Risk Periodization: The Spectrogram Monitoring Model of Financial System Risk of China

Abstract

The purpose of this study is to build a high-frequency,practical and more effective system of financial risk monitoring indicators in order to provide the financial risk early warning. The high-frequency monitoring indicators of financial risk is built, by applying the method of expert opinion, literature analysis, indicator attribute group on selecting and analyzing numerous “cloud” indicators of risk. The spectrum graph model of financial risk monitoring is established by using the clustering analysis and 2008 financial crisis case. The empirical result shows that financial risk monitoring system is statistically significant and realistic. It can timely reflect changes of the financial risk. The result also shows that the financial system risk monitoring spectrum is simple to use, is very intuitive and effective monitoring.
Key words: Financial risk; Risk monitoring; Highfrequency monitoring; Indicator monitoring system