On The Comovement Relationships Between Domestic And Hongkong's Stock Market

At present,our country is in the new normal economic development,so the economic development has shown the characteristics of slow growth,structural optimization and upgrading and innovation driven power characteristics.Under the new normal situation,China's economy is more open to the outside world,win-win cooperation in a more inclusive way.November 17,2014 Shanghai and Hong Kong declare a official policy implementation,this is China's foreign economic opening,one of the most important measures towards the internationalization of the RMB,to promote the effective integration of the mainland market,capital market and international capital developed in our country,improve China's capital market opening level.The co-movement relationships between the stock markets refers to stock market that have the same phenomenon,this phenomenon is so common in the stock market,the domestic and Hong Kong government through the new policy is to improve China's stock market and Hongkong's stock market deeper integration of initiatives,under this situation,so the Domestic and Hong Kong Policy study the implementation of the co-movement relationships and its changes the significance for the understanding of a country's stock market.In the paper that the co-movement relationships as a starting point of the research and analysis,as we known that In the first part of the introduction chapters introduces the historical background of "Shanghai-Hong Kong Stock Connect program" policy,the significance of this study,research purposes,etc;The second part of the literature reviews in the elaboration of the definition of linkage effect and the factors that affect the different scholars at home and abroad in the empirical aspects of the linkage of the different views and have a hierarchical classification;In the fourth of the introduction introduce the theoretical basis in Shanghai and Hong Kong and the stock market and Hongkong stock market history as a policy background,the specific effect for China and Hong Kong through the implementation of the policy in the macroeconomic area,financial market and market investors three subject to cause the analysis;In the fourth part of the sections,Shanghai's index and Hongkong's index are representing domestic and Hongkong stock market,sample data will be divided into two stage,the paper use stationary tests and test to explore long-term equilibrium relationships between the stock markets,using Granger causality tests,impulse response tests and variance decomposition tests to explore the short-term linkages.In the fourth chapter of the paper is conclusions and policy recommendations according to the empirical results and conclusion,and from different angles such as the investors,policy makers to draw suggestions as well as government department.