The Empirical Study On Fund Investment Strategies Based On Behavioral Finance Theory

At present, as the important financing tool in domestic and oversea financial markets, the securities-investment fund has its own advantages, such as portfolio investment, dispersing risk, professional financing and investing convenience, etc., and has become the one who stands firm amid adversities in the Chinese stock-market. The strategies of fund investment are vital to influence the survival and development of investment fund. Studying the behaviors of fund investment can enhance the people's comprehension on the fund, provide advice for individual investors'fund investment and standardize the investment behaviors of fund managers, so as to maintain the stock-market continuous, healthy and steady development.In the view of behavior finance, with the object of stock-oriented open-end fund and stock-oriented closed-end fund, the paper empirically studies the momentum investment strategies and contrarian investment strategies, then classifies the funds according to their different investment styles, fund types and bull and bear markets, and studies whether the impact of momentum and contrarian investment strategies are similar. On the basis of consequences, the paper verifies whether the momentum and contrarian strategies promote fund performance, finally gives some advice on the base of the corresponding consequences. This dissertation not only enlarges the extent and depth of the behavior finance, but also provides practical advice for fund investment and Chinese stock-market.On the base of the empirical research, the conclusions are drawn as follows: The funds often adopt momentum investment strategies on the base of the current stock price. Since bifurcation exists when strategies are taken according to previous stock price, some funds adopt the combination of momentum and contrarian strategies instead of the single momentum investment strategies. Strategies based on current stock price have obvious trend of buying the winners and less obvious selling the losers or buy low; strategies based on previous stock price still have obvious trend of buying the winners, but the trend of selling high is relatively more obvious.It is found in the classified strategies test:①For growth-type, balance-type and value-type funds, they all comply with recruit specifications fundamentally.②In contrast with closed-end fund, open-end funds are more obvious in momentum and contrarian strategies whenever it is , and operate more boldly.③From year 2004 to 2006, it is the turning point of big bear market to big bull market. During the two years, the momentum strategy is more obvious in bull market than bear market, especially buying the winners and selling the winners.In the performance study, two indexes—net growth rate and sharp ratio are used. By contrast, momentum strategy, especially buying-winner strategy can promote the performance of funds. But there are no evidence to prove that other strategies bring considerable profits for fund.