Empirical Analysis of New Energy Vehicle Industry Based on the CAPM Model

Abstract

As the public’s concern for energy resources and environmental protection is gradually strengthening, the new energy vehicle industry has emerged as a prominent trend in the vehicle industry’s future development, and its great potential for development makes it a hot direction for financial investment. The topic of this paper concentrates on the empirical analysis of the new energy vehicle industry based on the CAPM model, so as to explore the investment opportunities and risks of the industry and provide investment advice for investors with different risk preferences. In this paper, 15 stocks representative of the new energy vehicle industry in China's A-share market are selected. The risk-free rate of return is the one-year Treasury bond interest rate, and the market index is the CSI 300 index. The time span of the data is from June 1, 2022 to December 30, 2022. The results of the research prove that most of the stocks in the new energy vehicle industry are characterized by high return and high risk, so risk-neutral or risk-loving investors may consider investing in the stocks in this industry. However, in general, the CAPM model is weak in explaining the excess returns of the stocks in this industry.