The European debt crisis clouded over and Goldman Sachs was pushed to the forefront. Statistics show that Goldman Sachs used a financial derivative to cover up nearly 654.38 billion euros of debt for Greece, thus deepening the crisis. With the exposure of this business, many countries were accused of participating. Through the design of financial derivatives and leverage effect, their debts will not appear at present, but they will appear in the future. So does China need financial derivatives? What kind of financial derivatives do we need? Our reporter interviewed Xia Shasha, president of China Financial Derivatives Research Institute, on this issue.
When it comes to financial derivatives, many people may not be familiar with them. Can you briefly introduce financial derivatives to friends and the development status of financial derivatives in China?
This is actually very easy to understand. Literally, we can know that financial derivatives are financial-related derivatives, which usually refer to financial instruments derived from primary assets. Financial derivatives are a huge family, and many people feel a little strange. Perhaps it is a small variety or field that we usually contact. In fact, what we usually call futures and options belong to the category of financial derivatives. Its common feature is margin trading, that is, as long as a certain percentage of margin is paid, the full transaction can be carried out without the actual principal transfer, and the contract is generally settled by cash difference. Only contracts performed by physical delivery on the due date require the buyer to pay the full payment. Therefore, financial derivatives trading has leverage effect. This is easier to understand. In fact, we also applied the leverage effect when we borrowed money from the bank to buy a house.
China's financial derivatives market has developed with the reform of economic system and financial system, and has experienced many breakthroughs and hardships in the past decade. After several years of discussion and several failed attempts, China Financial Futures Exchange was established in 2006, which opened the prelude to the development of China financial futures market. So far, the question that you just asked whether China should develop financial derivatives is self-evident. Only four years later, the establishment of 20 10 stock index futures market marked the beginning of a new era in China's capital market.
I have a data here. 20 12, 1 14 Securities companies achieved operating income of 95.577 billion yuan in the first three quarters, and accumulated net profit of 26.342 billion yuan in the first three quarters, with 87 companies making profits, accounting for 76% of the total number of securities companies. As of September 30th, 20 12, the total assets of14 securities companies10.56 trillion yuan, net assets of 680.042 billion yuan, net capital of 482.879 billion yuan, balance of customer transaction settlement funds of 562.052 billion yuan, and market value of entrusted securities/kloc. The financial derivatives market has developed very rapidly, which has far exceeded the development speed of the financial market and the real economy.
Why is the financial derivatives market in China developing so fast? Is there any deep-seated reason?
I think it should be discussed from two aspects.
First of all, the development of financial derivatives market plays an important role in the perfection of a country's financial market and the development of its national economy. We only look at one function of it-hedging. Financial globalization makes the financial markets of various countries increasingly close, and the spread of financial risks is faster and faster, with increasing influence. Although the 1998 financial crisis, which started in Southeast Asia, was only a regional financial crisis on the surface, with the outbreak of the Russian financial crisis, the Asian financial crisis evolved into a global financial event. The financial turmoil in 2008 further proved that financial globalization has reached the point where it affects the whole body. In this case, China's financial system is facing great challenges, which urgently requires China to accelerate the development and improvement of the financial derivatives market. Only a healthy and mature financial derivatives market can ensure that we can have more countermeasures and methods when we encounter similar financial events, and we will not be helpless and trampled by others.
Secondly, there are few kinds of investment and low yield, which limits the huge investment demand. At present, China has the largest investment group in the world, and its investment scale is also in the forefront. However, the investment channels are limited to bonds, stocks, funds and a few derivatives, and there is a serious shortage of investable varieties, so the investment demand cannot be effectively released. Our survey shows that the vast majority of investors invest in funds, stocks and other products, and the proportion of derivatives is far less than that of developed countries with mature financial markets, so there is great room for development.
It can be seen that accelerating the development of financial derivatives market is an inevitable choice for the country, both from the national macro-economic perspective and from the perspective of investor demand.
Are there any shortcomings or hidden dangers in the rapid development of financial derivatives market in China? Where should we make greater efforts?
