Is Zhejiang Jinke Equity Pledge Good or Bad?

Equity pledge refers to the pledge established by the pledgor with its equity as the pledge target. Equity pledge is a financing tool, which can be used to fill the cash flow and improve the operating conditions of enterprises. However, its potential liquidation or explosion and loss of control risk to maintain equity. Whether the impact on the stock tends to be favorable or unfavorable depends on the actual situation.

1, positive inventory situation

If the company pledges its equity to obtain liquidity and hopes to operate its main business or launch new projects for this purpose, it is also good, after all, it is conducive to opening up territory. In addition, if the stocks you pledge are circulating stocks, that is to say, the number of stocks in the market has decreased and the demand has not changed much, then the amount of funds needed to pull up the stocks has decreased, and it is easier to open the market if it is in the market.

2. The situation of bad stocks

If the listed company only pays short-term debts, which has nothing to do with the company's development plan, it will make the company's financial difficulties surface and reduce investors' expectations and goodwill towards the company. Furthermore, if the equity is highly pledged, if the stock really falls below the warning line, once the securities company sells the pledged stock, it will easily lead to bad feedback. In other words, the market is too emotional about the stock because the securities company sells the pledge, which will eventually lead to the possible decline of the stock price.

Generally speaking, equity pledge is a financing tool, which can be used to supplement cash flow and improve the operating conditions of enterprises. Because there are some potential risks in equity pledge, such as closing positions or exploding positions, it is out of control to safeguard equity, and whether the impact on stocks is good or bad ultimately depends on specific circumstances. Don't judge blindly, you need to analyze the specific situation.

This answer is provided by Kangbo Finance, focusing on the interpretation of financial hot events, the popularization of financial knowledge, the pursuit of professionalism and interest, so that the financial content that the people can understand can convey financial value in vivid and diverse ways. I hope this answer is helpful to you.

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