AN EMPIRICAL STUDY ON THE PERFORMANCE OF NSE INDEX FUTURES AND THEIR UNDERLYING STOCKS DURING 2013–2016

D.SRIKANTH REDDY; PROF. D. SURYACHANDRA RAO

Volume : VII, Issue : IV, April - 2017

AN EMPIRICAL STUDY ON THE PERFORMANCE OF NSE INDEX FUTURES AND THEIR UNDERLYING STOCKS DURING 2013–2016

D. Srikanth Reddy, Prof. D. Suryachandra Rao

Abstract :

In this paper, we studied the performance of index futures and their impact on underlying stocks from the 1.Apr. 2013 to 31.Mar 2016, in National stock exchange (NSE), India. We found that there is, the index future and their underlying stocks are significantly positive. The market returns have a significant relationship with stock returns. We have applied Statistical Tools like Mean to calculate Average returns, Standard deviation it is a measure of the values of the variables around its mean, Correlation measures the nature and extends relationship between stock return and index return for a particular point of time and Beta describes the relationship between the stock return and index return. The graph indicates that there is relationship between index returns and stock returns. The study suggests that index futures are extremely useful for hedgers to minimise risk.