Controlling Shareholder's Share Pledge,Shareholder's Increase And Stock Volatility

In recent years,with the deepening development of China's capital market,the financing method of equity pledge has become more and more common in China's capital market.Equity pledge refers to a way in which the fund integrator pledges the shares held by it to the fund lender to obtain financing and is widely used by the controlling shareholders of listed companies.However,the expansion of the scale and scope of equity pledge aggravates the fluctuation of stock price and brings shock to the stable operation of the secondary market,which can not help to arouse people's concern about the economic consequences of equity pledge and concern about the impact of equity pledge on the stability of the capital market.This paper intends to study the above problems in order to provide reference for regulating the pledge behavior of controlling shareholders and maintaining the stability of the financial market.In this paper,the study found that although the controlling shareholder's equity pledge exacerbated the share price volatility,but for the sake of interests combined with its interests of listed companies,the more hope to maintain the stability of the stock price,the controlling shareholder by overweight stocks can effectively reduce share price volatility,this effect when prices fall mainly for stable investor sentiment.The behavior of controlling shareholders sharing risks with listed companies has been recognized by the capital market and has a long-term effect on stabilizing the company's stock price.Based on the above research results,respectively for investors,securities companies and regulators put forward feasible countermeasures and Suggestions:one is to strengthen investor education,guide the investors pay close attention to the equity pledge in listed company shareholder information,and wary of equity pledge the risks,avoid blind "winners" at the same time;The second is to urge the financing party to conduct due diligence on the pledger before the equity pledge,establish a perfect rating standard for the shareholders of the pledge after the occurrence of the equity pledge,strengthen the dynamic monitoring of the shareholders of revolving pledge and pledge with a high concentration,and strictly control the financing scale.Third,while standardizing the behavior of pledge of equity and preventing financial risks,appropriate incentive policies and measures should be introduced to guide the controlling shareholders of listed companies to take the initiative to bear and defuse the risks when they face the pledge of equity,so as to safeguard the rights and interests of small and medium-sized shareholders and promote the healthy development of the capital market.