On July 22, that is, today, hundreds of millions of shareholders ushered in two major events of A-share.

First, the Shanghai Composite Index has adjusted for the first time in 30 years. The second is the lifting of the ban by Science and Technology Innovation Board, which is as high as 180 billion, and it is estimated that he will have to witness history again.

Fund Jun saw some analysis that the new version of the Shanghai Composite Index will reach 4000 points, and the lifting of the ban on the surgical record board will also have an impact on the market?

What is the truth? The fund is analyzed one by one.

The new version of Shanghai Composite Index, long Niu slow Niu finally arrived?

The 30-year Shanghai Composite Index and A-share thermometer have finally ushered in a revision.

The adaptation of the Shanghai Composite Index has always been the proposal of many people, and there are indeed some unreasonable places in the index. With the development of the market, it can no longer objectively reflect the development pattern of the market and make appropriate adjustments. It is conducive to the index to reflect the current situation of the development of the stock market more reasonably.

On July 15, 1991, the Shanghai Composite Index was released for the first time as the first stock index in the A-share market, and the core compilation method has been used so far. In recent years, there have been many calls from all walks of life for the revision of the compilation plan of the Shanghai Composite Index. During the two sessions this year, some experts and market people, including representatives of the two sessions, once again proposed to improve the compilation method of the Shanghai Composite Index.

The Shanghai index is often hotly debated because its performance does not match the domestic GDP growth rate. For example, from 2000 to 2020, GDP increased 10 times, while the Shanghai index rose only 50 per cent.

Li Xunlei, chief economist at Zhongtai Securities, said that Prev distortion is not a new problem. Since 2006, Prev distortion has become a well-known term in the market. For A-share investors, one question that may often be puzzled is why the Prev does not fully reflect the continued high growth of China's economy. China's economy has achieved high growth for 30 to 40 years. China's GDP exceeded 10 trillion yuan in 2000 and reached 99 trillion yuan in 2019. While the Shanghai Composite Index reached 2000 points in 2000, why did it not break through 3000 points in 2020? there is a big contrast between the 10-fold GDP and the 50% increase in the stock index.

In fact, if we look at the total market value of the Shanghai stock market, the growth of the total economic output has been fully reflected. The total market capitalization of the Shanghai Stock Exchange was about 3 trillion yuan in 2000 and reached 35 trillion yuan by the end of 2019, while GDP increased from 10 trillion yuan to 99 trillion yuan in the same period, both of which increased by about 10 times. But why doesn't the index always go up? Why does the Prev index not fully reflect this growth?

As a result, the Shanghai Stock Exchange announced on June 19 that it would revise the compilation plan of the Shanghai Composite Index from July 22.

The contents of this revision include:

1. If a risk warning is implemented on an index sample, it shall be removed from the index sample from the next trading day on the second Friday of the month following the implementation of the risk warning measure. The securities whose risk warning measures have been revoked shall be included in the index from the next trading day on the second Friday of the following month.

The sample of Shanghai Composite Index contains dozens of risk warning stocks, and the elimination of these stocks has little impact on the index itself, but it is conducive to the survival of the fittest in the capital market.

2. Newly listed securities with a daily total market capitalization ranking among the top 10 in Shanghai shall be included in the index after three months of listing, while other newly listed securities shall be included in the index one year after listing.

According to the analysis of Northeast Securities, the best measure to enhance the characterization ability of the Shanghai Composite Index in the compilation and adjustment of the Shanghai Composite Index is to change the inclusion time of new shares, which is expected to boost the trend of the follow-up index.

In the past, the Shanghai Composite Index was uniformly included on the 11th trading day after the IPO. Judging from past experience, A-shares are basically in the high range of stock prices in the coming year within 10 days to 3 months of listing, a phenomenon that existed in all the 10 years from 2010 to 2020 except 2014. If we look at the 10-year data, the median rise or fall in the relative offering price is between 100% and 110% 10 days to 3 months after the IPO, and it falls to 50% one year after listing. This adjustment will greatly weaken the drag of the past.

