On The Approach Of ST Stocks Picking In Security Investment

Security investment involves high risk and return, which often makes inattentive investors, even those skillful experts, suffer money loss. And ST stocks, as a group of particular ones in Chinese security market, appear to be attractive or striking in price movement. On this condition, normal investors often perform without reason and make bad decisions, due to the lack of right manner and method in investment.For those series of problem, based on fundamental analysis, investment portfolio and behavioral finance theory, several research methods are employed to penetrate the ST investment from the return and risk analysis to the design of picking strategy, in order to contribute a little to ST investment.After that, a few of conclusions were reached: the ST rule was not perfect; the causes of ST companies were complicated and multifarious; the abnormal return of ST investment was a result of comprehensive factors; the earnings of ST investment presented particularly; there was higher risk in ST investment; the delisting risk of ST could be prevented to some extent by Discriminant approach; the valuation method should be used according to the delisting risk and future development of ST company. On the other hand, however, the more important in investment could be the psychology and personal mind. The behavioral factors, such as the habit and manner, also make a difference.