Stock Index Futures Hedging Rate Is A Comparative Study

Since 2006 stock market in China has kept soaring, which fully activated the stock market, set off an upsurge of investment in the stock market, while it also increased speculation factors and turbulence on the market. At this time, the introduction of stock index futures certainly has an important realistic significance.Stock index futures are the first financial futures at home. Investors in the stock index futures market knew little about the new product, so if the stock index futures introduced, the first batch of its investors should be institutional investors that are more technical and strong in fund, operating a relative business, and be eligible and capable to invest in the stock index futures.According to empirical analysis, it's found that the hedging rates estimated by different models have subtle differences in absolute volume, but it's improved significantly in relative volume. Therefore, for the small-scale investors, OLS model is more helpful, and for investors with higher technical requirements, GARCH model is in need.The creation of this paper is that at the very time the first stock index future to be introduced, two commonly used models are selected to estimate and compare the hedging rates of Hang Seng Index, the result of the estimation and compare will give some references to investors tending to invest in the HS300 Index Future.