Does Chinese Stock Indices Agree with Benford's Law?

Abstract

Benford's law is used to describe the statistical character of first digits from natural and experimental data sets. In this paper, we examined the first digits distribution of two main indices in Chinese stock market, the SSE Composite index and SSE Component index. We find that Benford's law reasonably holds for the two main Chinese stock indices. The result can be used in future research, like detecting anomalous behaviors in Chinese stock market.