The Influence of Asset Securitization on Financial Market
The influence of asset securitization on the equilibrium of money market. The analysis of the characteristics of asset securitization shows that from the perspective of financial market development, asset securitization improves financial efficiency, but at the same time intensifies the volatility of financial markets. As a trading place of property rights and income, asset securitization financial market often does not involve the asset itself, but only trades all its rights and interests and asset-backed securities representing the expected future income of the asset. In essence, it is a way to disassemble or divest the principal and interest of related instruments in order to trade the future rate of return of securitized assets. However, because the market of asset-backed financial products (asset-backed securities) is formed on the basis of primary financial markets (such as bonds, stocks, options and futures markets), the factors of price changes among them are the same, so their value changes have similar laws. Besides time, the price changes of asset-backed financial products are highly correlated with the prices of two markets (money market and capital market). Therefore, the market of asset-backed securities will be related to other primary markets.