Research On Information Preference Of Institutional Investors In China

Under the background of global financial market maturing,institutional investors have accumulated abundant funds,set up professional investment teams and gradually established their dominance in the securities market.At the same time,the influence of institutional investors on the stock market is also growing.However,the overall performance of institutional investors is difficult to make us satisfy.Especially in an environment of Bear Market,many problems that are worth thinking are exposed,such as the absurd research reports of securities analysts and the criticisms and doubts about the dismal performance of institutional investors.After the split share structure reform,there were two large-scale ups and downs in China's securities market,which seriously affect the rational development of the securities market.To clarify the market role and the market functions of institutional investors and securities analysts and exert the exemplary leading role of institutional investors have become a major issue that to be solved urgently.For a long time,domestic and foreign scholars mostly focused on the investment behaviors of institutional investors and securities analysts and the market response during their researches.However,the relevant researches on the information preference of institutional investors and securities analysts are few.Daniel and Titman(2006)proposed a groundbreaking theoretical model about stock market information by decomposing the share price information of listed companies into tangible information that reflects the fundamentals and intangible information that has nothing to do with the fundamentals.This division provides a good research idea for the research on the information preferences of institutional investors.Based on this,Cai Qingfeng and Yang Kan(2013)draw on the information classification models of Daniel and Titman(2006)for the first time to conduct a more in-depth study on the information preferences of institutional investors and securities analysts in China's A-share market.Of course,we do not ignore the further research space.First of all,based on the theoretical models of Daniel and Titman(2006),the paper decomposes the stock price information of listed companies into the intangible information reflecting the fundamentals situation and the intangible information having nothing to do with the fundamentals.In our opinion,if institutional investors prefer tangible information in their investment decisions,the changes in their investment behaviors are mostly based on the changes in the value of the relevant stocks,indicating that institutional investors prefer value investment.Conversely,if institutional investors prefer intangible information,institutional investors pay more attention on short-term market information,such as good policy responses and capital speculation.Then,on the basis of this theory,the paper refers to the research results of Cai Qingfeng and Yang Kan(2013)and tries to find and construct the proxy variables of tangible information and intangible information,that is,the tangible benefits variable and intangible benefits variable.And they are used to be the explanatory variables in the empirical model.At the same time,this paper selects the listed companies in Shanghai and Shenzhen A shares that exists institutional ownership during the period of the third quarter of 2005 to the third quarter of 2016 as a sample.Through respective regression analysis of the securities analyst's rating adjustment variable and earnings forecast adjustment variable and the institutional investors' shareholding ratio variation variable with the tangible earnings variable,the intangible earnings variable and the selected control variable.In order to judge the institutional investors or securities analysts' information preferences,we analyze the significance and positive and negative of regression coefficients of tangible benefits variable and intangible benefits variable.We find that securities analysts prefer the intangible information related to the non-fundamental situation when they rate the target company.And when the securities analysts adjust the value of the profit forecast of the target company,they also reconcile the tangible information related to the fundamentals.Institutional investors have different attitudes toward to the tangible and intangible information when they make investment decision.Institutional investors prefer to the tangible information related to fundamental situations,though they still are influenced by intangible information related to non-fundamental situations.