Overconfident Insider Trading Behavior And Market Equilibrium Research In The Speculative Noise Trading

This paper mainly analyses the trading behavior and market equilibrium of overconfident insider traders in the speculative noise market,and considers the influence of different degrees of overconfidence of insider traders,and makes a comparative analysis with the rational situation.Especially,speculative noise trading refers to a kind of speculative noise trader who uses false information such as rumors to trade in the market besides the insider trader who relies on internal information to trade for himself.With the introduction of heterogeneous beliefs and the influence of ignorant speculative noise traders in the market,the fluctuation of the whole market equilibrium becomes larger,and is quite different from the rational situation.Mainly: Overconfident insider traders in the competition with speculative noise traders will quickly reveal the true information,the remaining information in the price will become less,and the market will be more effective.And the more overconfident the insider traders are,the more information they can reveal through price.However,through numerical simulation,it is found that this can not make the trading intensity of the insider traders stronger.And the overconfident insider traders make the flow parameters of the trading market change greatly,and the market will become more unstable.The flow parameter image presents an inverted U-shape.In the middle of the day,the market is deepest and most stable.In addition,the trading volume of insider traders also fluctuates greatly,especially in the last period,the more overconfident the insider traders are,the larger the trading volume is,and larger than the rational situation.Through the totally opposite trading behavior between the two traders,we find that there will be some large trading volume phenomena in the market,which can also be used as one of the reasons for the large trading volume phenomena in the financial market.