A Review Study on the Analysis of Validity Validation of Chinese Stock Market Pairs Using CAPM

Mahe Du

doi:10.54691/bcpbm.v30i.2514

Authors

Mahe Du

DOI:

https://doi.org/10.54691/bcpbm.v30i.2514

Keywords:

CAPM, Theory validity test, China stock market, Review.

Abstract

Since the inception of the Capital Asset Pricing Model (CAPM), numerous empirical studies have been conducted to test its effectiveness. However, there are several disputes surrounding the CAPM model's implementation and study in the Chinese securities market. This paper first describes the significance of the CAPM model in testing its validity in the Chinese market. Then the paper summarizes 11 papers that include using data from the Shanghai and Shenzhen stock exchanges as assistance, and using different analytical methods to conduct research. The investigation demonstrates that the CAPM model's relevance and validity in the China stock market are restricted. Finally, a summary of the issues with the CAPM model's practical use in the Chinese securities market is provided, along with suggestions for solutions.

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