Can investors profit by utilizing technical trading strategies? Evidence from the Korean and Chinese stock markets

Abstract The idea of this study is derived from observing the profitability stock investments following phenomena continuously rising (or falling) prices stocks and overbought oversold) signals emitted by technical indicators. We employ standard event approach trading strategies to explore whether investors would exploit profits in constituent Korea Composite Stock Price Index 50 Shanghai Exchange when aforementioned continuous occur. find that both Korean Chinese markets are not fully efficient; finding may enhance robustness existing literature. In addition, we reveal contrarian appropriate for listed on market all cases investigated study. However, momentum simultaneously observed. These findings imply difference investor behaviors between might result dissimilar being employed these two markets.