Research On Public Finance Risk And Supervision Trigged By Margin Trading

Since margin training began in China,it has not only improve d the market mobility but enabled investors and securities traders to have access to leveraged earnings.Nevertheless,margin trading has leverage effect,which will have an impact on security market,as well as cause greater loss in investors when immature.Worse still,the risks caused by greatly unstable markets will spread to banks,funds,futures and so on financial markets,thus resulting in financially public risks.As is known to us all,the year 2015 was a prosperous year accompanied by several stock disasters in the second half year.Without the government's involvement,the great panic caused by the sharp drop in stock markets would result in the instability of the financial system.Various reasons can account for a stock disaster,among which hi gh leverage is one of the most important ones.If we conduct the research into the reasons for public risks of financing securities and the solutions to them,we can perfect its system and solutions as well,thus gaining an effective control of its risks a nd giving full play to its influence on stabilizing markets.Consequently,it can well protect markets,society and investors from bad influences and also ensure thee peaceful development of the whole security market and society.Based on a large quantity of literature cites,the thesis does a further study into the public risks by financing securities and concludes that financing securities will greatly affect the market,bring greater losses in investors and a threat to financial system.All of them need a stricter control on the risks.As a mediator connecting investors with regulators,brokerage plays a vital role in the regulation of its development and potential risks.From the angle of brokerage,the paper studies the reasons for risks in margin tradi ng and possible measures adopted by the brokerage,for brokerages can have a direct control of risks that appear in the processes of margin trading and transaction between investors.Since the brokerage is a profit-driven organization,it tends to ignore the risk control and violate regulations.Therefore,merely relying on brokerages is far not enough for the risk control,which requires regulators to improve the risk control system and provide regulatory measures.So,in the third chapter,we from the regulatory regime system,brokers and regulators three levels viewpoint,measures to deal with brokers and regulators to take business risks were studied.At present,based on the market and our research,China 's regulators have established a complete set of guiding systems and the risk control system.Despite a series of risk control measures,there exist questions like low maintenance ratio,high liabilities among customers,incomplete records of listed companies and so on.In order to ensure margin trading ca n develop healthily and fully develop the functions of it,the paper presents several solutions.For example,a self-discipline organization is supposed to give full play to its function;the regulators must perform their own functions,and strengthen the management of the underlying securities,etc.Through optimization measures,our country can put risks in the margin training under an effective control,thus achieving the aim of protecting legal rights of investors and keeping financial markets stable,too.