The Correlation Analysis Between Financial Derivatives And Financial Crisis

Financial derivative is one of the most profound changes in the international financial market in the past 30 years,it has cited a number of investment institutions and multinational companies of all ages by the function of price discovery and hedging risk.But with the deepening of innovation extending derivatives farther away from the underlying assets,the goal of innovation is becoming not to promote industrial upgrading and enhance economic efficiency,but to cover the traditional risk to speculative arbitrage,then derivatives will deviate from the nature that service the real economy,and become a booster increased market risk.Meanwhile,the international-contagion-Effect of derivatives makes every country has its impact,the degree just depend on country's position in the international financial system,even the empire,once the damage caused by poor regulation itself,will also bring its decline.In recent decades,the financial crisis has become more frequent and dangerous,seems to verify the above concerns about derivatives.Therefore,how to grasp the opportunity and make full use of derivatives to promote our economic development,meanwhile,bring experience from the past financial turbulence,draw lessons,and make good use of derivatives to enhance the vitality of markets,has become an extremely important issue.Therefore,this paper tries to find the footprint of derivatives from the period before the crisis,explore whether there is always the beginning or development of derivatives innovation before the crisis.It is of great practical significance for us to develop China's derivatives market.