The Application of Behavioral Finance in Trading—Analysis from Hainan and Xiong’an Property Market and Stock Market

Abstract

Behavioral finance has once again caused great fever after winning the Nobel Prize in 2017. Many theories can be more confirmed in the capital market. In 2017 and 2018, the establishment of the Xiong'an New District and the Hainan Free Trade Zone, the stocks in these two regions quickly went up, and the property market is also rapidly entering the frenzy. However, the performance and reasons of these two regions are still different. After the Xiong'an stock market experience, in just a few months, the stocks in the Hainan plate are still rapidly rising, and history seems to repeat itself. This paper will analyze the reasons for this phenomenon in these two regions from the perspective of behavioral finance, and the behavioral finance theory existing between the two regions.