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What are the factors that contribute to volatility in stock marketing?

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Stock market volatility is influenced by various factors. Macro factors like GDP, inflation, interest rates, money supply, and exchange rates play a role in determining stock price volatility . Additionally, company-specific fundamentals such as earnings and dividend payments are also significant contributors to stock market volatility . Moreover, external factors like oil price volatility, financialization of commodities, and social unrest events have been found to positively correlate with equity price volatility . Furthermore, the impact of domestic and global factors like VIX, TED spread, long-term interest rates, oil prices, sentiment indices, and macroeconomic indices on market returns has been studied, showing that these factors influence the probability of switching between different volatility states in stock markets .

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Open access•Proceedings Article•DOI Research on the Factors Affecting Stock Price Volatility Sijia Li, Yuping Wang, Zifan Zhang, Yiming Zhu - Show less +3 more 01 Jan 2022	Factors affecting stock price volatility include technical indicators, social unrest events, macroeconomic conditions (GDP, industrial productivity), and international aspects (oil price volatility, financialization of commodities).
Open access•Journal Article•DOI Determinants of Stock Price Volatility: A Literature Review Ranil Hewamana, D. Siriwardhane, Ananda Rathnayake - Show less +2 more 21 Jun 2022	Stock price volatility is influenced by macroeconomic factors like GDP, Inflation, Interest Rate, Money Supply, Exchange Rate, and company-specific fundamentals such as Earnings and Dividend Payments, alongside behavioral determinants.
Open access•Journal Article•DOI Analysis of Factors Influencing Stock Market Volatility Based on GARCH-MIDAS Model Dan Ma, Liping Liu, Yi He - Show less +2 more 17 Jan 2022-Complexity 1 Citations	Factors influencing stock market volatility include microstructure noise correction using rAVGRV, macroeconomic variables (MCI, DFI, IVA, M2), Chinese Economic Policy Uncertainty (CEPU), and Infectious Disease EMV.
Journal Article•DOI The effect of financial, macroeconomic and sentimental factors on stock market volatility Anna Czapkiewicz, Agnieszka Choczyńska - Show less +1 more 31 May 2021	Financial, macroeconomic, and sentimental factors such as VIX, TED spread, oil prices, ZEW index, long-term interest rates, and CPI influence stock market volatility according to the research.
Open access•Journal Article•DOI A Literature Study of the Stock Market Volatility 27 Apr 2023-BCP business & management	Factors contributing to stock market volatility include market maturity, historical analysis, external macro and micro influences, financial legal systems, market transparency, and openness levels.

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What is stock market volatility?5 answersStock market volatility refers to the degree of variation in trading prices over time within a financial market. It is a crucial aspect of investment risk analysis, often measured using models like ARCH and GARCH. Volatility can lead to opportunities for profit for risk-seeking investors but can also deter risk-averse individuals due to the associated uncertainty and potential high risks. Predicting stock market volatility has become a significant topic in financial research, with various methods like neural networks being employed to analyze and forecast market behavior. Understanding and managing stock market volatility is essential for investors and financial institutions to make informed decisions and mitigate risks in the dynamic and ever-changing financial landscape.

What are the causes of stock market volatility?4 answersStock market volatility is caused by investors' expectations and behavior, as well as factors such as information flow, trading volume, economical aspects, and investor's behavior. The previous residuals (ARCH effect) significantly contribute to stock market volatility at lower quantile levels, while previous volatility is significant at higher quantile levels. Additionally, exchange rate return is found to be a significant external cause of volatility. Investors in the stock market perceive certain factors to have an impact on stock market performance, such as company-related and industry-specific factors. Intraday range, which measures the difference between intraday high and low prices, is often used as an efficient volatility estimator.

Why is volatility important?5 answersVolatility is important because it is associated with risk in financial markets. It is a key concept for assessing market risk and making investment decisions. Volatility allows investors to earn unexpected profits and is considered by informed investors while making investment decisions. It is also used to analyze the duration of processes in the stock market and make adjustments to optimize financial strategies. Volatility is crucial for pricing risks in stock, option, bond, and foreign exchange markets. Accurate measurement and estimation of volatility are critical in financial markets. Additionally, volatility indicators and derivatives are popular among investors for hedging risks and improving portfolio management. Volatility models, such as GARCH, are used for predicting and forecasting market volatility.

What are the factors that lead to high volatility in the stock market?3 answersHigh volatility in the stock market can be attributed to several factors. Economic factors such as long-term interest rates, oil prices, and sentiment indices have been found to influence market volatility. Additionally, macroeconomic conditions like GDP and industrial productivity, as well as international factors such as oil price volatility and financialization of commodities, have a positive correlation with equity price volatility. Investor expectations and behavior also play a role in stock market volatility. Furthermore, the impact of microstructure noise on volatility estimation and the introduction of Chinese Economic Policy Uncertainty (CEPU) index have been identified as factors affecting stock market volatility. It is important to note that volatility is influenced by numerous factors, and there may be hidden factors that have not been considered.

What factors affect market volatility?5 answersMarket volatility is influenced by various factors. Economic factors such as long-term interest rates, oil prices, sentiment indices, and macroeconomic indices have an impact on market returns. Additionally, macroeconomic factors like economic policy uncertainty and government policies are correlated with and can predict market volatility. The analysis also suggests that factors specific to consumer markets, such as demand, consumer preferences, supply chain efficiency, innovation and technology, and pricing strategies, contribute to volatility in those markets. Furthermore, the presence of microstructure noise in mixed frequency data can affect volatility estimation, and the inclusion of Chinese Economic Policy Uncertainty index in the GARCH-MIDAS model has shown to impact stock market volatility. Overall, a combination of economic, macroeconomic, consumer market, and microstructure factors play a role in determining market volatility.

What is the formula to define volatility?5 answersThe formula to define volatility is not constant and can vary depending on the context. Traditional formulas for volatility only consider historical information and do not take into account decision makers' knowledge and skills. However, there are alternative models and approaches that can be used to estimate and calculate volatility. One approach is to extract volatility from price data by assuming it is described by a hidden Markov process. Another approach is to model volatility as a function of various factors such as the volatility of an information signal, real interest rates, and inflation expectations. It is important to note that the use of different measures and models for volatility is driven by the fact that volatility is not directly observable and there is a need to approximate it empirically.

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