Bank counter service

*

Securities registration office

*

Brokerage intermediary

```

There were no:

```

Trading servers

Databases

Matching engines

Online terminals

Market data feeds

```

The actual market infrastructure consisted of:

```

Clerks

Paper registers

Stock certificates

Stamps

Telephone calls

Filing cabinets

```

From a modern software perspective:

> The 1986 securities counter was a completely manual version of a securities core system.

---

# 2. Early Securities Markets Had Multiple Ledgers

A common misunderstanding is that early stock markets only had shareholder registers.

In reality, several different records existed.

These manual records later became the database modules of securities systems.

---

## 1. Shareholder Register

Purpose:

> Who owns the shares?

Example:

```

Investor:

Zhang San

Stock:

Feile Audio

Holding:

100 shares

```

Later database equivalent:

```

POSITION

HOLDING

```

---

## 2. Stock Certificate Register

Purpose:

> Is this physical certificate authentic?

Example:

```

Certificate No:

FLYX000123

Quantity:

100 shares

```

Later equivalent:

```

SECURITY_MASTER

CERTIFICATE_RECORD

```

---

## 3. Cash Ledger

Purpose:

> Has the buyer paid?

Example:

```

Investor:

Zhang San

Payment:

5,000 RMB

```

Later equivalent:

```

CASH_ACCOUNT

BALANCE

```

---

## 4. Transaction Ledger

Purpose:

> What transactions happened?

Example:

```

Date:

1988-05-20

Security:

Yanzhong Industrial

Buyer:

Zhang San

Seller:

Li Si

Price:

50 RMB

```

Later equivalent:

```

ORDER

TRADE

EXECUTION

```

---

# 3. Why Were Feile Audio and Yanzhong Industrial Historically Important?

Because they transformed ordinary citizens from passive savers into shareholders.

For the first time:

```

Citizens

↓

Purchase company shares

↓

Become shareholders

```

became possible.

---

For example, Feile Audio issued shares in 1984:

```

Total shares:

10,000

Face value:

50 RMB/share

Capital raised:

500,000 RMB

```

The issuance process was still very primitive.

Employees handled subscriptions directly at the company entrance.

This shows that the securities market was still based on:

```

Company

*

Issuing Agent

*

Manual Registration

```

---

# 4. The Complete Process of Buying Shares in 1986

Assume an investor wanted to buy 100 shares of Feile Audio.

---

## Step 1: Obtaining Market Information

Information sources included:

```

Brokerage bulletin boards

Newspapers

Company announcements

Friends and colleagues

Market rumors

```

There were no:

```

Online quotes

Internet

Mobile apps

Real-time market terminals

```

---

Market prices were local.

One brokerage office might show:

```

Buy:

50 RMB

```

while another location might show:

```

50.5 RMB

```

Price discovery was slow and fragmented.

---

# Step 2: Visiting the Securities Counter

A typical securities office contained:

```

Market bulletin board

↓

Information desk

↓

Order counter

↓

Cash counter

↓

Settlement counter

```

The investor provided:

```

Name

Identity documents

Shareholder information

Desired quantity

Price

```

---

# Step 3: The Clerk Recorded the Order

The clerk created:

```

Buy request record

```

This was the ancestor of:

```

ORDER

```

in modern databases.

But the implementation was:

```

Paper form

Ledger book

Pen

```

---

# Step 4: Finding a Seller

This is the biggest difference from today's market.

There was no central order book.

It was not:

```

Buy order

↓

Automatic matching

```

Instead:

```

Buyer

↓

Brokerage counter

↓

Find seller

```

---

The brokerage acted as:

```

Broker

*

Information center

*

Settlement office

```

---

# 5. Why 1986–1990 Was Not Yet a Trading Seat Market

Many people incorrectly project today's architecture backward:

```

Investor

↓

Broker

↓

Trading Seat

↓

Exchange

```

But this structure did not exist yet.

The more accurate model was:

```

Investor

↓

Securities Counter

↓

Manual Matching

↓

Transfer Registration

```

---

The brokerage counter itself performed many functions:

```

Trading

Registration

Settlement

Information Distribution

```

---

# 6. 1990: The Shanghai Stock Exchange Changed Everything

The Shanghai Stock Exchange officially opened on December 19, 1990.

This created the first major separation of roles.

Before:

```

Brokerage office organizes trading

```

After:

