Game Industry in Long-term Uncertain Situation: A Normalized Covid-19 Pandemic Perspective

Abstract

An unprecedented pandemic of Covid-19 hit the world and impacted the stock price of the game industry in China and overseas. How largely the game industry stock price is impacted, and the prediction of the future trends is being studied in this paper. To have a better understanding of data and to make sure predictions are accurate, this article employs VAR and ARMA-GARCH models. It is found that the relationship between the game industry and Covid-19 in the beginning stage is highly and positively related in China and overseas markets, but then the relationship turns to be negative. In the long run, the impact of Covid-19 on the game industry turned negligible, and the relationship became stable. It is also found that investors do not seem to learn from their previous experiences, and the earning yield of the game industry is repeated over and over in history, but the time for the recurrence of history has been shortened.