A stock index is a comprehensive data set that includes multiple stocks to reflect the value of the constituent stocks in the market. It is usually used to showcase the common characteristics that make up stocks, For example, trading on the same stock exchange, Belonging to the same industry, Or have similar market value. The main ways to calculate stock indices are 3 species, Price weighted index (Price-weighted index) , For example, the Dow Jones Industrial Average is calculated based solely on the prices of individual constituent stocks; Another common method is market capitalization weighting (market-value weighted) index, This is a weighted ratio calculated based on the market capitalization of different stocks within the index, For example, Standard&Poor's 500 Index, Hong Kong Hang Seng Index (Hang Seng Index) ; There are also market share weighted indices (market-share weighted index) , Its calculation is based on the weighted average of the number of shares, Rather than market value.

There are many factors that affect stock indices, You can mainly refer to it first 3 Macro factors in various aspects.

first, Changes in market interest rates have a significant impact on the stock market. generally speaking, The price of a stock index increases as interest rates decrease, Falling as interest rates rise. therefore, The level of interest rates and the relationship between interest rates and the stock market, It has also become an important basis for stock investors to go long and short on the stock index. Whenever the government announces a rate cut or cuts, The cost of borrowing funds in the market has decreased, Stock indexes usually rise in the short term. And whenever the government announces a rate hike, The opposite reaction to the stock index.

secondly, Inflation usually has a significant impact on stock indices. Mild inflation can stimulate the stock market, Severe inflation will suppress the stock market. Inflation is mainly caused by the central bank's rapid increase in the money supply, The money supply is generally directly proportional to stock prices, The increase in money supply leads to an increase in stock index prices, But later on, the central bank may tighten monetary policy by raising interest rates or other means to suppress inflation, Causing the stock index to decline.

third, Government economic policies have an impact on the stock market. The government has significantly reduced taxes, increased public spending, etc, It is possible to stimulate expected corporate profits, Short term increase in stock index.

Before selecting relevant stock indices for trading, It is best for investors to first understand the similarities and differences between different markets, Basic economic situation related to stock index, National policy changes, Fundamental factors such as monetary policy orientation, Then it is also necessary to understand the changes in the technical aspects of the stock index, Bull bear cycle, etc. If investors have stocks of companies they are familiar with, Or the national economic situation, You can choose to trade local stock indexes, Alternatively, one can determine which market is more suitable for trading based on the daily trading volume and participant characteristics of the stock market related to the stock index.

Corporate behavior  (Corporate Actions) It refers to events that cause significant changes in stocks. And when conducting transactions, The main corporate behavior that affects stock prices is usually dividend distribution. When your buy order for the stock index has passed the time for dividend distribution, You will receive the corresponding dividends. contrary, If you hold a sell order for the stock index and have passed the time for dividend distribution, You will need to pay dividends.

You hold an index contract, This does not mean actually owning stocks, So you don't have the right to vote, Or any subscription rights, The right to issue and split shares, etc.

however Mitrade We will take measures to adjust interest rates to minimize the impact of company behavior on your trading position.