Research On Risk Management In Financial Supply Chain Based On Behavioral Finance Perspective

Demica published a report in early 2007, which showed that 73 percent of the European large-scale enterprises were exerting downward pressure on prices to its suppliers on one hand;on the other hand,they were extending account period of the payments to these suppliers, thus many supply chains faced the risk of financing chain breaks. Therefore, financial supply chain is the supply chain that financial flow plays an important part in the function of integration and coordination in the fields of logistics and information flow. Its importance gradually attracts much attention of academic circles and business circles. Compared with the management of a single enterprise financial flow, Financial Supply Chain Management (FSCM)'s rage is wider and faces more complex uncertain factors. Therefore, in order to implement the risk prevention of the financial supply chain, we should consider financial risk and supply chain risk together. Modern theory of finance and its models are mostly based on the Rational Agent Theoryand Efficient Market Hypothesis (EMH), and their research paradigms are also constrained by the analysis frame of complete rationality. The rational people hypothesis of financial markets, which is fit for the construction of theoretical system, but it neglects the actual decision behavior of Economic man.With the accumulation of abnormal phenomena in the financial market, it has to face the embarrassment that aroused by the deviation between the results of model and actual data. As the game theory and experimental economics being accepted by mainstream economics, the behavioral finance theory that developed from the end of 1970s to the beginning of 1980s gradually begins to shake the authority of CAPM and EMH. Currently, the behavioral finance theory has gradually become an active field in the financial research. It gives a profound reflection to the modern financial framework, explains market behavior from the aspect of people, and fully considers psychological factors of market participants.It provides a new perspective on the study of the the risk management and the research of financial market.This paper firstly analyzes the methods of risk identification of current financial supply, and uses the methods of classification analysis to study the potential financial risk it faces. Through the analysis we find that there are too many indexes on financial supply risk. So the proposed Artificial Neural Networks(ANNs) based on the analysis of the principal constituent not only simplifies the index, but also increases the speed of convergence rate and attains better effects. According to the classification and quantization of risk in chapter 2 and the introduction of risk management approaches in the traditional finance theory in this chapter, the paper analyses the drawback of traditional theory and put forward a solution that we can use Behavioral Portfolio Model (BPT-SA model) to model the assets with different risk. According to the instance data, we can use portfolio model (BPT model) of behavioral finance theory to model the assets with different risk and use Particle Swarm Optimization (PSO) to program and to solve. Simulation experiments show that the model can solve the problem of management of credit risk in financial supply chain, allowing excellent operability.Innovations of this paper is that behavioral finance theory is introduced into the risk management in financial supply chain and it builds bank credit model (LBPT-SA model) based on behavioral finance theory and gives Particle Swarm Optimization (PSO).Comprehensive utilization of neural network algorithm (PCA / BP) provides a solution to make risk identification for financial supply chain.