Rich Dad’s Financial IQ Cultivation: Stock Fundamentals

Chapter 15 Issuance and Listing of Stocks (5)
(1) The stock exchange shall announce the market price immediately, and prepare a stock price list on a daily basis, recording and announcing the following items in an appropriate manner: the name of the listed stock; the opening, highest, lowest, and closing prices; The ups and downs of market prices after comparison; the subtotal and total of trading volume and value; stock indexes and their ups and downs; and so on.

(2) The stock exchange shall prepare daily, weekly, monthly and annual reports on the transactions in the market, and publish them to the public in a timely manner.

(3) The stock exchange shall supervise listed companies to disclose information in accordance with regulations.

(4) The stock exchange shall enter into a listing agreement with the listed company to determine the mutual rights and obligations.

(5) The stock exchange should establish a listing recommender system to ensure that listed companies meet listing requirements.

(6) The stock exchange shall make a decision to suspend, resume or cancel the trading of listed stocks in accordance with the stock regulations, the listing rules of the stock exchange, and the listing agreement, or in accordance with the requirements of the China Securities Regulatory Commission.

(7) The stock exchange shall set up archives of listed companies, make statistics on the listed stocks held by directors, supervisors and senior managers of listed companies, and monitor their changes.

(8) Members of the stock exchange shall abide by the articles of association and business rules of the stock exchange, pay seat fees, handling fees and other fees to the stock exchange in accordance with the relevant provisions of the articles of association and business rules, and deposit transaction margins.

(9) Members of the stock exchange shall provide quarterly, interim and annual reports to the stock exchange and the China Securities Regulatory Commission, and actively report the relevant situation; stock exchanges have the right to require members to provide relevant statements, account books, transaction records and other documents .

([-]) Management and supervision of stock exchanges
(1) The stock exchange shall not in any way transfer its establishment and business licenses obtained in accordance with the stock exchange regulations.

(2) Non-member directors and other staff members of the stock exchange are not allowed to hold part-time jobs in any form of member companies of the stock exchange.

(3) The directors, general managers, deputy general managers and other staff of the stock exchange shall not disclose or use inside information in any way, and shall not obtain benefits from members of the stock exchange or listed companies in any way.

(4) Senior management personnel and other staff members of the stock exchange shall avoid them when performing their duties, if they have a family relationship or other serious relationship with them.

(5) The stock exchange shall establish a system that meets the requirements for stock supervision and management and implementation monitoring, and provide stock market information to the stock exchange according to the requirements of the people's government of the place where the stock exchange is located and the China Securities Regulatory Commission.

(6) The authorized institution of the people's government where the stock exchange is located and the China Securities Regulatory Commission have the right to require the stock exchange to provide relevant materials of members and listed companies.

(7) The stock exchange shall, within three months after the end of each financial year, prepare a financial report audited by an accounting firm with independent accounting qualifications for stock business, and submit it to the authorized institution of the people's government where the stock exchange is located and the China Securities Regulatory Commission. The management committee shall file for the record, and at the same time copy and report to the Securities Management Committee of the State Council.

(8) Unforeseen accidental events of the stock exchange lead to market suspension, or technical suspension measures are taken to maintain the normal order of the stock exchange must immediately report to the people's government where the stock exchange is located and the China Securities Regulatory Commission, and copy to the State Council Securities Regulatory Commission. management board.

(9) The authority authorized by the people's government of the place where the stock exchange is located and the China Securities Regulatory Commission have the right to require the stock exchange to provide reports and materials related to business and finance, and have the right to send personnel to inspect the business, financial status and other aspects of the stock exchange. Accounting books and other relevant materials.

(10) The stock exchange shall deposit the trading deposit deposited by its members into a special bank account in accordance with the relevant regulations of the state, and shall not try it out without authorization.

(11) When a stock exchange or a member of a stock exchange is involved in a lawsuit, or the senior managers of these units are involved in a lawsuit due to their performance of duties or should be dismissed according to stock laws and regulations, the stock exchange shall promptly report to the local people's government where the stock exchange is located. Authorized agencies and China Securities Regulatory Commission reports.

([-]). my country's stock exchanges
At present, there are two stock exchanges in my country, one in Shanghai and one in Shenzhen.

