Study On Risk-spreading Mechanism And Regulatory Policy Of Securities Company's Direct Investment Business

The direct stock investment business of securities companies was approved to establish in Sept. 2007 when the financial innovation was praised highly by market. As business of financial innovation, it is regarded as powerful weapons to enhance the core competition by securities trader, which is still under the pilot phase. However, when financial innovation promoting the development of financial industry and financial market, it also increases the financial risks as well as reduces the effectiveness of financial supervision. Since the objective existence and uncertainties of innovational business risks, together with securities companies' special status as an intermediary in the financial industry, the risks of direct stock investment business have intense externality and great diffusivity, threatening the entire economy, the economy entities, even government and society.By researching on direct equity investment business and regulatory status at home and abroad, the paper analyzes the specificity and risk characters of securities companies' direct investment business. As a result, it makes a deliberation and concern on the formation mechanism of the business risk and risk-spreading mechanisms. Meanwhile, it expatiates on ways of risk diffusion and keys of risk control by seizing main risk factors. It suggests regulation on the innovation business is undoubtedly necessary. Also, by analyzing and grasping four main paths and their risk controlling point that result in risk diffusion, which are form of organization, the value chain of securities company's direct investment, the coordination within securities companies and the moral hazard, we can regulate effectively.This thesis draws lessons of supervisory experience from direct equity investment business in domestic and foreign countries, putting forward regulatory policy of the companies' direct investment business, which can be considered by three major aspects such as principle of prudent supervision, expansibility supervision and moral risk regulation. Furthermore, it proposes four suggestions on regulatory measures and regulatory emphases, including regulatory measures and priorities in sound legal system, regulatory measures and focuses on information disclosure, on precaution and early warning of risk, along with moral risk. In the public economy field, it selects a specific financial innovation business to discuss its risk-spreading mechanism and regulatory policies in the hope that a targeted specific business regulation, rather than generalities, will contribute to solute practical problems. It is of practical significance to improve our country's securities regulatory policy and risk control, which is helpful to maintain health and sustainable development of securities firms, ensuring stability and security of financial system, economy and society.The paper is mainly divided into five parts as follows:Firstly, it mainly explains the research background, significance and research objectives and content. It defines the relevant concepts and describes research methods and framework used in this paper. At the same time, it makes the relevant study on financial risks associated with the theory of financial regulation clear.Secondly, it illustrates basic situation and features of this business at home and abroad, analyzing the specificity, major risks types and risk characteristics of securities' direct investment business.Thirdly, from financial innovation business itself, information asymmetry and limited rationality of economic entities these three aspects, it analyzes the formation mechanism of this business risk. Fatherly, it analyzes four important paths of triggering risk spreading, which are organization form, the value chain of securities' direct investment, business collaboration, as well as the risk expanding ways caused by moral risks.In the fourth section, it amplifies the chief measures of controlling risk expanding from business risk itself, management of securities companies and the control of moral risks.In the fifth part, it indicates the necessity of supervision. After analyzing the relationship between risk and supervision of this business, using regulatory experience of finance and direct equity investment business homes and outs for reference, it comes up with the regulatory policy methods of direct security investment business and its regulatory measures and key points.