Journal
| Title | Impact of FIIs on Indian Stock Market: A Case Study of National Stock Exchange of India. | |
| Author's Name | Mohammad Shahfaraz Khan and Aslam Khan | |
| ISSN | 0974-7281 | |
| Page(s) | 75- 85 | |
| Volume No. | 8 | |
| Issue Month | July 2016 | |
| Keywords | FIIs, NSEI, OLS, Indian Stock Market. | |
| Abstract | With the advent of Liberalization, India attracts a large sum of FIIs every year. These foreign investments have a great impact on the Indian Stock Market. National Stock Exchange of India, which is one of the indicators of the Indian Stock Market, is also being affected by the foreign investments. This study has therefore been done to validate the null hypothesis that this foreign institutional investment being made in India affects the National Stock Exchange of India and Indian stock market as well. The stock market data have been taken from the websites of NSE, and the net FIIs data have been taken from the GOI report. A descriptive study has been done to validate the null hypothesis about the relationship between FIIs and Stock Market Volatility and also the impact of FIIs on the market capitalization and turnover of NSEI. The relationship has been checked on yearly and monthly basis and the data for same have been collected for 10 years. During the study, yearly and monthly data of Turnover and Market Capitalization of NSE and net FIIs investments of 10 years (2000-10) have been collected. The study has used OLS (Ordinary Least Square) technique under regression analysis as a statistical tool to validate the null hypothesis of relationship between Indian stock market and FIIs Investments and also identify the impact of FIIs on the Indian Stock Market. It has also used correlation to find the extent of association linking these variables. The inclusion criteria used for this study are that only NSEI has been taken as an indicator of Indian stock market and net FIIs have been taken only from the government record books available in the public domain. The result of the study suggests that FIIs have a positive impact on the performance and development of NSEI as well as on Indian Stock Market. It is also concluded that FIIs are responsible for the volatility of Indian Stock Market. |
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