Market Impact Analysis of Financial Literacy among A-Share Market Investors: An Agent-Based Model

Abstract

Financial literacy has become increasingly crucial in today’s complex financial markets. This paper explores the impact of financial literacy on the stock market by establishing an artificial financial market that aligns with the characteristics of the Chinese A-share market using agent-based modeling. The study incorporates financial literacy into investors’ mixed beliefs and simulates their behavior in the market. The results show that improving individual investors’ financial literacy can improve market quality and investor performance, as well as reduce the unequal distribution of wealth to some extent. However, the phenomenon of speculative trading and irrational behavior in the market can pose potential risks that require regulatory measures. Thus, policy recommendations to improve individual investors’ financial literacy and establish corresponding regulatory measures are proposed.

Weighted Signed Networks Reveal Interactions between US Foreign Exchange Rates

“…Under an increasingly complex global network of interconnected finance, understanding monetary connectivity in financial markets is crucial for economic actors, including investors, economic authorities, and policymakers [3]. This paper explores how the crosscorrelation of the exchange rate of the US dollar to a range of currencies changes in different periods.…”