The Innovation of Structured Products in China's Security Market

As a combination of the technologies in both derivative securities and financial engineering,securitization has become the most significant and the fastest growing financial innovation and financial instrument in the past 3 decades.In spite of its rapid progress,China's security market is still faced with certain problems and defects,among which the lack of diversity in financial products results in low profitability and uncompetitiveness.By tracing the evolution of securitization and structured products,it is shown that innovation of structured products plays a critical role in business and profit diversification.And a comparative analysis on the institutional environment and investor demands in current China's security market plus a further study on successful cases in the development of structured products in China have jointly demonstrated that it is more feasible to take a selective gradual step in the process of securitization in China and actively carry out innovative development of structured products in the meantime.