A Remark On Guo Shiliang'S Interpretation Of The Former Vice Chairman Of The SFC

Recently, Gao Xiqing, former vice chairman of the securities and Futures Commission, accepted an exclusive interview with Phoenix website.

In the meantime, Mr Gao said that China's retail investors could not be said to be immature.

For this, the words of Gao Xiqing, the former vice chairman of the SFC, immediately aroused widespread heated debate.

In fact, to speed up the process of "A retail market" to "retail" and enhance the overall share of market institutional investors is a matter of great importance to management in recent years.

It is undeniable that in the A share market, the retail investors are dominant, and the proportion of their institutional investors has not been fully improved. This is also one of the main reasons for the speculative and volatile risks in the A share market.

Throughout the world, the proportion of institutional investors in mature stock market is higher than that in European and American markets, with institutional investors accounting for more than 80%.

However, 50 years ago, the proportion of institutional investors in the European and American markets was less than 10%.

However, after many years of development, institutional investors in the local market have also been significantly improved. Especially after entering 2000, the proportion of institutional investors in the local market is showing a rapid rise.

As for our Hong Kong stock market, the development of institutional investors is equally difficult.

However, after years of development, the proportion of institutional investors in Hong Kong stock market has basically reached over 60%, and basically reached the above average level of the global mature stock market.

Obviously, for the vast majority of stock markets in the world, with the sharp rise in the proportion of institutional investors, it also means that the structure of investors in the local market will become more mature and the potential systemic risks of the market will be greatly reduced.

At this point, after experiencing the vigorous process of "going retail", the development of this stock market has gradually stabilized, and the overall volatility risk has also been greatly reduced.

In recent years, the A share market has made a lot of efforts in the development of institutional investors.

Among them, we should gradually improve the structure of investors in the capital market, encourage long-term capital to enter the market, such as the introduction of long-term funds such as pension, and so on, so as to achieve the purpose of raising the share of institutional investors in the stock market.

The author believes that improving the overall share of institutional investors in the stock market is irreversible trend, but in practice, it can not blindly pursue the number of institutional investors' development teams, but rather needs to improve the overall quality of institutional investors, and actively guide the real value investment concept to the market, so as to gradually modify the long-term distorted market investment values.

In terms of specific operation, we must further enhance on the one hand.

We should actively absorb the lessons learned before the stock crisis and fundamentally create a rational investment atmosphere for the market; on the other hand, we should enhance the self disciplined behavior of institutional investors, and actively summarize experience and training from the early "stock crisis", and we should actively guide the real value investment concept to the market, so that the investment behavior of the market will gradually become more and more popular.

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In addition, in the course of the gradual development of the stock market in the future and the gradual growth of institutional investors, we must also pay close attention to the legitimate rights and interests of investors, and gradually establish a stock market where investors' rights and interests are fully protected.

At the same time, it is more necessary to get the legal protection of the securities law, so as to provide legal support for the protection of investors' rights and interests.

Obviously, it is not easy to do this.

For a long time, the trading system from the A share market to the market paction.

And even to the market's trading threshold, there are huge differences between big capital institutions and ordinary investors.

At the same time, in combination with the background of low market violation costs and the lack of strict supervision, it is also a green light for some big capital organizations to make profits through loopholes in the system.

In practice, the venture capital institutions are far more speculative than ordinary investors.

In addition, more importantly, because large capital institutions have special financial advantages, information superiority and even many other advantages, they have also gained the advantage of making profits for such institutions.

It can be seen that in such a market environment, large capital institutions are unwilling to invest in the medium and long term value, but are more interested in short term frequent pactions.

In this regard, in the A share market dominated by capital, it is inseparable from the law of "becoming a capital and losing money".

As a result, in practice, the big capital institutions are more keen on hyping the market capitalization stocks, even though the share price has been far from the support of their real fundamentals, but still does not obstruct its hype enthusiasm.

Therefore, from the words of the former chairman of the SFC, he also expressed his worries.

However, in practice, this series of phenomena still plague the healthy development of the market, but also increase the inequality between large capital institutions and ordinary investors.

At this point, these market maladies must also be essentially eliminated.