Research On The Application Of Arbitrage Trading In China’s Zinc Ingot Trade

Bulkstock have become one of the important commodities in China’s economic development.bulkstock refer to commodities that can enter the circulation field,but are not retail links,have commodity attributes,and are used for industrial and agricultural production and consumption.As one of the bulkstock,zinc ingot has the characteristics of large trading volume,large capital occupation,large price fluctuation and wide circulation range.The development of zinc ingot trade and bulkstock trade complement each other,from barter and scattered trade to regular market trade,and further to fixed centralized trade market.With the evolution of trade form,new business models such as sample trade,forward contract,futures and option prototype have developed.In the evolution of zinc ingot bulkstock trade form,zinc ingot itself has commodity and financial attributes,and the trade market is also closely related to the financial market.Futures play an important role in zinc fixed trade.The main reason is that futures have the functions of discovering the real price,avoiding price risk,slowing down market price fluctuation,providing benchmark price for the spot market and reducing the purchase cost.These functions not only promote the development of zinc ingot industry,but also bring great economic benefits to enterprises carrying out zinc ingot trade.Zinc ingot price is affected by various factors in trade,and the price will fluctuate violently.In the process of price distortion and return,there is the possibility of arbitrage opportunity.Its essence is to earn the price difference profit in the process of price distortion and return to rationality.Zinc ingot arbitrage trading is helpful to the price discovery function of futures market;It also helps to improve market liquidity.Arbitrage trading is often referred to as the lubricant and shock absorber of the market;Arbitrage not only greatly improves the trading volume of the futures market,arbitrage traders obtain the income of price difference changes,objectively become the counterparty of other traders,including speculators and hedgers,take the initiative to bear the price fluctuation risk of unilateral contracts,and greatly improve the activity of trade transactions and market liquidity.This paper briefly analyzes the current basic situation of China’s zinc ingot trade,focusing on three different forms of arbitrage in zinc ingot trade:up discount,monthly difference,regional difference and their corresponding future cash arbitrage,intertemporal arbitrage and cross regional arbitrage transactions,and through historical data tracking Empirical analysis,establish Arima prediction model and cost analysis,find the arbitrage opportunities of zinc ingot trade,and put forward corresponding operation strategies and guidelines,so as to effectively avoid the risk of relative price in zinc ingot trade,turn danger into opportunity and turn it into more economic benefits,so as to promote the long-term and stable development of zinc ingot industry.