Research On Market Efficiency Of Market Maker System In National Equities Exchange And Quotations

NEEQ(National Equities Exchange and Quotations)was set up to undertake the task to trade more and more small and medium-sized high-tech enterprises since National Equities Exchange and Quotations Ltd.was founded in 2013,and its role of market allocation of resources was further enhanced.However,with respect to the position of a national exchange market,transactions in NEEQ are not active enough.Throughout many developed international OTC market,the lack of liquidity is a common problem among low-level capital markets.The Chinese regulatory authorities make improvements timely.Not only the expansion of NEEQ,the widely-used market maker system was introduced to NEEQ.Market maker system has many obvious advantages,such as fighting against market risk,reasonably pricing,effectively improving market liquidity and so on.However,the securities market of China is still in a long growth period.There are still a lot of defects and lacking,such as the lack of stocks which exchange by market maker,the lack of enough powerful market makers,the low-effect pricing mechanism,the weakness of supervision and so on.The paper,started from the formation history of the market maker system,sorted out the institutional basis,transaction characteristics,features and functions,etc.,reviews the market maker system.Then taking NASDAQ system and Taiwan Emerging Market system as an example,the paper make analysis of the status of NEEQ with market-maker system.It proved that the market maker system is an effective way to improve the lacking of liquidity in low level of capital market.Several unique experience can be introduced to NEEQ.This paper draws on stock market liquidity measurement index system,and make a visual measure about the effects of the market maker system to NEEQ.Finally,above all,it provided several recommendations,such as the consolidation of the status of market-maker system.strengthening supervision,improving the legislation construction and institutional construction,fostering market maker groups and professionals,focusing on the development aspects of the linkage mechanism between the multi-level capital market,etc.