The Impact of International Oil Prices on the Stock Price Fluctuations of China’s Renewable Energy Enterprises

In order to address a series of issues, including energy security, global warming, and environmental protection, China has ranked first in global renewable investment for the seventh consecutive year. However, developing a renewable energy industry requires a significant capital investment. Also, th...

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Published inEnergies (Basel) Vol. 12; no. 24; p. 4630
Main Authors Hsiao, Cody Yu-Ling, Lin, Weishun, Wei, Xinyang, Yan, Gaoyun, Li, Siqi, Sheng, Ni
Format Journal Article
LanguageEnglish
Published Basel MDPI AG 05.12.2019
Subjects
Alternative energy sources
Autoregressive models
Autoregressive processes
Climate change
Crude oil prices
Energy
Energy industry
Energy policy
Environmental protection
Fluctuations
Global warming
Investment
Oil
Renewable resources
Security
Stock exchanges
Volatility
United States > US
China
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Summary:In order to address a series of issues, including energy security, global warming, and environmental protection, China has ranked first in global renewable investment for the seventh consecutive year. However, developing a renewable energy industry requires a significant capital investment. Also, the international oil price fluctuations have an important impact on the stock prices of renewable energy firms. Thus, in order to provide implications for market investment as well as policy recommendations, this paper studied the spillover effect of international oil prices on the stock prices of China’s renewable energy listed companies. We used a Vector Autoregressive (VAR) model with innovations using a Factor-GARCH (Generalized Autoregressive Conditional Heteroskedasticity) process to evaluate the impact of market co-movements and time-varying volatility and correlation between the international oil price and China’s renewable energy market. The results show that the international oil price has a significant price spillover effect on the stock prices of China’s renewable energy listed companies. Moreover, the fluctuations of international oil prices have an influence on the stock price variations of Chinese renewable energy listed companies.
ISSN:1996-1073
1996-1073
DOI:10.3390/en12244630