Research On Thematic Investment Based On Weak-Form Efficiency Of A-share Maket

Since1990, China’s A-share market has made a tremendous development both in the types of stocks and the total market capitalization. It brings the growing enthusiasm for people to invest in the stock market. But China’s stock market has been always ups and downs. For the unstable investment environment, the majority of investors need some advanced investment theory to guide their choice.The most popular investment theory to Chinese investors is the value investing theory advocated by Warren Buffett. This set of investment theory comes from the long-term practice of Buffett’s investment career and withstands the test of time successfully. However, there is a premise that I have to say, Buffett’s investment is mainly concentrated in Europe and the US and other mature stock markets, but little in A-share market. While in terms of the degree of perfection and the rational investment of Chinese shareholders, there is a considerable gap between the A-share market and the Europe and the US stock market. So we should doubt the applicability of the theory.This essay aims to prove why the Value Investing Theory, specialized in investing blue chips which have strong capability of profit, large-scale properties and high brand value, is not very suitable for current A share market, under the base of weak-form efficiency. And then use thematic investing analysis frame and study of successful cases to clarify further that Thematic Investing Strategy would be better suited than others in such a weak-form efficient market, thus provide an alternative choice for those struggling investors. This essay also encloses the writer’s advice on improving shortcomings such as weak information disclosure and investors’irrational behavior on A share market, hoping our stock market could better serve China’s socialist economic construction under a healthier market environment and sound market systems.