Research On The Securities Investor Suitability System

ABSTRACT:In order to promote the long-term development of multi-level capital market, it is necessary to recognize the behavior and structure of the investors in the market, and to perfect the system of Securities investor appropriateness. Rules on securities investor appropriateness make it possible to strengthen the market supervision, to urge securities companies meeting the requirements of customer suitability, and to ensure that particular securities products and services are provided to suitable investors, thus preventing securities transaction risks in advance and protecting investors comprehensively. Hong Kong "Mini Lei Man Debt" storm warns us that the suitability system is necessary for the capital market, especially for the long-term development of the securities industry.This paper analyzed the history of Securities Investor Suitability System and drew some beneficial enlightenment. Based on the field of securities investment, this paper summarized the concept of investor appropriateness and the existing problems concerning the suitability rules, and put forward some targeted Suggestions so as to provide references for the improvement of the system of Securities Investor Suitability SystemIt is turned out that Securities Investor Suitability System in China is characterized by low legal validity, improper legislative purpose, and inadequate continuing assessment. In addition, the procedure and criteria of suitability obligations, the securities investor classification system, and suitability responsibility and investor relief mechanism are supposed to be improved. These problems can be solved by means of the following suggestions:try to protect investors and providing them with equitable participation opportunities; increase the legal validity of suitability rules; explicit the suitability obligations and securities classified system; and especially, optimize the legal liabilities and the investors’relieve mechanism.