Volume : IV, Issue : V, May - 2015
A Study of Foreign Institutional Inflows and Indian Stock Market Volatility
Dr. Kajal Gandhi
Abstract :
It is observed that a significant amount of capital is flowing from developed economies to emerging economies. It has been seen that the foreign institutional investments have played a dynamic role in emerging economies. The liberalization process undertaken by the government of India in early 1990s have ought about significant changes in the structure and functioning of the Indian stock market. One of the important policy measures included the allowance of foreign institutional investors in the Indian stock market in 1992. Entry of these FIIs has truly helped to change the face of Indian stock market. Positive fundamentals, gradual removal of structural barriers combined with fast growing markets have made India an attractive destination for foreign institutional investors. Today, FIIs are the key drivers of the Indian equity market and rising stakes in Indian companies. The volatility of the market which has been ought in by FIIs cannot be neglected in this regard. The increase in the volume of foreign institutional investment (FII) inflows in recent time has led to concerns regarding the volatility of these flows, threat of capital flight, its impact on the stock markets and influence of changes in regulatory regimes. In this paper using granger’s causality test it is revealed that FIIs granger causes the volatility in Indian stock market.
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DOI : 10.36106/ijsr
Cite This Article:
Dr. Kajal Gandhi A Study of Foreign Institutional Inflows and Indian Stock Market Volatility International Journal of Scientific Research, Vol : 4, Issue : 5 May 2015
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Dr. Kajal Gandhi A Study of Foreign Institutional Inflows and Indian Stock Market Volatility International Journal of Scientific Research, Vol : 4, Issue : 5 May 2015
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