Chapter 1640 [Launching three new valuations and a large number of ETF varieties]
A manager attending the meeting looked around at the crowd and analyzed: "The root cause of this problem is that funds are excessively concentrated in a few large-weighted stocks, and I believe everyone knows the reason for this problem."
The manager paused for a moment, and then spoke: "The reason is that small and medium-sized investors in A-shares and retail investors participate in the investment in the SGX market. They can only trade a few on-exchange New Securities 50ETF or over-the-counter New Securities.
50 ETF feeder funds, and the reason for this phenomenon is that the excessively high entry threshold of the SGX market has blocked more than 90% of investors."
Everyone also nodded, obviously agreeing with his view. Even Fang Hong, who was present at the meeting, also admitted that this was the fact.
Just look at the daily trading volume of the six major new certificate 50 ETFs. The daily trading volume of each ETF is not less than 100 billion. This is simply a miracle. It may not seem like much when you look at it intuitively, but when you compare it, you will know how incredible it is.
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During the same period, the CSI 300 ETF had a daily trading volume of only one billion or more than two billion, while each of the six major NSE 50 ETFs in the SGX market had a daily trading volume starting at hundreds of billions.
This situation occurs because hundreds of millions of retail investors have gathered to buy the NSE 50 ETF. Because it cannot meet the entry threshold of the SGX market, retail investors cannot buy individual stocks on their own. In addition, the income of the NSE 50 Index far exceeds theirs.
In line with expectations, most retail investors are more willing to buy the New Securities 50 ETF and hold heavy positions in the New Securities 50 ETF. After all, the risk of trading individual stocks is greater, which also leads to further concentration of funds.
In fact, retail investors are not the only way to participate in investing in the SGX market by buying the SGX 50 ETF, because there are also many public funds, including many active hybrid public funds, and the varieties are actually very rich and diverse, including those targeting mid-cap stocks.
For small-cap stocks, some also rely on industry stock selection. For example, some public funds specialize in chip stocks, some focus on growth stocks, etc.
Logically speaking, this can divert a lot of funds.
However, retail investors are not interested in these public funds, especially those active hybrid public funds. The reason is that they find that these funds are too impractical and cannot even outperform the market, and the gap is not even a little bit.
Why can't I win? Because it's filled with garbage.
Many active hybrid public funds managed by fund managers allocate part of the stocks in the SGX market, and then stuff a lot of junk stocks from the two neighboring markets into the investment portfolio, specifically to take over the stocks at high prices.
The reason why the financial rentiers attached to the two neighboring cities have not made much noise in recent years and have not targeted the SGX market as crazily as they did a few years ago is because they can indirectly suck blood from the SGX market in this way.
Many Christian people have poor information and do not know the truth, so they are harvested in this way. They could have eaten a lot of meat, but in the end, the meat was taken away without knowing it. They can only eat some dregs, and they even think it is okay.
But investors know relatively better, and the vast majority of investors will not buy active hybrid public funds.
If these funds did not fill in junk stocks, they would definitely be able to divert a considerable part of the liquidity in the past, and it would not be the case that everyone only recognizes the connection between the six major on-site new securities 50 ETFs and their over-the-counter new securities 50 ETFs.
Finally, one of the participants said: "To solve this problem, we must either launch new indexes and new ETFs, or lower the entry threshold from 1 million to 100,000."
The current head of SGX immediately spoke: "Lowering the threshold will definitely not work. If you lower the threshold, everyone will think that the market is about to peak and think that you want big guys to come in and take over. This will have a serious negative impact on the market."
The effect is that this is not advisable.”
The stock market has developed for so many years, and even retail investors are now smarter. The main reason is that they have been cheated too many times in the past. Even a pig will have a subconscious stress reaction. In the final analysis, it is seriously damaged by those financial rentiers.
The loss of credit leads to a sharp increase in the cost of trust.
Now if it is announced that the entry threshold has been lowered to 100,000 yuan, and the vast majority of investors can buy individual stocks on their own, everyone will definitely think that they will finally trick retail investors into taking over the orders, and then they will conclude that the bull market has peaked. In the end, everyone will
They all ran away, thus forming an established fact, and the market really experienced a bull-bear transition.
At this time, Fang Hong said: "I don't agree with lowering the threshold, not to mention that it will cause panic. Once the threshold is lowered, won't the market become dominated by retail investors again? Then should we go to retail investors?"
Fang Hong did not agree with lowering the threshold, nor did the current head of SGX. Both of them had made their positions clear. Naturally, the other participants present lost their attitude and just followed the example of the real talkers.
Another manager who attended the meeting said: "If we don't lower the threshold, we can only launch new indices and ETFs. We can't count on those public fund managers, right?"
When he mentioned public fund managers, everyone present smiled, but the smile was full of sarcasm.
As expected, this meeting would not be held today. In fact, no one from a public fund has ever been invited to discuss a series of major reform issues in the SGX market.
Fang Hong smiled, spread his hands and said, "Then we can only launch new indices and ETFs."
After a detailed discussion and exchange at the meeting, everyone finally confirmed the general direction and drafted a draft.
That is to say, the next focus of the reform of the SGX market is to launch three new indexes, namely the "SGX 500 Index", the "SGX 1000 Index" and the "NM Securities Composite Index", referred to as the "SGX Composite Index".
"Referring to", these three indexes have been confirmed at this meeting, but will not be launched at the same time.
The SGX Composite Index will include all stocks listed on the SGX-ST market, and will be calculated using the market capitalization weighting method, that is, the weighted number of each component stock's share of the overall market capitalization of the entire market. Therefore, super large-cap stocks have a great impact on the index.
Small-cap stocks have a small impact on the index.
After the launch of the NSE Composite Index, it will become the real market of the SGX market. Under it are the existing NSE 50 and the three major indexes to be launched, the NSE 500 and the NSE 1000.
The SGX 50 Index, which has already opened for trading, is composed of the 50 largest, most liquid, and most representative stocks in the SGX market. It is a representative index of super large-cap stocks.
The NSE 500 Index includes the 51st to 550th largest stocks in the A-share SGX market, a total of 500 stocks, and is a representative index of mid- and large-cap stocks; the NSE 1000 Index includes the A-share SGX
The 501st-1550th stocks with the largest market size, a total of 1000 stocks, are representatives of small-cap stocks.
