Study of Value of Recommendations from Chinese Securities Analysts
|School||Southwestern University of Finance and Economics|
|Keywords||securities analysts recommend stocks efficient market eventstudy|
After20years of development our country’s securities market has made remarkable progress, but still in new and transformation of the stage. As an important part in this market, securities analysts’behavior had a tremendous impact to market and investors. In order to research whether the stock recommended by securities analysts has investment value, this paper based on the traditional finance theories and behavioral finance theories, first study of securities analysts’ behavior, then on this basis of theoretical analysis empirical study has been done to examine.At the beginning why the securities analysts industry emerged had been analyzed, can be summarized as been a bridge between investors and quoted companies through information transmission. Rely on "experts" advantages in aspects of information searching, information processing, information discriminating and information application, they provide a wide range of services to investors.In the second part of this paper Chinese securities analysts industry had been introduced from an overall angle of view. With regulators improved the construction of legal system and a series of institutional barriers which restrict our stock market development cleaned, the securities analysts industry has stepped into a fast-growing channel from earlier "Gu ping jia " stage. In the past, stock analysts main serviced small and medium shareholders, due to this group’s speculative psychology and short-term behaviors the analysts often used technical analysis method and devoted to discover all kinds of inside information at that time. So the stocks recommended by them only had short-term hyping value and could not give investors with a bigger profit. With a number of mature investors, such as institutional investors appeared and advanced investment philosophy introduced, securities analysts has changed a lot for either working content, decision-making process, service objects or service pattern. They began to use fundamental analysis method to search stocks which had been wrong priced but with good quality in the market and advocate the concept of value investment. But parts of professionals lack of professional ethics corrupted the industry’s reputation, called "Zhuang tuo "、"Black mouth". They stands for bankers’ interest and has cheated ordinary clients, seriously damaged investors confidence on securities analysts. In this sense, this article is helpful for investors to find out the truth.