The Legal Control Of Securities Company's Risk In The Margin Trading

Securities company plays a special role in the margin trading,and its risk control does not only effect its own safety but also effect the safety of the whole security market,and maybe impact the stable operation of the financial market.The margin trading system in China has been set up recently,and the relevant regulation is in the initial explorative stage.This article tries to analyze the main categories of the risks of securities company in the margin trading and their characteristics through categorization of the risks,and discusses the legal framework of risk control in such three level as models of margin trading,risk control system and the instruments of risk control.This article has three parts,which include the introduction,the main text and the conclusion.The introduction briefly describes the research background and the purpose of the study,then makes a previous presentation of the main text.The main text has four chapters.The first chapter briefly describes the basic system of margin trading,discusses and defines the relevant concepts, and describes the risk-forming mechanism in the margin trading and the models of risk allocation among the market players.Based on the cause of risks,the second chapters divides the risks of securities company in margin trading into different categories such as market risk,credit risk,operational risk,liquidity risk and the legal risk, and analyzes their causes and characteristics. The third chapter discusses the basic framework of risk control,and proposes that such framework consists of three levels which are models of margin trading,risk control system and the instruments of risk control. Then it analyzes the relevant systems in American,Japan and Taiwan,and discusses respectively the specific contents and role in risk control of the three levels mentioned above in China.At last,it analyzes the legislation practice in relevant countries and regions.The fourth chapter reviews the flaws of the model of margin trading, the risk control system and the instruments of risk control in China,and proposes some countermeasures from some aspects such as the financial system,the operation technique and legislation.The conclusion part summarizes this article's central topic and get four conclusions.