Research Of Risk Control And Regulation In China Securities Market

With the research object of the security market risk control in China, the paper discusses the cause of the risk, measurement and countermeasures to control the risk from the macroscopic economy and regulatory system. More than twenty years’ development process of the security market in China shows that China’s stock market is a special emerging market. In 2015, the security market in our country occurred the severe abnormal fluctuation, and the paper makes a comparatively profound empirical analysis on the fluctuation from the macroscopic economy and regulatory system. Via the research, it holds that the main security market risk control theory in the developed country is researching the institution investment risk, while the risk prevention in our country pays attention to the prevention of retail investor’s investment risk.The paper can be divided into seven chapters.Chapter I introduces the research problem, expounds the background, practical significance and theoretical significance of the researchIt proposes the main research object in the paper:prevention and countermeasures on the security market risk in China. It introduces the current status of China’s security market, and specifies the theoretical significance and practical role of the research in the paper.Chapter II makes a comparatively systematic and comprehensive literature review and comment on the influence of existing identification, measurement, risk control and market risk in the security market on the macroscopic economy and financial crisis theory.Chapter III discusses the general theory on security market risk from risk definition, risk classification and the cause of the risk, and analyzes the risk connotation from the internal and external factors causing the security market risk. The theories of Keynes, Smith, Samuelson are applied to discuss whether the government shall intervene in the security market. Finally, the moral hazard theory, monetary veil theory and last lender theory are used to analyze the necessity for the government to rescue the market.Chapter IV discusses the security market risk index system and builds the security market risk warning model. The PE ratio, broad money M2 growth rate, stock market volatility and trading volume are acted as the stock index in our country; CSSI (-1) GDP output, M2 macro money supply, real estate climate index (estate), monetization degree (M2/GDP), trade balance (Export), bank credit balance (backloan),interest rate difference between China and US (rate), PMI, national foreign exchange reserve (FOREX) and non-performing loan (NPL) are explained variables, and the stock market risk warning model is built.Chapter V discusses the historical route and own feature of the development of Chinese capital market in details, and analyzes twice abnormal fluctuations in Chinese security market in 2007 and 2015. The root cause of the fluctuation mainly includes the following several aspects:financial innovation and excessive leverage, political excessive promotion, regulatory policy mistake, not optimistic macroeconomic situation, weak awareness of investor’s risk, etc. Finally, it further discusses the existed problems in China’s security market exposed from the stock market crash, enlightenment for us, and the influence of stock market disaster for macroeconomic level.Chapter VI compares the risk control mechanism and system in the security market in the world, and refines the reference in our country. Meanwhile, it discusses the occurred stock market disaster internationally according to lever driven, economic bubble, hot money and exchange rate causing types.Chapter VII is the countermeasures on the prevention of security market risk in our country. It expounds the problems in China’s security market under the current environment. Integrating the research results, it proposes the thought on the regulatory way needing to be adopted to prevent the systematical risk and the countermeasures. Firstly, the information disclosure system, price limit system, issuing and delisting system should be optimized. Meanwhile, the regulatory vacuum existed in "One Bank and Three Commissions" regulatory mode should be solved, the investor protection mechanism should be strengthened, the agency investors should be vigorously cultivated and the GEM high valuation should be reduced. Finally, the illegal leverage fund into the stock market should be prevented and the stability of RMB exchange rate should be maintained.