Analysis On The Effectiveness Of China 's Agricultural Products Futures Market

Chinese futures market has shown good momentum of development after ten years of rectification and development. Normative and proper Futures markets are really needed in mature socialistic market economy. How to make good use of the futures market, as China’s economic construction, is an important issue in China’s economic transition period to study. Constant spot market, price discovery and price risk hedging can only be achieved in mature and effective futures markets. Based on effective market theory, this article uses demonstration analysis and contrast method. This paper firstly describes the background and current situation of China’s agricultural futures markets. By analyzing the distribution and volatility of the return rates of Chinese soybean oil futures through the use of soybean oil futures spot price correlation coefficient method, ADF unit root test and Johansen cointegration test, vector error correction model, impulse response functions and variance decomposition associated test to study the dynamic relationship between futures and spot prices, this paper has been found that the price of futures and spot markets price is inextricably linked, however, the overall efficiency of the agricultural futures market is still low, the function does not fully played, has not yet reached a weak-form efficient. In the final chapter, the efficiency of the Chinese agricultural futures markets have been thoroughly analyzed and some specific approaches have been put forward, which intends to provide the government with some helpful suggestions for making policy of the normative development of the commodity futures markets.