Risks of corporate securities investment

The risks of corporate securities investment are as follows:

1. caused by the **** same factors;

2. caused by special factors;

3. the return on a particular security;

4. cannot be defused by diversification;

5. can be defused by diversification;

6. correlated with the return on securities investment;

7. not correlated with the return on securities investment;

8. purchasing power risk;

9. money market; corporate risk, etc.

10. market price;

Systematic risk is the risk of having an impact on the securities market as a whole, which can result in a loss of return on securities investment. Systemic risk is caused by factors external to the business, including political, economic, legal and moral factors. Systemic risk has a huge impact on the securities market, affecting all corners of the market. Systemic risk is further categorized into the following types:

1. Market risk - It is the risk caused by price fluctuations in the securities market, which is usually caused by factors external to the company, and has nothing to do with the good or bad condition of the company's operations. Market risk is also a comprehensive risk, affected by political, economic and social factors, among which economic factors have the greatest and most lasting impact. Market risk is even more difficult for securities investors to avoid the risk, can only try to mitigate its harmful effects.

2. Interest rate risk - refers to the risk of changes in market interest rates caused by changes in the rate of return on securities investment. In general, interest rates fall, security prices rise; interest rates rise, security prices fall. Changes in market interest rates affect the pricing of stocks and bonds, but the extent of the impact varies. Typically, bonds with fixed yields (debentures, preferred stock) are affected to a greater extent than non-fixed-yield securities (common stock); long-term bonds are affected to a greater extent than short-term bonds; and the stock of a company with a large percentage of debt is affected to a greater extent than the stock of a company with a small percentage of debt.

3. Purchasing Power Risk - is the risk caused by a decrease in the purchasing power of money due to inflation. All securities in a portfolio are subject to inflation because the principal recovered as well as the income received from the investment is realized in money, and although the nominal value of the principal and the income can remain constant, their purchasing power rises and falls with the price level. The degree to which each type of security is affected by purchasing power risk varies, with securities with fixed returns, such as bonds, having a higher purchasing power risk, and securities with variable returns, such as stocks, having a relatively lower purchasing power risk.

4. Policy risk - it is due to the change or uncertainty of government policy to securities investors caused by the uncertainty of income. Government policies in the usual sense include industrial policy, fiscal policy, monetary policy, income distribution policy and so on. Any change in policy will have an impact on the supply and demand in the securities market, causing fluctuations in securities prices.

Legal Basis

The Criminal Law of the People's Republic of China

Article 182 Anyone who manipulates the securities or futures market in one of the following ways, influencing the price of securities or futures trading or the volume of securities or futures trading, and the circumstances are serious, shall be sentenced to not more than five years' fixed-term imprisonment or detention, and shall be fined in addition to or singly. ; if the circumstances are particularly serious, the penalty shall be fixed-term imprisonment of not less than five years and not more than ten years, and a fine:

(1) individually or by conspiracy, concentrating the advantage of funds, holding shares or positions, or utilizing the advantage of information to make joint or consecutive purchases and sales;

(2) colluding with other persons to carry out securities and futures transactions with each other at a time, price and in a manner to be agreed upon beforehand;

(3) ) trading in securities between accounts under one's actual control, or buying and selling futures contracts on one's own account;

(d) frequent or large number of declarations to buy or sell securities or futures contracts and withdrawing the declarations without the purpose of closing the deal;

(e) utilizing false or uncertain material information to induce investors to engage in trading in securities or futures;

(vi) publicly making evaluations, forecasts or investment recommendations on securities, securities issuers, or the subject of futures trading, while at the same time engaging in reverse securities trading or related futures trading;

(vii) manipulating the securities or futures market by other methods. If a unit commits the crime of the preceding paragraph, the unit shall be sentenced to a fine, and its directly responsible supervisors and other directly responsible persons shall be punished in accordance with the provisions of the preceding paragraph.