The Return And Risk Analysis Of Stock Index-linked Structured Product

With the rapid development of the financial market and the enhancement of investors’ awareness of financial management,financial management has become an important transformation direction of innovative development for commercial banks.As innovative investment products,structured financial products are increasingly favored by investors relied on their rich pegged and flexible income space.With promote of financial innovation,structured financial products are introduced,and product designs are becoming more and more complex.If the issuer’s risk warning is insufficient,and the information disclosure is incomplete,some non-professional investors will blindly pursuit of high returns and investment in products that do not match their own risk tolerance.That may cause large losses,which is not conducive to the healthy development of the financial management market.This article selects the typical stock index-linked structured financial products in the market for case analysis.It aims to help investors have a deeper understanding of the benefits and risks of this type of financial products,and provide investors with a set of scalable analysis solutions of financial products,which will help them improve the financial management strategies and enhance their risk management capabilities.This article takes the "Golden Key ·Ruyi" 100 th stock index-linked structured financial product issued by Agricultural Bank of China in 2019 as an example.It uses historical simulation and Monte Carlo based on the GARCH model to estimate the product’s income,and conducts a sensitivity analysis of the product’s profit rate.According to the estimated results,the product’s return is within a reasonable range.Then,this paper uses the value-at-risk method to quantitatively measure the market risks faced by the product,and conducts a qualitative analysis of the risks faced by the product.It is concluded that the case product has a moderate risk level.Then,this article compares and analyzes the returns and risks of the case product with the same type of financial products from three perspectives:issuer,linked target,and term structure.The results show that the product’s rate of return is lower than that of city commercial banks and joint-stock commercial banks,but higher than that of state-owned commercial banks in the same period;meanwhile,the real rate of the caseproduct is higher than the structured financial product linked to gold in the same period,but the range of income of the case product is larger,and the risks born by investors are higher;from the perspective of the term structure,the longer the investment period,the greater the probability that investors will eventually get high returns is,but the higher the liquidity risk they face is.Finally,in view of the problems faced by the current development of structured financial products,this article proposes that it is necessary to improve investors’ financial literacy and risk awareness,strengthen the risk management capabilities of financial institutions,and improve the information disclosure system of financial products,which is helpful to protect the legitimate rights and interests of the investors and promote the healthy development of the structured financial product market.