Investment Efficiency Based on Technical Analysis: Evidence from Vietnamese Stock Market

Abstract

There needs to be more consensus between academics and investors regarding the effectiveness of investing in stock markets based on technical analysis. Previous studies in the Vietnamese stock market have mainly used t-statistics, which has been shown to be unsuitable when the object of study is stock prices due to violated assumptions. Therefore, to find the solution to this disagreement, the study used the bootstrap method with daily closing price data of VNIndex from the year 2000 until the end of 2021. The research results show that technical analysis can improve investors’ investment efficiency, with an average annual return rate of 12.85%. Moreover, this effectiveness is still maintained when transaction fees are taken into account.