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Study on the behavior of institutional investors and stock market stability

Author: WeiZhi From: www.yourpaper.net Posted: 2007-11-19 12:48:31 Read:
Abstract: Recently, the relevant departments proposed transnormal developing institutional investors in the securities market regulatory policy, institutional investors can stabilize the stock market, improving the securities market efficiency.However, institutional investors is not necessarily able to stabilize the stock market, the stability of the market also needs certain system environment.
key words: institutional investors; securities market; institutional innovation
China's securities market development in the course of 13 years, the outstanding problems is the development of the market is not stable, speculative atmosphere too strong, stock prices plummeted, the stock turnover rate is too high.In this regard, the management and scholars generally think that one important reason is that China's securities market dominated by small investors, the lack of institutional investors.Therefore, since 2000, the securities regulatory departments to put forward the policy orientation of the cultivating institutional investors, and implemented in practice.Undoubtedly, institutional investors is on the rise is a global phenomenon.Based on the statistical data of the United States of America in New York stock exchange, institutional investors, securities investment funds, insurance companies and pension funds hold shares in New York 46% of the total share capital, on the Tokyo stock exchange this ratio has reached 42%. but, even for young Chinese stock market is not very standardized, the key problem of the development of institutional investors is not we decide to develop, the more important is how we should develop.Or say, institutional investors to seek a correct path of development is the right choice.From China's current practice of stock market, have a certain variation and distorted behavior of some institutional investors, market violations frequently occur, in order to stabilize the stock market and institutional investors instead exacerbated market volatility.Therefore, analysis of the logic relation between institutional investors and stock market stability, and then set up the development of the relationship between the necessary market conditions, the final control to improve the actual situation of our stock market, we will be able to find a correct road has realistic significance to the development of institutional investors and make relevant policies.
, the behavior of institutional investors and stock market stability hypothesis
(a) meanings of the stability of the securities market
"Market stability" is a statement of the most common for the cultivating institutional investors in the promotion of stock theory and practice circles in the reason.那么,何谓“稳定”?
At present, the popular view, stable market is a smaller amplitude market, people in the investment can be more rational, less into the dished out in exchange for the price, but pay attention to the value of long-term securities.However, we know that, in a securitization rate is very high, the stock market more perfect state, the stock market is a barometer of a country's economy, as the strong economic growth of a country's stock market, natural and proper reaction is the stock price rose strongly, not gentle, zigzag to rise; when a country a serious economic recession, natural and proper reaction of the securities market should be the stock price downward slide, but not stable, continued to fall; when a country appear larger fluctuation, the stock market reaction should also be price fluctuations are larger with the.Thus, the stability of the securities market or not, the key is to see a country's economy is stable or not.
(two) behavioral characteristics of institutional analysis
As a kind of organizational form of the modern enterprise system, the behavior of institutional investors should be rational, its goal is to maximize shareholder or the fund holders.Therefore, the scale and structure of institutional investors must follow the economic, market situation changes constantly adjust the direction of investment,, which determines the institutional investors also has the advantages of short period, structures and even speculative characteristics.However, because of the large size, slow turnover and other factors, in the interests of motivation, institutional investors tend to use their capital and information advantages of scale, based on the market analysis, judgment and prediction, thus tendency for long-term investment in optimistic about prospects for the development of the industry, access to the high growth of listing Corporation.Obviously, institutional investors could not go beyond their own interests motivation to do any other things.However, it is a long-term strategic investment based on this point, we think that the institutional investors have the function of stabilizing the market.In fact, institutional investors are not necessarily long-term buying hoarding investors, more than the final investors, it must also meet certain performance standards, in a relatively short period, otherwise, will face a solvency risk.Therefore, institutional investors will also actively trading in its shares, as soon as possible to achieve excellent performance.When institutional investors think the risk -- income prospects will be worse, there is no reason to believe that they will still be large holdings of securities assets, draw on the advantages and avoid disadvantages because this is the only correct choice.At this time, that institutional investors against the interests of their own and the principle of benevolence to save the stock market is unrealistic.Unless it is expected that, if the short-term sell-off too much too fast will make its own to retreats, will not be sold, in order to obtain relatively stable; otherwise, as long as the early detection of risk than other investors, it will lead to sell.Moreover, in the stock market, institutional investors also inevitably exist "herding effect".Because of the fierce competition and performance pressure, the general institutional investors will also very concerned about the "leader" of the trend of institutional investors, buy all buy, sell all sold.The behavior of institutional investors do not play a role in stabilizing the market, which exacerbated the market fluctuation.
