The stabilization fund refers to the fund legally established by the government through a specific institution. This kind of fund can operate the securities market in reverse. For your convenience, let's take a look! Let me share with you the classification of stabilization funds. Welcome to read!

Overview of stabilization fund

The stabilization fund, also known as intervention fund, is a fund legally established by the government through specific institutions (CSRC, Ministry of Finance, Exchange, etc.). ). It operates the securities market in the opposite direction to stabilize the irrational violent fluctuations. It is urgent to prevent the stock market from skyrocketing and plunging in order to achieve the goal of stabilizing the securities market. Under normal circumstances, the source of the stabilization fund is legal or its basic composition is mandatory, such as national financial allocation and collection from relevant units participating in the securities market. , and does not rule out the placement of shares to investors who voluntarily purchase.

Classification of stabilization funds

Judging from the market where the stabilization fund plays a role, there are several kinds of stabilization funds, such as foreign exchange stabilization fund, national debt stabilization fund, grain stabilization fund and stock market stabilization fund.

Source of stabilization fund

The sources of the stabilization fund can be varied, mainly legal channels, and its basic components are mostly mandatory, such as state financial allocation and collection from relevant units participating in the securities market. , and does not rule out the placement of shares to investors who voluntarily purchase.

Characteristics of stabilization fund

According to the above definition, the stabilization fund has the following characteristics:

1. The stabilization fund is a policy fund whose fundamental duty is to stabilize the securities market and prevent ups and downs.

Therefore, the whole process of its establishment, operation, evaluation and management is influenced by policies or directly supervised by the government, serving the securities regulatory authorities and becoming one of the effective means of direct supervision of the securities market.

2. The stabilization fund is a non-profit fund, which makes it different from other securities investment funds, because the purpose of other securities investment funds is to maximize the fund value for investors. The stabilization fund should have a large enough plate. If the number of funds is not large enough, it will have little effect on the stability of the securities market and will not play the role of "anchoring the sea".

3. The source of the stabilization fund has legal channels or its basic composition is mandatory, such as national financial allocation and collection from relevant units participating in the securities market. , and does not rule out the placement of investors who voluntarily purchase.

4. There are special norms and procedures for the operation and management of the stabilization fund to ensure the principle of "three publics" and not harm the interests of the vast majority of investors.

Functions of the stabilization fund

The basic function of the stabilization fund is to stabilize the irrational fluctuation of the stock market. On the one hand, it refers to the irrational fluctuation of the market (index), on the other hand, it should also include the skyrocketing and plunging of individual stocks. According to American stock market theory, a continuous decline of 20% from a high point can be called a bear market, and a one-day decline of more than 5% can be called a stock market disaster. For example, after 1999 reached the high point of "5. 19" 1756, the Shanghai Composite Index fell to 1350, with a drop of nearly 25%, which was obviously inconsistent with the macro-economic development background of China, so it was irrational. On the first day of listing of 1999 10, the opening price of "Fund Zheng Xiang" was 2.45 yuan, and the highest price reached 10 yuan. The closing price of 6.2 yuan was much higher than its net asset value per fund unit 1. 137 yuan, forcing the management to raise funds in advance (65438. In similar situations, everyone should be involved. In addition to the function of "stabilization", the author thinks that we can refer to the role played by SIPC in the United States and give the stabilization fund the function of insurance, that is, to provide crisis compensation or guarantee for investors (including brokers, institutions and general investors). For example, when a securities company is in financial crisis, the stabilization fund can intervene in the securities company according to certain procedures, or give advice on management, or give financial support, or even help it liquidate and bear certain settlement insurance premiums.