Analysis Of Industry Linkage In China’s Stock Market Based On Social Network

The development status of China’s stock market shows that the industry linkage of the stock market is one of the key issues concerned by people from all walks of life in the industry.In recent years,with the rapid changes in the internal and external environment of the stock market,the stock prices of different industries in the stock market show obvious linkage effects,and the trend of investors’ allocation of assets by industry is becoming more and more obvious.Therefore,clarifying the characteristics of industry linkage will help us enhance our understanding of the "role" of various industries in the stock market from the perspective of industry linkage,so as to provide investors with more scientific investment suggestions,Help regulators better manage risks and improve the accuracy of decision-making.The research range set in this paper is from January 1,2007 to December 31,2021.Taking the daily closing price data of 31 primary industry indexes of Shenyin Wanguo as the research object,this paper establishes a powerless and undirected social network model to make an empirical study on the industry linkage effect of China’s stock market in the whole year and by year.In the research of industry linkage effect in the whole year,the overall network structure and cohesive subgroup are mainly analyzed.In the research of industry linkage effect by year,the change trend and structural characteristics of industry linkage network in China’s stock market in recent 15 years are compared and analyzed.The empirical analysis results show that:(1)there is an obvious linkage effect between the stock indexes of A-share industry.The linkage effect fluctuates periodically with the changes of market conditions.The linkage effect rises sharply in the year of stock disaster,the small world phenomenon is obvious,and the information is disseminated rapidly.(2)Banking and non banking financial industries often become "isolated points" in the industry linkage network.When the "stock disaster" market,they can often be "detached".(3)The basic chemical industry,mechanical equipment and transportation industry are mostly located in the core position of the industry linkage network;In the year of stock disaster,the influence of upstream industries such as nonferrous metals,petroleum and petrochemical increased significantly.Therefore,investors should be aware of the change law and industry characteristics of the industry linkage effect of China’s stock market,and focus on the industries with high network status,such as mechanical equipment,light industry manufacturing,basic chemical industry,commercial retail,textile and clothing,whose "every move" is related to the change of the market;Regulators should strengthen the supervision of stock market information in the year of stock disaster,and beware of further damage to the stock market caused by false information.