Study Of The Effectiveness Of China's Securities Market And Its Construction

The sustainable development of securities market cannot be separated from the promotion ofmarket efficiency. Promoting securities market efficiency and exerting resources configuration ofsecurities market are always regarded as important targets of legislation and supervision by mostcountries in the world. Efficient market hypothesis (EMH) is the classical theory concerned withsecurities market efficiency, and its creation and development have laded important foundationson modern financial theory. EMH is always regarded as the starting point of verifying marketefficiency and researching security status. Although the conditions of EMH are ideal and they arenot existent in real markets, efficient markets are hoped and pursued by people. The dissertation is concerned with conditions leading to EMH in Chinese securities marketsand systematically analyzing and evaluating the status of Chinese securities market efficiency. Theanalysis of the rationality of investors reveals Chinese market is typically consisted with single butsmall investors, and that there are some deep reasons for the large amount of speculation taken bythem. The study of the status of market competition displays Chinese market capacity is so smallthat it cannot pave the way for competitive and dispersive transactions of huge shareholders,which means incomplete market competition. The research of the transparency of Chinesesecurities market indicates the prevailing information asymmetry results a lot of insider tradingand untrue announcement. All that demonstrates Chinese securities market efficiency is low. Regulating and supervising securities market is a pragmatical and effective way for protectingand promoting market efficiency. The dissertation has also studied ecnomomics of regulation andsupervision, and given some points to the polices for making securities regulation and supervisionperfect after checking the circumstances of Chinese securities market. In the end, the dissertation has explored the ways for market efficiency's construction. Thewriter thinks enlarging market capacity moderately is the most direct and the most effectiveselection to promote Chinese securities market efficiency, and to tackle the liquidity ofstate-owned and corporate-owned shares is the most convenient way.