Investment Behavior:An Empirical Study On"Local Complex" Observed Of The Open-end Funds

Do investors tend to buy local stocks or the other way round? How to explain these behaviors from an economic and behavior finance perspective? Taking the open-end funds in Beijing, Shanghai and Shenzhen as samples, this paper tries to answer these questions.We discover: funds based in Beijing and Shanghai have evident local stock evasions while funds in Shenzhen have evident local stock preference; funds in Beijing gain the strongest local information advantage, followed by Shanghai and Shenzhen the weakest; and funds in Shenzhen show the strongest "Local Complex", followed by Beijing and funds in Shanghai basically show no evidence of "Local Complex". The above observations indicate: funds in Shenzhen are relatively conservative while information of local stocks in Shenzhen is the most transparent among the three cities; Funds in Beijing is the most open one while the information of local stocks is the least transparent; And funds in Shanghai lie somewhere in between.Our findings provide some valuable clues for the study of information hypothesis in asset pricing, cultural implication in finance and regional factors in behavior finance.