This paper introduces economic policy uncertainty into a stochastic discount model． Via parameter calibration and static analysis，the dynamic characteristics of stock risks resulted from different policy uncertainties are investigated． The channel through which policy uncertainty affects stock risk is simulated empirically， and the effect of policy uncertainty on stock risk is simulated by portfolio analysis to verify the applicability of the theoretical model in China． Finally，the panel model is used to quantitatively analyze the relationship between policy uncertainty and stock risks． The results show that policy uncertainty can improve stock risk through the enterprise’s cash flow，discounting factors and correlation coefficient，and the improvement is still significant after controlling traditional risk factors，corporate heterogeneity，and external environmental factors． Companies that are non-state-owned，having lower return on invested capital and lower asset growth rate manifest greater stock risks when policy uncertainty is higher． The magnitude of influence of policy uncertainty on stock risk is larger when the economy is weaker and the policy environment is more unstable．