investors who participate in securities lending and borrowing business are not one-way shorts in most cases, and they will operate in both long and short directions. On the other hand, lenders of restricted shares do not want to see their own ** smashed. As a result, they are more inclined to remain stable rather than engage in large-scale short selling.
So why are some investors concerned about the suspension of restricted share lending? This is mainly due to their high sensitivity to the market and risk awareness. They are concerned that if a large number of restricted shares are lent out and the market appears**, this may lead to increased selling pressure, which in turn will affect the movement of the entire market. In reality, however, this is not very likely to happen.
According to statistics, as of January 31, the Shanghai and Shenzhen stock markets totaled about 12.4 billion restricted shares have been loaned and have not yet been returned. Although this number is not small, it is still a small scale in the entire A** field. Moreover, the proportion of securities lending and selling to the turnover of A-shares has been below 1% recently. This shows that the impact of securities lending and borrowing on the market is relatively small.
So, why are some investors paying so much attention to securities trading? This is mainly due to the close relationship between securities lending and borrowing and snowball products. Some investors are concerned that if a large number of restricted shares are lent and short-sold, this may lead to *** and thus affect the earnings of the snowball product. The snowball product is a structured financial product, and its return is related to the ** volatility of the underlying asset. Before the expiration of the snowball product, if the underlying asset reaches a certain level, investors will face a huge risk of loss. Therefore, investors' focus on securities lending and borrowing is actually a concern about the risk of snowball products.
Regarding the risk of snowball products, industry insiders believe that securities lending is not the main force of selling pressure, so the impact on the index is not large. After the early stage of large-scale knocking snowball structure products, if the first continues to go down, there will be a second knock-in or a new knock-in. But for the CSI 1000 index snowball, every 100 points from below 5,500 points will lead to a snowball of 10 billion 20 billion nominal principal knocking in. The most concentrated level is between 4800 and 4900 points, and the corresponding nominal principal of this level is more than 50 billion, accounting for about a quarter of the snowball size of the stock index.
On January 31, the CSI 1000 closed down 4% at 4,785 points, which has completely fallen below 4,800 points, which means that the one-year or two-year snowball with a knock-in price above 4,800 points has been knocked in, which means that for these investors, the risk of loss they face has reached the maximum.
However, for some savvy investors, they may avoid this risk in some ways, such as hedging the risk through put options, or selling the underlying asset before the expiration of the snowball product to avoid losses, etc., of course, these operations need to be flexibly responded to according to market conditions.
Overall, although the suspension of restricted share lending has caused some investors to worry. However, this does not mean that the market will have a large **, on the contrary, the overall trend of the market is still affected by many factors, including macroeconomic conditions, policy trends, international environment and so on. Therefore, investors should remain calm and rational about market fluctuations and make reasonable investment decisions based on their own risk tolerance and investment objectives.
Of course, we can't ** for the direction of the market. But one thing is for sure, and that is that investors need to keep a clear head and not be fooled by short-term fluctuations in the market. In this market full of opportunities and challenges, only those who can grasp the opportunities and cope with the challenges can truly achieve success.
For those investors who are concerned about the risks of snowball products, they need to think carefully about their investment strategy. Although snowball products may carry the risk of loss, they can also bring high returns. Investors need to weigh the pros and cons and make informed decisions based on their own risk tolerance and investment goals.
In addition, investors also need to understand the nature of the market. It's a game where there are wins and there are losses. Investors need to keep a normal mind and not be swayed by temporary gains and losses. In the process of investing, we need to continue to learn and accumulate experience to improve our investment level. Only in this way can we find opportunities in the volatility of the market and obtain greater gains.
In conclusion, the impact of the suspension of restricted share lending on the market is complex and volatile. Investors need to look at market fluctuations rationally and make informed decisions based on their actual situation. In this market full of opportunities and challenges, we need to remain calm and respond positively in order to truly succeed.
In closing, I would like to say that investing is not an easy thing to do. It requires us to keep learning, accumulate experience, and improve our investment level. At the same time, we also need to keep a calm mind and not be confused by short-term fluctuations in the market. Only in this way can we get greater returns in the world of investment and realize our dreams of wealth.