Refinancing business, namely margin trading and securities lending business, refers to the business in which securities companies lend funds to customers for them to buy securities or issue securities for them to sell securities.

Securities transactions resulting from margin trading and securities lending business are called margin trading and securities lending transactions.

Margin trading is divided into two categories: margin trading and securities lending. Customers borrowing funds from securities companies to buy securities are called margin trading, and customers borrowing securities from securities companies to sell securities are securities lending transactions.

Function: 1. Play the role of price stabilizer. In a perfect market system, the credit trading system can play the role of price stabilizer. That is, when excessive speculation in the market or market making causes the price of a certain stock to skyrocket, investors can use securities lending to

The selling method sells the stock, thereby causing the stock price to fall; conversely, when a certain stock is undervalued, investors can purchase the stock through financing purchase, thereby causing the stock price to rise.

Margin margin trading helps investors express their expectations for the actual investment value of a certain stock, guides the stock price to reflect its intrinsic value, slows down the fluctuation of security prices to a certain extent, and maintains the stability of the securities market.

To effectively alleviate the financial pressure on the market, financing channels for securities companies can include funds and other methods. Therefore, the liberalization of financing and the entry of bank funds into the market will also be carried out in two steps.

During the downturn in the stock market, for institutions such as funds that need capital adjustment, it can not only solve urgent needs, but also bring considerable investment returns.

2. Stimulate the activeness of the A-share market. The margin trading and securities lending business is conducive to the active market trading. Using the amplification effect of the amount of funds on the market is also a way to stimulate the activeness of the A-share market.

CITIC Securities analysts Wu Chunlong and Chen Xiangsheng believe that margin trading and securities lending business will help increase the liquidity of the stock market.

3. Improve the living environment of securities companies. In addition to bringing considerable commission income and interest margin income to securities companies, the margin financing and securities lending business can also derive many product innovation opportunities and provide opportunities for cost reduction and hedging for self-operated businesses.

possible.

4. The basic margin financing and securities lending system of the multi-level securities market is the foundation of the modern multi-level securities market, and it is also the supporting policy to solve the structural imbalance of supply and demand that will inevitably occur after the separation of the old and the new.

Margin financing and securities lending, short-selling mechanisms, stock index futures, etc. are linked together, which will bring a huge amplification effect to the scale of funds and market risks at the same time.

In an imperfect market system, credit transactions will not only fail to act as a price stabilizer, but will further aggravate market volatility.

The risk is manifested in two aspects. First, if the overdraft ratio is too large, once the stock price falls, the loss will be doubled; second, when the market index goes bearish, credit trading will help the decline.

Difference: Refinancing business includes refinancing business and securities refinancing business.

The price difference advanced by securities financial institutions is in most cases a loan from a bank or financing in the money market, which is called refinancing, including capital refinancing and securities refinancing.

Expanded data refinancing business refers to the provision of funds and securities by banks, funds, insurance companies and other institutions, and securities companies serve as intermediaries to provide these funds and securities to margin financing and securities lending customers.

On August 8, 2012, the countdown to refinancing began, and the capital invested in the stock market exceeded 100 billion.

Concept: Investors buy (or sell) a certain security with part of their own funds (or securities) and the remaining part of funds (or securities) borrowed from financial institutions. The shortfall is the advance payment borrowed from securities financial institutions.

(or securities) are based on credit, which is the first credit relationship formed between securities financial institutions and investors.

On the other hand, the price difference advanced by securities financial institutions is in most cases loans from banks or financing in the money market, which is called refinancing, including capital refinancing and securities refinancing.

In the process of refinancing, a second credit relationship is formed between banks and other credit granting parties and securities financial institutions.

Generally speaking, opening this business will be a boon to the banking industry.

Because once the refinancing business is introduced, it will provide great vitality to the capital market and will be a long-term benefit to financial stocks.

Business role: It can be seen from the experience of overseas markets that the refinancing business has a huge promotion effect on the entire securities industry, margin trading and securities lending business, and the capital market.

After the refinancing business is launched, since securities firms can borrow funds or securities from securities finance companies, the scale of their margin trading and securities lending will be significantly increased.

Industry insiders pointed out that if the refinancing business is launched, the amount of funds available for financing and the number of stocks available for securities lending will be dozens or even hundreds of times, which will have a real impact on the market and even shake A-shares.

fundamental model of the market.

Operation method: According to the preliminary design, under the refinancing business system, a special company will be established to be responsible for the operation.