Research On The Institutional Investors’ Irrational Self-interest Behavior Based On Earning Forecast

Objective and reliable information is the basis for the normal operation of the capital market price mechanism, is fundamental to realize the allocation of resources and market the premise of sustainable development. And profit forecast information is about the assessment of enterprise value of the core information, so is the most important capital market of the contents of the information. Because investors have the scale, the information and the advantage of knowledge is capital market information "authority", also is the market average investors the most important source of information. People expected rational institutional investors issued a profit forecast of the objective and reliable, and guide ordinary investors for investment, so as to realize the optimization of the market resources allocation, maintain the order of the capital market. But the reality of institutional investors but appears abnormal behavior. In reality there institutional investors issued by misleading profit forecast and stock recommended case, thus to ordinary investors to bring the huge loss and severe damage to the operation of the capital market order. Therefore, the influence of institutional investors, released profit forecast accuracy factors is of important theoretical and practical significance.Previous scholars for institutional investors profit forecast of most studies of thought for studying the paradigm follow technology, the research on the influencing the accuracy of the profit forecast institutional investors technical factors, lack of its internal benefit relations explored. Although some scholars abroad the main test in underwriting business interests to institutional investors profit forecast, the effects of the underwriting business interests to find, institutional investors will release a optimistic earnings, but did not comprehensive study on the institutional investors in earnings forecasts from the connotation of irrational behavior, and the mechanism, not related to its business and brokerage business interests to the influence of the profit forecast.In this paper, the rational economic man hypothesis from the start, to limited rational self-interest, and then to irrational self-interest, according to its logical development of the concept of clues, from the irrational the connotation, namely the sacrifice collective interests to seek their own interests, and give up long-term interest in exchange for short-term interests. And points out from the irrational behavior happens conditions in the information asymmetry, market position imbalances, market supervision of the loss of market of the ethics of decay. For this analysis framework of Chinese institutional investors on the analysis, the results showed that as the market for profit, earnings atmosphere pressure, institutional investors may have irrational from the motive. And institutional investors in the information knowledge dominance of the market reputation agency, supervision and internal control, lack of failure and other reasons, the institutional investors are likely to benefit by the irrational produce from the behavior.Because the main interest lies in institutional investors underwriting, self-supporting and brokerage three kinds of business, so the paper focuses on the three kinds of business in the interests of the induction, institutional investors would profit forecast to show from the irrational behavior. China’s capital market through choosing relevant sample data for inspection, the results found that Chinese institutional investors will also be for underwriting business interests and in profit forecast to show optimistic tendencies, this optimism tend to affect its profit forecast accuracy, and can lead to short-term market excess pay rise, but but down the middle, and may damage the interests of ordinary investors that affect the market allocation of resources. This shows that the Chinese institutional investors from the irrational behavior of existing evidence. Further, found that institutional investors profit forecast of the adjustment of its business with the direction in investment direction not related, institutional investors won’t adopt other institutional investors the profit forecast report, also not the color of the profit forecast report on their investment. Institutional investors that the profit forecast is not released its real intentions of expression, it shows that the subjective also exist irrational from the motive. Through the brokerage business interests and profit forecast relations, the author finds that the existing institutional investors issued by the market average earnings significantly from the tendency of prediction, and this can lead to deviate from the brokerage business interests of the increase, this is our country institutional investors through the profit forecast to reach the irrational from the objective evidence. According to institutional investors from the irrational behavior of the influence factors and conditions, this paper finally from the market ethics the improvement of the environment, market supervision and internal control the ascension of the institutional investors, the market reputation mechanism and so on many aspects put forward the countermeasures.This paper from the irrational and connotation of the generation condition are analyzed, and based on this institution investors to the profit forecast the irrational behavior from the behavior mechanism and may form of analysis. This field is not only an important supplement literature, but also of the economic organizations conflict of interest in the environment of behavior analysis model of the contribution. And three business interests for institutional investors with an analysis of the relationship between the profit forecast, inspection results and countermeasures for ordinary investors understand institutional investors profit forecast of the behavior, regulators to strengthen institutional investors in investment profit forecast from the irrational behavior of the supervision and guidance is of important theoretical and practical significance.