The Shanghai Stock Exchange is currently the largest securities trading center in my country. It was established on November 1990, 11 with a registration of RMB 26 million.Shenzhen Stock Exchange is the second stock exchange in my country. It was established in 1000 and officially opened in July 1989 with the approval of the People's Bank of China.Since the opening of these two exchanges, they have continuously improved their market operations and gradually realized the computerization and networking of transactions and the paperless operation of stocks.At present, the types of securities listed on these two exchanges include (A shares, B shares), treasury bonds, corporate bonds, warrants, funds, etc.By the end of 1991, there were 7 stocks (including A shares and B shares) listed on the Shanghai Stock Exchange, with a total market value of 1997 billion yuan.There are 422 stocks (including A shares and B shares) listed on the Shenzhen Stock Exchange, with a total market value of 9218.07 billion yuan.

The Shanghai Stock Exchange and the Shenzhen Stock Exchange are organized in accordance with the internationally accepted membership system and are non-profit institutions.Its business scope includes: 1. organizing and managing listed securities; 2. providing a venue for centralized securities trading; 3. handling the clearing and delivery of listed securities; 4. providing market information for listed securities; Other business.Its business purpose is to improve the securities trading system, strengthen the rights of the securities market, promote the development and prosperity of China's securities market, and safeguard the legitimate rights and interests of the state, enterprises and the public.

The Shanghai Stock Exchange and the Shenzhen Stock Exchange are composed of four parts: members, council, general manager and board of supervisors.Members are legal persons who have been approved and meet certain conditions. They all enjoy equal rights, have the right to participate in general meetings, have the right to elect and be elected to the directors and supervisors of the exchange, and have the right to propose and vote on the affairs of the exchange.The general meeting is the highest authority of the stock exchange and is held once a year.The board of directors is the daily affairs decision-making body of the general meeting of members of the stock exchange and is responsible to the general meeting of members.The general manager is the legal representative of the exchange, who is nominated by the board of directors and reported to the competent authority for approval.The duties of the general manager are to organize and implement the resolutions of the general meeting and the board of directors and report to them; preside over the daily business and administrative work of the firm; appoint heads of departments of the firm; and handle relevant affairs on behalf of the firm.The stock exchange also has a board of supervisors, which is responsible for the supervision of the financial and business work of the stock exchange, and is responsible to the general meeting of members.

[-]. Listing rules of my country's stock exchanges

At present, there are two stock exchanges in my country, namely the Shanghai Stock Exchange and the Shenzhen Stock Exchange.

([-]) Listing Rules of Shanghai Stock Exchange

1. The listing of stocks on the Shanghai Stock Exchange is divided into two parts, namely, the first part of listing and the second part of listing.The requirements for companies listed in the first section are relatively high. The paid-in share capital of the applying company shall not be less than RMB 500 million, the proportion of public offering shall not be less than 25%, and the number of registered shareholders shall not be less than 500. The profit must not be lower than the prescribed standard, and it must be recommended by a member of the exchange, and a transfer agency has been established in Shanghai, and its business status must be regularly announced in at least one publicly issued newspaper.The requirements for enterprises listed in the second part are relatively low. The paid-in share capital of the applicant company should not be less than RMB 100 million, the proportion of public offering should not be less than 10%, and the number of registered shareholders should not be less than 300.

2. Regular review of listed securities

The Shanghai Stock Exchange’s trial market business rules stipulate the circumstances under which listed securities are suspended or terminated from listing. According to the regulations, the explanation is as follows:

The Shanghai Stock Exchange can conduct regular and irregular reviews of the listed securities. The regular review is scheduled for the first quarter of each year. If it is found that the listed securities are not suitable for continued listing, the stock exchange will report to the competent authority of securities - the Chinese People's Republic of China. The Shanghai branch of the bank may suspend its listing after filing, and the longest period of time shall not exceed 9 months.

Specific circumstances under which listing should be suspended include:
(1) The company undergoes major reorganization or major changes in its business scope and does not meet the listing standards;
(2) The company fails to perform its statutory disclosure obligations or there are false records in its financial reports and documents submitted to the stock exchange;

(3) The conduct of the company's directors, supervisors, managers, and shareholders holding more than 5% of the actual issued share capital damages the interests of the public;

(4) The average monthly trading volume in the past year is less than 100 shares or there is no transaction in the past 3 months;
(5) Losses in the past two consecutive years;
(6) The company faces bankruptcy;
(7) The company is suspended from business dealings with banks due to credit problems;
(8) Not paying listing fees for one consecutive quarter;
(9) Other reasons for suspension of listing.

For listed companies, their stocks will be automatically suspended from listing during the period of issuing additional stocks or paying dividends or bonuses.The securities whose listing has been suspended shall be resumed when the reasons for the suspension are removed.

