A Quantitative Study On Money Supply Associated With Stock Market Returns

In recent years,the impact of the stock market on China's economic development has become more and more obvious.With the rapid development of China,the impact will continue to deepen.The influence and reverse effect of the money supply on the stock market are important issues that have always been focused on by the government and economic researchers.Therefore,it is of vital significance to study the association between the money supply and stock-market return.This paper sums up the basic model and method of the association between the money supply and stock-market return,and studies the long-term and short-term associations according to the classification of the positive and negative growth rate.In the analysis section,the measuring software,vector autoregressive model and impulse response function are used to study the short-term association;the unit root test,cointegration test,E-G two step method and error correction model are used to study the long-term association;the cointegration test model is improved to check the nonlinear relationship between sequences.According to the analysis,the association between the money supply and the stock market,and its phased character in China can be concluded.