Open AccessAn Empirical Examination of the CAPM on BSE SENSEX Stocks
Publication year - 2019
Publication title -
international journal of recent technology and engineering
Language(s) - English
Resource type - Journals
ISSN - 2277-3878
DOI - 10.35940/ijrte.b1121.0982s1019
Subject(s) - capital asset pricing model , financial economics , economics , stock (firearms) , stock market , risk–return spectrum , business , actuarial science , econometrics , portfolio , engineering , mechanical engineering , paleontology , horse , biology
Investment plays a significant role in the modern economy. The investor understands the importance of investment in wealth creation. But real causing problem for investor is prediction of risk to have assured return in each company shares. It has understood that minimizing the systematic risk is always difficult than unsystematic risk. If we look in to the earlier study done by many researchers, we find that CAPM model would be right technique to know the risk and return relationship in any stock. With the point of view of significance and reliability of CAPM model, we have used CAPM techniques to conclude the results. The first model developed by William Sharpe and other scholars supporting to this model has been used to test the results. This study investigates the validity of CAPM on BSE 30 companies from BSE website. The study considered closing price of 30 companies of BSE stock market from January 2009 to December 2018.