The fundamental functions and carriers of the stock index futures market are long and short positions. In fact, the futures market carries many risks, and there are significant differences between the stock index futures market and the stock market. Long and short positions are a manifestation of stock index futures. Only by maintaining a balanced perspective on long and short positions can we accurately understand the operational rules and mechanisms of the stock index futures market. Below, we explore how to interpret long and short positions in stock index futures.

1. A Result of Trading
   In the early days of the futures market, due to its small scale, there were some issues in commodity futures and spot markets. Under such circumstances, long and short positions were highly helpful for investors in predicting market trends and held certain reference value.
   For the stock market, because information spreads quickly among groups, the price of stock index futures loses its independence and must maintain influence through continuous trading. Moreover, according to valid data statistics, if the daily change in long and short positions can be substituted for the daily return of the spot index, then these positions lose their ability to convey information, and the relationship between the two data points the next day becomes insignificant.

2. Do Not Use Long and Short Positions to Predict the Stock Market
   Many people now use changes in long and short positions and the next day’s spot index returns to predict the stock market. In reality, this method is not feasible. For example, if the short position volume in stock index futures is used for prediction, the accuracy rate for predicting an upward trend is only 46.4%, falling short of 50%. Therefore, using this method makes it difficult to achieve ideal returns.

3. Short Positions Do Not Necessarily Indicate a Bearish Market
   In many cases, short positions can have substantive effects, helping investors avoid a "long squeeze" dilemma when facing risks. They can reduce pressure on the stock market during bear markets and extreme conditions and may even enhance the market’s resilience in the long run. For investors, the focus is on short-term market trends, and adjusting long and short positions based on market fluctuations is merely a form of trend-following investment. It is crucial not to assume a bearish outlook on the market.

The above is an introduction to how we should view long and short positions in stock index futures. After all, since their launch in our country, stock index futures have played a significant role in promoting market development. However, it is essential to approach such investments rationally—while acknowledging their value, we should also maintain a questioning attitude and respond with the right mindset.