Margin trading comes to start today

Shanghai Stock Exchanges announced its member traders yesterday the regulations fro trial margin transactions, in which details have been stipulated for the application of the trial business on March 31. This represents the margin service has come to the stage of former operation after 4 years preparation. Shenzhen Stock Exchanges gave the news the same day. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

In line with the CSRC’s requirements, the two markets have pushed ahead the work in careful examinations for the shares to buy and the bond to perform, and have drafted the guidelines for the member traders, meanwhile, the associated clearing firm has fulfilled the test of technical system and the analog of trade procedures, in order to ensure the safety running.

It appears potentially risky in margin transactions as is completely new in <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />China’s securities market with short-selling mechanism and leverage effect. So it is improper for all the investors except those experienced and in better provisions.

The participants should get full understanding of the knowledge about the business, and give close watch on the information publicized at the related websites, as to prevent the risks and safeguard themselves.