what is margin trading? It refers to the business activities of securities companies that lend funds to investors to buy securities or lend securities for them to sell. Investors borrow funds from securities companies to buy securities and borrow securities to sell them, which is called margin trading, also known as credit trading.
margin trading is divided into two categories: margin trading and margin trading. Investors borrow funds from securities companies to buy securities, which is a financing transaction; Investors borrow securities from securities companies and sell them, which is a securities lending transaction.
financing can enlarge the scale of your operation. For example, when you are optimistic about a stock and want to intervene in a big way, you can borrow money from a securities firm to buy the stock. When the stock rises to the target price, you can sell the stock to pay off the loan, thus amplifying your income. Securities lending creates conditions for you to make money by shorting a stock. When you are bearish on a stock, you can borrow the stock from a brokerage firm, and then sell it. After it falls, you can buy the stock and return it to the brokerage firm to get the difference.
So, can all investors participate in margin trading? No!
Article 12 of the Measures for the Pilot Management of Margin Trading Business of Securities Companies clearly stipulates that if you have been engaged in securities trading in a securities company for less than half a year, have insufficient experience in securities investment, lack risk-taking ability or have a record of major breach of contract, the securities company can't and won't ask you for margin financing and margin trading. In other words, new investors who have been trading stocks for less than half a year are disqualified first, and investors who have no risk tolerance are not qualified. Because brokers are also worried about risks, there may be a minimum threshold requirement for the amount of funds for customers when formulating terms, so investors with too small funds may not be able to participate in margin financing and securities lending.
how to play: borrow money to pay back the money, and borrow shares to return shares
Article 21 of the Administrative Measures: If a customer purchases securities by financing, he shall repay the funds he has invested in the securities company by selling the securities or directly repaying them. If the customer sells the securities by short selling, he shall repay the securities integrated into the securities company by buying the securities and returning them directly.
borrow money to pay back the money, and borrow stock to pay back the stock. This means that when the securities bought by financing fall, you need additional funds to repay, and when the stocks sold by short selling rise, you also need to increase funds to buy the same number of stocks to close the position.
who will be the collateral for margin financing and securities lending?
it mainly includes cash, SSE-listed trading funds, bonds and stocks. Among them, a series of restrictive conditions are also listed for stock collateral, including listing and trading for three months; The circulating share capital is not less than 2 million shares, and the circulating market value is not less than 1 billion yuan; The average daily turnover rate during the sampling period is not less than 3%. The daily average volatility does not exceed 3%, and the fluctuation range does not exceed 6%; The number of shareholders holding more than 1, shares exceeds 5,; The total shareholding of the top 5 tradable shareholders shall not exceed 6% of the tradable shares; The stock issuing company has completed the share-trading reform; The stock has not been specially treated (non-ST shares), etc. The 3 constituent stocks in Shanghai and Shenzhen, including the 5 constituent stocks in Shanghai Stock Exchange, will be collateral that brokers are willing to accept.
which brokerage company is expected to be the first to pilot?
The Administrative Measures gives seven conditions to be met when applying for a pilot securities firm, among which "it has been appraised as an innovative pilot securities company by China Securities Association" and "its net capital in the last six months is more than 1.2 billion yuan" are two hard conditions. Among the existing 17 innovative securities firms, the net capital of BOC International, Shanghai Securities, Guodu Securities and donghai securities does not meet the above requirements.
As the net capital level should be given priority under the same conditions, it is basically impossible for China Merchants Securities, Ping An Securities, changjiang securities, Guoyuan Securities, orient securities and other brokers with relatively low net capital levels to become the first batch of pilots.
among the remaining eight securities firms, from the perspective of net capital, CITIC Securities, Haitong Securities, Huatai Securities and Guotai Junan have obvious advantages, and CITIC Securities' entry into the pilot is basically certain; From the perspective of brokerage business, Guotai Junan, Haitong Securities, Guosen Securities and Guangfa Securities ranked in the top four last year, and Guotai Junan also had strong competitiveness. From the perspective of brokerage texture, CICC is naturally higher, its net capital ratio is higher than 9% for a long time, and its institutional customer resources are quite abundant, so I believe it can occupy a seat.
never overdo it!
When you handle margin trading, if the trend of the stock price is contrary to your expectation, you will face great risks. For example, the stock you bought will fall instead of rising, and the stock you sold through margin trading will rise instead of falling. When the loss in your account approaches the margin bottom line, you will be required to add margin. At the same time, because the stock price fluctuation is not one-way, in order to reduce the risk, you'd better not operate in Man Cang after margin trading. Otherwise, it will be closed because there is not enough funds. When the loss on your account reaches the bottom line of the margin, the brokerage firm will close your securities and you will be completely washed white.
Calculation of cost account: The Measures stipulate that the financing interest rate shall not be lower than the benchmark interest rate for loans of financial institutions in the same period stipulated by the People's Bank of China. This means that the interest rate will be one of the important costs of your margin financing and securities lending, which will increase your position cost. If your stock doesn't go up or down, you will also lose money.
Stock is the abbreviation of share certificate, which is a kind of valuable securities issued by a joint-stock company to shareholders as a holding certificate in order to raise funds and obtain dividends and bonuses. Each share represents the shareholder's ownership of a basic unit of the enterprise. Stock is an integral part of the capital of a joint-stock company, which can be transferred, traded or mortgaged at a fixed price. It is the main long-term credit tool in the capital market. Securities investment fund refers to a kind of collective securities investment mode with * * * benefits and * * * risks, that is, through issuing fund units, investors' funds are concentrated, managed by fund custodians, and managed and used by fund managers to invest in financial instruments such as stocks and bonds. International experience shows that funds can greatly promote the transformation of savings funds into investment, stabilize and activate the securities market, increase the proportion of direct financing, improve the social security system and improve the financial structure. The development of China's securities investment funds also shows that the development and growth of funds have promoted the healthy and stable development of the securities market and the perfection of the financial system, and played an increasingly important role in national economic and social development. There are many kinds of securities investment funds, which can be classified in different ways. According to whether the beneficiary units can subscribe or redeem at any time and the different transfer methods, they can be divided into open-end funds and closed-end funds; According to the different organizational forms of investment funds, they can be divided into corporate funds and contractual funds; According to different investment objects, investment funds can be divided into money funds, bond funds, stock funds and so on.