Abstract: Based on the investment specifics in every fund’s semiannual and annual statement as data,this paper adopts the testing method of Wermers(1999),makes a more practical extension of the assumptions and an empirical test of Chinese security funds’ herding behavior.It finds that Chinese security funds’ herding is more significant on the only-buy side than American mutual funds’ corresponding herding while Chinese security funds’ herding on the two other sides is less significant than American mutual funds’ buy herding.Chinese security funds flock into the large-capitalization stocks,small-capitalization stocks,IT stocks and newly-listed stocks on the only-buy side while not on the two other sides.The investment focus of Chinese security funds are in the medium- and large-capitalization stocks,which is beneficial to the stability of the stock market.The fund investment is highly related with the market trend.

Key words: herding, small-capitalization stocks, large-capitalization stocks, IT stocks, newly-listed stock