The Legal System Of Listed Warrants Study

As introduced into Chinese security market, warrants do not play the role so well. Why it happens to China while several other security markets such as in Hong Kong and in Germany manage the warrants dealing market much successfully? This article makes it attempt to find certain legal issues behind the surface disputable doubt about those warrants issued by Chinese listed companies and security dealers. As a fact, it is so difficult to search for those articles mainly focused on warrants. The most is about the whole regular rules of supervising financial derivatives which merely refer to the warrants as the part of an article. The only several Chinese articles about warrants have introduced several simple concepts of warrants which are prone to the factual trading procedures. The warrants research is still very simple, especially for the legal construction of both warrants and their underlying stocks. Hence, the innovation of my article is embracing warrants and their underlying stocks as a whole part for thinking about. Under the background of financial crisis, this article calls for a reasonable price fluctuation zone which needs the support backed by the construction of an efficient legal system. Besides, the article has included some typical cases which can make the points more convincible. Because those previous research materials paid more attention to foreign successful warrants dealing system but ignored China's own weakness. The writing structure of my article is as follows:Chapter One focuses on the basic concept, constitutions and the economic functions of warrants. Through the analysis, we find it that warrants are certain special kind of derivative security. They are similar to the options but have their own dealing characters. And due to the multi-functions, they are able to play a positive role in the Chinese security market.Chapter Two focuses on the legal-analysis of warrants. As a kind of derivative, warrants carry certain virtual rights and own the leverage. Besides, risk control is also indispensible for the dealing of warrants, which includes the risk of issuing, manipulating the price of underlying assets and warrants.Chapter Three is to analysis the deep legal contradiction hid in the negative effect made by warrant in China. Hence, it is to claim the protection of dealing equally in China, which depends on the proper rescue system. Therefore, this chapter calls for the building of hearing system and group litigation. In this chapter, the model of supervision is also been discussed theoretically. The belief of financial supervision is the core one which legal system construction should consider most. The aim of supervision must definite. In China, it should come with the guarantee for the social benefits.Chapter Four is a comparative analysis about the successful management of warrants' dealing in Hong Kong. In this chapter, we will find it that the legal rules in Hong Kong is so detailed and so delicate, which guarantee the fairness of dealing circumstances. And another key to success is its excellent dealing guards between the warrants market and stock markets which depends on the sound understanding of warrants' derivative nature.Chapter Five tries to discuss the weakness of Chinese warrants market, which attributes to their own unreasonable rules, the negative role played by stock market and the poor governance of state-owned companies. In this chapter, the article also points out the wrong doings of creating warrants in Chinese security market. Therefore, the only solution is to construct the legal system by the belief that protection of investors' equity should be the core value for considered. Then, the legal systems can make themselves alive.Chapter Six is to suggest relative legal improvements against the rules of stock market and the rules of warrant market. In this chapter, how to build an efficient supervision system is also involved. It is necessary for us to developing a multi-level security market in China.