A STUDY ON RISK AND RETURN ANALYSIS OF SELECTED STOCK IN BOMBAY STOCK EXCHANGE

Abstract

Investment in the stock market involves higher risk. At the same time, it brings comparatively higher return than any other investment opportunity. This study is an attempt to analyse the Risk and Return analysis of the selected stock in the Bombay Stock Exchange. The objective of the study is to analyse the return on investment in the shares of the selected companies for a period of 5 years from January 2013 to December 2017 and also to find out their volatility. This study is descriptive in nature. It analyses the risk and return on the stock of ten companies chosen from three industrial sectors, namely, Information Technology, Banking and Automobile based on their share prices. It uses the analytical tools like Beta, Alpha, Correlation to analyse the risk and return from the shares of the corresponding companies. This survey will attempt to identify how the risk of the different sector of company in investment attests on the return and efficiency of the portfolio management of the company sector. Finding of this research may help the companies in the different sectors to make suitable revisions, manage the various risks and lead to efficient portfolio management. The results of the study also help the investors to identify the best way of their investment to get maximum profit. The study reveals that among the ten selected companies in the BSE, Maruti Suzuki India Ltd, HDFC Bank and HCL Company have yielded very high profitable return in the stock market.