Research On The Relationship Between Chinese Securities Market Structure And The Performance Of Securities Companies

One of the most important parts of the modern financial market is stock market.In1987,the establishment of China’s first securities company is a symbol of China’s securities market formation.30 years later,China’s capital market has made great progress,including market size,trading rules,regulatory measures,trading methods and so on.China’s securities market has become an important part of China’s financial market,but also an important part of the global financial markets.At the end of 2016,China’s total market capitalization of a shares reached 50.62 trillion yuan.There are 129 domestic securities companies totally with 5.79 trillion assets.And the total market value of China’s securities market has surpassed Japan and become the world’s second largest market,second only to the United States.But we should place more attention on those challenges in China’s securities market.As the level of commissions keeps going down,the market environment getting more and more intense.What’s more,the homogeneous services can’t meet the diverse needs of the market and the unstable income is out of the securities companies’ control.Therefore,it is meaningful for us to get to the bottom of this question.This paper analyzes the problem from a perspective of the relationship between market structure and performance.Firstly,this paper makes an analysis on the market structure and the performance.According to the Market Share 、 CRn and HHI we estimate,the market structure of China’s securities market is kind of dispersive and it is competitive market structure.And the market structure moves at the direction of centralization in recent years.As for the performance,this paper studies on the price of major product and analyses the structure of income and the profitability.Then we study on the interrelationship of each other by means of statistic software tools.We choice ROE as explained variable,choice Market Share,CRn and HHI as explaining variable and choice the turnover and the commission as controlled variable.The result of total sample shows that the indices of market structure are positive correlated with the performance.The result of subsample shows that there are differences between listed companies and unlisted companies,which means listed security companies can’t represent the industry.At last,we draw a conclusion basing on all this study and give a suggestion forsecurities companies and our government.For securities companies,it is necessary to implement differential competitive strategy as the market structure keeps concentrating.And the security companies should improve their service to win the pricing right as the commission slides.As for our government,it is better to lower the threshold of entry,which makes the market more competitive.And the price chaos of security companies needs to be checked by our government.