Dynamic Study Of Hushen 300 Constituent Stocks Based On Relative Industry Link

Stock market has been one of the most important aspects in studying financial market. It is also the economy barometer of a country. From the perspective of complex networks, one can construct a network to understand the financial system and its dynamic behavior. However, it is found that the topology of the network is different by using different network model, which may draw wrong conclusions in financial study. In this paper, we provide 3 methods of structuring the stock network. With the empirical study of hushen300 index stocks, we show the uniqueness problems exist in both MST network and threshold network. However, we provide another method to structure the forest network which can solve the uniqueness problem.Investors would like to pay attention to the impact of industry factor when making investment decision. In this paper, we have improved the Relative Industry Link(RIL) measure through the network structure. Then, we use it to investigate the relationship between the industry factor and the stock market under different network model. It turns out that the Relative Industry Link did well in the forest network. With the empirical study, we find that stocks affected most by industry factor is in the fields of mining industry, financial industry and real estate industry, while some industries are not. Besides, we find some connection between industry index and RIL.