Thus, we draw a conclusion: the stability and the volatility of the stock market lies not only in its fluctuations in size, but also depends on whether they reflect the operation status of the economy, therefore, long-term strategic institutional investors do have the function of stabilizing the securities market.However, this is not an inevitable relation, it is influenced by the institutional investors' own interest factors, when the counter with their own interests, the stability of the securities market can only be called is only one party is willing to policy makers.
The early development of the securities market of our country is mainly dominated by individual investors, the major effect is very obvious, thus forming a sharp fall situation.From the beginning of 1996, all produced a large number of securities companies, Trust Investment Company and the fund company, thus gradually changed the original condition, brokerage, investment companies and fund companies have become an important force in the stock market.However, all kinds of behavior, in our country we think that institutional investors, institutional investors in China at the present stage of stable market function has not been fully play (in the fund as an example):
(a) there (or ever existed) market manipulation
In 2000 October the "fund muckraking event" was first disclosed the fund industry is "down", "warehouse" market manipulation.In March 23, 2001, the China Securities Regulatory Commission issued a notice on its website says, there are 8 abnormal trading behavior in stock trading in the 10 fund management company at the time of the.
(two) obvious herding effect
Herding effect of institutional investors is mainly reflected in the concentration and stock concentration in the industry.China's institutional investors (especially the fund) has a high degree of concentration of industry, more than the fund was up to more than 80%, and the industry concentration is below 50% of the fund is less.From the stock situation, according to the fund announced the 2002 annual report, although the Shanghai and Shenzhen two city all 1201 stocks in 845 stock distribution is 66 held by the fund, but only 212 stocks in the 66 fund holdings, apparently 66 fund Chong Canggu obvious mutual overlap, one of the most obvious cross is China Unicom, 66 funds hold the stock, and one of the 44 companies as 重仓股 holds.Look at the portfolio from the fund announced the fourth quarter of 2002, a stock selection convergence is more obvious.China Unicom, Sinopec, China Merchants Bank, and other blue-chip market suddenly become the overwhelming majority of the fund Chong Canggu, portfolio and the fund more similar, the fund's personality and style has become increasingly blurred.
(three) short-term investment behavior is severe
At present, China's institutional investors are not typical of the long-term strategic investors, the portfolio shows trading behavior is frequent, short-term behavior is serious.The average stock fund in 2002 turnover of 2.23 times, and 1.83 times in 2001, improves the 27%.2002 funds held by the stock turnover rate as high as 5.8 times more than in 2001, 1/3.
(four) as "positive feedback traders" chasing Shadie
This point in the second half of 2001 the most prominent.Fund Ta Kong "6.24 market", the choice of the market the highest bit is
Dynamic margin strategy.From the combination of end of the second quarter of 2002 released by the 54 fund, closed-end fund net value amounted to 89724000000 yuan, of which the stock market a total of 57705000000 yuan, the weighted average of the stock positions ratio was 64.31%, compared with 50.07% in the first quarter of the year the proportion of positions, the fund generally increase the proportion of stock positions.On the other hand, the fund in 2002 fourth quarter investment portfolio is displayed, the sharp decline in the market, the fund began Jiancang sharply, to 12 at the end of last year, the fund's average position dropped to 53.11%, the lowest for almost the market, achieve the lowest position during the first half of the year.
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