A Research On The Effect Of Margin Trading On Earnings Management Of The Company

In the year of 2015, the stock market has experienced a historical volatility, the Shanghai Composite Index rose to 5000 points from the original 3000 points in about three months, followed by a period of less than 3000 points in less than three months. In the capital market operation process, the margin trading policy once again aroused the attention of scholars, what kind of role did margin trading play in this period? Some scholars believe that in this non-rational fluctuation wave, the development of margin trading undoubtedly exacerbated the volatility of the market, buy and sell short lead to the fall and rise of the market, from the descriptive curve of margin balance and the stock market, there is a strong linkage between the two. As early as the introduction of margin trading policy, research on the rest of the stock market volatility, liquidity and pricing efficiency has been endless。In March 2010, after the formal implementation of the policy, margin policy achievements from the empirical validation come forth in large numbers. However, despite the numerous research results, not a more consistent view on the impact of margin trading to the capital market has been drawn.Under this background, this paper attempts to study the effect of margin trading from the corporate accruals management view, influence the profit manipulation behavior, the final effect is reflected in the quality of financial information, and thus play a role in the efficiency of the capital market to. From the micro perspective, the paper studies the effect of margin trading policies, which have been studied in recent years. The research of this paper is devoted to the study of the angle of view, at the same time set up the direct link between the company and the secondary capital market, widen the margin policy effect research perspective.From the perspective of earnings management, this paper studies the impact of margin trading on the earnings management behavior of the listing Corporation. Firstly, on the basis of theory analysis, this paper constructs the profit margin of the company management, and uses the principle of the short selling of short sellers to explain the effect of short selling on the profit margin of the company’s management, and proves the relationship between margin trading and earnings factors is similar, and there is a similar relationship between the margin and the external governance factors. The empirical results show that, in the high degree of market, the effect of margin trading on earnings management is not obvious, in contrast to the low degree of market, margin trading has a significant effect on earnings management. So the margin and the external governance factors in the play to play an inhibitory effect on earnings management also has an alternative effect.