Abstract
The presentation of SV model was directly related with the diffusion of asset pricing in financial theory. SV model can be applied to financial theory appreciably and widely in financial analysis, financial forecast and so on. The analysis of the risk and the volatility of securities market is always the major subject for Modern finance. First，in order to help investors and government regulators to better understand the Shanghai stock market and Shenzhen stock in their exchange risk characteristics, this paper apply WinBUGS statistical software for statistical analysis of the sample data and SV model to the stock market of empirical research. According to the comparison between these two markets, this paper finds out that shanghai stock market is in higher risk because of its low volatility persistence. Then, it gives several suggestions to avoid this situation. Finally, this paper gives a simple comparison between the promotion of ARCH model and the promotion of SV model.
