Volatility spillovers between crude oil and Chinese sectoral equity markets: Evidence from a frequency dynamics perspective

A-Tier
Journal: Energy Economics
Year: 2019
Volume: 80
Issue: C
Pages: 995-1009

Authors (2)

Score contribution per author:

2.018 = (α=2.02 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We examine the frequency dynamics of volatility spillovers between crude oil and China's stock markets in a spectral representation framework of generalized forecast error variance decomposition using sectoral stock indices data. We find evidence of total volatility spillover driven mainly by short-term spillovers. The net spillovers of the oil market are almost all positive and dominated by short-ter.m components, although the spillover during China's 2015 financial crisis is negative and attributable to long-term components. In addition, there exists heterogeneity in net pairwise (frequency) spillovers between the oil and sectoral stock markets. Moreover, structural breaks in volatilities appear to be a significant feature of volatility spillovers. Finally, frequency spillovers in our system can predict future stock market volatility. These results have economic implications for investors and policymakers.

Technical Details

RePEc Handle
repec:eee:eneeco:v:80:y:2019:i:c:p:995-1009
Journal Field
Energy
Author Count
2
Added to Database
2026-01-29