Empirical Study On A-share Stock Valuation Based On Quantile Regression

China's stock market has developed for nearly 30 years.Compared with mature markets in the West,China's stock market is still in its infancy.The reason is the lack of a sound management system and mature investment theory,the existence of a large number of irrational investors.With the continuous advancement of China's economy,more and more investors have chosen to join the stock market and have gained a lot of profits.Therefore,as an A-share investor,what kind of company to choose when investing,when to buy it,and when to throw it reasonably become a hot issue.However,among many investment methods,value investment has gradually become the mainstream.As the soul of value investment,the margin of safety uses the difference between market price and its intrinsic value to help investors reduce their investment risk and obtain benefits.Based on the margin of safety principle in value investment,this paper uses the data of CSI 800 constituent companies in the A-share market from 1990 to 2015.The quantile regression analysis of the two different financial indicators in the financial statements,the ROE and the lowest P/B ratio,under different quantiles.Then find out a "safety line" that investors can refer to when selecting stocks.Buying under this "safety line" can protect the security of the principal as much as possible and avoid investment losses.Reflect the significance of value investment.I hope that the research results of this paper can provide more valuable investment references for small and medium investors in China.