Empirical Study Herd Behavior Characteristic Trends Based On GRACH Models

As we all know, the development of China’s securities market is in its infancy. In the stock market, because of the prevalence of speculation, it will certainly spike. At the same time, the share price will be ups and downs, which will affect the interests of small investors. The herd behavior is one of the main reasons that cause volatility of the stock market. Therefore, it is necessary to study herd behavior.In the past article, we do research on herd behavior mainly by means of various types of mathematical models. By contrary, this article makes an empirical analysis on the A shares of SSE with the GARCH models and the relationship between CSCD and Rt.The study found: The intensity of herd behavior of A share market of SSE in periods of rising is more obvious than in periods of falling. Among all of the sectors, the telecommunications industry sector and comprehensive sector were stronger than other industry sectors, while herd behavior does not exist in the sector of food and steel plates. Among all of the plates in different areas, when the index is rising, no differences exist in herd behavior of the plates, however, when the index fell, herd behavior is stronger in economically developed areas than economically backward regions. In several different outstanding capital stocks, when the index is rising, the herd behavior of the outstanding capital stock is obvious; while the index fell, shares of small outstanding capital stock are more stable than other sectors.