The defects of the traditional rating of securities credit rating

Traditional securities credit rating information as the basis for investor decision-making, the value content is low

Securities credit rating information describes the future earnings of securities, due to the many factors affecting the future earnings of the securities and the complexity of the information processing difficulties, resulting in a lack of value of the securities credit rating information. It is difficult for investors to make an investment decision based on the information on securities, if they do not have the help of the original information on the securities. In other words, if there is value in the information on securities, it can only differentiate between securities, but choosing the investment object among securities of the same rating cannot be done based on the information on the list.

Second, the traditional securities credit rating index selection is more difficult

Take the stock rating as an example, the stock rating rating of stock returns, involving stock price indicators. Stock price volatility, frequent changes, and many factors affecting stock price fluctuations, but also very complex, both political and economic factors, and sometimes the performance of listed companies, dividends and bonus distribution has become a secondary factor. As a result, rating stock price indicators, and ultimately stock returns, has become extremely difficult.

Third, the traditional securities credit rating information processing lack of accurate, scientific methods

The original information from the securities processed into the future securities price changes on behalf of the information, the lack of accurate, scientific methods, resulting in a lack of credibility of the processed information on the future price changes of securities. From the future securities price change information and securities income distribution information processed from the securities listing information, and therefore also lost its significance.

Four, the traditional securities credit rating lack of participation of listed companies and investor trust, lost the survival and development of the market

Securities credit rating is different from bond ratings. For bond ratings, because usually do not require bond financiers to disclose their financial information, bond financiers do not have the responsibility and obligation to disclose their financial indicators in the news media (such as newspapers), investors in the investment and purchase of bonds can not judge and analyze the situation of the financing enterprise, can only rely on the assessment of the company's ratings on the bonds to make their own risk judgments and investment choices, which gives rise to investor demand for information about bond The information demand for bond ratings. Furthermore, the government's mandatory establishment of bond rating for enterprises has prompted enterprises to apply for bond rating in order to finance. The above factors determine the basis for the development of bond ratings. On the contrary, the public listed companies have disclosed the financial information, the shareholders have a basis for investment, and the lack of investors' trust in the information compiled on the securities greatly affects the investors' demand for information on the credit rating of the securities. At the same time, national legislation does not require listed companies to carry out securities credit ratings, so listed companies are not obliged to apply for ratings. Securities credit rating loses the trust of investors and the participation of listed companies, it loses the basis for survival and development.