Tag: Stock

Testing the hypothesis that monetary policy responds to stock market movements

Abstract This paper highlights a problem in using the OLS model of Taylor’s rule, including lagged value of fed funds rate and stock index’s return to address whether the monetary policy should respond to asset prices movement or not. However, to know more exactly about the direct or indirect relationship between stock prices and the …

Test the Efficiency of Chinese Stock Market

Introduction 1. Background Osborne (1959) proposed that the movements of stock price are similar to the “Brownian motion” in the area of chemistry which mentions the never-ending and disorder movement of the particles that suspended in liquid or gas. Since the feature of “random walk”, the path of the share price is unpredictable. Fama also …

The Stock Market Crash of 1929

Abstract The paper investigates the causative factors of the 1929 stock market crash. With help of the economic data and previous researches, it has been highlighted that the tight monetary policy led to the crash and subsequent economic failure in 1932. Besides other factors, the prime lesson from the crash for investors in the 21st …

The Impact of Trading Volumes on Stock Market Volatility and Returns: A Case of the Swiss Stock Market

1. Introduction 1.1. Background to the Study There is a general consensus among financial economists that the distribution of stock returns can be completely described by two moments: (i) the conditional mean; and (ii) the conditional variance (volatility). The conditional mean is the lower moment, which is difficult to predict. In contrast, the conditional variance …