Abstract: The traditional research paradigm of the formation mechanism of herd behavior believes that incomplete information is an important factor causing the herd behavior of institutional investors. Whether the use of fintech in the capital market can improve the quality of information and thus reduce the herd behavior of institutional investors is of great significance for achieving high-quality development of the capital market. From the three dimensions of fintech attention, the number of fintech companies and fintech policy support, this paper comprehensively measures the level of fintech development in each province. Based on the empirical research of China's A-share listed companies from 2011 to 2021, the findings show that fintech has effectively reduced the herd behaviors of institutional investors, that the improvement of information balance, information disclosure, information transmission and information acquisition is an important way for fintech to play a role. The heterogeneity analysis reveals that fintech shows a stronger inhibitory effect on institutional investors' herding behavior in the companies located in the central and western regions and regions with lower financial marketization, the companies belonging to high-tech industries and the non-mainboard listed companies, as well as the sub-samples of sellers' herding. Further analysis shows that fintech can alleviate the negative economic effects such as lower stock pricing efficiency and crash risks caused by the herd behavior of institutional investors. Therefore, it is necessary to further strengthen the application of fintech in the capital market and provide modern scientific and technological support for creating a highly transparent information environment.

Key words: institutional investors, herd behavior, fintech, information quality