The new classical capital market theory, of which the CAPM is the most representative one, starts from a number of assumptions such as perfect information and perfect rationality and arrived at some propositions about the subjective equilibrium and market equilibrium.
In accordance with the requirement of China's WTO entry and the development of socialist market economy, the developing model of our financial market must be transformed toward diversified market participants and management, balanced development of money and capital market, market-oriented financial activities, indirect market manipulation , overall opening-up and gradually globalization of financial market.
The study herewith presented aims at confirming the existence of a stabilising effect due to the presence of infinite memory since, with all the other conditions begin the same, a memory rate >amp;gt; exists at which market equilibrium is a sink.
Under the equilibrium market-clearing condition for the insurance security the market price of risk is uniquely determined by a backward stochastic differential equation.
From the angle of general balance, the author of this article mainly studies how China's market keep balance by analysizing the balance of labour, currency and goods during the transfer of China's economic structure. He concludes that the key to macro-market balance and rational resource allocation is to speed up the market-oriented reform.
Based on the General Equilibrium Theory of mathematical economics, this paper studies the relations betweep non -arbitrage and equilibrium and effectiveness of resources allocation of financial markets. As a result, equivalent relations are established between concepts like non - arbitrage and market equilibrium and Pareto optimality under proper conditions.
The model of financial assets valuation and its assessment was presented from capital market balance ,stock market union ,stock market line and value with imaginary assumptions .The balance condition of capital market was elaborated and the application of capital assets price model in appraising investment item was introduced .