The Investment Risk Management And Countermeasures Of Social Security Fund

After three decades of reformation and opening up, not only China economy has a continuousdevelopment, but also the level of People’s living has a very significant improvement. Socialsecurity insurance system becomes more sophisticated and robust, but the problems faced come inshowers, especially in how to increase the value of the social security fund has made thegovernment feel the pressure. In this context, using mathematical model and the knowledge ofportfolio investment to make a discussion on the Social security fund becomes one of the importanttopics.For that, in this paper, on the basis of introducing the development of the social security fundsystem, the requirements of the investment and the corresponding market environment, the risksand the countermeasures may be faced, the writer makes an explanation about safety-first model onrisk-control level, expected gains level and safety gains level. In the case of single account, theassumptions of the model, the necessary and sufficient conditions of the existence of the optimalsolution and the final formulation to solve the problem have been directly given. In the case ofmultiple accounts, a proof of the linear combination of the optimal results also standing on theefficient frontier leads to the linear combination model of multiple accounts and how to solve themulti-account model was also proved. The results of the safety-first model are got by using the datafrom national debt, corporation bonds and stock, and the analysis of the results leads to the furtherconclusions that we need to improve the ratio of the stock investment, also we need to strengthenthe risk management. Furthermore some views and opinions on the current phase of the investmentof social security funds have been given.