Comparative Study On Capital Allocation Efficiency Of Stock Market Between China And India

Capital is the power and source of development of the securities market, as a part of financial markets, the capital market position in the development process of financial globalization is increasingly important. The stock market is an important part of capital market, so stock market boom laid the steady a country’s capital market. One of the basic functions of the stock market is to achieve the optimal allocation of capital, which is the fundamental purpose of national development of the stock market. Therefore, the efficiency of capital allocation study of the stock market is an enduring topic. China’s securities market for over 25 years since 1991, in the ups and downs of the history of 25 years, prosperity and decline, but on a whole has made remarkable achievements. The Company and enterprise through the stock market to raise capital in which to develop, particularly through equity financing for China’s listed companies in this way provides a very important financing channel. As the main members of the BRIC countries, China and India is developing rapidly. As the degree of free movement of capital increases, investors will be in different countries to invest capital markets. All of these research in China and India the capital allocation efficiency of the stock market provides a solid foundation. Therefore, this paper is based on China and India in the stock market, the authors used the theory with practice, empirical analysis method to study the gap between the Chinese and Indian stock markets between the efficiency of capital allocation.In this paper, there are six chapters, each chapter in India and China stock market as the center, the comparative analysis of the efficiency of capital allocation in stock market of differences between the two countries. First of all, after reading lots of literature on the basis of the literature summary of research methods, learning research methods and conclusions of different scholars and to determine their own research direction;Secondly, the allocation of capital theory are summarized, and the analysis of stock market financing theory the amount of GDP and economic growth in China and India for the background of the stock market; Again, using quantitative analysis method examines the relationship between the amount of funding in India’s and China’s stock market and economic growth, then according to the analysis results and the comparison between the two countries stock market capital allocation efficiency; Finally, through the comparison of the efficiency of capital allocation of stock market in China and India is proposed to improve the capital allocation efficiency of China stock market policy recommendations, also make the significance of this study and implement.