A Study Of The Effeets Of Institutional Investor's Behavior On The Stability Of The Stock Market Of China

In the Early of the development of China's securities market, individual investors hold a dominant position, but its investment philosophy is not mature enough, strong sense of speculation in the stock market often chase sell, blindly follow the trend, on China's stock market stability caused a very negative impact. So in the development of mature markets in developed countries learn from experience, the management on the development of unconventional strategy of institutional investors, on the basis of institutional investors in a short period of rapid development, promoting rational investment philosophy, stabilize the stock market played an important role. However, institutional investors in our stock market is also widespread price manipulation, insider trading, illegal operations and other acts, which makes it the possibility of institutional investors to play its role in stabilizing the stock market had a question, the current institutional investors, domestic and foreign scholars whether the function of stabilizing the stock market there is a big controversy, therefore, this study has very important theoretical and practical significance.This paper summarizes recent studies in the literature, based on the behavioral finance, securities investment, game theory and econometrics and other disciplines theory, combined with the actual situation of China's securities market development, from both theoretical and empirical to behavior of institutional investors on the stability of China's stock market conducted in-depth research. In theory, this paper describes the characteristics of institutional investors and behavior characteristics, and from behavioral finance, game theory and the investment philosophy of the mechanism of the three angles, then institutional investors in the development situation of China on the basis described, analyzes the stability of institutional investors on the positive effect of China's stock market and negative effects; in the empirical analysis, this paper, China's largest institutional investors-as represented by securities investment funds, the first concentration from the fund's holdings, Awkwardness dispersion index and industry concentration of the three aspects of the investment behavior of securities investment funds were descriptive analysis, and rate of change in shareholding of institutions and the decline in the market index was up regression analysis found significant between the two rendered positive correlation between the final index for the market index and the Fund conducted a Granger causality test, the results also show that the reality of institutional investors in the stock market does not play a stabilizing role, and even to some extent, exacerbated the stock market's volatility. The reason, this paper argues that China is still not formed primarily an enabling institutional investors to play a stable market environment the stock market functions, and institutional investors in their own governance structure and internal control system is still not perfect. Given these factors, the development of this paper, the actual situation of China's stock market, combined with characteristics of the development of institutional investors, in order to better play our institutional investors stabilize the stock market have made the function of practical suggestions and countermeasures.