For example, the revision of the index compilation avoids the drag on the index caused by irrational speculation at the initial stage of the listing of new shares. The most extreme was the listing of Petrochina Company Limited in 2007. The weight was relatively large, the stock price fell to a fraction, and the cumulative decline of more than 90% after more than a decade of listing was a drag on the Shanghai Composite Index. Without the contribution of Guizhou Moutai and other large-cap bull stocks, the Shanghai index would have been lower than it is now.

3. Depositary receipts issued by red-chip enterprises listed on the Shanghai Stock Exchange and Science and Technology Innovation Board-listed securities will be included in the Shanghai Composite Index in accordance with the revised compilation plan.

According to the current industry composition of the Shanghai Composite Index, traditional cyclical industries such as finance, transportation, chemical industry and mining account for a relatively high proportion, while consumption, medicine, science and technology and other new economic industries that represent the direction of China's economic structural transformation account for a relatively low proportion. In particular, the proportion of science and technology industries represented by semiconductors, science and technology hardware, Internet, software, and high-end manufacturing is significantly lower than the proportion and status of these industries in the national economy.

Before the launch of Science and Technology Innovation Board on the Shanghai Stock Exchange, many representative companies in the new economy chose to list in Shenzhen, Hong Kong or even overseas. as a result, the performance of the Shanghai Composite Index over the past decade does not fully reflect the overall picture and structural characteristics of China's economic growth. The launch of Science and Technology Innovation Board, on the one hand, opens the door for many technological and innovative enterprises to be listed on the Shanghai Stock Exchange, on the other hand, the inclusion of Science and Technology Innovation Board Securities in the Shanghai Composite Index will directly increase the proportion of listed companies in emerging technology industries in the index. it is a useful supplement to the composition of the Shanghai Composite Index industry.

Is the Shanghai Composite Index going to jump to 4000?

Last night, the fund gentleman noticed that some netizens of Weibo Corp posted an analysis saying that the market was about to reach 4000 points.

In fact, this statement comes from a research report, Everbright Securities Financial Engineering team believes that the earnings capacity of the Shanghai Composite Index has improved slightly after the revision. Referring to the new compilation plan of the Shanghai Composite Index and simulating the new Shanghai Composite Index, the team can see that the overall income has improved: the revised Shanghai Composite Index has achieved an annualized income of 5.47% since 2000. Compared with the original index of 3.67%, it has been significantly improved (as of June 19). As an index with the function of barometer of the A-share market, it will boost investor confidence to some extent.

According to the team's simulation, the new Shanghai Composite Index currently stands at about 4,000 points.

The financial engineering team of Everbright Securities reminded that because the closing price of complex weight is used to calculate the return of individual stocks, the performance of the index under the new rules in the above chart includes part of the income of dividends, but even after deducting the historical dividends of the Shanghai Composite Index, the index under the new rules is still slightly better than the original index.

According to the Shanghai Stock Exchange, the implementation of the revision of the compilation of the Shanghai Composite Index, drawing lessons from the adjustment of the compilation of the international representative index, is proposed to be carried out in a seamless manner, that is, the point on the effective date of the change in the index compilation plan is seamlessly connected with the point on the previous trading day, and the real-time point on the effective date is calculated based on the closing point of the previous trading day and the rise and fall of sample stocks on the same day. Therefore, the implementation of the revision of the Shanghai Composite Index will not affect the continuity of the Shanghai Composite Index and will not affect investors' observation of the market situation.

Analysts believe that the New economy Company is expected to bring a long bull market to the Shanghai Composite Index. With a number of Chinese high-tech companies listed on the board and a number of Chinese technology companies returning to the A-share CDR, the proportion of the science and technology industry in the Shanghai Composite Index will continue to rise, which is expected to drive the market to continue to climb, get rid of the ten-year "curse" of 3000 points, and bring the long-term bull market that A-share investors have been looking forward to for a long time.

First Anniversary of Science and Technology Innovation Board

The lifting of the ban has also come.

