Irrationality and Bounded Rationality - Empirical Research on Investor Behavior in the Chinese Stock Market

Author: Jiang Xiaodong
Publisher:
Publish Date: 2006-08-01
Features: This research has the following two important significances: , for individual investors, through this study, one can understand the relationship between investment behavior and investment returns, understand the impact of gender and investment tenure on investment behavior, and understand the application of heuristics in investment decisions. This provides direct reference for individual investors to recognize their own investment decision-making process and make more scientific investment decisions. Second, for regulatory authorities, one can understand the underlying reasons behind certain seemingly "irrational" investor behaviors, and understand the psychological reasons for certain behaviors that cause overall stock market volatility. This plays an important role in helping securities regulatory authorities take more effective measures to protect investors' rights and prevent excessive stock market volatility. The study of investor behavior is still a young discipline, and relevant research in China has just begun. This book is adapted from the author's doctoral dissertation and has the following innovations: First, through field research and obtaining valuable personal investor trading account data from a securities company's data warehouse, and designing statistical indicators to objectively measure the trading activity and performance of individual investors, the entire empirical research is based on accurate data. Second, starting from the individual behavior of investors, three new explanations for the high turnover rate in the Chinese stock market are proposed. Third, for the first time, the psychological decision-making heuristics of investors are introduced into the predictive model, greatly improving the accuracy of the predictions.