Study On The Influence Of Media Coverage On The Stock Returns

The media,as a main way to convey information in the modern society,conveys information to the public timely and efficiently after collecting,sorting and reporting the information,which affects public's life.With the improvement of economic level,the improvement of the public' income level,and demand for asset allocation,the influence of media information is increasing in the economic field.The media information,as the main way of information about the stock market for the individual investors,can effectively reduce the information search cost of investors,affect the stock allocation scheme and investment decisions of individual investors and affect the stock price by buying or selling stocks.Based on the background of the information age,this paper analyzes the role of media in the stock market:the role of information conveyance and the role of market supervision,does empirical analysis with the media attention and stock return data and analyzes the difference between concept plates between media attention and stock return from the theoretical and empirical aspects.In theory,this paper mainly analyzes the role of media in the stock market.Firstly,the information conveyance function,which means the media can positively affect the public's attention and way of thinking,also can impact the economic environment when the events occur in the stock market.The media conveys information to investors through various forms.Investors are often impressed by stocks or related companies with more media coverage for the reason of "limited attention",then adjust the investment strategy and buy or sell this stock.A large number of investor behavior will cause stock price volatility.At the same time,there are some listed companies use the media to transmit information to protect the interests of senior managers.The next one is market supervision function.Media supervision plays an active role in the stock market due its own openness and universality.Media supervision is considered as the effective supervision power in the emerging capital market,not only affecting stock returns but also as the role of external governance.On empirical aspect,based on the traditional theory of media coverage impacting on the stock returns,use the stocks of concept plate as sample,select eight popular concept plates in 2015:Disney,two-child policy,reform of state-owned enterprises,new energy automobile,military and civilian integration,virtual reality,the Belt and the Road,Internet finance.Divide the media coverage into the coverage about concept and individual shares,capture media coverage data of concept plates and individual stocks based on Baidu media index and obtain stock returns,market returns,turnover,price-to-book ratio,market value and volume of transaction from the wind financial database,do empirical analysis with these data.Analyze the impact of media attention of concept plates and individual stocks on the stock returns respectively.In this paper,the results show that there is a correlation between the media attention and the stock returns,but there is a significant difference among different concept plates.(1),there is correlation between the media attention of individual stocks and concept plates which is based on Baidu media index and stock returns,the degree of correlation of media attention of concept and stock returns is more significant than media attention of individual stocks.(2),from the perspective of plate differences,the impact of media attention of concept on stock returns is more significant in the concept plates which is significant related with the national policy,which means that national policy related media information has a greater impact on investors.The "freshness" of the concept is also one of the factors that affect the relationship between media attention and stock returns,which means that the new concept has a bigger impact on the stock returns.The above empirical results and analysis are in line with actual situation of China's stock market.The stock market in China rises sharply at the end of 2014 and the beginning of 2015,a large number of investors entered the stock market.The number of new accounts break millions in a week,which lead the Chinese common people to roll in stock market.But among the individual investors,most investors lack professional knowledge and rational judgment and some of the new investors are lack of experience.In this environment,the dependence of investors on the media information will be significant improved,investors will believe in the media information especially the authority media,which is be significant verified after the"People's Daily" publishing an article named "4000 points is the beginning of bull A share market".The number of new accounts in that week reached millions,the impact of media information on investors is evident.In the view of actual situation of China in recent years,the impact of media attention of concept on stock returns is higher than the impact of media attention of individual stocks,which is also realistic.This paper will help to make up for the gaps in the current research about the media attention of concept,also can provide advice for the investors,listed companies and regulators.