Research on Investment Value of Bank Stocks Based on Factor Analysis Model

Abstract

Banks are directly affected by macroeconomic factors in China, with changes in these factors significantly impacting bank stock prices and the banks' operations and management. Due to differences in capital attributes, state-owned banks and non-stateowned banks exhibit various micro-level differences, leading to different reactions in their stock prices to macroeconomic changes. Consequently, the investment value analysis for banks with different attributes also differs. This paper conducts an empirical analysis of the investment value of bank stocks, primarily following these steps: first, conducting factor analysis on cross-sectional data to calculate the total variance explained by the factor analysis and the factor scores; second, calculating the common factors and composite scores for each quarter; and finally, using panel data and the improved TOPSIS-based factor analysis model to evaluate the stock investment value of 16 banks for the first, second, and third quarters of 2022. The results indicate a disparity in investment value between state-owned and non-state-owned banks, with an overall imbalance in investment value among these banks.