Underwriting means that when securities are issued, the securities firm and the securities issuer sign an agreement to be responsible for the sales, which is divided into underwriting and agency sales.

Sponsorship means that when securities are issued, a special sponsor agency is required to recommend the issuance and listing of securities.

When an issuer raises funds through the securities market, it hires a securities operating agency to help it sell securities. Securities operating institutions rely on their reputation and business outlets in the securities market to sell securities within the specified issuance validity period. This process is called underwriting. It is one of the basic functions of securities operating institutions.

According to the different responsibilities and risks borne by securities operating institutions in the underwriting process, underwriting can be divided into four methods: underwriting, bidding and underwriting, agency sales, and sponsorship promotion.

Underwriting means that the issuer signs a contract with an underwriting institution, and the underwriting institution purchases all or sells the remaining securities and bears all sales risks. It is suitable for companies with large capital needs, low social visibility and lack of experience in securities issuance.

Tender acquisitions are usually conducted when investment banks are in passive competition. Securities issued in this form usually have higher credit ratings and are popular with investors.

Consignment underwriting is generally formed when investment banks believe that the credit rating of the security is low and the underwriting risk is high. At this time, the investment bank only accepts the entrustment of the issuer and sells securities on its behalf. If not all the securities issued within the specified time plan are sold, the remaining portion will be returned to the securities issuer, and the issuance risk shall be borne by the issuer itself.

Sponsorship promotion means that when the issuing company increases capital and expands shares, its main target is current shareholders, but it cannot ensure that all existing shareholders subscribe for its securities. In order to prevent difficulty in raising the required funds in time, or even cause When the company's stock price falls, the issuing company generally entrusts an investment bank to handle the issuance of new shares to existing shareholders, thereby transferring the risk to the investment bank.

The "sponsor system" for new stock issuance means that the sponsor (brokerage firm) is responsible for the issuer's listing recommendation and guidance, verifying whether the information contained in the company's issuance documents and listing documents is true, accurate and complete, and assisting The issuer establishes a strict information disclosure system and assumes risk prevention responsibilities. The sponsor institution and its sponsor representatives perform sponsorship duties, but they cannot reduce or exempt the issuer and its senior executives, intermediaries and their signatories from their responsibilities.