Foreign Institutional Investment and Stock Market Returns: Evidence from Indian Capital Market

Patel, Samveg A.

doi:10.5958/j.0976-173x.4.2.011

Cited by 2 publications

(2 citation statements)

References 0 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Following were the sets of equations framed Stock Returns = Ln (P 0 /P 1 ) (Eqs. [1][2][3][4][5][6][7][8][9][10][11][12][13][14][15] for the purpose of such analyses where FIIs, DIIs and stock market returns have been assigned as endogenous variables and their dummies as regressors:…”

Section: Methodsmentioning

confidence: 99%

“…An interesting finding from the study also suggested that mutual funds significantly increase the tendency of herding. Patel [12] analyzed the impact of FIIs on Indian stock market returns using monthly data for the period 1993-2012. The researcher applied various econometric techniques such as Johansen co-integration test, augmented Dickey-Fuller test, Granger causality test and vector error correction model (VECM).…”

Section: Literature Reviewmentioning

confidence: 99%

See 1 more Smart Citation

A cause and effect relationship between FIIs, DIIs and stock market returns in India: pre- and post-demonetization analysis

Parab

Reddy

2020

Futur Bus J

View full text Add to dashboard Cite

In one of the most historic decisions in the Indian economy, the Government of India demonetized its two highest currency notes (Rs. 500 and Rs. 1000) on November 8, 2016. The Indian stock market does not only consist of domestic investors; however, it does attract a large pool of foreign investors. The present study, considering the significance of demonetization in Indian economy, attempted to examine the association between foreign institutional investment (FII), domestic institutional investment (DII) and stock market returns taking into account a period of 686 days from June 11, 2015, to March 27, 2018, i.e., 343 days pre- and post-demonetization. The study made use of various statistical techniques such as summary statistics, augmented Dickey–Fuller test, correlation analysis and regression analysis. The results indicate a negative relationship of FIIs and DIIs with Nifty 50 Index Returns prior to demonetization; however, such a relationship was noticed to be positive post-demonetization. The present study did not evidence a significant impact of demonetization on FIIs and DIIs, but a significant negative impact was noticed in the case of Nifty 50 Index and various sectoral indices post-demonetization. Nifty Realty sector was found to be severely affected because of demonetization. The study will help the government in understanding the impact of demonetization on foreign and domestic institutional investors, various sectoral indices and evaluate market sentiment post-demonetization and therefore frame necessary policies. Also, the information provided in present study will help various stock market participants.

show abstract