Influence Strength From Leading Stocks Of Environmental Protection Enterprise On Shanghai Index

It has been a hot focus in the study field that studied stock market by discussed share index for a long period. This paper discussed and analyzed the relationship between Shanghai composite index and leading stocks of environmental protection enterprises. It was on the basis of analyzing the time series data set by quantitative analysis.Shanghai composite index and ten leading stocks of environmental protection enterprises were selected to be the unit of analysis in this paper. It collected time series data set of these stocks in the period of 2005 to 2009 and analyzed the relationship between the units by the analysis methods including Johansen Cointegration Test, Vector Error Correction Estimates, Granger Causality Test, Impulse Responses and Variance Decompositions. The results were showed as follow: The relation of Shanghai composite index and these leading stocks of environmental protection enterprises was cointegration relationship. The leading stocks of environmental protection enterprises moved toward different directions while the shortage term fluctuation deviating the long term fluctuation and showed different repair apparatus. Shanghai composite index was not affected by lag phase of these leading stocks of environmental protection enterprises except itself. The impulse responses of Shanghai composite index to these leading stocks of environmental protection enterprises were not steady. The influence of these leading stocks of environmental protection enterprises on Shanghai composite index was slight while the lag phase was short term. The influence would become strong while added the lags.Some summaries could be made by analyzing the results of the quantitative analysis:There was a long term steady relation between Shanghai composite index and these ten leading stocks of environmental protection enterprises but the influence of these ten leading stocks of environmental protection enterprises on Shanghai composite index was slight. It indicated that the Environmental Protection Industry in China was not become the leading industry and the order in the environmental protection market was under correction. There were some problems in the environmental protection enterprises and it must be solved in future.In order to enhance the Environmental Protection Industry in China, the government had to keep playing the oriented role of the fiscal policy. The investment and financing system in the market should be improved. Some excellent environmental protection enterprises should be made up and trained to improve international competitiveness of the Environmental Protection Industry of China. With the Environmental Protection Industry improving, the relevant legal system should be normalized. The environmental protection enterprises should train a number of excellent staff and attach importance to the ability of independent innovation. Standard management system should be made up to advance the competitive advantage. Establish the original brand system and take grate attach to the brand competition.