Empirical Research On Financial Crisis Forewarning Of The Listed Companies On GEM

The opening of GEM(Growth Enterprise Market) in October 2009 injected fresh blood for the development of the Chinese securities market. It’s launching also set an effective way of capital raising for the small and medium-sized high-tech enterprise in China. However, with the high risk the GEM was paid high attention by the parties concerned.Firstly this paper analyzes the current situation and existing problems that may cause financial crises of GEM in China, and then the financial crisis warning models are introduced and evaluated. This paper takes the 43 Chinese a-share listed companies’ ratios as the basis, which are the same industries and similar scale with the first 28 gem companies, and uses financial crisis warning Logit model to analysis the first 28 national gem listed companies’ financial risk. Then this paper puts forward early warning signals for the companies, and helps the investors make investment decision.