The Study of Price Risk Management in Supply Chain Based on Financial Engineering

The risks exist in the supply chain management inevitably. These risks are created by the market demand indefinite, the price undulation and other reasons. The study of the risk management gradually expands from the financial service industry to the supply chain. The finance property risk can be controlled by using financial engineering theory. And this theory is also effective in the risk management of the capital flow in the supply chain. The methods of controlling finance property risks by financial engineering is applied in this paper under the environment of the supply chain, then this paper study the ways of each kind of financial tools to reduce the price risk in the capital flow of the supply chain in detail. The financial engineering can prevent risks through the financial tool combination. This paper establishes the reasonable model of the financial tool combination which effectively reduces the risks that exist in the supply chain.