Abstract: This paper builds a representative firm’s cross-period decision model to analyze the firm’s optimal trading volumes at the quota-fulfillment day and the non-quota-fulfillment days. The equilibrium results show that the firm’s optimal trading volume at the non-quota-fulfillment days positively correlates to its own risk aversion coefficient, market maker’s risk aversion coefficient and the standard deviation of the random carbon demand at the quota-fulfillment day; while negatively correlates to the firm’s carbon output efficiency. Our model explains why in Chinese carbon pilot markets the trading volume is huge around the quota-fulfillment day while scarce at the non-quota-fulfillment days. We propose corresponding policy suggestions to help smooth the trading volumes and improve the efficiency of Chinese carbon markets.