China Investment Fund Investment Behavior

The traditional finance theories have gradually become the complete theories system by the effort of Markowitz, Sharp, Litner and Mossin, etc. since the next half of 20 Century. And then the traditional finance theories became the predominant theories in the financial and economic realm in 70's which guided the human economic activities. However, when the abnormal phenomenon were accumulated and more attention were paid to these phenomenon in the last part of 80's, the traditional finance theories were challenged. Under such circumstance, many new theories came out which were used to explain the actual behavioral in the financial market. And behavioral finance theory was just one of them. Compared to the traditional finance theories, there are difference in hypothesis, method and analysis mode between them, which supported a new inspect and idea to study economic problems, especially some investment characteristics. Behavioral finance is a good tool to solve some new problems during the course of the completion of security market of China.Security investment funds are a kind of important constitution of institution investors. By the development of security investment funds , they have invested some similar stocks during the same tune which has deeply effected the development of security market. And these phenomenon attract the attention of penman . The penman tries to know whether their investment have herding effect, the degree of herding effect and the real meaning to the investment mode, etc. By far, there are not enough studies of security investment funds and all these study were based on the framework of traditional finance theories. Thereby the penman will analyze the reasons of the similar investment, the degree and the effect to stock price on the framework of behavioral finance by the method of demonstration to tell the meaning of these phenomenon.The paper is composed of six chapters:IntroductionThis chaper makes a introduction of behavioral finance, including the development, basement and investment theories . In addition, this chapter introduces the object, clue and method.Chapter 1 Characteristic Analysis of Security Investment Funds InvestmentThis chapter uses behavioral finance analysis method to compare the investment between security investment funds and security companies to know the difference and then fetches out the concept of' herding effect'.Chapter 2 Theories and Literature of Herding EffectThis chapter introduces the theories and literature of herding effect in the framework of behavioral finance.Chapter 3 Demonstration of Herding Effect of Security Investment FundBeginning with the demonstration of foreign funds, the chapter brings forwards the deficiencies of previous demonstrations and the plan of this paper. After that ,this chapter makes a demonstration and conclusions.Chapter 4 Reasons Analysis of Security Investment Funds of China This chapter makes analysis of herding effect of security investment funds from the aspects of marker, information and agent, etc.Chapter 5 The Consideration of Herding Effect of Security Investment Funds and the Development of Security Market of ChinaThis chapter makes a profound consideration of demonstration from the aspects of the price of stock market ,investment mode to discuss whether herding effect is benefit for the development of China security market in the future and then puts forwards some suggestion to guide herding effect of security investment funds.