The first is that industry standards need to be standardized. Although China's financial derivatives market is developing rapidly, we can't ignore many problems such as insufficient financial innovation ability and weak overall competitiveness. From the international experience, this is an inevitable stage of the development of financial derivatives market. The reasons include policies, laws, the overall development level of the financial industry, industry experience and many other factors, but the lack of industry standardization is one of the main reasons. Due to the lack of standards, derivatives provided by domestic institutions often cannot meet the needs of enterprises for hedging, and enterprises often face great risks because they are not clear about the attributes and specific formation mechanism of products. In addition, the lack of industry standards also directly affects the continuous innovation of financial derivatives. For ordinary investors, some complex derivatives have exceeded the cognitive scope and actual needs of investors, which has brought losses to the interests of investors. At the same time, this excessive innovation has actually been divorced from the actual demand, which has had a negative impact on the entire financial market and even the real economy.
Second, the financial investment environment needs to be improved. After just a few years of rapid development, China's financial investment environment has been greatly improved compared with the past. However, the imbalance between hardware facilities and software facilities seriously restricts the further stability and healthy development of the industry. A good financial investment environment that can reassure the government and people requires not only beautiful office buildings and comfortable environment, but also a large number of good financial service institutions and well-trained employees. Due to the imperfection of industry norms and standards, China's financial service institutions are mixed, the interests of investors can not be effectively protected, and it also brings management problems to relevant government regulatory departments. While emphasizing financial supervision and risk control, improving the professional ethics, professional quality and social responsibility of employees in the financial industry is also a factor that we can't ignore. Finance has no national boundaries, and capital will always flow to places with higher returns. Therefore, it is very important to improve the financial investment environment in China, especially to strengthen the supervision of financial institutions and the education of employees. In my opinion, it is impossible to establish a financial system with core competitiveness without the support of a good financial environment.
Finally, investor education and rights protection are not in place. Investors are the source and foundation of financial markets. After more than 20 years of development, China's domestic stock market has become the third largest market in the world by the end of 20 1 1. Generally speaking, China's securities market is still dominated by individual investors. Investors, especially small and medium-sized investors, are in a weak position in the market because of their lack of professional knowledge, weak risk awareness, weak risk tolerance and insufficient self-protection ability, and their rights and interests are easily infringed. In the market where individual investors account for more than 99% and the ability to identify and bear risks is not strong, it is urgent to strengthen the protection of investors' rights and interests. The existence of information asymmetry will inevitably lead information owners to harm each other's interests in order to obtain greater benefits, which has been common in financial markets.
How should we deal with it? How to deal with it? What role will China Financial Derivatives Research Institute play in this process?
Insufficient improvement requires long-term efforts from all walks of life. First of all, we must establish an industry self-regulatory organization. We already have the CSRC, the Futures Association and other industry regulators, but judging from the mature market and development experience of foreign countries, this is far from enough. Among the regulators in the United States, government regulators include the Federal Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC). In addition, there are some self-regulatory organizations in the derivatives market in the United States, such as the National Futures Association (NFA). According to the development experience of financial derivatives market in developed countries such as the United States, it is particularly important to establish industry self-discipline system and standardize industry code of conduct in the early stage of industry development. The financial derivatives market has its own operating rules. In the process of building China's financial futures market, we need to learn from the experience of developed countries seriously, but we can't blindly copy them. We should combine our specific national conditions, reform and improve it, and then absorb and use it. In this process, it is necessary to gradually improve the formulation of industry training and education plans, conduct professional education for institutions and investors, and evaluate the professional level of market participants. With this as the direction, with the support from all walks of life, we initiated the establishment of China Financial Derivatives Research Institute, the primary task and purpose of which is to establish the industry standard of China financial derivatives market.
In addition to industry self-discipline, we should also pay special attention to the strategy of financial talents. The cultivation of financial talents should not only focus on the cultivation of professional quality, but also on the cultivation of professional spirit. China's open financial market will face more intense international competition, which also poses new challenges to the business and management ability of financial talents. The financial industry is a knowledge-intensive industry with high intelligence, high creativity, high technology and high risk. Understand both China financial market and international financial market, with excellent comprehensive quality and strong language ability. At the same time, professional and technical talents with excellent business and middle and senior management talents have become the hot spots sought after by financial institutions. Therefore, under the background of global financial integration, whether financial institutions can rationally plan the talent strategy under the new situation and seize the commanding heights of talents will be the focus of all kinds of financial institutions to shape their international competitiveness under the global financial integration environment in the future.
