Study On Financial Derivative Instrument And Its Risk Management

The production and development of financial derivative instrument is the product of the world's economics finance integration, the various countries' finance liberalization, and the international finance innovation. Since the 1970s, in the background of financial innovation, financial derivative instrument has poured great energy into the entire capital market, but the risk which it has brought is also high.Since the reform and open policy, China had carried some experiment work on the aspect of futures,stock,national debt and so on.In the background of the world's economics integration and China joining WTO, opening the domestic finance market gradually,and impelling finance liberalization is a inevitably choice for Chinese government. The promotion for the development of financial derivative instrument is not only the need for both of the China financial system and the international finance system,but also the inevitably request for Chinese enterprise and the financial organization participating international competition, dodging supervision and guarding finance risk.However,financial derivative instrument just like a double-edged sword,it brings new financial risk actually when dodging and shifting risk.Since the 1990s,it's a common occurrence to see mint loss and bankruptcy related to financial derivative instrument business in the international finance market; At the same time, financial derivative instrument also become a main method for the international floating capital to snipe the developing countries.Therefore,in view of the inevitability of developing financial derivative instrument and the importance of risk management on the both of financial theory and practice in China, this article has done some research and analyse on financial derivative instrument and its risk management,in order to play a certain instructional role for developing financial derivative instrument in China.