Commodity Futures Market Risk Control Study Of Non-normal Price

Futures market is established for risk management, but it also lies a great deal of risks in this industry. Looking back through the hundred years history of futures market development, risk management and concrol are an inevitable problem that those organizers and managers in this market have to face all the time. For each steps in its growth, how to arrange and control risks is undoubtedly the toughest job.Presently, China's political environments tend to be much better and introduce a broader way to develop its futures market. The compendium of the tenth "five years project" and the sixteenth whole party congress discussed on how to develop the futures market and how to correctly deal with the relations of fictitious economy and entity economy, which swept off obstacles of futures market development in theory. In 2003, CSRC is about to take series of actions to encourage the development of futures market and the launch of new products including cotton and corn futures is in the process. However, risk resources and risk management are still major topics.The principle of this paper combines both macro and micro with theoretical and practical analysis together. First it begins with risk control theories in futures market from basic understanding, then come to its core content, i.e. where the abnormal price risk generates, which is drawn on the basis of two case studies. Second, based on current status and future growth of China's commodity futures market, this paper applies comparison research methods to search the difference of risk control in futures market between foreign countries and China, also to find out the weakness of China's futures market. Finally, the paper makes useful recommendations to futures market in China.There are five parts in this paper. The first part is introduction, describing the topic background. The second part summarizes the existing theories and introduces characteristics and risks of the futures market. The third part talks about the main cause for the risks of China's futures market and explains the four sources of risk under the new environment, fourth the fifth part suggests some new measures on abnormal price risk control. At last the part gives two cases on abnormal price risk, which are about the Zhengzhou Wheat Futures Market and Shanghai Rubber Futures Market.