Operational Mechanism And Pricing Research Of The Catastrophe Bond

Huge disasters occurred frequently in recent years in our country,and caused huge losses to our country economy.According to China's national conditions,development of theory and practice of catastrophe bond has the necessity and feasibility.At present,foreign scholars in the aspect of catastrophe bond's theory research and practice started relatively early,relatively more mature,system.Foreign scholars mainly from catastrophe insurance risk securitization catastrophe bond content in economics within the framework of interpretation,the mechanism and pricing method of catastrophe bonds are conducted on relatively deep research,and also made more in catastrophe bond pricing theory of recognition.While China is now the study of catastrophe bond is still in its infancy,and no in-depth study,although there is a study of catastrophe bonds abroad for reference,put forward some opinions and Suggestions.However,the current domestic research in general are not enough system,the lack of considering difference of home and abroad.Therefore,this article will first catastrophe risk securitization products and other catastrophe bonds and comparison analysis,concluded that catastrophe bond is more suitable for development of our country,and from the catastrophe bond at present in our country development present situation,this paper analyses the necessity and feasibility of issuing catastrophe bonds in our country.Then,this paper discusses the mechanism of the catastrophe bond in terms of triggering events and triggering mechanism,credit rating assessment,distribution process and trading process.Then,from two aspects of financial theory and risk theory of catastrophe bond pricing model,this paper compares and analyzes for the choice of catastrophe bond pricing model to lay the theoretical foundation.Select the 2006 floods in 2006-2014 loss data,Matlab software iterative analysis of flood disaster loss data,loss distribution fitting,then to the capital asset pricing model as the flood risk bond pricing model,simulated flood risk bonds pricing to our country.Finally,Suggestions for the development of catastrophe bonds in China are put forward.