The Research On The Legal Issues Of Introducing Market-maker System In Securities Market Of China

Health and efficient securities market can effectively reduce risks and stimulate the economic vitality of the nation. A perfect securities trading mechanism is the inevitable requirement. Securities market belongs to the emerging markets in China. The current trading mechanism cannot effectively provide sufficient liquidity and stability. It cann’t meet the demand of institutional investors in the future. The market-maker system in overseas shows that the market plays an important role in activating market transactions and improving the efficiency. Based on domestic and foreign situation, this paper suggests that the pattern of introduction of market-maker system should be "competitive bidding system is prior and competitive market-maker trading system is complementary". According to the market microstructure theory which analyzes the value of the market-maker system, this paper studies the theory of market-maker system. Market mode model is the latest stage of the market microstructure theory. Based on the model’s analysis of structure that contains five indicators of market quality, namely, liquidity, stability, effectiveness, transaction cost and transparency, this paper contrasts the competitive bidding system and the market-maker system. Analysis concludes that introducing market-maker system can maintain liquidity,stability,efficiency.While competitive bidding system has advantages of high transparency and low transaction costs. The paper is not limited to the Growth Enterprise Market in China but the entire securities market.From the administration, market entity, legal and technology,the paper analyzes the difficulties in introducing market-maker system.Considering the aim of the market maker is to pursue profit, this paper tries to balance the rights and obligations as far as possible.The structure of building the market maker system mainly includes access system,business system, supervision system, etc.. At the same time,the margin system, T+0transaction system,investor protection system also are considered.