Deposit for margin trading lifted 60% and risky firms monitored

As reported, the  initial margin requirements has been raised by 60 percent on trial operation for the investors, with down of conversion rate by marginal securities, and the  securities firms are approved to exercise control over ten types of risky customers.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

The investors’ margin requirements should not be below the ruled 50 percent when trading on needed securities, according to the regulations from Shanghai and Shenzhen stock exchange, while the rate for treasury bond, EIF, stock fund, constituent stock and the like, when demanded as deposits, should not be higher than the maximum percentage as 95, 90, 80, 70 or 65 respectively.

Actually, several firms have decided 60 percent up of the initial margin, or the proportion of 300 percent for the required deposit, to obtain the funds.

“All of the operations are in line with the requested standards”, saying by a larger broker, and no single deal of contract has ever been liquidated since the trial run.

Some approved firms say that the cash would be unacceptable as deposit, as a chief manager at Shenzhen indicates, “the cash is less than security equivalents in advantage to handle the leverage of the investor, as its conversion rate equals to the point of <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />11”.