| Margin trading is referred to the credit business that the qualified security companies would supply credit money or securities to the eligible clients, who may get profits from the credit money and securities, and require some collateral as interests. Generally, Margin is between security companies and their clients, as well as security companies and financial institutions.Margin trading is a common practice in major overseas stock markets. It originated in the United States. Under the financial market which is not mature enough, China has been carefully preparing for the introduction of margin trading because the "short" mechanism will give investors a financial leverage which could intensify trading risk.On March 31,2010, Shanghai Stock Exchange and Shenzhen Stock Exchange officially began to accept margin trading brokerages, which marks that after 4 years'well-preparation, margin trading has finally been in operation. However, margin trading, after all, brought the "short" mechanism to our country which we have never tried. It brings opportunities as well as a serious challenge. Therefore, how to develop the model of margin trading to prevent the risks is a key issue.Currently, according to their economic condition and development, many countries have formed different margin modes and legal framework. These systems can be summarized as the following three modes:the first one is the market-oriented model which is used by the United States and other Western European countries, the second one is the specialized credit trading mode which is used by Japan and South Korea, and the third one is the "dual track" credit trading mode represented by Taiwan. Different models all have their unique characteristics from which China should draw lessons. This article is divided into five parts to analyze the margin trading mode of our country and the mode improvement issues.The first part is introduction, mainly discusses the topic and the background of this article. And then it comb the literature about foreign margin trading system. At last, the structure and insignificance of the paper are proposed.The second part made a brief introduction to margin. Then on the basis, the case of margin trading in China from March 31,2010 case was introduced, explaining some details of the mode in our country and arranging the market transactions case.The third part elaborates on the margin modes formed overseas, which are the market-oriented mode, the specialized credit trading mode and the "dual track" credit trading mode, and abstract what lessons can we draw from them. Finally, this part make a comparison between the market-oriented mode and the specialized credit trading mode.The firth part analyzes what we can learn from the overseas modes. First it analyzes what experience we have borrowed from them and points out some problems our present mode may cause. Then it analyzes whether they still have other edges worthy our learning. At last, it points future development direction of margin trading mode in our country.As a new trading system, Margin trading brings the securities markets much challenges and more opportunities. Based on the analysis of the international margin trading modes, this thesis makes a proposal to form the mode of our own country and the suggestions for improvement. The suggestion is that at present we should draw lessons from the specialized credit trading mode, establish a security financial company. And with our credit market has large trading scale, the Margin trading mode in our country will develop into the market-oriented mode. |
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