Journal
| Title | Understanding the Major NSE Indices through Beta Analysis | |
| Author's Name | Faye Xavier Colaco and Andrea Almeida D’Costa | |
| ISSN | 0974-7281 | |
| Page(s) | 12-18 | |
| Volume No. | 6 | |
| Issue Month | July 2014 | |
| Keywords | Beta, NSE, Return, Risk, Sectors. | |
| Abstract | Understanding risk and return is most critical and most important basis of any transaction. There will always be some amount of risk which is associated in any transaction. The extent of this risk would probably vary from industry to industry, but the underlying fact remains that risk will always exist as it cannot be eliminated from the system. This risk comprises of unique and market risks. Beta, which is basically a measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole, is used by investors to get an accurate measure of the market risk of various sectors. The objective of this paper is to understand and interpret the Return and Risk for eleven sectors of Indian economy over the last 10 years. The sector wise indices from NSE were used for the purpose of this analysis. The sectors that have been considered for the study include Auto, Banking, Energy, Finance, FMCG, IT, Media, Pharma, PSU Banks and Realty sector. The analysis of Beta for each year indicates that Beta values have not been stable for any sector over the 10 year period except for the Auto sector. The Beta value for the Auto sector is constant over the last 10 years whereas values of some sectors have shown an increasing trend and the other shows a decreasing trend. |
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