Institutional Investor Information Competition And Firm Idiosyncratic Risk

Corporate idiosyncratic risk,as the fluctuation of stock price at the company level,is closely related to corporate characteristics,and can reflect the information development status and cash flow fluctuation of the enterprise.Preventing systemic financial risk is our government’s unswervingly determination,and the characteristic risk of listed companies has become the focus of more and more investors to improve their investment returns.After the phenomenon of idiosyncratic risk was put forward,the factors influencing enterprise idiosyncratic risk were paid more attention and analyzed,and the field of microfinance also began to get involved in this problem.It mainly focuses on two aspects of corporate fundamentals and investor behavior.No matter which interpretation,its internal logic involves corporate governance.The investor structure with individual investors as the main body has always been considered as the main reason leading to the deviation of the rational track of the capital market,advocating investor institutionalization has become the development trend of the global capital market.Since 2000,China Securities Regulatory Commission(CSRC)has promoted the cultivation and development of institutional investors to a strategic height and issued a series of relevant measures to standardize and support the development of institutional investors.Institutional investors are gradually approaching the role of capital market ballast stone in terms of participation and influence.Institutional investors as a special group of investors have received widespread attention in domestic and foreign studies,and the promulgation of the G20/OECD Corporate Governance Principles has emphasized the positive role of institutional investors.According to the characteristics of institutional investors as informed traders,the antagonistic relationship between institutional investors based on corporate private information is called institutional investor information competition When discussing the relationship between institutional investors and corporate idiot-specific risk,the existing literature is mostly based on the analysis of the total shareholding ratio of institutional investors,ignoring the internal differences and mutual relations of holding institutional investors,and lacking a detailed investigation of the inter-relationship among institutional investors Based on this,this paper will take the Angle of information competition of institutional investors as the entry point,and further explore its impact on corporate trait risk and its mechanism.First,this paper expounds the concept of information competition of institutional investors and corporate trait risk Secondly,the paper discusses the influence of information competition of institutional investors on corporate characteristic risk and puts forward theoretical basis and research hypothesis.Finally,the paper uses empirical analysis method to verify the above hypothesis,and carries out further analysis by grouping according to information transparency and property right nature.The empirical results of this paper show that information competition among institutional investors will lead to an increase in the level of corporate trait risk.Specifically,firstly,information competition among institutional investors will promote the increase of corporate trait risk Secondly,corporate governance acts as an intermediate mechanism between the two.Finally,in the sample group with high information transparency and the sample group of non-state-owned enterprises,the promotion effect is more significant.After a series of robustness tests,the conclusion of this paper is still valid.In addition,the research of this paper also has certain significance in reality.On the one hand,the study of the impact of corporate governance on corporate characteristic risk is helpful for enterprises to fully stimulate the supervision and management initiative of internal and external investors with the help of corporate governance,so as to achieve the expected goal of high profits in the environment.On the other hand,to explore the internal logic between institutional investors’ information competition and corporate idiotypic risk can further investigate the role of institutional investors in the market,to promote the investors to better play the utility of institutions,improve the stability of the market,so as to contribute to the stock market in the future can be more stable development.