Studies On Effects Of Agricultural Policy On Agricultural Listed Companies Stock Price Fluctuation

Agriculture is the primary industry of our country, it’s an important strategic position in national economic development. The prosperity of agricultural economy, increasing farmers’ income, is the premise of the national higher standards of living. The prosperity of agriculture is also critical to the country’s social stability and unity. The level of agricultural economy development also determines the status of our country in the world economic competition. Therefore, our country attaches great importance in the development of agricultural economy, and offers supports to the development of agriculture over the years. Especially since 2004, our country provides an increasing support to agriculture, the agricultural economy obtained fast development in such a policy environment, rural areas unprecedented changes, the farmers’ living standard has been improved better and better. However, the problems of agriculture, countryside and farmers are still not optimistic. We still have many problems to solve, including the problem of how to promote the further development of the agricultural listed companies.Agricultural listed company is a listed company which is based on agriculture, is the embodiment of further organized agricultural industry in China. It is an important carrier of the small agriculture units and the big market. Agricultural listed companies are different from other agricultural organizations, they raise capital, increase the value and the scale of the companies through the stock market as a capital platform. At the same time, agricultural listed companies also make the stock market offer supports to agricultural development. Fot the stock market, the functions it plays lies in the stock price mechanism. As a result, stock prices on the stock market are well concerned. The formation of the stock prices is not only based on powerful information, but also subjects to the macroeconomic environment, interest rates, the company operating conditions, investors’ expectations, and many other factors. The stock market in China, which is famous for "policy stock market", is closely related to various kinds of policy. Since 1982, favorable policies for agricultural industrialization development have been launched constantly, from "cultivating" to "supporting" then to "improving". This makes agricultural listed companies more special than other listed companies. The stock price fluctuations of agricultural listed companies have certain industry characteristics.The fluctuations of stock price can be studied from two aspects of short-term and long-term. Studying agricultural policy’s effects on agricultural listed companies stock price fluctuations from short-term and long-term, revealing the agricultural sector short-term price fluctuations in the stock market performance, investigating the long-term effects on the fluctuations of stock price from agricultural policy, and then analyzing the deviation degree between its share price and intrinsic value, they not only have important reference value for the agricultural investors and the market management decisions, but also can provide referential suggestions for the agricultural policy makers of our government. It can make our country’s agricultural policy work better, also can create further perfection on stock market price mechanism of our country, improving the efficiency of stock market, giving full support of the stock market to modern agriculture.This paper focuses on the angle of policies effect, takes the measure of modern finance measurement research and statistical methods. The Paper is divided into seven chapters according to the proposed research objectives. The study is expanding from the following aspects:Chapter 1:Introduction. The paper proposes the research background and significance, the research objectives and methods, then combs the research status of the stock price volatility and agricultural listed companies at home and abroad according to the causal relationship between the developing necessity, the policy and the agricultural listed companies.Chapter 2:Analysis of evolution of Agricultural Policy and its orientation. First, the paper summarizes the developing stages of agricultural policies. Secondly, the paper reviews and analyzes the major agricultural policy, and finally lays the foundation for later study of the whole article.Chapter 3:Effect and mechanism of stock market volatility in the policy review. Mainly on the effectiveness of the theory, policy effects and the transmission mechanism of the stock market were reviewed by scholars of Chinese literature review of China’s stock market policy, the performance characteristics of the policy obtained city.Chapter 4:Research of the characteristics of stock fluctuations of listed companies. Describing the stock fluctuations using the statistical methods and verifying the fluctuations of the stock return volatility using ARCH models.Chapter 5:Research of the effect of the agricultural policies on short-term price volatility. From a policy effects perspective, the chapter studies the effect level of agriculture "Document No.1" on agriculture listed company’s share price gains. Using the study method of policy event to analyze the effect of publishing "Document No.1" during 2006-2012 on agricultural listed company’s share price gains.Chapter 6:Analysis of effects of agricultural policies on long-term enterprise value of agricultural listed companies. Analysis of the deviation degree of agricultural listed company’s share price from its intrinsic value using F-O residual income pricing model. The paper regards agricultural listed companies as the research object based on 2006-2012 enterprise data, estimates the intrinsic value of agricultural listed companies, and then analyzes the deviation degree of agricultural listed company’s share price from its intrinsic value.Chapter 7:The main conclusions and suggestions. According to the study results, it proposes the research conclusions and suggestions, meanwhile mention the issues requiring further study.The main conclusions from the paper:(1) The trend of agricultural listed company stock price was weaker than the market, the level of volatility is stronger than the stock market and the risk is higher than the market risk.(2) The agricultural listed company stock price fluctuation has agglomeration characteristics, existing date effect and scale effect of the day return.(3) The agricultural policy on agricultural listed company as an affection on stock returns in short-term, the agricultural listed company in the impact of agricultural policy can obtain excess return, causing the stock price short-term fluctuations and fluctuate obviously.(4) The agricultural policy on agricultural listed company long-term investment value of promotion effect is not reached, agricultural listed company stock exists serious overvalued phenomenon,long-term impact on the stock price effect of agricultural olicy deficiency.Conclusions of this article were drawn from both short-term and long-term perspectives, it suggests contradictions between the support direction and policy implementation. Therefore, it proposes the supporting systems to improve the policy implementation, in order to be able to provide managers as a reference and brainstorm for the sound development of the agricultural listed companies.