The Introduction Of Fusing Mechanism Has Gradually Stabilized The A Share Market.

China's A shares belong to a highly speculative market, and the retail market is dominated by retail investors.

At this point, this is essentially different from the developed and mature markets in Europe and the United States.

Obviously, blindly introducing foreign mature trading mechanism and blindly worshipping the operation mode of European and American markets are all undesirable behaviors.

Therefore, the incident that ended with the help of this fusing mechanism has also brought certain experience of management to the management.

On the evening of January 7th, the three exchanges announced that the index will be suspended from January 8th.

After this news release, immediately aroused the high attention of the market.

It was thought that the introduction of the fusing mechanism would bring a steady and lasting impact on the A share market.

Little imagine, after experiencing the stock market crash in January 4th and January 7th, the Chinese version of the fusing mechanism has not only played an important role in stabilizing the stock market, but also intensified the volatility risk of the stock market.

We can even think that the Chinese version of the fusing mechanism has accelerated the recent downward trend of the stock market.

However, for the Chinese version of the fusing mechanism, under its actual operation, it exposes many malpractices, but the final phenomenon is fusing and stabilizing, instead, it becomes a help drop device for the stock market to fall.

Among them, for the Chinese version of the fusing mechanism, it is built on the basis of the price limit system, and then fuses.

At the same time, it takes Shanghai and Shenzhen 300 index as benchmark index and sets 5% and 7% fuse threshold respectively.

However, in the specific practice, in the irrational market environment, between 5% and 7% of the fusing threshold, although a 15 minute cooling off period is established, it is easy to concentrate the market sell-off and lead to the market.

Emotions.

In this regard, if the management can not make prompt and decisive emergency actions in the 15 minutes, the stock market will be down and the probability of hitting two fuses will increase greatly.

At the same time, the CSI 300 index is used as the reference benchmark for the market. However, under the actual circumstances, the volatility of the Shanghai and Shenzhen 300 index is much lower than that of the rest of the main market indexes.

In this regard, when the CSI 300 index triggers 7% of the fusing threshold, it also means that the vast majority of stocks in the market have fallen into the limit.

It can be seen that when the stock market has already experienced a large scale down, it will once again be fusing, and its essence will be greatly reduced.

The author believes that for 7% of fusing threshold settings, it is originally a "superfluous" action.

The reason is, on the one hand, as the above mentioned large area limit problem, its fusing function has been greatly reduced; on the other hand, after 7% fuses, the market will stop trading until closing.

However, for this rule, it is likely that a large number of selling will not be released in time, and then the risk of centralized selling will be postponed to the next trading day.

In fact, in view of the recent slump in the A share market, it has a copy of the stock market crash in 6 and July.

However, in view of the risk of liquidity crisis in the market at that time, the market is directly exposed to a huge risk. In this period, it may not be too effective for the market to realize self-regulation.

At this point, when necessary, when the national team enters the market in large numbers or encourages the listing companies and fund institutions to increase their holdings and so on, it is still crucial to break the embarrassing situation of the market.

In this regard, in the face of this vulnerability threshold set up loopholes, really need to cause management deep reflection.

However, in view of the suspension of the index in the evening of January 7th

The move did bring some boost to the short-term market.

At the same time, with the abolition of the fusing mechanism, it also implies that the management has discovered the seriousness of the problem in time, and given timely correction, to some extent, more than the whole market.

Looking forward to the future, for every innovative type

Before launching, management must fully understand the characteristics of China's stock market and make adequate preparations before it is launched.

Otherwise, after the launch of every heavy new model, the most hurt ones are those small investors who lack information superiority, capital advantage and lack effective risk hedging tools.

It is worth affirming that management can find problems in time and correct them.

However, the suspension of the fusing mechanism does not mean that the current stock market crash will end from this point, and there will be many subsequent problems that need to be dealt with by the market.

Obviously, under the background of the current market volatility risk continues to intensify, still need to test the management level of wisdom.