.jpg)
To promote the healthy and orderly development of securities margin trading, with the approval of CSRC, SZSE recently further expanded the scope of underlying stocks for margin trading. The number of underlying stocks other than those listed under the registration-based IPO system of SZSE will increase from 800 to 1,200. The foregoing adjustment will become effective from 24 October 2022.
Before this, SZSE had expanded the scope of underlying stocks six times. The stocks listed on the ChiNext Board under the registration-based IPO system are underlying stocks for securities margin trading from their IPO dates. The structure of underlying securities has been constantly optimized. After the expansion, the SZSE-listed underlying stocks will take up nearly 90 percent of all A-shares on SZSE in terms of floating market capitalization. In addition, all the constituent stocks of the ChiNext Index and the CSI 300 Index, 97% of the constituent stocks of the CSI 500 Index, and 83% of the constituent stocks of the CSI 1000 Index are covered. Among the 400 stocks added this time, the stocks with a floating market capitalization below CNY 10 billion account for over seventy percent and the stocks in key areas such as advanced manufacturing, digital economy and green and low-carbon development take up nearly sixty percent. With the coverage of small-cap and medium-cap stocks further expanded and the representation of underlying securities in industries and markets enhanced, it can help channel more market resources into key areas with national support.
Securities margin trading is a basic arrangement of securities trading. Since its pilot project was launched in 2010, the securities margin trading business has operated stably on the whole, the risk management capability of securities companies has improved, and the risk awareness of investors has been enhanced. The expansion of the scope of underlying stocks can help give play to the positive role of securities margin trading in facilitating price discovery and improving the liquidity of underlying securities, thus further meeting investors’ diversified investment needs.
Next, SZSE will, under the unified leadership of CSRC, practice the policy of “system building, non-intervention, and zero tolerance” and the urges to revere the market, revere the rule of law, hold high professionalism, stay alert to risks, and obtain support from various parties across the board. It will continue to optimize the basic policies and regulations on securities margin trading, improve the risk control mechanism, guide securities companies to further improve their risk management level, and work with them to promote the long-term healthy development of the securities margin trading business, so as to effectively maintain the stable and orderly operation of the capital market. Meanwhile, SESE reminds investors to pay high attention to the leverage feature and risks of securities margin trading and embrace rational investment to prevent investment risk.
