The impact of central bank's open-market operations to the return rate of stocks

摘要

We often see that media report net injection as good news and withdrawal as bad news. However, this article finds that their impact to stock market's return rate is not evident, while the declarations of sell repo, reverse repo and central bank bills have significant influence on it. We discover that behavior finance theory can explain this phenomenon better, and various classical biases are also found in investors' decisions reacting to central bank's operations.