The Research Of The Formation Mechanism Of China Stock Market Froth

The research of the formation mechanism of stock market froth has the important theory and realistic value. For policy-maker, it that the stock market froth is melted promptly could avoid that society and economy would be affected seriously because of the forth breakage. For investor, they could avoid losing base on this research. In the foundation of domestic and foreign researches, the article studies on the formation mechanism of stock market froth systematically and thoroughly through the qualitative and quantitative investigation by the macroscopic and microscopic angle, as the background of real Chinese economy environment and stock market situation.This article mainly studies the following content. The first part is the formation mechanism of stock market froth. I give the hypothetical assumption on the multi-dimensional investors'structure and investment strategy, and the formation mechanism of stock market froth. The second is the stock intrinsic value's measurability and Chinese stock market forth. In this part, I mainly analyze some concepts and correlation theories about the stock intrinsic value's measurability, and how investors can find the stock intrinsic value and the determining factors of measurability. I also give why the Chinese stock market has the lower the stock intrinsic value's measurability and how it could form the forth effect. The third is the investors'rational gambling behavior and the froth risk of Chinese stock market. I analyze that the investors'rational gambling behavior influences the froth formation and the reason that the Chinese stock market froth is formed. The fourth is that stock market internationalization and Chinese stock market froth risk. I mainly give the stock market froth mechanism from stock market internationalization and some related questions.This article has four conclusions. First, many kinds of the main policy-making ways cause many different investor communities in stock market, so there is the multi-dimensional investors'structure. Second, investor's fund distribution function may respond investors'behavior. But, investor's fund distribution function would change along the time change, so it is the key of forth formation. The former involves the multi-dimensional investment decision question. Third, according to the froth formation mechanism under the stock market multi-dimensional investment decision pattern, the following factors have close relationship with froth formation. They are the stock intrinsic value's measurability, the investors'rational gambling behavior, the irrational factor and the investors'consistency behavior. Fourth, the lower stock intrinsic value's measurability is one of the important factors that cause stock market froth breakage, and investors'rational gambling behavior also cause the froth formation. In the process of China stock market internationalization, security valuation has an enormous uncertainty, so it easily causes securities price fluctuation and froth formation.