The Study To The Behaviors Of Bounded Rational Investors Of China’s Stock Market In The Game

China stock market is an emerging market. Compared with foreign mature markets, thereare many shortages in the market structure and operation mechanism. High frequency andlarge range of price volatility are the significant features of the market. There are many factorswhich cause price volatility, but the most important one is the interaction between investorsfor their unbalanced interest. So the study on the investors’ behaviors in stock market can helpunderstand the impact of their behaviors on stock prices.The main contents of this paper are as follow:1. We analyze the game characteristics of the stock market and point out that stockmarket investors have two major characteristics: one is bounded rationality, and the other isthe abilities of repeated learning and changing strategies. Based on the two characteristics, itis reasonable to apply the evolutionary game theory to study the investors’ behaviors.2. We give the concepts of the Nash equilibrium, evolutionary stable strategy and neutralstable strategy, and highlight the relationship among the three ones.3. We mainly build evolutionary game models of two groups of the stock marketinvestors-institutional investors and individual investors—and analyze the boundedrationality investors of their decision on strategy choice. From these models we explain someeconomic phenomena on stock market. We also built the evolutionary game model of theinstitutional investors and market regulators. By analyzing the various parameters, we candraw the conclusion that the greater benefits investors get from market manipulation, themore money market regulators should punish. The regulators can also increase the frequencyof the market investigation to curb the occurrence of market manipulation.