The Study On The Supervision System Of Market Makers In China's GEM

As a basic trading system for stabling the price fluctuation and improving the trading efficiency of the securities market, the market maker system has been widely adopted by the developed capital market abroad. However, the research on introducing the market maker system into China is still at its elementary stage, being limited to the introduction of the foreign Growth Enterprise Market (GEM) and the market maker system. Furthermore, the studies of the supervision upon the market makers are few and far between. Although in recent years securities companies of our country regarded modern investment banking as the main direction and developed business, such as assets reorganization and fund management, to adapt to the reform of both financial system and state-owned enterprises, function as a market maker was never considered as the aim which they pursued. Besides, market maker system isn't mentioned in the relevant official documents concerning the establishment of China's GEM. Both the theoretical and practical experience are lacking in this aspect at present. As a matter of fact, effective supervision is an important part of the market maker system. Studying on the supervision system of market makers in GEM will not only help to regulate the behavior of the market makers and improve the efficiency of the market maker system but also contribute to the sound and stable development of China's GEM. Therefore, the study will, on the basis of empirical, theoretical and comparative analysis, make a comprehensive discussion on the supervision system of market makers in GEM, use the legislation and practices from countries which have mature capital market for reference, draw a personal remark and suggestion on the supervision system of market makers in China's GEM.The article consists of four Chapters as follows:Chapters I summarized the supervision upon the market makers in GEM. It starts with the definition and characteristics of market maker system and auction system, introduces the trend of the choice of the trading system in the global GEM, on the basis of analyzing the necessity of introducing the market maker system into China's GEM, discusses the practical demand of the supervision upon the market makers in perspective of the opportunism behavior.Chapters II focuses on the theoretical basis for the supervision upon the market makers. It introduces the relevant theories which concern supervision in economics, analyzes basis of economics for the supervision on the market makers, after the systematic studying on the legal basis for the supervision upon the market makers under the theories of economic analysis school of law and sociological school of law, makes a further discussion on the legal basis for the supervision on the market makers from the viewpoint of incomplete law theory.Chapter III mainly discusses the supervision system of market makers in GEM of US, UK and Germany. In this chapter, the author pays great attention to the supervision system of market makers in NASDAQ and makes a brief introduction to the relevant systems in AIM and Neuer Market.Chapter IV proposes the legal advice for the supervision system of market makers in China's GEM.