Effects Of Hainan International Tourism Island Strategy Declared On Hainan Stocks

On January4th,2010, the State Council announced that the view of strategic development of international tourism in Hainan Island, which means that the construction of Hainan international tourism island rose to national strategy that will greatly stimulate the economic development of Hainan Province, bring listed companies in Hainan good development opportunities, and also will impact Hainan stock price. This article would use event analysis method to analyze the stock price movement after declaring Hainan International Tourism Island Strategy. This paper chose a sample of15stocks to do a research with empirical analysis and comparative analysis. First, the research based on the entire sample as a whole, which not only confirmed that the declaration of Hainan International Tourism Island strategy had a significant impact on the stock movement, but also reveals that its true impact on the stock price is after declaring the development strategy. On this basis, re-establishing a more reasonable event window for each stock movements were analyzed, and the impact of stocks in different industry were compared. Through the analysis and comparison of individual stocks, it was found that Hainan International Tourism Island strategy declaring had greatest impact on Lawton, Hainan Expressway, Hyde shares, Big East Sea A and Luoniushan, which are respectively tourism and real estate related. Further industry based on a comparison between different industries reveals that the excess return of the tourism and real estate industry are more than the other industries. The results of this study can provide a reference for stock market participants to explore the potential investor shares, and grasp the short and long term investment opportunities.