Market Volatility Spurs Brokers to Work Overtime on Account Openings

Following the seven-day non-stop National Day holiday, securities firms have started "night markets."

Recently, many branches of Galaxy Securities have notified customers that from October 10th, their on-site business hours have been extended: the business hours from Monday to Friday have been adjusted to 8:30 to 20:00. At the same time, they also open on weekends to welcome customers, with business hours from 9:30 to 16:30. According to the reporter's understanding, CITIC Securities, Guotai Junan, and many other securities firms have also extended their business hours in the near future.

Since the start of this round of market conditions, the number of stock investors has surged, and the workload of front-line employees of securities firms has also been fully utilized. As the number of account openings "exploded" and the business volume surged, online illegal account openings, promotions of "one in ten thousand exemption of five," and other industry issues also emerged.

Recently, regulatory authorities have issued relevant notices to various securities firms, requiring them to provide good investor services, strengthen compliance risk control management, and ensure the stable operation of the market. The reporter learned that many securities firms have already standardized their business activities such as branch account openings according to regulatory requirements and increased investment in investor education for both new and old customers.

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I. The number of account openings has surged, with "post-95s" and "post-00s" entering the market.

In the process of researching many securities firms, the reporter found that since September 24th, the number of account openings of most securities firms has increased significantly both online and offline. However, affected by the convenience of account opening, the proportion of online account openings is larger, and the increase is more significant.

For example, since September 24th, the number of non-site account openings of Galaxy Securities has shown an explosive increase. According to statistics, the average daily account opening during the National Day Golden Week is about twice that of the past.

According to the person in charge of the relevant business of Dongwu Securities, the number of new account reservations during the 7-day National Day holiday reached three to four times the number of account openings on September 30th, approaching 20 times the average daily new account openings before the market started, and the new account reservations were 31 times that of the National Day period last year.

The surge in Hong Kong stocks during the National Day period has further attracted new stock investors. China International Capital Wealth revealed to the reporter that on the first trading day after the National Day, the number of account openings increased by more than three times compared to usual, the account callback increased by 12 times compared to usual callbacks, the peak of customer inquiries was 22 times the usual inquiry volume, and the number of intelligent customer service transactions that day exceeded 130,000.

"But at present, the processing speed of all work has basically returned to the normal level." Many interviewed securities firms said. When asked why the number of account openings has decreased, but the business hours of the branch are still extended, the person in charge of a securities firm branch in North China said, "There are many people opening accounts, but there are not many effective accounts. Moreover, the newly opened accounts need to be called back in time according to regulations. The callback is also a key time to convert effective accounts."It is understood that due to the new account openings dominated by the post-95s and post-00s, the inflow of funds is not ideal. According to data from Dongwu Securities, the new account openings in recent times have seen a significant proportion of the new generation. The number and proportion of account openings by the post-95s and post-00s have increased significantly, accounting for nearly half, gradually becoming an important force in the wave of account openings. At the same time, the number of account openings by the post-85s has also increased, accounting for nearly 30%, a 40% increase compared to the past.

In the new account openings of CITIC Securities, investors are also mainly young people, with ages concentrated between 18 and 40 years old, and the gender ratio is relatively balanced. The person in charge of the management committee of CITIC Securities mentioned that due to the A-share ETF market scale breaking through 3 trillion yuan, the participation rate of newly opened customers in ETF investment varieties has increased significantly compared to the past.

Second, old customers are busy opening "two-way financing" accounts.

While new investors are busy opening accounts, old investors are busy opening "two-way financing" accounts.

Data shows that with the increase in market activity, the financing balance has been climbing continuously since September 25th, and both trading days after the holiday have broken through the 1.5 trillion yuan mark. The latest data released by China Securities Finance Co., Ltd. on October 11th shows that as of October 10th, the number of individual investors in the two-way financing market is 7.0135 million, an increase of nearly 40,000 compared to September 24th; institutional investors are 52,391, an increase of 270 compared to September 24th.

Reporters learned that due to the need for counter handling for "two-way financing business", "recent two-way financing account openings have long been fully booked". According to Guolian Securities, the number of financing and securities lending accounts opened by the company during the National Day holiday showed a significant growth trend, reaching 10 times the daily account opening number.

The person in charge of the management committee of CITIC Securities told reporters that since the start of this round of market conditions, the two-way financing balance of the two cities has been rising day by day, with a cumulative increase of nearly 200 billion yuan, an increase of more than 15%. Even if the market adjusts, the two-way financing balance of the market still maintains growth, reflecting the strong confidence of investors in the market and an optimistic attitude towards the future market.

