Noise Trading Of Financial Market

As the basic of modern financial theory, Paper tried to shed light on investors'behavior by "how they actually make decisions in the real market". Discuss the reason of Noise trade in the financial market and the effect to the market price.The most important reason of noise trade is irrational behavior, behavioral finance economists hold that irrational traders are not necessarily be washed out, on the contrary, they could "create their own space" by the higher risk they take. The behavior of investors is heavily influenced by their anticipation while the institutional environment and the equitableness are key factors to a reasonable efficient capital market.In case of Chinese financial market, immature marked and irrational trader result in the noise trading more heavy than developed financial market. In my viewpoint, it's better for the market to create a program of available information and to bring up rational trader. It can help the market efficient...