Stock advantages of trust holding shares:

1. Trust holding shares is mainly to solve the problems of capital amplification or identity confidentiality before the shares are invested. Letting trust companies finance listed companies has little to do with whether they can buy shares. But in fact, listed companies and trust companies have a creditor-debtor relationship.

2. The future stock price should be linked to the industry and performance of the listed company itself: the trust company may only have a stock pledge project with the listed company. The stock price will not perform well in the future because of this relationship. Trust companies may become the shareholders of listed companies. For example, so the stock is pledged to the trust company, and the listed company is short of money. It doesn't mean that the stocks held by the trust must perform well or will be excellent in the future. Extended information

Trust shareholding means that a trust company bought and held the shares of this listed company, which was used by speculators as an excuse to speculate and named as "trust shareholding concept stocks".

Legal risk

1. Legal risk of invalid trust shareholding.

2. Trust shareholding can't resist the legal risks of the third party in good faith or the compulsory measures of judicial administrative organs.

3、? Legal risks arising from the choice of the trustee.

Purpose

1. Confidentiality. For some reason, the client doesn't want his name to appear on the industrial and commercial registration materials or publicly disclosed information, so he adopts the method of holding shares by trust, so that the trustee enjoys rights and assumes obligations as a shareholder of the company, while the client seems to have nothing to do with the company.

2. Legal restrictions. There are special legal requirements on the shareholder qualification and shareholding ratio of specific companies, such as securities companies, fund companies and banks. Ordinary investors may not meet this requirement, so they entrust trustees who meet this requirement to invest in specific companies as shareholders.

3. Entrustment management: based on the trust in the management ability of the trustee, the trustor hands over the equity to the trustee for operation and management.

Reference: Baidu Encyclopedia? Trust shareholding