Financial Knowledge Base

A few days ago, someone asked me using the pre-adjusted prices of very early Kweichow Moutai stock. Honestly, I was taken aback at first glance: Looking at the “pre-adjustment” values, Yahoo had no negative numbers, while East Money showed negative numbers. When I later reviewed my article from June, titled Detailed Explanation of ‘Adjustment’ and Data Acquisition in Backtesting, I realized that I had mixed up several things. At the time, I presented the “ratio method” as if it were the single standard, but pre-adjustment in the domestic A-share context and the commonly used adjusted close for Hong Kong/US stocks are fundamentally different metrics.

This article only does one thing: separate these two metrics/standards. I will put my judgment first so that you don’t get confused later: The pre-adjustment (or forward adjustment) of leading domestic apps is more like leveling the candlesticks by following the exchange’s ex-rights/ex-dividend reference price; the commonly used international adjusted close is more like using a cumulative multiplier to express the total return from “reinvesting dividends.” They are both called pre-adjustment, but they answer different questions.

This matter deserves separate discussion because it directly impacts how we view Maotai. Previously, many people treated Maotai as an eternally rising consumption myth, and whether young people drank it or not was just a minor factor. Now, that is no longer the case. It is true that young people naturally have little interest in Baijiu (Chinese liquor), but this is more like a slow-moving variable. The sudden turnaround reported in the annual report appears to be driven by the contraction of an entire old system: obsolete business demands, traditional wealth distribution methods, and established status-driven consumption patterns.

In mature markets like the US stock market, the closing price (Closing Price) holds significant reference value. It’s not only a summary of daily trading sentiment but also a benchmark for index calculations, fund net asset valuation, and portfolio valuations. Consequently, trading demand focused on closing prices has emerged. Within the Interactive Brokers (IB) trading platform, MOC (Market-on-Close, Closing Price) and LOC (Limit-on-Close, Limit Price) are important order types that allow investors to execute trades at the close.

• Hong Kong Stock Exchange (HKEX) dark pool trading involves numerous proprietary terms, with most being recognizable but some still unfamiliar.

Prompt: As a Chinese person, when seeing English financial news and information about actions of US listed companies, why are mergers and acquisitions written like this: NAOV reverse stock split: 1 for 10? Is this a unique English grammar that doesn’t conform to Chinese grammatical habits? Based on this, please explain the meaning of the stock split.

The practice of “the same contract code, for transactions in the same direction, commission is only charged once” is commonly referred to as “Commission Aggregation / Combined Commission” within the securities industry. This is not a hard-and-fast regulation by the Hong Kong Exchange or regulatory bodies, but rather a business convention formed through market competition and brokers’ efforts to optimize customer experience.

To truly understand the significant differences between traditional stocks and digital currencies in terms of trading and settlement, we need to deeply grasp the core “components” and “rules” that make up each ecosystem. We can view them as two entirely different games: one a rigorous, multi-party collaborative “professional league,” and the other a code-as-law, open-to-all “open world.”

In today’s era of the global digital wave, we’ve become accustomed to instant transfers and near-instant payments. Therefore, many people are confused: why, after clicking “sell” on a stock, does my funds not immediately clear in full and become available, but instead takes one or two business days? This is precisely a crucial and historically significant concept within traditional stock trading – settlement.

prompt: Why does traditional stock trading require the concept of settlement?