What does real-name registration system mean?

Stock real-name registration system means that when investors open an account, they must carry out real-name authentication. Brokers must know the true identity of investors and ensure that investors' buying and selling behavior and capital flow are their true behaviors. This system is an international practice.

In China's securities market, stock trading has always been a non-real name trading. This provides conditions for bank credit funds to flow into the stock market illegally, and also opens the door for listed companies to be keen on entrusted financing. In the current primary market, it can be said that it is very common to obtain subscription income by falsely opening multiple accounts; In the secondary market, due to the implementation of non-real-name transactions, the same fund or several related funds can easily control, transfer and reverse chips through multiple non-real-name accounts. And almost all institutional investors borrow a lot of personal names to speculate in stocks. It has become an open secret in the domestic securities market that only a small part of the large amount of institutional funds circulating in the secondary market are owned by real-name registration system accounts. Non-real-name trading has become a hotbed of illegal activities in China stock market and an important technical means to illegally manipulate the stock market.

In addition, another problem brought by non-real-name registration system registered securities accounts is that they cannot provide scientific decision-making basis for management. At the turn of the Millennium, the management made an unconventional decision to develop institutional investors, mainly because there were too few domestic institutional investors. This statistical data from securities trading institutions is considered to be highly authoritative and widely cited by management and relevant securities researchers. It is an important argument that there are indeed too few institutional investors in China's securities market and it is necessary to develop institutional investors in an unconventional way. But in fact, because many illegal institutional investors open accounts by impersonating individual investors, the above statistics are very unreliable. Although there are fewer institutional investors in China's securities market, they are not as extreme as the above statistics reflect. So as to make a decision to develop institutional investors, which leads to the blindness of institutional investors' extraordinary development to a certain extent.