```

Exchange performs centralized matching

```

---

The market structure became:

## Investors

Responsible for:

```

Buying and selling decisions

```

---

## Brokers

Responsible for:

```

Customer management

Order collection

Cash management

```

---

## Exchange

Responsible for:

```

Trade matching

```

---

## Registration Organization

Responsible for:

```

Final ownership records

```

---

# 7. What Exactly Was a Trading Seat?

A trading seat was originally not a software interface.

It was:

> The physical location and membership privilege that allowed a securities firm to participate in exchange trading.

---

Early structure:

```

Brokerage firm

↓

Trading representative

↓

Exchange trading floor

↓

Assigned seat

↓

Order entry

```

---

The seat had two meanings:

## 1. Membership Right

Who is allowed to trade?

---

## 2. Access Channel

Through which route does the order enter the market?

---

Later:

Physical seat:

```

Trading floor position

```

became:

Logical seat:

```

Trading connection identifier

```

---

This eventually evolved into concepts such as:

```

Seat ID

Trading Unit

PBU

```

---

# 8. The Real Data Flow Around 1990–1991

After exchange trading began:

```

Investor

↓

Brokerage Counter

↓

Brokerage Trading Staff

↓

Trading Seat

↓

Shanghai Stock Exchange

↓

Execution Report

↓

Brokerage

↓

Investor

```

---

## Order Flow

```

Customer submits order

↓

Brokerage records request

↓

Order transmitted by telephone

↓

Trader enters exchange system

```

---

## Execution Flow

```

Exchange matches orders

↓

Creates trade record

↓

Returns execution

↓

Brokerage updates customer record

```

---

## Registration Flow

```

Trade

↓

Clearing

↓

Settlement

↓

Ownership update

```

---

# 9. The Origin of Modern Brokerage Software

The software modules of the 1990s were simply digital versions of these manual processes.

---

## Customer Management

Origin:

```

Investor registration ledger

```

Modern:

```

CUSTOMER

```

---

## Account Management

Origin:

```

Shareholder records

```

Modern:

```

ACCOUNT

```

---

## Order Management

Origin:

```

Paper order slips

```

Modern:

```

ORDER

```

---

## Trade Management

Origin:

```

Transaction registers

```

Modern:

```

TRADE

```

---

## Position Management

Origin:

```

Shareholder books

```

Modern:

```

POSITION

```

---

# 10. Why Did Centralized Brokerage Systems Become Necessary?

Because brokerage networks expanded.

If every branch operated independently:

```

Branch A

Independent system

Branch B

Independent system

Branch C

Independent system

```

head offices could not manage:

```

Customer data

Risk control

Settlement

Trading connections

```

---

The industry moved toward:

```

Branch Office

↓

Head Office Centralized Brokerage Platform

↓

Trading System

↓

Exchange

```

---

This transition directly created demand for:

```

Centralized Brokerage Systems

Transaction Middleware

Message Routing

Trading Platforms

```

---

Which later became the market for systems such as:

```

Jinzhen KCBP

Jinzhen KCXP

Hundsun AS

Hundsun AR

```

---

# 11. Historical Significance of 1986–1991

This period completed three fundamental transformations.

---

## Transformation One

Stocks changed from:

```

Internal enterprise certificates

```

to:

```

Publicly tradable securities

```

---

## Transformation Two

Trading changed from:

```

Manual counter matching

```

to:

```

Centralized exchange matching

```

---

## Transformation Three

Ownership changed from:

```

Paper records

```

to:

```

Electronic registration

```

---

# 12. From One Stock Certificate to Securities IT

The complete evolution:

```

Paper Stock Certificate

↓

Shareholder Register

↓

Brokerage Counter

↓

Trading Seat

↓

Stock Exchange

↓

Securities Account

↓

Clearing and Settlement

↓

Centralized Brokerage System

↓

Securities Trading Platform

```

---

A small securities office on Nanjing West Road in 1986 may have looked insignificant.

But historically, it contained the embryo of China's entire securities technology architecture.

Modern systems such as:

```

Customer systems

Account systems

Trading engines

Settlement platforms

Middleware

Centralized brokerage systems

```

can all trace their roots back to:

```

One ledger

One stock certificate

One counter

One clerk

One telephone

```

The history of securities IT is ultimately the history of transforming human-operated financial records into digital financial infrastructure.
```