Research On The Legal Supervision Of The Short-selling Mechanism

Short selling,as a generally accepted trading method in mature financial markets,has become an important part of the international securities market.With its own unique price discovery function and risk aversion function,it provides its own value to the activation,liquidity,and information discovery of financial securities markets.However,it has high risks and is easily used by illegal trading practices as a tool(that is,"malicious short selling").These negative effects usually cause customary prejudices of the society,which in turn leads to the lack of a high-quality legal environment for short selling mechanisms to fully develop.Securities market in China has been in a unilateral trading market model for a long time,and relevant financial derivatives such as stock index futures and government bond futures,etc.,with short selling trading models were launched upon the establishment of the China Financial Futures Exchange in 2006.China's short selling mechanism is still in its infancy,and there is still a long way to go compared with internationally mature financial markets.The short selling trading market has gradually expanded,but the concept of short selling is still lacking in the legal definition.Therefore,in the reform of modest financial innovation,legal issues such as the clarification of legal concepts,the absence of high-level laws,and the legal power of cross-market financial enforcement are highly required.This thesis mainly sorts out and identifies the legal concepts and behavioral composition of short selling transactions and market manipulation behaviors,traces the theoretical basis of legal supervision of short selling mechanisms,and provides financial supervision agencies with reference on basic level of law to conduct particular supervision activities on short selling businesses.Then it draws on the more mature laws and regulations of the United States and the European Union on the short selling mechanism,and provides ideas for the establishment of a regulatory system and a risk control system for the short selling market in China.This thesis aims to explore the legal basis for the financial supervisory authority to exercise the " Fusing mechanism" and the cross-market "ban on short-selling" system through the malicious short selling incident of the Chinese stock market in 2015.And finally it tries to open the top-level design of financial legislation and build a superordinate law forcross-market supervision.The first chapter of this thesis mainly expounds the basic legal theory of the short selling mechanism,discusses the necessity of supervision of the short selling mechanism through the market effect of the short selling mechanism and clarifies the legal positioning of short selling transactions.The second chapter gives enlightenment to the legal supervision of China's short selling mechanism through a comparative study of the relevant short selling mechanisms of the securities market in the United States,the European Union and Hong Kong.The third chapter cites major short selling cases in China's financial futures market and summarizes the legal issues of the current short selling mechanism supervision in China.The fourth chapter proposes ways and methods for establishing and improving the legal supervision of the short selling mechanism of the securities market in China.