Interaction between Life Insurance Fund Investment and Financial Market in China: General Investment Strategies for Life Insurance Companies

摘要

In this paper the interactions between the return rates of life insurance companies and each financial asset were mainly discussed in order to get the general investment strategies for the life insurance companies under the present situations of financial market in China. Firstly, the interactions between the investment of life insurance companies and the financial assets were qualitatively discussed. It was found that life insurance companies could impact the operation of financial market through their large amount of fund and rational investment style, while the financial market could impact the life insurance companies by providing channels for maintaining their value and dispersing their risks. To further measure the interactions between them, the method of Granger Causality Test was used. The quarterly data of return rates of life insurance fund investment and financial assets from 2004 to the first two quarters in 2008 were gathered and put into evaluating. Then it was found that: the return rates of stock and fund can greatly influence the investment return rate of life insurance; the investment of life insurance companies can influence stock and fund markets; the deposit rate can make a middle level of impact on the investment return rate of life insurance company; the return rates of government and enterprise indexes did not impact that of life insurance fund investment significantly. Finally, on the base of these analyses, a series of four-quadrant financial assets investment strategies of life insurance companies was established.