The Risk Of Stock Financing And Its Research On Risk Supervision

Stock financing is also called OTC stock allocation, and its corresponding to the field stock financing, which is the "two financial" business of the secu rities company's. Stock financing is capital leverage in the capital market and outside the "two financial business",which is usually operate in the form of company, based on customer's own funds to provide funds for the stock invest ment.The appearance of stock financing is not accidental, but a process from q uantitative change to qualitative change.A-share market with the rapid develop ment and expansion of the scale of circulation in a long time, resulting in cap ital market lack, at the same time, the "two financial" from formal financing c hannels services a higher threshold, so most retail can't reach the conditions a nd turn to the financing platform. Therefore, all kinds of leverage of inside fin ancing and outside financing has become a major promoter of the market rally round, they magnify the rise of the stock market, also accelerated the crash i n the stock market, which can be described as "succeed with capital, defeated with capital". In the last few years, from July 2014 to 2015 September, the S hanghai composite index once rose by 110% and then plunged by 41 percent, result in a "crash".It means that the rapid growth of the scale of financial leve rage is the direct reason leading to the stock market crashed, but why did OT C stock allocation exist? What are the risks and why not stop the rapid expan sion in time? Can the existing regulatory policies on the OTC distribution effe ctively prevent the occurrence of similar incidents? A lot of problems are wort h considering in the formulation of the relevant system by the regulators.This paper is intended to analyze the risk of stock financing and its research on risk supervision, preventing similar risks happening again from the system design. Firstly, the paper introduces the knowledge of stock distribution, and then analyzes the operation mode of LC company's stock financing, introduces the company's business development, process settings, HOMS account management, open mechanism, cooperation agreement and other internal control system, and then analyzes the risk of stock financing companies. Finally, take the risk of the stock distribution as studied target with the problems of the supervision and management, and research the current regulatory measures whether effectively prevent the occurrence of this kind of risk or not, and put forward the corresponding suggestions.The research result of this paper is to reveal the principle of the stock distribution and the risk of the platform based on taking LC company as an example, and then put forward the countermeasures to strengthen the supervision from the system design, so as to protect the interests of investors and promote the stable development of the market. This paper argues that regulators should reflect on the problems in the process of stock allocation supervision, not only "fire fighting", but also "fireproof", from the source of the system design correctly handle the relationship between the government and the stock market, the bank and the stock market.