Cryptocurrency Market Volatility and Its Spillover to Traditional Stock Markets: GARCH and DCC-GARCH Modeling
Researchers actively study cryptocurrency market behavior. They examine how volatility in crypto markets affects traditional stock markets. This topic uses advanced econometric models for clear insights.
First, analysts apply GARCH models to measure volatility in cryptocurrencies. These models capture sudden price swings effectively. Next, they use DCC-GARCH models to detect spillover effects. This approach reveals dynamic correlations between crypto and stock markets.
Moreover, the study tracks how shocks in Bitcoin or Ethereum spread to indices like Nifty or S&P 500. Investors gain better risk assessment tools through this analysis. As a result, portfolio managers can improve hedging strategies.
In addition, researchers compare results before and after major events. They analyze periods such as market crashes or regulatory changes. This helps identify changing patterns over time.
Overall, this research delivers practical value for financial decision-making. It supports regulators, investors, and policymakers with evidence-based findings. Scholars continue to refine these models with fresh market data.
This topic works well for empirical studies, thesis work, or journal publications. It focuses on strong statistical analysis and real-world applications.