What is the impact of margin financing and securities lending on stock prices? Margin trading can enlarge the supply and demand of securities, increase the trading volume, and amplify the use effect of funds, which has an obvious effect on increasing the liquidity and trading activity of the stock market, thus effectively reducing the liquidity risk. According to statistics, the foreign margin trading volume accounts for more than 15% of the total securities trading volume, the United States accounts for 16% ~ 20%, Japan accounts for 15%, and Taiwan Province Province accounts for 20% ~ 40%. At the same time, margin financing and securities lending can also help to improve the stock price formation mechanism and play a market buffer role in market fluctuations. There is no substitute because there are a certain number of securities. If the securities market is limited to spot trading, then the securities market will run in one direction. When the supply and demand are unbalanced, the stock price will inevitably rise and fall, or skyrocket and plummet. However, the cooperation between credit trading and spot trading can increase the flexibility of stock supply and demand. When the stock price rises excessively, "short sellers" expect the stock price to fall, so they sell ahead of time, which increases the supply of stocks. Spot holders will not continue to raise prices or take advantage of high prices, and the market will not overheat. When the stock price really falls, "short sellers" need to make up for it, which increases the purchase demand.