Analyzing Factors of Stock Price Index and Using Simple Linear Regression Techniques

Abstract

Macroeconomic factors usually have an impact on the capital market, but not to the same extent on stock prices, which is related to the lag in the transmission of macroeconomic policies, the short observation period, and market volatility. Usually an increase in money supply, decrease in interest rates, and liquidity easing affect stock price volatility, while inflation has a more complex impact on the stock market. In this paper, the volatility of HS300 stock price index is studied by exploratory analysis of correlation factors and simple linear regression analysis is applied to analyze the correlation.