Conflicts Of Interest Behavior And Its Regulation Of Securities Analyst In Our Country

Security analysts are the major providers and analysts of market information, the activities that many security analysts collect and analyze information can improve the pricing efficiency of market, and enhance the welfare of all investors. However, the security anlysts'behavior of conflict of interests can have passive impact on investors and listing companies by various ways, resulting in the distortion of markets price mechanism and low level of resource allocation efficiency. Therefore, reinforce the supervision and governance of the security analysts' conflict of interests, improving the objectivity and independence of security research, are not only the necessary measure which can protect the interests of vast investors, especially the individual investors who are in the inferior position of information, but also the necessary measures which can uphold the effective operation of whole security markets and improve the pricing efficiency of security markets.This paper think that our country's securities analysts exist behavior of conflict by gathering stock rank statistical issued by analysts between 2007-2010 and some typical cases in China securities, then explain the regulation of analysts'.behavior of conflict conceptually, analyst have motive to issue too optimistic, biased report because analysts in a double commissioned agent relationship. Based on the current regulations of analysts'conflict of interest, our country have strengthened the supervision of analysts, but still exist self-discipline has not been formed and self-discipline became a mere formality this problems.Literature thought that underwriting,brokerage and self-operated business of securities company. Pressure from managers of listed companies and analysts' personal goal will cause analysts' conflicts of interest, analysts'reputation will restrain actions, to test literature conclusion is suitable for China's securities, which factors will influence analysts'behavior of conflict of interest,then this paper made an empirical study on the impact of securities underwriting and analysts'reputation on security analysts, independence. The empirical results shows:when the security firm and the listed firm have underwriting relationships, the analysts provide higher stock rank, This study indicates that, securities underwriting have an impact on securities analyst's independent position. Foreign literature and empirical study think that analysts'reputation can restrain the conflicts of interest, but this paper get a contrary conclusions, the investment rank made by high reputation analysts is more optimistic than other reputation rating analysts', this results shows that analysts' reputation have little restrict on its conflicts of interest.