Analysis Of The Applicability Of Buffett's Value Investment Philosophy In China's A-share Market

With the rapid development of China's economy,the level of national income has increased significantly,and there are various ways of financing,such as stocks,bonds,funds,gold and so on.Stock investment,as one of the main modern investment methods,has brought tremendous impact on people's lives.More and more people are investing in securities to maintain and increase the value of their own property.However,the securities market is a concentrated place with high risk coefficient.The development history of China's stock market is relatively short,its information disclosure mechanism is not perfect,and there are a lot of information asymmetry.Participants in China's stock market,especially retail investors,do not have in-depth study because of their small capital scale and limited capacity,but are hearsay and speculative blindly.They often make investment based on past investment experience and investment intuition,and lack professional knowledge in investment.This has caused serious losses to investors to a large extent,which not only devoured the wealth of the majority of small and medium-sized investors,but also.To affect the stability of China's economy and society.Therefore,it has become a necessity to guide investors to invest correctly through professional channels.China's stock market is an emerging market,and is in a special period of transition reform.Under such circumstances,it is particularly necessary for stock investors to find a set of investment strategies suitable for China's stock market if they want to obtain excess returns.Under the background of China Securities Regulatory Commission strongly advocating the concept of value investment and more and more investors are keen on value investment,this paper first summarizes the development of value investment theory at home and abroad,the validity of value investment theory and Buffett's concept of value investment,and then screens out the indicators to meet Buffett's concept of value investment and quantifies the corresponding investment perspective.Later,this paper chooses the historical data of all listed stocks in China A-share market from April 2009 to December 2018 to test the effectiveness of the strategy.Empirical results show that Buffett's value investment concept outperforms the market portfolio in bull market in every year of the test,and has outperformed the market in other years.At the same time,the number of strategic shareholding portfolio is relatively small and stable.It can be found that the strategic shareholding portfolio selected in this paper is far better than the performance of the composite index of the stock market at the same stage.Based on the empirical results,it is found that Buffett's value investment concept is effective in China's A-share market.At the end of the article,some basic conclusions are summarized,and some suggestions are put forward.The empirical study of Buffett's value investment concept in China's A-share market further enriches the investment strategy of China's stock market,and has a certain reference significance for investors.