FINANCIAL engineering and risk management, though not buzzwords for investors, can help propel China's financial market system and benefit Shanghai's world financial hub status, according to a Shanghai vice mayor.

"Investors may talk more about share prices, monetary policy or financial tools rather than the topics like risk management," Tu Guangshao said at a symposium yesterday.

"However, financial engineering and risk management can help the financial market system, which is key to the city's world financial hub status."

As an emerging market, the experience from foreign markets can help China to bolster its development of the financial industry and China will be more involved with the global financial market against the backdrop of globalization.

Shanghai is gearing up to be a world financial capital. The city is already home to China's stock, futures, foreign exchange and gold bourses.

The central government set a strategic goal of building the city into an international center in the early 1990s and the blueprint will gradually come to fruition as China's fast economic development continues.

China's financial market is in market reform and internationalization. Theoretical research is a good means to improve the country's market mechanism in the process, Tu said.

China' financial market, especially the stock market, has ample retail investors.

When the market investors structure is improving with institutional investors are more developed, more of the theoretical application will find their way in the market, Tu said.

"A month ago, Shanghai held the Lujiazui Forum and now comes the International Symposium on Financial Engineering and Risk Management," Tu added. "Both of them offer a platform to share views which will do good to Shanghai's world financial capital hub establishment."