Modelling of the Impact of Technical Trend Signal on Shanghai Stock Market
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Abstract
The paper examines the impact of technical trend signals on Shanghai stock market using an adaptive expectation model based on consistent investment behaviors. The result shows that Shanghai stock market is sensitive to the technical signals. And as far as the trading charges are concerned, only the minority investors, with technical analysis, may possibly gain abnormal returns, while the majority operating according to technical trend signals would assume significant risks.
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