The Research On China's Stock Market's Efficiency Problem

Whether China's stock market is weak form efficient has always been a controversial problem. According to the features of The weak form efficient,any investors can not gain stable excess profit by means of studying the regular pattern of the history prices in the weak form efficient market.That is to say,any technical analysis methods is in vain. In light of the point of this view,this paper examined the weak form efficiency of China's stock market in terms of the profitability of CCI's conventional practices and the combination usage of CCI and MA.Firstly,the tatistical test based on the Shanghai Composite Index suggested that the two conventional practices of CCI should be able to gain stable excess profit,which demonstrates that China's stock market is not weakly efficient.Afterwards,the statistical test of the combination usage of CCI and MA suggested that this strategy can improve the conventional practices of CCI and should be more able to gain stable excess profit.This also supports the conclusion of above.Thus,it can be concluded that China's stock market is not weakly efficient within the sample period, investors shoud be able to gain excess profit by means of applying suitable technical analysis strategy.