The Effects That People's Expected Return Brings To The Development Of Stock Market

With the development of economic, the incomes of people increase substantially. Now the saving balance achieves 8 thousand billion, a great deal of funds are looking for invest channels. However, the stock market, which ought to be the major investment channel of people, only attracts a small part of people's fund. The stock investment portion of people's investment in our country is much lower than that of the developed countries. Many reasons cause that the people's fund dare not to enter stock market. The direct reasons are the expected return rate of stock market is highly uncertainly and the risk & return is non-symmetric. It created ill effect for the development of stock market. Most of the papers regarding to the construction of stock market are stand for the government to study the development of stock market, instead of individual investors. Using the expect theory, this paper intents to study how the expected return rate of stock market affects the investment behaviors and how the investment behaviors affect on the development of stock market. The paper also raises some suggestion on the construction of stock market.