Under any of the following circumstances, the stock exchange may terminate its listing after reporting to the competent securities authority for approval:
(1) The circumstances listed above for suspension of listing have caused serious consequences;

(2) Failure to eliminate the reason for the suspension within the suspension period;
(3) Enterprise dissolution or bankruptcy liquidation;

(4) Other reasons for the termination of listing.

A company that has been approved to list its shares must immediately submit a relevant report to the stock exchange when it encounters the following situations:

(1) Significant changes in the company's organizational structure, business policy, and business scope;
(2) Personnel changes of members of the company's board of directors or senior management;
(3) Relocation and merger;
(4) Changes in the increase or decrease of shareholders and shareholders whose shares account for more than 5% of the actually issued share capital;
(5) Changes to the par value or style and seal of the stock;
(6) Issue preference shares or corporate bonds;

(7) The account transfer is suspended due to the distribution of dividends and bonuses;
(8) Heavy losses caused by human factors or disasters;

(9) Selling enterprise assets amounting to more than 15% of its total assets;

(10) Court disputes arising from financial issues;
(11) Predicting company losses.

3. Entrusted to buy and sell stocks
According to the Shanghai Municipal Securities Trading Market Business Trial Rules, the consignor who entrusts a securities firm to buy and sell securities in the trading market must register with the securities firm in person.

The client can open a special fund account and a special securities account at a securities firm.The funds in the special capital account are transferred to the bank by the securities firm, and the interest is automatically transferred to the special account. The securities in the special securities account are kept by the securities firm free of charge.

When entrusted to buy and sell stocks, the consignor must deliver the money or the stock in full to the securities firm according to the entrusted buying price and the entrusted selling amount. The required funds or securities can no longer be delivered guaranteed.

The forms of entrustment to buy and sell securities include: face-to-face entrustment, telephone entrustment, telegram entrustment, facsimile entrustment, letter entrustment, etc.To accept the client's entrustment to buy and sell securities, it must be a securities firm approved by the stock exchange to operate brokerage business in the trading market.

A securities firm's acceptance of entrusted trading of securities is limited to its headquarter business offices and branch business offices, as well as agencies for securities trading business approved by the stock exchange.Those who accept entrustment to buy and sell securities on behalf of securities firms must be securities salesmen registered with the stock exchange.The personnel in the preceding paragraph must wear the logo issued by the stock exchange when performing business, and have the obligation to provide consultation to the client.

Securities firms are not allowed to accept transactions decided by discretionary entrustment.

Securities firms shall be obliged to keep confidential the client's register and entrusted items, and shall not disclose them without the client's permission.

Proprietary trading of securities in the stock exchange market is limited to approved securities dealers.Securities firms shall not buy or sell securities on behalf of others in the securities exchange market in the name of proprietary trading.Without the consent of the stock exchange, securities firms are not allowed to join hands in proprietary trading in the trading market.Securities firms buying and selling securities on their own in the securities exchange market must not have the purpose of manipulating the market, buying at high prices and selling at low prices.

In order to maintain the stability and continuity of the trading market, when a stock exchange requests a securities firm for proprietary trading, the securities firm shall cooperate.

Securities transactions are carried out in the following categories:
(1) Same-day transaction: refers to the transaction in which all parties to the transaction carry out clearing and delivery on the day when the transaction is completed;

(2) Ordinary transaction: refers to the fourth business day (including the day of the transaction, which will be postponed in case of statutory holidays) after the transaction is completed, and the parties to the transaction carry out liquidation and delivery;
(3) Agreed day transaction: refers to a transaction in which the parties to the transaction carry out liquidation and delivery on the agreed date within 15 days (including the day of the transaction) after the transaction is completed.

Securities firms are required to make public declarations for bidding when buying and selling securities in the trading market.The stock exchange may, according to needs, choose the bid bidding method from the following items: first, verbal bid bidding; second, computer terminal bid bidding; and third, counter written bid bidding.

4. Central settlement net settlement system

The Shanghai Stock Exchange implements the central clearing and settlement system called the international stock market practice.According to the trial rules of the Shanghai stock exchange market business, the stock exchange takes each market opening day as a clearing period, and all securities firms must uniformly open an account with the business department of the Shanghai Branch of the People's Bank of China, and maintain a sufficient balance to ensure the same-day clearing, delivery and transfer The need for price.

The clearing and delivery business is uniformly handled according to the principle of "net settlement".According to the principle of "net settlement", each securities firm shall only calculate the net amount after offsetting the receivables and payables in the settlement of the price in one settlement period, and only calculate the amount of receivables and payables in the settlement of securities. (Referring to a security) net amount after offsetting.

(End of this chapter)