Analysis on Impact of China's Stock Index Futures on Stock Market Liquidity

This article uses exchanging volume, relative prices, and yield volatility of the daily trading data of the CSI 300 index as indicators to measure its liquidity and makes empirical analysis to analyze the impact of the introduction of stock index futures on the liquidity of spot market. Through study we found that the introduction of stock index futures market had a crowding-out effect on the spot market in the short term, thus reduced the liquidity of the spot market. But in the long term, the stock index futures attracted plenty of outside capital with its funds attracting effect, and the spot market showed a gradually increasing trend in liquidity.