The Effects the Agricultural Policies on the Stock Price Volatility
|Keywords||Agricultural Policy Stock Price Fluctuation|
The Slump and boom in China’s stock market as well as the uncertainty of policyexpectations undoubtedly increased the difficulty of the relevant national economicmanagement departments to regulate the stock market, and reduce the country’s power toregulate and control securities market by economical means.Therefore exploring theeffects that the changes of the government regulation and control policy have on China’sstock market in depth and system, is of very important theoretical and practicalsignificance to strengthen the management and control of China’s stock market, improvethe efficiency of government to regulate and supervise the stock market, and safeguardthe healthy, stable and sustainable development of China’s stock market.On the basic of analyzing related literature and theory, this paper expects to carry onthe empirical research on the stock price movement whthin a short time after theagricultural policy was released in2012and2013,using descriptive statistics and eventResearch. The research shows that after the policy is released, related stock prices risesharply, which means that the release of agricultural policy in a short term has a positiveimpact on the fluctuation of agriculture shares price, and affects related stock prices ondifferent level. But the effects on the two events are different, the amplitude decreasingcontinuously, especially the huge difference in the shenzhen agriculture index, whichshows that the market have a certain immunity to the release of agricultural policy, andthe issue of agricultural policy can’t strongly stimulate agricultural stock price growth inthe short run as last year.Finally, on the basis of above theoretical research and empirical research, this paperpoints out the main reasons why the relevant stock prices fluctuate after the agriculturalpolicy released: the market validity is insufficient, policy making is not careful enough,the appropriate expectations and public opinion management mechanism has not been setup yet. Hereby, we put forward the following policy recommendations: improving stockmarket efficiency gradually; improving the policy decision-making, disclosing andexecuting programes; leading investors to invest rationally; strengthening the support to the listed agricultural companies.