The Influences Of Margin Trading On Security Markets In China

Securities margin trading, also known as "securities credit transactions" or margin trading, which refers to the investor provide collateral, borrow money to buy securities(financing transactions) or securities and selling(securities transaction) to companies which have qualification of securities lending and borrowing business of securities. For a long time, our country securities market belongs to the typical city of unilateral, can only go long, and can’t be short. Margin, can make the investors can do much, can be short. They not only have one more investment options to be profitable, but also when in a bear market, investors can sell securities in order to avoid risks. Along with the development of margin trading, the underlying shares pool is expanding capacity and its share of the market also increasing. Margin trading business’ s impact on the stock market has become the focus of concern of the vast investors and regulators increasingly.From the CSRC published《the measures for the administration of securities margin pilot》in June 2006, securities lending and borrowing business formally entered the domestic investors. Securities lending and borrowing business after five years of development, the official start of the pilot project of the business from March 2010 caused heated discussion due to the lack of perfect market regulation mechanism. In recent years, with the stock market gradually into the "bull market", the scale of margin trading became lager, the underlying stock pool expanded. At the same time, more and more investors use margin so that securities lending and borrowing has become a basic operational business in the domestic market. Margin business brings the opportunity to securities market, as well as increased the risk. This article from the concept of margin, taking the methods of the empirical research, comparative analysis and combining the qualitative analysis, the relevant departments of the securities firm for on-the-spot investigation, the very understand margin status, on the basis of empirical research to select the two cities of Shenzhen and Shanghai overall data of margin trading business, the time from July 2014 to January 2016, to contain the pilot securities lending and borrowing shares of Shanghai and Shenzhen 300 Index as a redex for presenting the A market volatility, using VAR model of the CSI 300 index volatility, balance of finance business, securities business balance three makes an empirical analysis of time series data to illustrate the shorting the introduction of margin trading and securities trading mechanism for the real implications of the Chinese stock market. Based on the research of model and according to the methods of co-integration analysis, granger causality and error impact test to test Shanghai and Shenzhen 300 index and the relationship between the securities lending and borrowing, discussing the financing, securities, factors affecting the volatility of stock market.At the same time,analyzing those factors deeply to predict the margin on the development of the whole stock market, and the impact of investing in stocks. In the end, through empirical research’s consequence, contrasting foreign mature stock market securities lending and borrowing business operation model and analyzed, on the development of margin in the future in our country and refinancing mechanism more perfect put forward the corresponding policy recommendations.