The Risk Assessment Of Offshore Finance And The Dentification Of The Best Portfolio

Since China’s accession to the WTO, the development of offshore finance has obtained great achievement. In addition, in recent years, such as the RMB joining to the SDR, "One Belt And One Road" strategic vision, Shanghai-Hong Kong Stock Connect program etc., we all need the support of offshore financial business. But at present, domestic commercial banks to set up offshore financial business have not formed a set of relatively complete system of norms. On such occasion, the paper puts forward a volume control model with mathematical analysis characteristics timely.Offshore finance helps promoting rapid economic development, but it also makes an impact on the stability of the economy, especially the imperfect current economic system and immature financial market in China. So, it has a realistic meaning to clear characteristics of offshore finance and risk and seek for a right method to measure the risk.In this paper, we get the mathematics characterization of offshore finance after its classification; for the first time we put forward the discrete and continuous control models of the best portfolio, and get the analytic solutions of the optimal portfolio.Firstly, the risk of the offshore financial business is identified and measured. We use the WBS-RBS method and obtain the risk identification results under two dimensions of general and special risk. Moreover, with the multidimensional risk measurement method, we obtain the general method of risk measurement.Secondly, discrete and stochastic business control models are established. Expected default probability and discrete optimal control theory are applied in the business control models. The optimal risk factor is obtained through HJB equation.Finally, two examples are presented. The results show that the proposed offshore financial business control models have certain rationality and practicality, which means the models have high theoretical reference value regarding with the related business.With unique research perspective, we have studied the offshore financial business risk and business scale, whose results are new. What’s more, the results for related business risk and its business scale study have higher theoretical reference value and practical significance.