Study On The Investment Behavior Bias Of Chinese Securities Company

The securities companies are not only the intermedium institutions in the securities market, but also one of the major institutional investors, and an important part of a nation's financial system as well. Since the establishment of China's securities market, the securities companies have been playing a very significant role in activating the market and connecting capital demand and supply. However, the securities companies have been facing a severe situation and suffering great loss in the whole sector since 2001, due to the continuous decline of the value system of the securities market. Furthermore, some securities companies have been ordered to be restructured or even closed. Although the recent years' weak operating tendency in the securities market is the direct cause of securities companies plight, from the aspect of the securities companies themselves, the most important reason is the failure of the investment they made, which resulted from the investment behavioral bias. Under this circumstance, this paper studies the investment behavioral bias of the securities companies and its reasons by employing behavioral finance, econometrics, game theory, neoclassic economics and other related theories. Meanwhile, the paper makes suggestions in terms of internal behavior and external restrains related to the securities companies' investment behavior.Based on the assumption of limited rational "economic person", the thesis holds the view that when securities companies pursue the maximum investment profits, they can not be absolutely rational because of their limited of perception of resources and ability, which is manifested by irrational and irregular investment behavior in practice. Firstly, by researching the relationship between investment anticipation, historic investment return and the fluctuation of stock prices, test the cognitive bias of heuristics bias and framed reliance of the securities companies. It also builds an overconfidence model of the securities companies to study the trends and influence of the formation and variation of overconfidence in making investment. Secondly, by adopting relative cases, it analyzes the violated investment behavior of the securities companies, and expounds the affected factors, usual measures and operation process of the violated investment behavior. Therefore, from the four perspectives of cognitive factor, cultural element, internal regulations and external environment, this thesis expounds the causes of securities companies' investment behavioral bias in depth. Finally, it raises suggestion respectively on the modifications of internal behaviors, such as education, human resource cultivation, corporate governance, internal risk control, incentive mechanism, culture development, and innovation, and of external restrains, such as financing channels, risk control mechanism, regulation development, supervisory efficiency and self-disciplined organizations, so as to reduce securities companies' investment behavioral bias.