A, Administration Of Futures Trading In Raw Material Prices Risk

A Corporation is a listed Corporation which deals in broadcasting and communication transmitting tube, vacuum interrupter, and the likes of electro-vacuum device. Copper is one of the most important materials which A Corporation uses. The prices of copper have dramatically increased since the year of 2003. Since A Corporation took no action to manage the risks of price fluctuation in the face of the growth of cooper price, A Corporation completely exposed itself to the risks of price fluctuation of cooper market. This led to the rise of the production cost of A Corporation year after year and the continuous drop of the primary business profitability. It effected seriously the consecutive development for A Corporation. The intention of studies in this paper is to seek to the solution which can avoid the risks of price fluctuation, then bring forward the further application method.Firstly, aiming at the financial reports of different fiscal periods since 2002, with the method of price fluctuation and factor analysis, this paper deeply analyzes the financial state of A Corporation. It is concluded that the increase of cooper price is the significant factor which influences business profitability, besides it will not eliminate in short-run. This paper introduces the basic function of future market in retrospect the developing processes of the future market in China. It illustrates that Chinese future market, especially the cooper future market becomes comparatively mature and normative market as a consequence of providing the effective channel for enterprises avoid the price risks.This paper depicts the basic theories of hedge associated with the actual practice of A Corporation, then analyzes the results of hedge. It implies that the hedge may effectively manage the risks of price fluctuation for A Corporation of so as to stabilize the cost and reduce the business risks. Meanwhile it researches the management institutional code of domestic future market. It shows that code of future market not only offers the fundament of law for bargainers, but also provides the guarantee for the...