Analysis On The Guarantee Path Choice About Chinese Margin Trading

Since the CSRC modified and supplemented the RefinancingAdministrative Regulation and the Margin Trading AdministrativeRegulation on October26th,2011, Chinese margin trading has beenrecognized to transfer from pilot to regular. However, as a credittransaction, the guarantee nature of it has not been agreed. And thisdispute has impact on the function of margin trading and the interests’protection between parties, as well as the refinancing development. Thispaper firstly analyses and evaluates trust，pledge, and alienation guaranteeof margin. And then draws a comparison from the prospective of function,and based on these comparison and analysis it tries to find one properguarantee path which is in harmony with the function of margin trading.This article is divided into five chapters:Chapter Ⅰ, the overview of margin security. Firstly, this chapterdescribes the margin trading function, guarantee legal relation and otherfundamental issues. Secondly, it clarifies the controversies on theguarantee nature, as well as discusses the practical role and value of theguarantee nature, which lay the foundation for this paper.Chapter Ⅱ, trust security on margin trading under regulations. Thischapter describes and values trust construction, trust by declaration, andintroduction of a trust company on margin trading.Chapter Ⅲ, pledge security on margin trading under theoreticalresearch. This chapter describes and values the tiptop possessory pledgeand pledge of the account on margin trading.Chapter Ⅳ, alienation guaranty on margin trading under securitiespractice. This chapter describes the character of alienation guaranty and alienation guaranty on margin trading, and discusses some shortages onalienation guaranty in China.Chapter Ⅴ, the guarantee path choice from the prospective of function.Firstly, it draws a comparison among these three security ways, andanalyses and confirms the alienation guaranty on margin. And it refers tothe margin security in other countries and districts. Lastly, in the contextof financial innovation, it rethinks these shortages on alienation guarantyand suggests solving the trouble by judicial interpretation andadministrative regulations.