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Duration model analysis and its application
Author: ZuoWeiFeng
Tutor: DengChao
School: Central South University
Course: Finance
Keywords: Interest rate market Interest rate risk measurement Duration Model Modified duration gap
CLC: F224
Type: Master's thesis
Year: 2005
Downloads: 546
Quote: 3
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Abstract
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The pace of market-oriented reforms and economic restructuring of China 's interest rates are basically the same, take the progressive reform . China has basically achieved near medium-term target for the interest rate market , can be predicted that in the near future , China is bound to realize the full interest rate market . In the interest rate market conditions , China's commercial banks will be faced with a major market risk - interest rate risk . Therefore , strengthening the management of interest rate risk , the direction of one of China 's commercial banks should be strengthened . Measure the interest rate risk of the method and its accuracy is one of the most important topics of interest rate risk management of commercial banks . With the rapid advance of China 's market-oriented interest rate reform , Calls for the introduction and development of new practical interest rate risk quantitative analysis tools , which is the need to improve the theory and practice of the development of China 's commercial banks interest rate risk management of commercial banks in China , is also joining the WTO urgent requirement of facing the competition of foreign banks , to improve its overall strength . Duration model and its gap technology is recognized as the international banking industry since the 1990s , one of the most reliable standard interest rate risk management and measure . In Western countries, the duration of the model and its gap in financial markets has reached a very high level . This article briefly describes the traditional Macaulay duration model , convexity theory , FW duration model , the effective duration of the model , the model with the direction of the random duration duration model ; systematic research , compare and review the background of these models and theories advantages and disadvantages and Scope ; interest rate risk management tools - Interest rate sensitive gap and duration gap technology comprehensive comparative study ; duration gap model because of two important assumptions greatly limits its practical application value , by relaxing these two assumptions , first proposed a new model of the modified duration gap and amendments crown gap . Finally, according to the actual situation of the modified duration gap model as well as a commercial bank branch in Hunan Province empirical analysis , and proposed the corresponding countermeasures and suggestions to the interest rate risk of the line .
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CLC: > Economic > Economic planning and management > Economic calculation, economic and mathematical methods > Economic and mathematical methods
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