China's Futures Market Speculation Moderate

With important function of giving play to prices of finding , avoidingthe risk in the economic activity ,the futures market is the importantcomponent of the modern market economy. Since the futures market of our country set up since the beginning ofthe 1990s, after more than ten years of development , rectification ,developing again, it has already been on the way to developing steadily.But the question of excessively speculation is unable to l cure all the time,which has hampered forward market's progress. This paper analyzes the theory of the way to measure the degree ofmoderation of speculate in commodity futures market of China. It alsoanalyzes the state of excessive speculation in the commodity futuresmarket and the way to control it. This paper includes the following four parts: Part 1 summarizes the theory of hedge an speculation, whichincludes the conception of hedge and speculation in futures market andthe connection with in the two most important trade form of the futuresmarket. Part 2 discusses conception of "degree of moderation of speculationin futures market. Moderate speculation is very important in a futuresmarket to make sure hedge to be successful, it offers liquidity to thehedge. But if there is too much speculator than hedger in the futuresmarket, the risk of market would increase. Then we make research in howto measure the moderation of speculation. Part 3 is about the research of the whether there is too muchspeculation in futures market of China. The way of discussion ispresentation the development of futures market of China, point out therewere many risky affair in the history, and it reflect that there is excessivespeculation in the commodity futures market of China. Part 4 brings up some suggestions on how to improve the riskcontrol of the futures market of China , considering the situation ofChinas economy development and the characters of risk management ofthe futures market of China. The main innovations of this paper are as follows: 1. So far, it is thefirst time to make a thorough study on the degree of moderation ofspeculation in futures market of China 2. On the basis of expounding thegrain market of China at present time, this paper analyzes the "basis" and"turn over rate" of copper futures,soybean futures and rubberfutures ,from which we can measure the degree of speculation of thefutures market of China.