The Influence Of Risk Attitude On Household Financial Asset Allocation

In the research of finance, the two main object are corporate finance and asset pricing. Corporate Finance is a study on how to effectively utilize various financing channels, to obtain the lowest cost source of funds, and the formation of an appropriate capital structure. Asset Pricing attempt to explain the price or value of the assets under uncertainty of future payment. But as the economy continues to develop, the financial markets continue to improve, more and more people enjoy the benefits of economic development Personal, household wealth is increasing, for the purpose of increasing the value of assets, family and personal needs of assets allocated, original traditional finance research are now going into new areas, more and more scholars began to focus on the behavior of household financial investmentSince China's reform and opening, especially after joining the WTO, the rapid economic development has been made, our country's financial research also learn from Western developed countries, the development of China's national conditions is suitable for a variety of financial instruments. In the rapid development of our country, the rapid rise in wealth, people's living standards rapidly, the income level of Chinese residents has also been greatly improved, which create financial investment conditions for our family.Domestic and foreign scholars have studied the behavior of financial market participants in many families, and in many ways the family financial asset allocation behavior has been studied, and a lot of research has been made.In the first part of the paper, we introduce the background and significance of the study. Then, we summarize the related theories about the allocation of financial assets and discuss the relevant literature in China and abroad. Next we introduce relevant concepts of household finance and features of the allocation of household financial assets. And in the 4th chapter, we analyze the current situation of Chinese household financial asset allocation. After that, the 5th chapter is the empirical analysis, which is the main part of the paper. The empirical analysis is based on the data from Chinese Household Financial Survey (CHFS) which is conducted by Southwestern University of Finance and Economics. And the last chapter of the paper is the summary of the paper. We also provide some advice in the last chapter.In the empirical analysis of the paper, we use probit model to study the influence of risk attitude on the participation of stock market. And we use the tobit model to study the influence of risk attitude on the depth of participation of stock market and risky financial market. In addition, we use mlogit model to study the influence of risk attitude on diversification of household financial assets. And the major conclusions we draw are that risk attitude can influence the diversification of household financial assets and risk appetite indicators have a significant positive impact on the possibility of family involvement in the stock market. Risk preference family will increase the risk of assets invested in stocks of financial assets relatively to those who's risk attitude are neutral. And risk preference family will increase their likelihood of participation in financial markets compared to those who's risk attitude are neutral, risk-averse attitude lead family reduce the possibility of their participation in the financial markets.