Stock Price and Trading Volume

High school
Pages 4 (1004 words)
Download 0
The Volume and Price Change Per Se and the empirical evidence found. There are the bull markets and the bear markets, the volume is found to be relatively heavy within the bull markets and to be lighter within the bear markets. First bond market (20) tests had been developed by Epps as to sustain the above mentioned theory and then later tests were developed upon stock markets (22).


Wood, McInish, and Ord (71), had found contradicting evidence, in the price-volume relationship. For they established the ratio between the price change and trading volume to be greater for the share prices downticks.
Smirlock and Starks (64) had found that the relationship could only be supported during the time intervals when they could distinguish when the new information ex ante had reached the financial market. Due to the lack of the delivery of information to the financial market and the upbeat transaction costs, small amounts of evidence found that the relation had been lower for the up-ticks in the price than for the downticks.
Data collected over an hourly basis from an extensive market index by Jain and Joh (38), had discovered the trading volume relates positively to the enormity of the price change. Findings have shown though, that the volume is more sensitive towards the positive price changes in contrast to the
negative price changes. Epps, Hanna, Jain, Joh and parts of Smirlock and Starke's findings shown an implication of a positive correlation between the price change and trading volume per se. Ying's items (1) and (2) and a numerous number of researchers had found a similar positive correlation as found above.
Rogalski (60) had ...
Download paper
Not exactly what you need?

Related papers

Malaysian stock market
Using Duncan & Etebari's (1990) method, an initial sample of five securities firms in the KLSE which posted the largest price gains for each of the 49 trading weeks of 2005 will be obtained, all of which were queried by the KLSE during the same period as well. From the price data, initial raw returns will be calculated which in turn will be used to estimate average and cumulative average returns.…
12 pages (3012 words)
Maximising Stock Valuation
With this background, as per the BT management's opinion as on 31st March 1983 with the NFL loan amount of 2944 million the debt ratio for the company was too high and a new capital structure was needed to increase the stock valuation for the proposed floatation move.…
7 pages (1757 words)
The effect of dividends on stock price
You must also have -a run of consistent good luck. Sudden wealth and big windfall gains depend more on luck, less on skill and knowledge. J. Paul Getty1 was -one such outstanding example. He became the world's richest man and accumulated a vast fortune of over U.S. $ 2 billion but it took him over fifty years of consistent and steady investing to do so. It would be useful for you to ponder over…
37 pages (9287 words)
Role Of Analytical Investment Strategies And Efficient Market Hypothesis In Equity Selection And Stock Price Behaviour.
This paper investigates the applicability of the hypothesis in the U.K. stock market through interviews with investment analysts and managers to discuss the effectiveness of each strategy in the selection of equities. As a practical application of the concepts learned, the intrinsic value of IBM Corporation's stock is calculated using fundamental analysis, and an interpretation in the light of the…
42 pages (10542 words)
Stock Price and Information
This will benefit existing shareholders.however; the potential new shareholders are not stupid. They will infer overvaluation from the new issue, thereby bidding down the stock price on the announcement date of the issue. So, for the information asymmetry stock price is raised.therefore, information affects stock price in many way.…
20 pages (5020 words)
Stock split and stock price
Yes, you are right. Stock options even before they are vested have values. Such values are computed using complicated option pricing models such as the Black-Scholes option pricing model. These models are based on several factors.…
2 pages (502 words)