Empirical Study Of Chinese Security Investors Protection Fund Based On BSDE

The security market has just sprung up in China recently. However, many securitycompanies go bankrupt and investors disinvest because of the financial crises orinternal operation risks. As a group with lower bargaining power, the interest of smalland medium security investors is undoubtedly vulnerable to damage. Based on thisfact, the government of our country issued Measures for the administration ofSecurities Investor Protection Fund on June30,2005, and registered Security InvestorProtection Fund Company on August31,2005, both of which marked the beginningof protecting the security investors. Needless to say, it is of great significance toestablish the Security Investor Protection Fund (SIPF). On one hand, this system caneliminates the unlimited liability bearing by the government for the business failure ofsecurity companies. On the other hand, it proposes a long-term mechanism to solvethis problem, which can stabilize the domestic financial market. However, at presentthe SIPF is not mature in many aspects, such as investment operation mechanism andscope of compensation. Learning the experience of other countries will be of greathelp. SIPF is a protection system recommended by many countries, which can protectthe investors effectively. Thus, it also plays a significant role in protecting the smalland medium investors and stabilizing the financial market. The markets andsupervision modes are different in different countries and stages, and so are the SIPFs.This thesis first establishes a research framework comparing different SIPFs, thentakes the development of SIPF in America, Canada, Japan, Hong Kong and Taiwan astypical examples. After concluding the functions, financing and compensations ofSIPF, this thesis summarizes the general laws of SIPF and indicates their trends ofdevelopment. Based on the security market and backward stochastic differentialequation, this thesis studies the capital sources, operation mechanisms, budgetsystems and empirical studies of the SIPF in our country, and put forward newmethods to protect the small and medium investors. Some attention to the key pointssuch as balance of payments integration is paid also. Last but not least, this thesisresearches the advisable experience of SIPF’s financing, compensation and so on, andgives some advices to improve the domestic SIPF. Out of question this thesis will beof great help in fulfilling the functions of SIPF such as market risks disclosure andprice discover. And it has important practical significance on developing the domesticfinancial market and improving the financial system as well.