China Securities Investment Fund Investment Decision-making Behavior Research

Up to December 31,2007, the ratio of the mutual fund compared with total shares in circulation for sale in A share market in China has accounted for almost 32%. The immediate result is that the fund has formed the tendency to impact on the stock market deeply in Chinese A share market. The decisions based on the content of investment portfolio management have big impact on the performance of fund as well as the fund toward A share market. Combining the theory with demonstration, the thesis carries a research for investment decision behavior according to the logic sequence of practice, theory and then practice.Firstly, the related concepts of fund are introduced. The models of the investment fund are brought to the readers through the explanation of how the investment portfolio management is the core content of decision behaviors in investment fund. The investment portfolio is mainly made up of the choice of investment strategy, the allocation of asset and the selection of trade-off strategy.Secondly, within theory's paragraph of thesis, it carries on an investigation into the model of Markowitz and CAPM together with the theory of hypothesis effectiveness in market and finance. The analysis shows us the limitation of guidance and application, which the theories have toward the fund investment decision behaviors. Therefore, we should attach the specific condition's limitation while analyzing the fund investment decision behaviors.Thirdly, based on the environment of history, law, industry, market and culture in China, the thesis has the limiting factors. It analyzes decision behaviors of the fund investment through the theory of traditional investment and financial behaviors. The trade-off between risk and return while making the investment decision is still the key issue for investor. Therefore, the thesis analyzes the impact of fund's risk preference, return expectation, and liquidity. Accordingly, it makes the analysis on the choice of fund's investment strategy, allocation asset and trade-off strategy. Based on it, under the current market condition, the thesis draws the conclusion that fund should pursue more positive investment and asset's allocation strategy, which is that the fund should invest on the blue chips with the big circulate market value and take the positive and passive feedback on trade-off strategy. Afterwards, the thesis verifies the conclusion within the demonstration part through statistical and comparative methods, and the result shows that it is allied with the theory analysis.Finally, the thesis analyzes the impact on security market by fund investment decision behaviors in China. The impact includes the market fluctuation, the development of fund as well as the listed company'sgovernance structure. All of these impacts have their own pros and cons.Based on the above analysis, the thesis puts forward some specific suggestions about how to improve environment of securities market and standardize the development of fund. Hope all the efforts could make sense for constituting policy.