In the A-share market, the meaning of a seat refers to the terminal provided by the exchange for members to conduct quotation trading in the trading hall, so only members can apply for a seat in the exchange. Common seats are: special seats for brokerage transactions, special seats for QDII, special seats for funds, special seats for insurance and special seats for hot money.
Only institutions that meet certain conditions can apply for seats, such as obtaining a license to operate securities and futures business, engaging in securities brokerage, securities underwriting and sponsorship business or other securities businesses recognized by the China Securities Regulatory Commission; Obtaining the Business License of Enterprise as a Legal Person issued by the registration authority according to law; Have a good reputation and business performance.
Due to the membership system of the exchange, only institutions with huge funds can directly open seat numbers on the exchange, so investors can see institutional seats in the transaction process. Therefore, retail investors and individuals can only use the seats of brokerage firms to conduct stock trading, and cannot directly accept quotations on the exchange.
In the traditional sense, the trading seat is the fixed position for securities companies to trade in the trading hall of the stock exchange, and its essence also includes the meaning of trading qualification, that is, they can only engage in the actual securities trading business after obtaining the trading seat. Judging from the relevant management systems of Shanghai Stock Exchange and Shenzhen Stock Exchange, trading seats represent the rights and interests of members in stock exchanges and are the basis for members to enjoy trading rights.
According to the way seats are provided, there are tangible seats and intangible seats.
Tangible seat refers to the computer quotation terminal located in the trading hall of the exchange and networked with the matchmaking host. Securities companies trade securities by manual quotation through tangible seats, that is, the counter staff of the securities business department dictate the entrustment of investors to the market representatives in the trading hall of the stock exchange through the hotline. The market representative uses the computer quotation terminal on the seat to input the commission into the matching host, and receives the real-time market price and transaction return data through one-way satellite.
Invisible seats refer to that securities companies use modern communication network technology to directly connect the computer terminals in the securities business department with the exchange matching host, directly transmit trading commissions to the exchange matching host, and receive real-time market and trading return data through the communication network. The main communication mode of stealth seats is two-way satellite, which has high technical level, fast transmission rate and good safety and reliability to adapt to the characteristics of vast territory and scattered investors in China.