At the same time, the person in charge also pointed out that there are differences in the emotions of new and old investors during market fluctuations. New investors may be more susceptible to market emotions, and compared to old investors, they are more likely to feel uneasy and confused in market fluctuations. However, regardless of new or old investors, they should pay attention to risk management in the investment process, avoid blindly following the trend or overusing leverage.

Third, establish a strict "firewall" mechanism to strictly prohibit employees from stock trading.

At the time of the hot account opening, there have also been some non-compliant phenomena in the industry, such as online illegal account opening and promotion of "one in ten thousand exemption from five". To eliminate such problems, many people in the industry have said that a strict "firewall" mechanism should be established to further strengthen the compliance review of all links in online account opening, including continuously increasing internal compliance business training during online account opening promotion, to ensure the accuracy, authenticity, and compliance of promotional content.CITIC Securities' management committee stated that amidst the fervor of account openings, the company has strengthened the management of online account opening personnel's professional qualifications and conduct. Comprehensive training has been provided to staff involved in non-site account openings to ensure they fully understand the management regulations and regulatory requirements related to online account opening services. A robust risk monitoring mechanism for non-site account business has been established to monitor online account opening services, promptly reveal and warn of potential risks, and handle them effectively. Strict confidentiality of investors' personal information is maintained to prevent any data leaks. Additionally, to regulate the online business of various branches, Huanan Securities has established a joint internet platform inspection team, which conducts quarterly supervision and inspection of the internet platform from aspects such as brand image, ideology, compliance management, online business, investor education propaganda, and corporate WeChat. Furthermore, the online business of the internet platform has been included in the scope of on-site inspections of branches, with enhanced training and case warning education for internet platform business.

During market upswings, there are always securities employees who cannot resist the temptation to cross the red line that "securities practitioners are not allowed to trade stocks." In response, a senior official from Guojin Securities said that the company has strengthened internal guidance to standardize employees' internet business behavior, such as emphasizing the prohibition of publicly sharing account opening links and requiring strict review of all external marketing materials. In addition, employees are required to truthfully report their own, their spouses', and related persons' mobile phone numbers, account information, etc. Securities practitioners' spouses and related persons who engage in stock transactions are required to regularly declare this information in the OA system as stipulated. Dongwu Securities has established an employee information reporting and monitoring system, adopting real-time monitoring and regular investigation to prevent employees from trading stocks. At the same time, combined with measures such as comprehensive compliance training, case warnings, and daily compliance tips, the prohibited actions of practitioners are communicated to every employee, requiring them to keep these in mind and practice them.

Huanan Securities stated that to prevent employees from trading stocks through others' accounts and using insider information or undisclosed information for investment, the company encourages employees' family members to open accounts with the company for easy verification. Even if employees' spouses and related persons do not open accounts with the company, they are also required to regularly declare this information to the company.

IV. Proactive Preparations Ensure Smooth Data Interaction of Various Information Systems

With the market trading booming, some securities apps have experienced stuttering and delays. Many industry insiders have said that companies have taken proactive measures, strictly implementing industry requirements during the construction and upgrading of trading systems. The load capacity must reach three times the historical peak to cope with the sudden surge in securities trading volume.

The relevant person in charge of CITIC Securities' management committee said that first, during daily upgrades and maintenance, the IT department has been continuously optimizing the system architecture and deployment structure, and conducting不定期 multi-user, high-concurrency test scenarios to detect the system's reliability and stability in dealing with sudden traffic increases. Second, the company has been on high alert,高度重视IT systems' work in dealing with this sudden surge in traffic at the beginning of the market boom, including system expansion and emergency measures. During the National Day holiday, the IT department tested and expanded various links in the trading chain, including the network, main machines, and storage, to enhance the system's processing capacity and be ready to meet the potential trading peak. China International Capital Corporation Limited (CICC) stated that to meet investors' needs for account transfers at the opening, it negotiated with banks to advance the time for bank-securities transfers, and this time was moved to 6:50 AM (ICBC), becoming the first securities company that can transfer funds before 7 AM. In addition, it has strengthened network and information security protection, providing technical support and performance optimization for the system. On the customer side, it has worked with the customer platform team to optimize the non-site account opening system, improving the efficiency of account opening review and services, and expanding the concurrent application capacity of app nodes and terminal trading. "Guojin Securities' technical departments closely monitor the operation and infrastructure of various systems, sort out the capacity of various systems, and have implemented corresponding expansion preparations and performance capacity tests to ensure sufficient backup capacity for various systems. At the same time, they have rehearsed and optimized emergency response plans for important systems to provide technical support." said a senior official from Guojin Securities. In addition, reporters learned that Huanan Securities urgently expanded and added 42 servers for trading terminals such as Huanan Securities App, Huiying App, and Huiying PC to ensure the stable operation of the trading system; for business processing, non-site account opening, financial malls, etc., it urgently expanded and added 9 servers, contacted operators to expand the bandwidth of internet dedicated lines, and optimized load balancing mechanisms to ensure smooth data interaction of the company's various information systems. Dongwu Securities also conducted system stress tests in advance. To cope with high-concurrency visit traffic, the technical department urgently expanded, including upgrading bandwidth, firewalls, switches, servers, etc., and increased the frequency of system inspections to ensure stable operation.

