Research On The Application Of Financial Derivative Instruments In Corporate Finance

Financial derivative instruments provide a useful tool to hedge manage kinds of risk and assets for the financial institution corporation and investors, while it also becomes some investors' best choice to speculate because of its lever effect and powerful profitability in the market. With the growth of financial derivative instruments transaction in the world wide, its effect increasing reflects in the macro economic and corporate finance. But, it was brought into China later than other countries and still in the primary stage now, its use is limited to sever financial institutions and corporations. The common corporations and investors can't contact with and come to understand the financial derivative instruments, to use it to evade the risk and gain the profit in the finance. With the development of national financial market, financial derivative instruments will be the important tool in corporation financing. The thesis aims at the application of financial derivative instruments in corporate finance, is expected to put forward some valuable proposal about how to use financial derivative instruments in corporate finance, through the analysis of basic theory of financial derivative instruments, the research on how to use financial derivative instruments in corporate finance and the investigate of the control of financial derivative instruments risk.The national corporations urgently need to use financial derivative instruments to evade and transfer financial risk currently, but it is not the time to speculate at the same time. The corporation use financial derivative instruments to hedge, mainly performance in the management of interest rate risk, foreign exchange risk, stock risk and so on. The thesis discusses the corporation how to choose and take advantage of different derivates to evade kinds of risk. Financial derivates also used to manage the stock price , adjust the capital structure etc. Meanwhile financial derivates generates a new risk, so the corporation should control and manage this risk. The thesis puts some suggestion about relevant internal control system, through the analysis of the basic characters and cause of financial derivates risk.