On the first anniversary of Science and Technology Innovation Board's opening operation, the ban on the first batch of Science and Technology Innovation Board's initial public offering shares, institutional placement and strategic placement shares of one year will be lifted soon, and the ban will be lifted on a scale of 215.1 billion yuan in July, the largest amount in the year. The pressure for the first batch of Science and Technology Innovation Board to lift the ban was mainly concentrated on July 22, and the scale of lifting the ban was as high as more than 180 billion according to the previous trading day. Accounted for 97 per cent of Science and Technology Innovation Board's lifting of the ban in the whole month.

The fund gentleman has sorted out a table, everybody makes do to have a look. The market capitalization of China Micro Corporation, Lan Qi Technology, Hongsoft Technology and Ruichuangwei Nano is as high as 10 billion yuan. Based on the closing price on July 21, the total market capitalization of the four companies totaled more than 100 billion yuan.

Huatai strategy research team believes that July 22 Science and Technology Innovation Board liquidity may face greater pressure, short-term stock prices or pressure, and may form a certain disturbance to the technology plate. However, the possibility of sustained large impact is small, and the impact on individual stocks is greater than that on the overall stock market.

In terms of the type of investors, the proportion of venture capital (including equity investment institutions) in Science and Technology Innovation Board's lifting of the ban was the highest (79%). The Huatai strategy team believes that these investors may be more willing to reduce their holdings after the lifting of the ban, while insurance, annuity, pension and social security funds may be less willing to reduce their holdings in the short term after the lifting of the ban, but this part of the capital accounts for a relatively small proportion.

Huatai strategy team believes that the peak of Science and Technology Innovation Board's lifting of the ban on July 22 (Jin Kirin analyst) will form a supply pressure impact, liquidity may face greater pressure, short-term stock prices or pressure, and may form a certain disturbance to the technology sector. among them, the stocks with a large proportion of the market value of circulation are facing relatively greater pressure of adjustment, especially those stocks with a higher proportion of venture capital institutions in the scale of lifting the ban need to pay more attention. However, the possibility of sustained large shock is small, and the psychological shock (risk preference shock) before the lifting of the ban is greater than the actual reduction effect, and the impact on individual stocks is greater than that on the overall stock market.

From the perspective of the impact of lifting the ban on the stock market, Huatai strategy team believes that it can be divided into two categories:

First, the effect before the lifting of the ban (more psychological shock), the lifting information belongs to historical public information, in fact, there is no incremental information. Listed companies need to announce the lifting of the ban in advance (the CSRC stipulates that the lifting of restricted shares of listed companies must be notified 3 trading days in advance). The fall in stock prices before the lifting of the ban is more likely to be caused by the selling behavior of investors out of the demand for risk avoidance.

The second is the effect after the lifting of the ban (the actual reduction effect and the herding effect). On the one hand, the reduction of shareholders' holdings after the lifting of the ban will worsen the supply and demand of individual stocks and lead to a decline in stock prices, on the other hand, it will also lead to the selling behavior of other circulating shareholders, further increasing the supply pressure of stocks, causing the stock price to continue to fall.

Historical experience shows that the peak of lifting the ban does not correspond to the decline of the stock market.

The large-scale lifting of the ban of the first batch of listed companies on the gem did not have a significant impact on the market.

From the perspective of the rate of return on the day of lifting, Huatai strategy team believes that the rate of return of lifting is the key factor affecting the willingness of shareholders to reduce their holdings. Generally speaking, the higher the rate of return, the stronger the willingness of shareholders to reduce their holdings, while the lower the rate of return, the smaller the probability of shareholders of listed companies to reduce their holdings.

On July 22nd, the Kechuang 50 Index will also be launched. Huatai Strategy team believes that relevant index funds and ETF may be set up one after another and attract incremental funds to enter the market. At the same time, Kechuang theme funds (as of 2020.7.7, a total of 41 Kechuang theme funds with a total management scale of 33.5 billion yuan) can also undertake the reduction of shares after the lifting of the ban by means of inquiry transfer, placing, bulk trading, etc. To a certain extent, it can alleviate the impact of the increase in stock supply.