V. New and Old Stock Investors Flock to the Market for "Crash Courses" in Investor Education

The account opening market continues to be hot, and with the influx of old stock investors, the workload of securities front-line personnel has surged. However, in addition to busy business development, the blind entry of new stock investors and the unfamiliarity of old stock investors with new rules have also brought pressure to securities companies' investor education work.

"On the first trading day after the National Day holiday, when the market opened with a gap and the increase converged, there were new customers asking why they couldn't sell the stocks they bought in the morning in the afternoon. This even became a joke," a customer manager at a leading securities branch in Beijing told reporters. Recently, it has also been noticed that new stock investors on social platforms are not familiar with the basic trading rules of A-shares, such as not understanding "T+1", not knowing the time for bank-securities transfers, etc., and there are even baseless statements like "you need to hold the stock for 7 days before you can sell it". "Strengthening investor education for new stock investors is imperative."

For old customers, although they are familiar with the basic rules, they find it difficult to master various intelligent tools in the current app. "The mentality of many old customers is: they don't understand, but they are greatly shocked. We will patiently explain step by step, but to be honest, customers still need to practice operations themselves and it takes a certain amount of time," said the customer manager.

How to carry out investor education work for new customers such as "post-95s" and "post-00s"? The relevant person in charge of CITIC Securities' management committee said that CITIC Securities has produced a series of long graphic strategies to interpret common problems and popularize A-share trading rules, such as "To Stock Market Novices: Investing is Not a 100-Meter Dash, But a Marathon" and "Ten Questions and Answers for New Customers". In response to the situation where there are many young customers among "post-95s" and "post-00s", interactive live lectures, series of investor education short videos, comic pictures and texts, and other innovative forms of investor education have been launched; through customer service platforms such as Qingting Dianjin App, new media official accounts, and investor education bases, continue to launch and optimize novice areas, novice courses, simulated trading, investment academies, investor education activities, and other diversified forms of investor education to continuously improve the effectiveness of investor education.

Huanan Securities also mentioned that in response to the unfamiliarity of new stock investors with the basic trading rules of A-shares, the investor education base has launched a series of intimate measures. The base has produced a series of short videos called "Newcomer's Guide to the Market", each focusing on a core knowledge point, such as "One Minute to Understand the 'T+1' System" and "The Must-Know Terminology for Stock Market Novices", to help new stock investors quickly master the basics of investment. At the same time, it actively uses online platforms to carry out live broadcasts and short video online activities, regularly holds live lectures, and especially sets up a Q&A session to answer the audience's questions, thus forming a good atmosphere of two-way communication and knowledge sharing.

For old customers returning to the market, the person in charge of Dongwu Securities introduced that the first step for customers returning to the market is often stuck on passwords and accounts. In response to common problems, the company's official microblog has launched the "Old Customer Investment Guide Answer", which demonstrates in detail how to retrieve customer numbers, reset passwords, and perform basic operations such as bank-securities transfers in trading software. At the same time, for old customers with trading experience, an investment advanced guide has also been launched, actively popularizing the basic rules and appropriateness management conditions of business such as margin trading, the Science and Technology Innovation Board, and Hong Kong Stock Connect.

VI. "A Letter to New Stock Investors" Becomes a Standard ConfigurationBefore the National Day holiday, a sudden surge in the A-share market led to a massive influx of new retail investors. After the "miracle day" of October 8th, the market trend continued to decline, and trading volumes also fell. In just four trading days, the stock market "taught a lesson" to the new investors.

On October 8th, CITIC Securities, known as the "big brother of brokers," posted on its official Weibo account "To New Friends Entering the Market for the First Time." It suggested that new investors should "not rush and take steady steps." Subsequently, several other brokerage firms, including CICC, Guosen Securities, Ping An Securities, Guojin Securities, and Huanan Securities, released similar messages, offering advice to newly entered investors.

For instance, Guojin Securities published letters to new investors such as "To You Entering the Market for the First Time" and "A Beautiful Starting Point, the Process is Not Smooth." Huanan Securities, in its letter "To New Investor Friends," reminded investors that the stock market is a means to achieve financial goals, not the entirety of life. It advised against letting stock market fluctuations affect daily life and work emotions, maintaining a healthy lifestyle, and facing the market with a clear and calm mind to make more accurate judgments.