Study On Market Risk Management Of BOC Paper Gold Investment

In recent years, with the sharp rise in price of daily necessities in China, people areincreasingly feeling the pressure of inflation. The capability of against inflation triggered lotsof people to invest in gold. Paper gold by definition can be understood as a paper-basedgold transaction. Investors buying and selling gold is recorded in the pre-opening bankaccount—paper gold account, and do not need the extraction of physical gold. Throughlow-profit models to buy high-sell access to post profits. Because of low investment threshold,easy account opening, simple operation, Paper gold attracts many individual investors, andbecomes one of the most popular ways of gold investment. Account amount of paper preciousmetals trading in2011, ICBC had exceeded910billion Yuan, the number of customers morethan300million. Thus, the paper gold investment has become an important means forinvestors in gold investments.This paper researches some related BOC paper gold investment risk management issues.The first chapter makes a simple introduction of the background, significance and researchmethods, also reviews some domestic and international financial risk management researchachievements. The second chapter introduces the concept and status of paper gold in China,and analyzes the main factors affecting the price of paper gold. The third chapter discusses thecontent of BOC paper gold investment risk identification, including market risk andnon-market risk. The fourth chapter study on the assessment of BOC paper gold market riskby building Chinese paper gold investment VaR-GARCH model, which carried on theempirical analysis by using BOC paper gold price data. The fifth chapter proposes somemethods about the market risk control. The sixth chapter is the conclusions and researchprospects.The paper intends to establish its theoretical ground on the basis of the financial riskmanagement research achievements at home and abroad, using a combination of normativeand empirical analysis to study BOC paper gold market risk management issuessystematically, conducting qualitative and quantitative methods to BOC paper goldinvestment risk identification, making an empirical analysis to paper gold market risk of BOCby VaR-GARCH model, and then raised some paper gold market risk control methods.