The Analysis on Chinese Listed Companies Huge Return of Equity Financing;

According to the model,we can see that the firm with relatively expected low-productivity will choose equity financing for M&A,and the firm with relatively expected high-productivity will choose debt financing for M&A,and the firm with expected medium-productivity will not choose financing from outside.

The reasons for the weakening in equity financing and debt financing of China s companies are then pointed out.

The advantage of stock ownership financing in moden enterprise and the reason that enterprises have a partiality for stock financing in China were analyzed on emphasis.

e stock ownership financing and debt financing (including bonds and loans obtained from banks or other financial organizations)occupy in regard to the total capitals of the enterprise.

Study on Compare of Corporate Stock Financing Behavior between America and China;

Their financing behaviors violated the Financial Law of modern financing theory, resulting in the strong preference to stock financing, which has brought about some problems such as the low efficiency of stocking capitals, poor performance caused by excessive stock expansion and abnormal operation of financing system, etc.

Research on the Equity Finance of China s Listing Companies;

Over the past years, the judgment of excessive equity finance by Chinese listed companies has been to a large extent based on perceptual knowledge rather than theoretical analysis and explanation.

It is necessary to introduce guarantee fund for equity finance for the purpose of establishing a binding system and accountability system, facilitate credit building, avert market risks and safeguard the interest of investing public.