An empirical analysis of stock market liquidity in China
Journal Title: Scholars Journal of Economics, Business and Management - Year 2015, Vol 2, Issue 5
Abstract
Abstract: In capital markets, their liquidity is the most important thing to measure the state of the markets. To some extent, the liquidity of capital markets decides their operation state. It is not only an important property, but also a prerequisite for their survival. If the security markets have no liquidity or lower liquidity, then the value of financial assets can be undervalued, or the extreme phenomenon that no anyone will be willing to possess the assets in some special circumstances will be appeared. The stock markets have two basic functions, that is, to provide liquidity and price discovery. In the existing literature, there is a huge amount of the study about capital pricing, but there is a little study about liquidity. The liquidity of stock markets mainly refers to the stock asset cashability, and it is also an important indicator to measure the efficiency of the stock markets. A higher liquidity of security markets will enhance the confidence of investors and attract more investors, which in returns will increase market liquidity. However, although the factors of the liquidity of the stock markets and their measure indicators have been mentioned for a long time, yet it has not been a convincing conclusion. Some scholars analyze them from a theoretical perspective, while others analyze them from the practical side. Moreover, quantity researches about liquidity deepen people’s knowledge about it. This paper analyzes the factors of influencing liquidity from theoretical and empirical perspective, and put forward some suggestions to improve China’s stock market liquidity. Keywords: Liquidity; Stock market; Market Microstructure.
Authors and Affiliations
Zaifeng Wang
Keywords
Related Articles
- EP ID EP384656
- DOI -
- Views 75
- Downloads 0
The Competitiveness Analysis of Indonesian Cocoa Beans Export in the World Market
Abstract:Cocoa is an important agricultural commodity in the world economy. Indonesia is the third largest producer of cocoa beans after Ivory Coast and Ghana. Previous research demonstrated that cocoa had many opportuni...
Rural Poverty Alleviation: Reflections on Zimbabwe’s Experiences and Needed Strategy
Abstract:This paper evaluates rural poverty alleviation strategies that have been implemented by the government of Zimbabwe since independence in 1980 such as the establishment of cooperatives, growth points, infrastruct...
Globalisation and Nigerian Economy: Diagnosis and Prognosis
The impact of globalisation on Nigerian economy is the thrust of this paper. The work uses vector auto-regression method because of the variables’ interrelatedness, time series data of 1970-2013 were analysed. The result...
To Promote Quality Improvement of Urbanization by Normalizing Regulation inside Government
Abstract: China is now at a crucial stage of developing urbanization deeply. The development of urbanization turns to deceleration stable period from acceleration period. The quality improvement of urbanization is the pr...
The Imperatives of Sustainability Management Accounting System (SMAS) For Developing Country: The case of Nigeria.
Abstract: This research study is set out to determine the imperatives for Sustainability Management Accounting System ( SMAS) implementation across manufacturing organisations in Developing Countries . The researcher ado...