Study On The Securities Investor Suitability System

In recent decades, the development of China’s securities market is very fast. Now China has formed a multi-level capital market including Exchange Trading and Over-The-Counter Trading. Among them, Exchange Trading consists of Motherboard market, small and medium-sized enterprises, and Second-board Market. Over-The-Counter Trading is based on agent transfer system. There are many different levels of security products in this multi-level capital market. And with the development of innovation in financial products, more and more new financial products are appeared one after another. At the same time, there are more and more investors came into the stock market. These investors are different from each other. They have different financial situation, different investment knowledge and different capability about investment risk. But they all acquire the relative scarcity of information. Compared with the financial institutions, the ordinary investors are clearly disadvantaged in the professional knowledge, investment experience and product information and other factors. Since financial institutions often show their professional ability to customers and investors themselves lack the knowledge and experience of investments, more and more investors tend to make investment decisions depending on the professional judgment of financial institutions. In many cases, the financial institutions believe that their personal interests are more important than the interests of investors. Therefore, it is necessary to make the investors’ suitability system better and complete. In this way, we can avoid financial institutions make improper investment recommendation to investors. This is a effective way to protect investors’ rights. And it also works well to protect the interests of investors and to balance the unequal status of financial institutions and investors.At present, there have been series administrative norms and Self-regulatory norms about the investors’ suitability system in areas such as Second-board Market, securities margin trading and Share Price Index Futures. But there are still some deficiencies. The laws and regulations about the investors’ suitability system is in the low level of the entire legal system. And the relief approaches of investor are exile when investors violated. Consequently, in the process of perfecting our security investor’s suitability system, we must based on the reality of local industry development. At the same time, it is necessary to learn the law and regulation as well as experiences from other countries.This paper consists of three parts, including foreword, main body and conclusion. The main body also has three parts. In the first part, the author introduces the connotation of the investors’ suitability system. The investors’ suitability is a kind of obligation to financial institutions such as securities companies. From this part, it is easy to realize the difference between the investors’ suitability system and the qualified investors. In the second part, the author makes the collation and classification of the relative regulations about the investors’ suitability system in different developed countries just like America, Japan and European Union, also about the lawmaking and adjustment of relative regulations about the investors’ suitability system in Hong Kong. In the third part, the author makes a comparative analysis about the investors’ suitability system in our Second-board Market, securities margin trading and Share Price Index Futures. On the basis of this analysis, the author put forward some ideas and suggestions in perfecting the investors’ suitability rules in our country.