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Loans Of China's Stock Index Trading Patterns And Concept Of Operations

Posted on:2001-08-22Degree:MasterType:Thesis
Country:ChinaCandidate:L ChengFull Text:PDF
GTID:2206360002951711Subject:Finance
Abstract/Summary:PDF Full Text Request
The rapid expansion and the fast development of financialderivatives have become the most apparent and important characteristicof contemporary international financial markets. Since the first financialcontract came forth in l972, the kinds of financial derivatives havecome to over 1200. Of all these kinds, the stock index future, acting as akind of effective instrument to operate stock market risks fOr stockinvestors, plays an important role in derivatives market.The stock index future is a kir.d of standard agreement with whichthe buyer and seller agree to settle at the promised price in future. In 70sof the twentieth century, all developed countries in the world wastortured with the petroleum crisis and the stock price fluctuateddramatically, the stock investors cried for a new financial instrument bywhich they can avoid the systematic risks in stock market. So, when thefirst kind of stock index future -the Value Line Average was invented byKCBT in 1982, it was quickly accepted by the investors. And at no time,many stock houses and future house supplied their stock index futures.By now, over 40 countries have this kind of financial derivatives.Why stock index future is so popular? It owes to its specialcharacteristics of rapid mobility and high level-rate. In stock indexfuture market, the hedgers can transfer their price risk to the speculatorswho participate in because the high level-rate of stock index future makethey can utilize massive amount fund with little investment and such mayprobably bring them high revenue. In this process, the equilibrium pricecome into being gradually and the stock market will improve its mobilityand effectiveness.As the expansion of Chinese stock market and the growth-up ofinstitutional investors, in recent years, more and more theorists proposedeveloping Chinese own stock index future. The reasons mostly are thatto consummate the functions of Chinese stock market, China mustachieve the aim of setting up multi-kinds of stock products, and the birthof index future will be a key to it.And this paper analyses how to construct Chinese stock indexoperation mechanism. Most questions that are heatedly discussing atpresent will be settled here.Five chapters make up of this paper as folIowing:Chapters l firstly introduces the stages of stock index future'sdevelopment. On basis of that, the author analyses the functions of indexfuture and explain why stock index future can improve the functions ofstock market. At the end, the author summarizes the necessities andpossibiIities of Chinese setting up stock future index from the view ofthe institutional innovation of Chinese securities market and futuresmarket.Chapter 2 analyses the choice of the transaction mode of Chinesestock index future. The author thinks, after introducing the trend ofmerger of stock house and future house in developed countries andcombining with Chinese practices, Chinese stock index should be set upat securities house with a transaction mode of integration.Chapter 3 analyses the content of Chinese stock index future'scontract. As the core of stock index future, the author constructs aparticular contract with (l)new kind of index, the author thinks that atpresent both Shanghai's and Shenzhen's index is not perfect for the stockindex future, it should take great effort to construct a new kind of indexwhich would be a composite index consisted of 200 to 300 companiesand calculated by current stocks; (2) muItiplier of 50 point to l00 point;(3) 20% rate of originaI guarantee fund and 75% rate of maintenanceguarantee fund;(4) the smallest quotation unit of l point or 0.5 point, etc.From the principIes of effectiveness, fairness, order and reducingsystematic risks, chapter 4 gives the proposals 'of estabIishment of2transaction and settlement operations of Chinese stock index future.Since the stock index future will be set up in securities house,...
Keywords/Search Tags:China', s
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