Analysis Of The Effectiveness Of Securities Investment Based On The Perspective Of Overconfidence

In recent years,more and more non-financial listed companies enter the securities market.They invest securities actively,especially stocks,who want to improve the company’s performance through investing securities.Investing securities has two sides to the enterprise,While improving the situation of the company,it also has high risks.In the face of more and more companies suffering losses due to securities investment,this paper analyzes them from the perspective of managers’ overconfidence.Corporates’ decisions of investing are closely related to managers,but people are not rational.With the continuous development of financial markets,many phenomena in enterprises cannot be explained by traditional finance.The theory of overconfidence has been widely studied.The existing studies find that managers generally have excessive self-confidence,which will overestimate the company’s risk tolerance and make more aggressive investment strategies,therefore affect the company’s investment results.This paper uses Shanghai RAAS Blood Products Co.,Ltd.as a case company to analyze the risk management of its’ portfolio investment.This company’s securities investment suffered huge losses in the case of a stock market crash in 2018,therefore,this paper analyzes the motivation and effect of securities investment from the perspective of managers’ overconfidence.Firstly,the reasons and result for the investment of securities are analyzed in detail,then combining with the result of the company’s portfolio investment,this paper analyze the influence mechanism of managers’ overconfidence on their securities investment,the key point is to analyze the basis of the overconfidence from the perspective of managerial personality characteristics,Finally the paper raises suggestions for Shanghai RAAS Blood Products Co.,Ltd.’s investment.Through the analysis,this paper finds that the overconfidence of Shanghai Lai Shi managers has deepened with the staged success of securities investment,under the influence of managers’ overconfidence,the company will overestimate the risk tolerance and continuously increase the scale of securities investment.The analysis and conclusions of this paper have certain reference value for the risk management of portfolio investment and the overconfidence of managers in non-financial listed companies,And it has a certain warning effect on portfolio investment by non-financial listed companies,enriching its’ s experience in investing and is conducive to modern enterprise management.