What is distortion of the index
28th, Grail rose 140多 points, over the first three quarters of the transaction. This year, the market has doubled, if light gains, most investors should profit doubled. However, statistics show that many investors lost money in the first half.
this phenomenon is called the "index of distortion". That is gained when many stocks not risen; stocks rose when the index is down sometimes.
so, what is a "distortion of the index"? Why is there such a phenomenon?
how the index is calculated
compiled and published by the Shanghai Stock Exchange's index of series, including the Shanghai 180 index, Shanghai 50 index, the Shanghai composite index, a stock index, index of b-share indices, indices, bonds, fund index.
among them, the first issued by the Shanghai composite index, is based on all the stocks listed on the SSE as calculated using SSE all the a and b share share capital weighting. This index since July 15, 1991 began publishing in real time, base date set for December 19, 1990, the base index is set at 100 points.
all comprehensive reflection of the Shenzhen Stock Exchange a-share and b-share stock price movements of the Shenzhen composite index, and the circulation of their weights the weighted composite stock price index. On April 3, 1991 as the base of this index, the base index is set at 100 points.
Shanghai Stock Exchange, Shenzhen stock index series are weighted composite price index formulas, and "real-time" evaluation. Approach: after the end of each trading day call auction, bidding stock opening price of the collection (no deal taking the previous day's closing price) calculates the opening index, each with a new deal, the index is recalculated until closing, real-time release to the outside.
index causes distortion
index of main reasons of distorted, because most of the stock index is made of weighted average equity, rather than a mathematical average, so big influence on the index than small-caps or market index 10%~20% determines the minority shares.
guotai Junan securities report, index uses SSE total equity weighting all the a and b shares, compared with the shares shares total capital ratio is relatively small, which means that most of these stocks are illiquid market was also included in the index. When the calculation method in the large weight of wild swings in the stock, could trigger a reduction index inflated deficiency.
after the index is another important reason for the distortion of the IPO day included in the index. The beginning of 2007, ten days after the IPO can only be included in the index, making false high index is suppressed.