| China's stock market has a share-trading system defects, people classified the total equity of listed companies as a non-tradable and tradable two categories, and prohibits non-tradable shares free trading in the primary market . China's stock market have had a lot of adverse effects. In order to address deficiencies and share-trading triggered by the Chinese stock market ills, at the beginning of 2005 listed companies in China share reform gradually unfold. In 2007 China has basically completed the share-trading reform. Share reform to resolve the fundamental issues which non-tradable shares can not be free trading , help reduce insider trading, and major shareholders encroach the interests of small shareholders, the market will have an impact on volatility.Volatility is a measure of the quality and efficiency of the stock market as an important indicator because the market must be a stable market and give full play to its foundational function. If fluctuations excess to a certain extent, the market functions may exist some problems. Investors prefer low volatility. Low volatility means investors can reduce unnecessary risks, will enable traders finish the transaction in the market prices little changed circumstances. By using Granger causality test, the VAR model and GARCH and TARCH classic model of the stock market prices, volatility and the Sustainability of the stability analysis, I found that after the completion of shares to investors of information asymmetry between the decline in market performance improve, the stability of the market increase.The article finally said that under the theoretical and empirical analysis of the conclusions of the share reform the effectiveness of the existing problems, to further strengthen the share reform after the improvement of the market regulatory system, and enhancing the prospective study, simplification of administrative examination and approval procedures, strengthen market integrity of the proposed construction . |
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