This paper explores the relationship between financial engineering and financial innovation and their key role in the financial market. First, on the basis of fully understanding the concepts of financial engineering and financial innovation. Subsequently, the application of financial engineering in the design of new financial products, risk management and capital market, as well as the successful cases of financial engineering in financial innovation are elaborated. These cases verify the innovation potential and market impact of financial engineering. In the research, the challenges and risks of financial engineering are also deeply studied, including legal and regulatory problems, market uncertainty and ethical problems. These issues highlight the need for financial engineers and financial institutions to actively address these challenges while innovating to ensure the robustness of the market. Facing the future, in order to realize the sustainable development of financial innovation, more regulatory and ethical frameworks are needed to ensure the healthy and compliant development of financial engineering in the future, so as to better promote the continuous development and progress of the financial market.

Financial engineering;Financial innovation;Market;Products

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DOI： https://doi.org/10.62639/sspjinss01.20240103

Published： 2024