Researching On The Effects Of Financial Innovation On Wealth Management Development

The social progress makes people accumulating wealth in a fast way,so this phenomenon leads the financial products and services to be morepersonalized and diversified. According to the US history, it shows thatthe design of products depend on the application of the financialinstruments. From the1960s to1980s, financial innovation has focusedon the development of new financial instruments such as derivatives,computer technologies and the application of some new financialtheories.In the early1990s, Americans expand structured products businessvigorously. These structured products are the complex mixture of thebasic products and derivatives instead of the traditional products likefutures, options and swaps. The further development on the boundary ofthe financial product provides a variety of services for the wealthmanagement customer choices.The wealth management industry only exists for a short period of timein China. The related research conducts more fully in the development ofthe current wealth management industry and the necessity to carry it out.On the other hand, the study in the using of financial products and toolsfor wealth management is not enough. The domestic wealth managementmarket has great potential is evident to everyone, however, itsdevelopment is still slow. In addition to the constraint of governancesystem and the lack of professional employers, the limited financialproducts and tools is another important reason. Hence, in this paper, fromthe angle of financial innovation and based on the experience of thedeveloped markets, we will analyze the effect of financial innovation onthe development of the domestic wealth management industry. Based on the structure of this paper, it is divided into six chapters. Thefirst chapter introduces the background and the significance of this paper,summarizes the domestic and foreign wealth management research, andhighlights the innovation instruments and structure arrangement of thispaper. The second chapter analyzes the financial instruments in Westerncountries, the history of the innovation and the force to promote thefinancial innovation. Combined with the history and experience of thedevelopment at the wealth management market in western countries，the third chapter analyzes the effect of the innovation of financialinstruments in promoting the development of wealth managementbusiness. The fourth chapter not only analyzes the past, current and futuresituation for the innovation of financial instruments in China, but alsodiscusses regulatory challenges from the innovation. According to thepresent situation of domestic wealth management, the fifth chapteranalyzes the factors restricting the development of wealth management.The sixth chapter analyzes the development of wealth managementindustry under the financial innovation trend. By analyzing the case aboutthe new investment opportunities of the high net worth clients, thischapter discusses the internationalization path of Chinese wealthmanagement firms.