On March 18th, in order to ensure the smooth development of businesses related to the comprehensive registration system, Shanghai Stock Exchange and Shenzhen Stock Exchange jointly organized the first network wide test with China Clearing Corporation and China Securities Finance.

This time, it is mainly to test the correctness of the technical systems of all market participants by simulating the processing process of trading in stocks and depositary receipts on the Shanghai and Shenzhen Stock Exchange. The specific content of the test includes: consignment declaration, transaction return, market reception and display of mainboard registered stocks, IPO issuance of mainboard depositary receipts, listing, trading, non-trading, and other businesses.

| The degree of marketization of A-shares is expected to deepen

On the one hand, after the comprehensive registration system "opens the door to welcome the new", the market-oriented reform of new stock issuance will be further effective, leading to new changes in pricing mechanisms, pricing efficiency, and investment concepts. The coexistence of breaking the law and striking new premiums may become the norm.

"The registration system has unchanged requirements for the appropriateness of existing investors on the main board, and does not impose restrictions on investors' assets, investment experience, etc. This puts forward higher requirements for investors' ability to identify the fundamental situation of listed companies, leading to a gradual shift in the structure of investors towards institutionalization and specialization," said Li Zhan, Chief Economist of China Merchants Fund Research Department.

After the registration system has been introduced to the entire market, the market-oriented pricing mechanism has been further improved, thereby reducing the price difference between the primary and secondary markets. This means that "striking new" is no longer once and for all, and investors need to seek real potential companies and high-quality stocks.

On the other hand, in the era of comprehensive registration system with smooth IPO channels, the value of "shell" resources has further decreased. Institutional insiders predict that in the future, the M&A market will only be more critical of targets than the IPO market, and the risk of investment strategies that attempt to rely on "speculation" to turn around will increase exponentially.

In addition, more diversified and market-oriented exit channels are expected to consolidate and deepen. Enterprises without the ability to grow in value will exit the capital market, and irrational investment behaviors such as "speculation" will be effectively curbed.

| Capital market service technology innovation capability will continue to strengthen

This comprehensive registration system reform has improved the efficiency of review and issuance, relaxed the requirements for profitability, and directly benefited emerging technology sectors that represent technological upgrading and conform to the national industrial transformation policy. The characteristics of direct financing, especially equity financing, such as risk sharing and benefit sharing, will further accelerate the formation of innovative capital and promote a high-level cycle of technology, capital, and industry.

The implementation of delisting for listed companies will also be stricter, and the efficiency of delisting will be further improved. With the in-depth implementation of the reform of the stock issuance registration system, in the delisting process, supporting measures for delisting and corresponding transfer mechanisms are expected to be further improved, and the subsequent financing channels for enterprise delisting will also be more smooth.

What changes will happen to trading software?

In trading software, investors' different experiences will mainly focus on entrustment and market conditions. First of all, in terms of new share subscription, in the Shanghai stock market, the minimum limit for investors to apply for new shares on the Shanghai stock market was revised from 1000 shares to 500 shares.

Secondly, in terms of limit order declaration, after the implementation of the registration system, due to the new addition of price cage rules to limit orders, investors should pay attention to the fact that the purchase price cannot exceed the upper limit for the stock purchased and the selling price cannot be lower than the lower limit for the stock sold during limit orders. Therefore, trading software provides investors with a reminder of the upper and lower limits of the entrusted price.

In addition, investors can view the new market signs. The Shenzhen Stock Exchange newly displays four indicators: unprofitable at the time of listing, voting difference, agreement control structure, and registration system. The Shanghai Stock Exchange newly displays three indicators: unprofitable at the time of listing, voting difference, and registration system.

What is the impact on ordinary investors?

The implementation of the comprehensive registration system, which gives more decision-making power to the market, is conducive to improving market efficiency and reducing costs. At the same time, it can also reduce the workload of securities regulatory agencies, making them more focused on the regulatory core.

Ordinary investors can consider the following points to respond:

1. Strengthen information acquisition and analysis capabilities: The comprehensive registration system requires enterprises to disclose information in accordance with information disclosure rules. Investors need to strengthen their information acquisition and analysis capabilities to better understand the financial situation, operating performance, and development prospects of enterprises, and make rational investment decisions.

2. Concern about the quality and reputation of enterprises: Under the comprehensive registration system, the information disclosure of enterprises is more important. Investors need to pay attention to the quality and reputation of enterprises, especially those that engage in illegal activities such as financial fraud and insider trading.

3. Diversified investment risk: Under the comprehensive registration system, investors face greater risks and need to diversify their investment risk to avoid concentrating all their investments on one stock or a few stocks.

4. Focus on long-term investment: The comprehensive registration system leaves more decision-making power to the market, making the market more responsive. The volatility of stock prices may increase. Investors need to focus on long-term investment and avoid blind following and short-term trading.