On June 28, 2024, at 10:00 am, the 32nd Forum on Digital Technology and Economic Finance Frontiers was successfully held. The theme of this lecture was "Trading Behavior and Market Quality: Based on Probabilistic Attitude", and the guest speaker was Professor Shunming Zhang from the School of Finance, Renmin University of China. The lecture was chaired by Xianming Sun, Associate Professor of the Finance School and executive Deputy Director of the Innovation and Talent Base for Digital Technology and Finance. More than 30 teachers and students from the School of Finance participated in this lecture.

First, Associate Professor Xianming Sun, on behalf of the teachers and students of the School of Finance, extended a warm welcome to Professor Shunming Zhang and briefly introduced Professor Shunming Zhang and his research directions in related fields.

The lecture officially began with Professor Shunming Zhang emphasizing that the optimistic or pessimistic probabilistic attitude of market traders not only influences their trading behavior but also impacts the overall market structure. Professor Zhang proposed that, given the common assumption of state independence in most market quality assessments, a deep exploration of traders' probabilistic attitudes and their transmission mechanisms within the market is crucial for understanding market dynamics.

Subsequently, Professor Shunming Zhang pointed out that, with a probability-neutral equilibrium serving as the benchmark scenario and the majority of market qualities proven to be state-independent, focusing on probabilistic optimism-pessimism attitudes can induce optimism among traders, leading to confidence in their trading abilities, while simultaneously limiting the participation of pessimistic traders. Following this, Professor Zhang elaborated on his research findings, stating that optimistic and pessimistic markets exhibit opposite characteristics in terms of price premiums and price impact functions. These two markets demonstrate opposing state-dependent features in terms of price skewness, market volatility, market liquidity, and price efficiency. These patterns are applicable to discussions of information costs and transaction costs. In summary, probabilistic optimism-pessimism attitudes play a decisive role in determining asset prices and market quality.

Finally, the participants engaged in active academic exchanges with Professor Shunming Zhang, jointly discussing the theme of the lecture. Professor Zhang provided detailed answers to the questions and puzzles raised by the teachers and students. Associate Professor Xianming Sun expressed his gratitude to Professor Zhang for his speech, marking the successful conclusion of this forum.

Speaker Introduction

Shunming Zhang is a professor (Wu Yuzhang Scholar Lecture Professor) at the School of Finance, Renmin University of China, a doctoral supervisor, and the director of the Institute of Financial Engineering at Renmin University of China. He holds a Bachelor's degree in Mathematics from the Department of Mathematics, Central China Normal University, and a Master's and Ph.D. in Mathematical Economics from the Institute of Systems Science, Chinese Academy of Sciences. He has served as a lecturer and associate professor at the School of Economics and Management, Tsinghua University, a visiting professor and postdoctoral researcher in the Department of Economics, University of Western Ontario (Canada), a researcher in the School of Economics and Finance, Victoria University of Wellington (New Zealand), and a specially appointed professor (doctoral supervisor) of Wang Yanan Institute for Studies in Economics, Xiamen University. He was awarded the National Science Fund for Distinguished Young Scholars in 2008, selected as a national candidate for the "New Century National Hundred, Thousand, and Ten Thousand Talent Project" in 2009, granted the Special Government Allowance from the State Council in 2013, and appointed as a specially-appointed professor under the "Chang Jiang Scholars Program" by the Ministry of Education in 2015.

Currently, he serves as an editorial board member of "Systems Engineering - Theory & Practice," "Economic Mathematics," and Journal of Systems Science and Information, among others. He has presided over the National Natural Science Foundation of China's Youth Program, the National Social Science Fund's Key Project, the National Science Fund for Distinguished Young Scholars, four National Natural Science Foundation of China's General Programs, and the National Natural Science Foundation of China's Key Project (Theoretical Research on Financial Risk Management under the Transformation of Digital Economy, 2023-2027). He is currently involved in the Key Research and Development Program of the Ministry of Science and Technology, "Key Technologies and Applications of Financial Data Synthesis and Intelligent Model Risk Monitoring" (Special Project: Science and Technology Support for Social Governance and Smart Society), and serves as the sub-project leader for Sub-project 1, "Research on Financial Data Synthesis and Data Risk Assessment Technology." In recent years, he has been focusing on the latest developments in uncertainty, studying ambiguity and asset pricing, and has published over one hundred papers in domestic and international mainstream economics and finance journals.

Frontier Forum for Digital Technology and Finance introduction

Recent years have witnessed a dramatic acceleration in a digital revolution in economic sectors and a rapid adoption of the new generation of information technologies, such as artificial intelligence, blockchain, cloud computing, big data, etc. These technologies effectively set off the digital economy. It has become a key driving force in creating global economic growth, improving the modernization level of governance capabilities, and promoting high-quality economic development in China. In particular, digital finance is the most important part of the digital economy. To explore the development direction of the cross-integration of digital technology and finance, the Innovation and Talent Base for Digital Technology and Finance is hosting the “Frontier Forum for Digital Technology and Finance”, in collaboration with the School of Finance, Wenlan School of Business, Economics School, School of Information and Safety Engineering, School of Statistics and Mathematics, School of Public Finance and Taxation of Zhongnan University of Economics and Law (ZUEL). This lecture series will invite the well-known scholars at home and abroad in digital technology, digital economy, digital finance, and other related fields as guest speakers, providing an open and cutting-edge academic exchange platform for interdisciplinary research on digital technology and finance.