Abstract
Foreign research on the stock market and macroeconomics has always believed that the two have a relatively strong correlation, but the domestic research results are completely irrelevant or weakly correlated. This article uses the Shenzhen Index as an example to analyze its relationship with the macro economy, and combines the irrational investment theory to analyze the reasons for the weak correlation between the macro economy and the stock market.
Highlights
Many literatures in the past have studied the relationship between GDP and macroeconomics
This article uses the Shenzhen Index as an example to analyze its relationship with the macro economy, and combines the irrational investment theory to analyze the reasons for the weak correlation between the macro economy and the stock market
Relevant foreign literature all shows that the relationship between the stock market and the economy is relatively strong, but domestic research is not the case
Summary
Many literatures in the past have studied the relationship between GDP and macroeconomics. Chen Shoudong and others analyzed the relationship between industrial added value and variables such as the Shanghai Stock Exchange Index and Industrial Index through a co-integration model and found that the real economy and the stock market are weakly correlated (Chen, Yi & Liu, 2014). Li Yanhong and He Zhanghua analyzed the relationship between GDP and the amount of funds raised in the stock market through co-integration and error correction models, and concluded that the stock market and the economy are deviating (Li & He, 2009). “The stock market is risky, and you need to be cautious when entering the market.” This just confirms the above figure, but from the overall trend, both are both. It is showing an upward trend, so an important hypothesis of this article is proposed: the two are relatively weakly related, but the economic development is still relatively affected by other factors
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