Research On Risk Prediction And Its Governance Of Private Equity Investment

The so-called private equity funds(Private Equity,referred to as PE)investment,refers to the fund to take private placement rather than the form of public offering,through the listing of companies and enterprises of equity investment and financing behavior,and taking some legal means to sell equity to obtain a certain profit of investment and financing activities.As a new kind of centralized fund for investment,private equity funds include a variety of forms of investment,such as direct injection,Pre-IPO capital,the risk of mergers and acquisitions fund leveraged buyout,etc.Private equity funds,which have long been regarded as a closed form of investment and financing,often do not cause systemic financial risk,or the general external economic problems.With the modern capital market and capital transaction that are becoming more and more derivative,huge and globalization,private equity funds are beginning to show the potential risks,as the development of China's investment and financing market is not complete,which is particularly evident in the field of financial investment in China,this will cause a certain impact on the financial order and financial security,even led to the financial and economic crisis.Based on this,the theory is comprehensively used of private equity fund,principal agent theory and the concept drifting theory of data stream in this paper,and those are combined theoretical research with practical test,qualitative analysis and quantitative model,and the origin,formation mechanism,prediction and government are deeply studied of the investment risk of private equity funds.The main contents are as follows:Firstly,it is put forward the theoretical and practical significance of the prediction and government of private equity investment risk.Private equity investment fund not only provides a new source of financing for corporate financing,also it has a positive impact on the national economy,the capital market and the investment enterprise.At the same time,it also hides a lot of risk including excessive leverage ratio,market manipulation,conflict of interest,market transparency,as well as non-public financing and so on.As for the capital market itself being not perfect,the process of raising funds being not standardized,adverse selection and other reasons,these make it very easy to spread and expand the huge risk hidden in the course of operation,and then there may be the occurrence of systemic financial risk,which may induce financial crisis.Therefore,it is of great significance to evaluate and forecast the risk of private equity investment scientifically and effectively.Secondly,the causes are analyzed of the risk of private equity fund investment.In the process of the operation of private equity funds,there are multi agent relationships.Due to the existence of multi agent relationships;there is a large amount of information asymmetry between investors,fund managers and investment companies,this caused the private equity funds in the investment process to hide a great risk.From the perspective of risk sources of private equity investment,these risks can be divided into systemic risk and non systemic risk.According to the stage of the law of life cycle,these risks can be divided into early stage of investment risk,medium-term risk and late risk,the causes and effects of risk at different stages are different,they constitute the overall risk of private equity investment.Thirdly,the formation mechanism is discussed of private equity investment risk.On the basis of analyzing the causes of the risk of private equity investment,the internal mechanism and the law of the formation of private equity investment risk is deeply studied.Based on Different investment strategies of private equity funds,private equity funds are in the form of portfolio investment in order to spread the risk of investment,different rates of return on investments are different from the risk level,risk exposures of private equity is different.Because the external environment is formed by the external warning source and the fund itself causes the formation of endogenous warning source have a great conduction effects.After the volatility of capital markets,the risk of private equity investment has a strong effect on contagion and amplification.An infectious disease model of private equity investment risk is constructed in this paper,and the solution is carried out,and infectious disease model is used to analysis on the formation mechanism of the risk of private equity investment.Fourthly,the risk prediction system is constructed of private equity investment.According to the cause and formation mechanism of private equity investment risk,the general process of private equity investment projects is analyzed,and from the perspective of investment projects to define the level of risk of private equity investment,then the frame structure is constructed of the forecast system of private equity investment risk.On these bases,the index system is constructed of risk prediction of private equity investment,and the method of the concept drifting of data stream is chosen to predict the investment risk.Fifthly,the real risk of private equity investment is simulated and forecast.Based on previous researches,the concept drift method of data stream is used to forecast the risk of private equity investment,the selection process and standard of the empirical sample fund are put forward.From the Qing Ke group(Zero2IPO)database,they are selected for the top 30 private equity investment institutions 2013-2015 years of investment as an investment risk sample fund,the empirical samples have been simulated by parallel,series and hybrid classifiers in the concept of data flow.Combined with the random of the risk of private equity investment,the method of group decision making is used in the empirical analysis.At last,the governance strategy system is put forward of private equity investment risk.Based on previous theoretical research and empirical simulation evaluation,the four aspects of strategy system is constructed of private equity government in this paper,they are investment information disclosure mechanism,investment risk safeguard mechanism,external environment of governance and exit mechanism of private equity fund.In the process of construction of management strategy system,the combinations are emphasized innovation with application and theory with practice,so that the governance strategy system plays a proper role in the risk control and management of private equity investment.