Legal Study Of Investors Appropriateness In Chinese New Third Market

Based on autonomy theory，the transaction should be accord to the principle of"caveat emptor" between securities companies and investors in the New Third Marketand the whole securities market. However, with financial innovation, securitiesinstitutions provide many of the products or services beyond the scope of ordinaryrational investors can understand. Due to the high-risk and low market transparencyand huge difference in the funds and preffessional knowledge between inverstors andhosted brokerage, investors to rely on the hosting broker, causeing a "power"phenomenon in the private sector. In order to ensure the legitimate rights and interestsof investors, only to confirm the results between the private interests of the game inthe form of law. Such results confirm is the content of the system of investorssuitability system.Investors suitability system originated in the United States, an integral part andmost effective means of protecting investors of the stock market to balance the rightsand obligations between investors and securities companies. The system requiresfinancial institutions to recommend products or services consistent with the objectiveand subjective factors including the investor’s own financial situation, professionalexperience, risk tolerance and investment. China’s Growth Enterprise Market, MarginTrading, Stock Index Futures and other fields have been introduced Investorssuitability system, playing a greater role in protecting the interests of investors andpromoting the healthy development of the market. However, the theoreticalfoundation of China is still shallow, practical experience is lacking, there is a bigdebate in the content, positioning systems and legea nature. There is a large gap in thespecific content of the system between outside the mature stock market.Trading itself is not active in its infancy in the New Third Market, theappropriateness of the system is not fully played out effect. Compared with system ofthe United States and areas of the China’s Growth Enterprise Market, the Investorssuitability system deficiencies can be found in the New Third Market, Performance inpositioning deviation, the lower level of normative documents, content requirementsin principle, lack of interoperability, lack of civil liability lead to the broker sponsoredcan not pay enough attention to system, investor protection is not obvious, restrictinginvestors to participate in the initiative, is not conducive to the market development. Therefore, the New Third Market should be based on market conditions andexpected developments, improve in the position, the level of normative document,the content, violation of the appropriateness of civil liability, to establish a scientificand rational investors suitability system.