Population Life Prediction and SM Bonds Pricing Based on DEJD Model

In the context of the aging population, longevity risk will increase great economic pressure to the national endowment security system. How to measure and manage longevity risk has become the focus of research in recent years. Based on the Chinese population mortality data, and Lee-Carter model, we introduce DEJD model (double exponential jump diffusion model) to describe the jump asymmetry of time series factors, and prove that DEJD model is more effective than Lee-Carter model in fitting time series factors. In addition, we use the population mortality data predicted by DEJD model to price the SM bonds in Chinese market, providing an important reference for the promotion of SM bond in China.