MSCI Is Similar To Online Stock Trading "Net Red". Don'T Take A Shares As A Treasure.

First look at a piece on Wednesday full screen is brushed: ask: A shares after joining MSCI, what impact on Chinese leeks? Answer: used to be home-made vegetable cutting machine, now is Sino foreign joint venture combine harvester! 21 hours in Beijing time, Morgan Stanley Capital International Inc (MSCI) (also plated by Ming Sheng) announced that A shares will be included in MSCI emerging market index, is expected to be included in China A shares of 222 large cap stocks.

Based on the inclusion factor of 5%, these A shares account for about 0.73% of the MSCI emerging market index.

Starting from June 2018, China's A shares were included in the MSCI emerging market index and the MSCI ACWI global index.

Why do we say that retail investors should not include A shares in MSCI as a good thing?

First of all, this advantage is a futures: A shares can only be incorporated into China's A shares into the MSCI emerging market index and the MSCI ACWI MSCI global index from June 2018.

It is expected that only a limited amount of incremental funds will be brought to us in a year, but the short-term good will be realized. Before that, the 222 large cap stocks that may be included have been rising for several months. Will it still be up for a year? Obviously, no adjustment can be made at any time when there is no incremental capital coming into operation. There is a rule in the magic A shares, that is, good profits are bad. That day does not mean that every day will rise. I personally hope that A shares will enter a bull market after joining MSCI, but is it possible?

Secondly, MSCI is similar to the online stock market "net red". It shares its stock portfolio on the Internet, because its stock is beautiful. Its investment portfolio is popular among many investors on the Internet. What he buys is followed by what he bought.

Some listed companies communicate with this "net red", hoping to incorporate their company's stock into his portfolio.

Will "net red" buy a company's stock, mainly considering whether the company's share price will go up.

Is it really important for MSCI index to be included in A shares? Just like the stock market "net red" does not buy shares of a listed company, the company's stock price depends on the level of profitability, and it has little to do with the net purchase.

If the company is a good company, foreigners will not buy it, but some people will buy it. The stock price will go up.

If the company falsification, even if foreigners buy, the stock price will fall.

Again, the biggest feature of A shares is

The short bull short bear is long, and the retail institution has few institutions.

This is also a wonder in the world, also known as Chinese characteristics.

These characteristics have led to the large number of institutional investors who use the advantage of capital to join hands to kill scattered investors. The stock market, which is originally a resource optimized allocation, has become an irregular casino.

If A shares are included in the MSCI, if the international institutions are to be promoted, it will be another year before they are officially incorporated. If the Chinese stock market is not as standardized as it is now, the relevant laws and regulations and delisting mechanisms are not perfect.

The capital market institutions remain in the same position.

Short run up and down, bulging and collapsing bull bears are not afraid of long risks. They are dissatisfied with foreigners' long-term investment in obtaining stable income and serious soil and water. They want to coax foreigners' money into the field, but they have no doors.

Fourth, after A shares are added to MSCI, the frequency of RMB free convertibility will increase, which will accelerate the pace of RMB internationalization.

International people have always had some criticisms about China's capital controls. The A share is included in the MSCI index. Whether the capital flow restriction can be further released is still a question mark.

Currency internationalization is a double-edged sword.

Internationalization of RMB makes China's domestic economy and

Closely related to any financial crisis in the international financial market will have a certain impact on China's economy and finance.

Especially after the currency internationalization, if the real exchange rate of the local currency deviates from the nominal exchange rate, or the spot rate, the interest rate and the expected exchange rate and interest rate deviate, it will give international investors the opportunity to arbitrage and stimulate the flow of short-term speculative capital. The empty companies like the muddy water will also take the opportunity to come, so that the "sheep effect" produced by the Asian financial crisis in 1997 will probably have a negative impact on China's economic and financial stability.

This is also a necessity for A share to join the MSCI. It is necessary to set up a "firewall" to safeguard national financial security.

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