GEM index fund is one of the most important index funds. Many new investors do not know GEM index very well. Here is a brief explanation of what GEM index fund means and what GEM index funds are.
We all know that the requirements for enterprises to be listed in our country are relatively strict. They need to reach a certain scale and make enough profits. As we all know, the size of listed companies in the CSI 1000 index, even the smallest, is tens of billions. But also There are some companies whose current profits are not very good and their scale is relatively small, so they cannot meet the conditions for listing on the main board. What should they do? The country has prepared a lower threshold listing market for these companies, which is called the GEM.
Listing on the main board is the most difficult. As we usually say, Ping An, China Merchants Bank and other listed companies are large and listed on the main board. The requirements for listing on the GEM are lower. If the conditions for listing on the main board cannot be met, you can consider listing on the GEM. If the conditions for listing on the GEM cannot be met, you can also consider listing on the NEEQ.
The GEM index is composed of 100 companies selected from the GEM of Shenzhen Stock Exchange. The GEM index is also a market capitalization weighted index.
The conditions for GEM listing are more relaxed. Most of the investors are small enterprises with small scale and unstable profits, and the corresponding risks are also greater. Whether the profits rise sharply or fall sharply, it belongs to unstable profits. GEM index funds are more risky to invest than the main board index funds such as CSI 300 and CSI 500.
Index funds tracking GEM index include:
On site: E Fund GEM ETF
On the market: Fuguo Growth Enterprise Market Index