In the development of China's financial market, financial talents can be said to be an important guarantee for the effective operation of the whole financial market, and also an important aspect for China's financial enterprises to obtain benefits and succeed. However, there is a serious gap between the existing talent training and career planning system in China and the market demand. We believe that it is imperative to implement the talent strategy. In this regard, China Financial Derivatives Research Institute focuses on the orientation of financial talent strategy, and on this basis, it puts forward a good policy with practical significance on how to establish a scientific and perfect financial talent strategy. Facing the trend of global financial integration, China Financial Derivatives Research Institute has made a comprehensive innovation in the education and training of high-end financial talents, as well as the evaluation and planning of talents' career, created a leading financial qualification certification and training system and a financial practice education and training system, and strengthened the training of international financial talents.
China Financial Derivatives Research Institute brings together elites from financial institutions, banks and investment institutions, as well as industry experts from top financial talent education and training institutions, human resources service institutions, career planning consulting institutions and management consulting institutions to conduct in-depth research on the business practice, training management and career planning of high-end talents in the financial industry, thus forming a talent strategy combining internal training with external introduction. Based on this strategy, we will unite financial institutions and industry leaders to build an excellent platform dedicated to the education, training and service of financial talents in China, which has considerable investment value. Since the reform and opening up, China's financial market has developed by leaps and bounds, forming a unique financial system circle in China, and establishing securities and futures markets, money markets and inter-bank foreign exchange markets. Participants in the financial market are increasingly diversified and systematic, including commercial banks, social security funds, trust companies, insurance companies and securities companies; Market products gradually diversified and specialized, including financial bonds, government bonds and central bank bills, as well as corporate equity and debt bonds, and constantly innovated in securities and banking products. Securities innovation products such as open-end funds have begun to take shape and gradually emerge in the financial market; Cross-market financial innovation products are constantly emerging, such as the emergence of money market funds and the development of bank credit asset securitization. Generally speaking, China's financial market, under the guidance of national macro-policies, has fully played its role in optimizing resource allocation, achieved good integration with the international financial market, and achieved remarkable results.
However, compared with developed countries, China's financial market still has many deviations from its normative significance. For example, there are still some problems in the financial market, such as insufficient products and simplification, insufficient financial deepening, and some aspects of innovation are suppressed. In addition, the industry norms and standards of China's financial market still need to be improved. Therefore, with the continuous development of China's economy and the deepening of opening to the outside world, China's financial market also needs to adapt to the situation, change its concept and form industry standards and norms with the characteristics of China's financial market.
The author has noticed that some atypical phenomena have appeared in the domestic financial market recently. For example, when the total amount of money and credit is relatively loose, the liquidity of the banking industry is abnormal, and the interbank market interest rate soared in the short term; The scale of social financing has greatly expanded, but the problem of financing difficulty and expensive financing in the real economy, especially in small and micro enterprises, still exists; In order to pursue profits, shadow banks invest their funds in real estate and local financing platforms with high profit margins, which leads to the separation of real economy and finance, the amplification of asset bubbles, the aggravation of financial assets mismatch and the increase of financial risks.
In this regard, the author believes that the premise of standardizing China's financial market is to establish a reasonable market hierarchy system. The financial market is an interlocking system, so it is very important to optimize the allocation of financial resources and comprehensively promote the development of multi-level financial markets. China's financial market products are relatively single, and the market level is insufficient. It is necessary to establish a transparent, efficient, interconnected and safe financial market system through active innovation. The more complex the economic environment, the more accurate the formulation and implementation of norms, the better the timing, rhythm and intensity of the shots, and the prevention of excessive intervention and inaction. It is necessary to develop multi-level financial markets, promote more reasonable and effective pricing of financial products, increase market liquidity, expand the capacity of financial markets, and enable more enterprises to obtain equal financing opportunities, thus reducing the systemic risks of financial markets.
On the one hand, judging from the normative requirements for the benign development of financial derivatives in China, the study of "removing the rough and selecting the fine" should absorb the elements that adapt to the healthy development of financial markets, for example, how to revitalize the stock of money and credit, make good use of the increment, improve the efficiency of capital use, and promote finance to better serve the real economy; On the other hand, it is necessary to thoroughly study the special financial phenomena in China's economic transformation, accurately grasp the circular flow of national economic funds, find out the risk points and joint points, formulate active and steady plans and resolutely respond to them, and resolutely hold the bottom line that no systematic and regional risks will occur.
In a word, a big change is brewing in China's financial market. The profound significance of this great change is that it will give birth to a unified, diversified and hierarchical financial market nationwide, replacing the more decentralized financial market structure, thus changing the single market function of blindly pursuing financial market financing in the past.
(The author is a member of CPPCC, president of China Financial Derivatives Research Institute and founder of China Cornerstone Capital Fund).