Measuring The Speculation Of China’s Stock Market

In this article first defines the definition of speculation in stock market, and analyzes theadvantages and disadvantages of speculation in stock market. After analyzing theperformance of the stock market speculative, we selected the exchange rates, PE, book value,stock index day volatility, turnover volatility of daily price, the number of fell more than7percent of the stock as a measure of the proxy variable of the degree of stock marketspeculation, the first three of these indicators as proxy indicators of long-term speculativefactors, four proxy indicators of short-term speculative factors. Take over of the proxyindicators of the three long-term speculative factors, and select the corresponding theoreticalvalues; also a brief description of the last four indicators.In determining the index weight, we analysis the advantages and disadvantages of objectiveweighting method and subjective weighting methods. In the final use objective weightingmethod based on the subjective weighting method to give the weight of the indexes,construction the speculation of stock market. Then use speculative index measure the degreeof China’s stock market speculation, found that in the long term there has a more seriousspeculation in China’s stock market, but looked from the short-term China stock marketspeculation is also very active. Then use the exchange rate to test the speculative indexmeasurement, but also but the exchange rate and fluctuation of stock index two indexmeasurement the most serious of the three time periods in which the results of speculativespeculation index measurement, the test results confirmed the speculation indexmeasurement results. Finally it is pointed out the quality of listed companies is not high, thestock functional position is unreasonable, short and withdrawal mechanism, the irrationalinvestor structure are the long-term speculation factors. Investors exist rich psychologicaland herding behavior of institutional, manipulation, regulation is lax are the short-termspeculative factors because. In view of the above the stock market speculative reason, shouldimprove the quality of listed companies, to reduce government intervention and play a rolein regulating the market, strengthen the education of investors, strengthen securitiesregulation.