Investigation of the effectiveness of technical analyses on the changing trends of China's stock prices
Date Issued
2015
Date
2015
Author(s)
Hsu, Ching-Chi
Abstract
In recent years, the international economy is relatively in recession. Although China''s economy maintained a steady growth, inflationary pressures are also coming up. Home prices continued to rise, wage growth has failed to catch up to inflation changes. So how can one keep the asset value high，that is a big issue of concern to the public. This is why a variety of finance and investment goods becomes important. The usual way to invest and conduct financial transactions is thru savings, buying real estate, funds, stocks, bonds, foreign exchange, futures, insurance and so on. These commodities each have their own advantages and disadvantages. This paper is focus on stock investments in goods as the research object. Although the government often remind people of stock market risk, and investors should be careful. People are attracted to it because the stock market is a high-risk, high-yield product. For investors, how to select a high profit share is very important. Choosing high profit share method is nothing more than the basic stock analysis, technical analysis and evolution analysis. For hundreds of years, it has been how investors find profitable stocks to invest in.This paper is based on Shanghai and Shenzhen stock index as the provision for our sampling base. From January 1, 2004 to December 31, 2013 the 10-year historical index of the stock market transactions in the range of, 242 days a year as the sample period, five days a week as a sampling length (That is take a sample every 5 days ), at least more than 30 samples of the index is necessary for our analysis (Shanghai Stock Exchange 43 Index, the Shenzhen Stock Exchange 41 Index, 84 files total index). Using the technical analysis methods, utilizing five commonly used technical indicators (Stochastic Oscillator，Moving average，Moving Average Convergence / Divergence，Relative Strength Index，William OverBought/OverSold index) and 10 different parameters to be analyzed for each of these 84 indices in order to identify the appropriate time and the sale price, and then calculate its annual rate of return. Developing a buy and hold strategy for profitability, and to cross reference and compare them to find out which one is relatively better and more profitable. So that you can scientifically analyze what which stock will yield a higher annual rate of return through technical analysis tools. At the same time, we can all get a share of the corresponding technical indicators rankings which is undoubtedly a worthy reference data.
Subjects
Shanghai Stock Exchange
Shenzhen Stock Exchange
Stochastic Oscillator
Moving average
Moving Average Convergence / Divergence
Relative Strength Index
WILLIAMS OverBought/OverSold INDEX
Type
thesis
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