An Analysis Of The Hedging Function Of China Futures Market

It has already 14 years after the Zhengzhou grain wholesale market promoted the futures mechanism in October, 1990. The development time although does not long, but the experiences in the China futures market developing process the difficulty, and is not inferior to the other futures markets. One of the basic economical functions of futures market is the risk shift, and to achieve this goal the most commonly used method is hedging. Hedging is the driving force of the futures market, which was deciding the futures market existence and development. Without hedging the futures market will lose the existence significance.Through hedging we can achieve the goal that shift price undulation risk, this is the reason of precisely the prompt sale and the futures market attracts more producers and operators. The on-hand merchandise operator carries on in the futures market to hedging, can beforehand to own management profit have a basic estimate, therefore the value to contain in the futures market quoted price to the market rational analysis factor, only in the rational analysis foundation, can make the decision-making which avoids to the risk, and is advantageous to the realization of price discovery function.Many domestic experts believed that, to standard the futures market must have vigorously to cultivate hedging, enables the economical function of the futures market to display well, first is encourage the enterprise to participate in hedging. It can be said that, the futures market was precisely caters to the enterprise to avoid the risk. The guidance enterprise involves a futures market participation set hedging is one of futures exchange's responsibilities. Hedging transaction the increase to be already advantageous to enterprise's production management, also is advantageous to the suppression the speculating behavior in futures market. To develop hedging is the objective need of socialist market economy, is the essence requests of the development of Chinese futures market. The futures market only has a full display hedging function, can produces themanagement for the market economy development and the enterprise to provide the effective service. But, at present our country's futures market still occupied the experiment site stage, the market mechanism not yet improves, the stock speculator compelled the warehouse phenomenon repeatedly to have the occurrence, in the current futures market a set of time guaranteed the value to be insufficient, hedgers by far weakly to the speculator strength. Just like W ?Grossman pointed out, " In China, the loss which the value suffers because has not carried on hedging, be much bigger than the loss which brings by accidental transaction defeat." China futures market's foundation is not jail, stability bad, transaction variety few, and certain exchange supervising and managing not to be lax, forward price undulation unusual, the market is unable the assurance, the transaction dispute and even the lawsuit is unceasing, enormously has disturbed the market order. Fundamentally said that, the initiative, the encouragement and guarantee the protective covering time to guarantee the value, is promotes our country futures market health development, to decide our country futures market life and death the important matter.Through the research on the hedging theory, analyzes hedging and the congenial transaction proportion relations in our futures market, and the validity of hedging, may study our country futures market whether fully displayed a set of time to guarantee the value function. This article attempts from the value of hedging, and the evolving of hedging theory, the present situation of hedging in China futures market, the restriction factor and countermeasure which blocks hedging function of China futures market. This article has three major parts, approximately 38000 words.First: the value and the main function of hedging and its the theory evolution. In this part, the author first introduced the concept of hedging, the basic realization form of hedging, and th...