Quantitative Exploration Of The Risks Of Internet Financial Wealth Management Products

With the development of the Internet,the traditional finance industry began to take the Internet "express" to reconstruct and reform,and the Internet finance came out.In 2013,Yu 'ebao,a financial products based on Alipay,was born,which is considered to lead the first year of Internet finance in China.Thanks to the tide of Yu'ebao,many Internet companies and financial companies have launched their own Internet financial wealth management products.Such products have traditional financial products features such as high liquidity,high security,and have the characteristics of different from traditional financing patterns,such as,low threshold,pay complete functions,wide coverage and high efficiency.At the same time,the products also have double risks brought by the traditional financial and the Internet,including web-based business risk caused by financial business characteristics and technical risk caused by information technology,which besed on the Internet.Once the Internet financial risk of financial products is out of control,both sides of the damages not only affects the investment and financing,but also for banks,insurance companies,Internet companies,regulators and other relevant institutions.So do not ignore risks of the Internet financial wealth management products,to strengthen risk prevention is very important.Because of the Internet financial wealth management products development time is shorter,most research is in the stage of qualitative level,quantitative research is few and lack of depth,lack the support from data,which is less persuasive.In addition,the lack of risk comparison research on different platforms and products is not objective and intuitive.In the financial time series risk measurement method,many studies only consider the volatility or the thick tail of the income unilaterally,and lack the multi-angle understanding of the risk.Therefore,it is an important part of preventing risk to quantitatively explore the risks of Internet financial wealth management products scientifically and rationally.Based on eight respectively from well-known Internet companies and the big four state-owned commercial banks to launch Internet fund products as an example,based on earnings volatility and thick tail on the Internet to quantify the risk of financial products.First,explore the background of the Internet financial risk of the products,including theoretical significance and practical significance.Based on domestic and foreign scholars in the field of research results,the risk of financial products from Internet research and measurement of financial time series is summarized,and put forward in this paper,which is based on views and opinions.Second,the main characteristics of Internet financial wealth management products in China with the risk theory overview:main characteristics of Internet financial wealth management products in China have low transaction costs,financing threshold low,pay complete functions,wide coverage,high efficiency,strong information liquidity,etc.The main risk is liquidity risk,credit risk,payment and settlement risk,legal risk,choice of security risk,technology risk,etc.Third,risk quantification of Internet financial wealth management products in theory to explore the main method of summary and evaluation.Choose a suitable for China's Internet financial products yield characteristics of risk quantitative approaches:risk value of VaR and conditional value at risk CVaR,EGARCH model describing the earnings volatility,and the tail based on income distribution method of extreme value theory model of POT.Fourth,take the eight Internet financial wealth management products as samples for empirical analysis.Analysis steps including basic statistical characteristics of the test and analysis,based on the EGARCH model financing product revenue volatility of exploration on the Internet,and POT method based on Internet financial VaR and CVaR an analysis of the financial product yields.Finally,through the theoretical and empirical analysis,some main conclusions and puts forward relevant countermeasures and Suggestions.Through the analysis of the results of the study,found that:1.Large fund size and stable yield are conducive to product safety operation.2.The quantitative exploration of risk by EGARCH-POT model is more multifaceted and predictive.3.The risk of earnings fluctuation of financial wealth management products introduced by Internet enterprises is generally greater.4.The risk value of Internet financial wealth management products in the four major state-owned commercial banks is of great value.After a summary of the results of the study,puts forward some relevant countermeasures and Suggestions:1.Clear Internet financial wealth management products supervision subject and object.2.According to different risk type differential risk prevention mechanism,strengthening technical supervision.3.Strengthen the information disclosure of Internet financial enterprise self-discipline,to speed up the pace of compliance is changed.4.Accelerate the construction of relevant laws and regulations system.5.We will improve the mechanism of the third party rating,from the perspective of social norms Internet financial wealth management products.6.To strengthen the construction of network safety,ensure the safety of transaction.7.To strengthen the publicity and education of investors,improve risk awareness.Innovations in this paper,combined with statistical analysis method,to explore the eight the risk value of the Internet financial wealth management products,and from the perspective of the Internet and bank industry,take eight products risk into classification comparison,in order to provide investors with financial wealth management products on the Internet the understanding of the risk of multiple perspectives.The reasonable use of financial management of capital to invest,and provides some reference opinions to regulators.In addition,based on earnings volatility and thick tail,combines EGARCH model and extreme value theory model of POT,quantify the value at risk of financial products on the Internet,the idea and method may provide some references for research on the risk of other financial products and using for reference.Shortage of this paper lies in that,due to changes in the Internet features such as fast,its impact on Internet financial risk financial products is full of unknown,this paper chose only limited Internet financial wealth management products as the object,cannot be completely characterizes the risk of such products.Based on the background of the Internet,compared with other risk measurement methods,this article on the Internet to explore the risks of financial products method is optimal,it remains to be further explored and discussed.