Research On The Effect Of Margin And Short-term Trading Mechanism On The Volatility Of China's Stock Market

In March 2010,the trading mechanism for margin financing and short selling was introduced,and the market trading system in China was improved.At present,there are a total of 950 standard stocks available for investors to choose to trade.After the introduction of the margin financing mechanism,investors can only become history through unilateral long-selling situations.The volatility of China's stock market changes after the introduction of the margin trading mechanism,which is a problem that must be faced in the development of China's stock market.The situation of China's stock market can be reflected by different indexes.This article selected the Shanghai and Shenzhen 300 Index.The financing transaction and securities lending trading operations are represented by the financing balance and the short-selling balance,respectively.Through empirical research and analysis,the correlation between the financing and short-selling trading mechanism and the volatility of the stock market was obtained.The sample range is the latest data since the introduction of margin financing and securities lending in China,from January 31,2013 to January 31,2018.The data source is Choice financial terminal.First of all,it is necessary to carefully read the relevant documents in conjunction with the arguments of this article,and after summarizing and summarizing,the research value and social significance of the article are obtained.Second,starting with theoretical knowledge,the basic content of margin financing and securities financing is discussed in detail,and further research is conducted in connection with specific conditions in China to simulate and analyze how stock market volatility is affected by the margin financing mechanism.In the empirical analysis,the CSI 300 Index,the financing balance,and the short-selling balance were determined as the determination of sample data and indicators.The specific measurement method uses a vector autoregressive model,which mainly includes ADF test,Granger causality test and cointegration test.Empirical research shows that: based on the use of global sample data,the research shows that there is a correlation between financing transactions and stock market volatility in the financial and financial transactions,and there is almost no short selling,which is mainly due to the two markets in China.The development of extreme imbalances in the midfield;when the bull market is selected,it shows that both margin financing and securities lending will exacerbate the market volatility,and the stock market volatility mainly occurs at the earlier stage of the two changes;using the bear market data,it is concluded that the two funds can stabilize the stock market volatility.After summarizing and analyzing the conclusions of empirical research,combining the specific operation of margin financing and financing in the development process,relevant improvement measures and recommendations are proposed.