Research On The Influence Of Irrational Behavior Of Capital Market On Residents’ Financial Investment Decisions

This thesis first analyzes the current prosperity of the financial market,investors are faced with huge investment opportunities,of course,opportunities and risks coexist,investors also face unprecedented complex decision choices.However,investors are often affected by their own and external factors and make irrational investment behavior.This thesis hopes to find out the significant factors affecting investors’ investment decision through the analysis of irrational behaviors before and after investment of financial products,hoping to provide help for investors’ decision-making and reduce irrational investment.Based on the theory of consumer behavior,this thesis divides financial investment decision into pre-investment stage and post-investment stage.Based on information processing theory,finite decision theory and behavioral finance theory,investment decision is further divided into three sub-stages,namely,information collection,editing and evaluation.Combining the theory of cognitive bias with the theory of investment decision,based on the analysis of the concept and manifestation of irrationality,from the influence of irrational behavior on investment intention and investment satisfaction in the pre-investment stage,the hypothesis to be tested is put forward,and then the influence of irrational behavior on investment and financial decision-making of residents is analyzed.The ordered Logistic regression model and binary Logistic regression model were used for empirical analysis to verify the impact of irrational behaviors on residents’ financial investment decisions.The robustness test was conducted with Optimal Scaling model.Through the Multinomial Logistic model heterogeneity analysis and put forward related Suggestions.The results show that the representative heuristic bias,availability heuristic bias,anchoring heuristic bias and adjustment heuristic bias positively affect investors’investment intention.Representativeness heuristic bias,accessibility heuristic bias,anchoring and adjusting heuristic bias,sunk cost all negatively affect investors’investment satisfaction.Recency effect has a significant positive effect on investors’investment satisfaction.Therefore,it verifies the impact of irrational behavior on residents’ financial investment decisions,further analyzes the differences between residents’ personal characteristics and irrational behavior on investment decisions,and finally puts forward targeted suggestions from three aspects:individual investors,financial institutions and regulatory authorities.