Research On The Model Of Evolutionary Game Of Security Investors In China And Application

Since the 1980's, with the extensive application of Information Economics and the rise of Behavioral Finance, noise trading theory began to receive wide attention from scholars at home and abroad. Different from the traditional financial theory, the noise trading theory abandons the strict assumptions about the perfect rationality for investors. Instead, it uses a more realistic analysis framework of bounded rationality, which has made a more convincing explanation to the phenomena of financial markets emerged in empirical studies, so it has been rapidly recognized in both academia and practices.In this paper, noise trading of the investors in stock market is made to be the theme, and there are three main research issues. First, it established the evolutionary model about the behavior of portfolio investors based on the relevant conclusions of DSSW model, and then it has study the mechanism of the noise trading with the solution of the evolutionary model. Second, it has analyzed the impaction to the evolution system and its balanced process caused by the parameters in the model, which mainly are the noise traders' risk aversion coefficient, index return volatility, risk-free rate of return, fundamental risk and transaction costs. Third, it uses the values of various parameters during the period 2000-2008 to do the empirical analysis about the evolution path of domestic security investors' behavior, and finally made some corresponding recommendations based on the results in the empirical research.