Closed-end Fund Discounts Research Based On Clustering Investor Sentiment Theory

The scholars have paid long attention to the puzzle that the prices of the closed-end funds (CEFs) always depart their net price values. The first researches attempt to explain the phenomenon based on the Effective Market Theory, while there are always some limitations. With the development of the Behavior Finance, the investor sentiment theory has attracted more and more attention for its good explanation in the four typical aspects of the CEFs discounts. While it is a pity that most of the investor sentiment researches related with the CEFs discounts are limited in the present theory and the demonstration only focuses on the existence of the investor sentiment without further innovation.The paper makes the demonstration research of CEFs from investor sentiment aspect. First of all, it summarizes the relevant theories related with the CEFs discounts. Then it modifies the investor sentiment theory based on the Chinese market feature and the demonstration result shows that there is investor sentiment in the Chinese CEFs market and the strength of the investor sentiment is much stronger compared with that in the American market.The emphasis of this paper is to carry out the further research of the diversity and discrepancy of the investor sentiment. Following the investor's heterogeneity theory, the paper hypothesizes that there might be different investor sentiments, and designed relevant demonstration method. This paper also classifies the investor sentiment according to the demonstration results.The research result of this paper enriches the investor sentiment theory and the demonstration method related with diversity and discrepancy of the investor sentiment offers new idea for further research of investor sentiment theory. The latest sample data reflect the newest feature of the Chinese CEFs discounts, and the result is helpful for making policies and investment...