Research For Price Risk Management For Benzene Future Trading In Shanghai ZR Company

Accompany with the development of the global economics, the requirement of the resource product has been intensely growth. This kind of product has been controlled under the national law. Every country is trying to protect it by policy.In another hand, after the global economic crisis in 2008.the economy has been felled down all the time, also the product prices. Profit of the companies went down accompany, risk is raising day after day, under this background, how to predict the risk for the market becoming more and more important.Shanghai ZR Company is a petroleum trading company. It mainly importing and distributing resource products, such as Gasline, Liquid Petroluem, Raw Paper and Rubber in China market. Shanghai ZR Company trading in Southeast Asia, Northeast China,Middle East and Europe markets. It deal in spot and future markets. After the global crisis, the company risk on product prices become more and more serious, the traditional way to predict the price crisis does not work anymore, it leads to big loss in especially Benzene trading. For solving this problem, the managing group decide to do some effort on price risk management.This dissertation is mainly use POT model based on extreme theory to evaluate the value at risk. The Plattes Benzene Price Index has been chosen for this research. By the analysis of the extrem theory based value at risk we reach the more accurate evaluation to the price risk, it could be used as reference for the trade, not only for Benzene. This is theory can be used in other products like rubber in the future. To improve the risk control ability for Shanghai ZR company.