Margin trading refers to the behavior that investors provide collateral to securities companies qualified for margin trading, borrow funds to buy securities (margin trading) or borrow securities and sell them (margin trading). Including securities companies financing and securities lending to investors and financial institutions financing and securities lending to securities companies.

The essence of margin financing and securities lending is to increase trading funds for investors and amplify investors' income, which is actually the same as third-party financing.

Margin trading is actually in two forms. Financing refers to borrowing money from securities companies and buying shares with their own shares as collateral.

If the stock borrowed goes up, the profit part will pay off the money and interest borrowed from the broker, and the rest will be its own profit; Securities lending refers to borrowing shares from securities companies with principal as collateral and then selling them. After the sold shares fall, buy back similar stocks at low prices. ?

Extended information margin financing and securities lending refers to the securities trading activities in which customers provide collateral, securities companies lend funds to them for buying listed securities or lending listed securities for selling, and customers repay the borrowed funds or securities, interest and expenses within the agreed time limit. The main influence of margin financing and securities lending on the capital market lies in the realization of leveraged trading and short selling mechanism. It has a long history in western countries.

Stock pledge financing is a way to obtain financing funds by providing pledge guarantee for securities such as stocks.

As can be seen from their definitions, the connection between margin financing and stock pledge financing is that both are financing methods and both need certain collateral. In most cases, both of them use stocks as collateral, and at the same time, both of them will have a significant impact on the capital flow in the securities market.

In the past, when the securities market was immature, some people even did not distinguish between "financing" and stock pledge financing in margin financing and securities lending, and replaced each other. With the standardization of the national stock pledge financing and margin financing and securities lending system, the market has gradually made a clear distinction between these two concepts.

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