Financial literacy is generally considered to be an important factor affecting investors' decision-making, but there is no unified conclusion on whether the improvement of financial literacy can improve the degree of rational decision-making of investors. This article aims to examine whether the improvement of financial literacy can improve the rationality of investors from the perspective of investment psychology and behavior, and on the other hand, to further analyze the impact of the improvement of investor group financial literacy on stock prices. We designed three sets of mutually controlled investment evolutionary game experiments and analyzed the experimental results. We found that the improvement of financial literacy can help investors overcome the "Framework Effect" and "Heuristic Deviation," significantly improve the rationality of investors' decision-making, reduce stock price volatility and improve stock pricing efficiency. The results provide strong empirical evidence for the necessity of investors' financial literacy education.