A Project Report

On
COMPARATIVE RISK RETURN ANALYSIS OF BOMBAY STOCK
EXCHANGE AND
IT SECTOR IN INDIA

A Thesis submitted in partial fulfillment of the requirements for the award

of the
Degree of

MASTER OF BUSINESS ADMINISTRATION

Prepared by
MS. SUPRIT BHUYAN
REGD. NO. 230402100008

Under the Guidance of

Dr. Girija Nandini

SCHOOL OF MANAGEMENT

CENTURION UNIVERSITY OF TECHNOLOGY AND MANAGEMENT

ODISHA

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 2023-24

CERTIFICATE

This is to certify that the thesis entitled “Comparative risk return analysis of
Bombay stock exchange and IT sector in India” being submitted to the
faculty School of Management, Centurion University Technology and
Management is a bonafide work of MS. SUPRIT BHUYAN, carried out
under my / our supervision, is in accordance with the standards prescribed by
the university for the award of the degree of Master of Business
administration of this University. It is to further certify to the best of my /
our knowledge, that this work has not been submitted earlier in this institute
and the university or elsewhere for the award of any degree or diploma.

Signature of Co- Supervisor Signature of Supervisor

Name of Co- Supervisor with designation Name of Sup

SIGNATURE
(Dr. V…... C……)
HEAD OF THE DEPARTMENT / DEAN OF THE SCHOOL

DEPARTMENT SEAL

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 DECLARATION

I hereby declare that the Thesis entitled “Comparative risk return analysis of

Bombay stock exchange and IT sector in India” submitted for the Master of

Business administration is my original work and the project has not formed

the basis for the award of any Degree / Diploma or any other similar titles in

any other University / Institute.

Name of the Student: SUPRIT BHUYAN

Signature of the Student:

Registration No: 230402100008

Place: Bhubaneswar

Date

3
 ACKNOWLEDGEMENTS

This project has been a great learning experience for me and I would like to
express my sincere gratitude to all the people who guide me through the project.
I owe enormous intellectual debt towards my university faculty Dr. Girija
Nandini Centurion university of Technology and Management for the
continuous support and cooperation throughout my project. I would like to
thank all the respondents whom I interacted during my project & for their
cooperation without this I may not be able to complete it successfully.

Name of the Student: SUPRIT BHUYAN

Signature of the Student:

Registration No: 230402100008

Place: Bhubaneswar

Date:

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 CONTENT

S.N CHAPTER

1 INTRODUCTION

2 INDUSTRY PROFILE

3 RESEARCH

METHODOLOGY

4 DATA ANALYSIS

5 FINDINGS

BIBLIOGRAPHY

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 ABSTRACT
Risk, in simple wont, is an uncertainly, Risk and uncertainties are the. facts of
life so to the common stockholders. Technically, their meaning' are different.
Risk, simply in investment, means a chance of happening some unfavourable
event or danger of losing some value. Risk suggests that a decision maker
known the possible consequences of a decision and their relative livelihoods at
the limes he makes decision. In other, uncertainty is simple a lack of definite
outcomes, its anything that could happen-any unknown event, which may be
favourable, or unfavourable on the other hand. Uncertainty involves a situation
about which the likelihood of the possible outcomes is not known. The trouble
arises from the fact that despite different interpretation of uncertainty and risk,
people often use them interchangeably. Although it is quite clear what precisely
these two terms mean, authorities in the field of finance do agree that the risk is
the product of uncertainty. Return better known or reward from an investment
includes both current income and capital gain or loss that arises by the increase
or decrease of the security price. Usually expressed as a percent of beginning
price of the investment, the overall rate of return can be decomposed into two
parts as capital appreciation and dividend. Capital appreciation is the difference
between ending value and beginning value of an investment. Return is defined
as the dividend yield plus the gain or loss. The relationship between different
levels of return on their relative frequencies is called a probability distribution.
The findings and results will be helpful to evaluate the strength and weakness of
the sampled banks and industry. The recommendation is made to take a
corrective action and decisions.

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 INTRODUCTION

The Securities Exchange Board of India (SEBI) is the regulatory

board which makes regulations and laws to govern the stock
market of India. Currently, there are two stock exchanges in
India, i.e. the Bombay Stock Exchange(BSE) and the National
Stock Exchange (NSE). Although a one-stop platform market
where individual investors and after understanding the risk
involved. The stock market is and how much he can expect to
gain can be estimated by BSE has more than 5,000 companies
registered, most of the capital market plays an important role in
developing a companies and industries for productive use. In
turn, stock companies come with their own objectives, and both
have country by making savings of individuals available to
getting rich. Many people out there have got rich through the
govern the stock market of India. Currently, there are two
individual investors can entrust their savings to the stock
investment, such as bonds or fxed deposits. However, with
investors to invest their savings in the stock market, even lost
more than they were able to gain through investment inmarket
has to give investors something in return so that market. So
this something is the returns above the normal rate of returns
that investors can get through any safe regulatory board which
makes regulations and laws to risk comes high returns.
However, it may not be true every risk-returns analysis. It is a
common belief that with high stock exchanges in India, i.e. the
Bombay Stock Exchange stock market, but simultaneously,
there are also many who stock market; so the returns should be
attractive enough for The Securities Exchange Board of India
(SEBI) is the the stock market.
STOCK MARKET IN INDIA

The stock market in India is a dynamic and rapidly growing segment of the country's
financial system, acting as a key mechanism for raising capital and facilitating investment.
India’s stock market is primarily driven by two major exchanges: the Bombay Stock
Exchange (BSE), the oldest in Asia, and the National Stock Exchange (NSE), which
revolutionized trading in the country with its electronic platform introduced in the 1990s.
These exchanges are home to thousands of listed companies, ranging from large
multinational corporations to small and medium enterprises (SMEs), providing diverse
opportunities for investors. The market also includes products like equity shares, bonds,
derivatives, and commodities, and continues to evolve with the introduction of new financial
instruments such as Exchange-Traded Funds (ETFs) and Real Estate Investment Trusts
(REITs).

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The Indian stock market is widely regarded as a barometer of the country's economic
performance. Key indices like the Sensex (for the BSE) and the Nifty 50 (for the NSE) track
the performance of the 30 and 50 largest and most actively traded companies, respectively.
These indices are closely watched by both domestic and international investors to gauge
market sentiment, economic trends, and investor confidence. For example, the movements of
these indices often correlate with factors such as inflation, GDP growth, interest rates, and
foreign investment flows.
India’s stock market has become increasingly integrated with the global economy, attracting
a large influx of foreign institutional investors (FIIs), particularly after the liberalization of
the Indian economy in the 1990s. The reforms initiated by the Indian government and the
Securities and Exchange Board of India (SEBI) have played a key role in ensuring the
market’s growth and credibility. SEBI, the regulatory body, enforces strict guidelines on
transparency, corporate governance, and investor protection, which has helped build investor
confidence and attract more global capital. The government’s initiatives, such as allowing
foreign direct investment (FDI) and easing norms for foreign investors, have further opened
up the Indian stock market to global players.
Technology has also been a major driver of growth in the Indian stock market. The shift from
traditional open-outcry trading to electronic trading platforms has made stock trading faster,
more efficient, and accessible. Investors today can trade from anywhere in the world through
online platforms, and the rise of mobile trading apps has made it easier for retail investors to
participate in the market. The market’s expansion has also led to a surge in retail
participation, with a growing number of young and tech-savvy investors entering the market,
driven by a rise in financial literacy and the accessibility of investment tools.
In recent years, the Indian stock market has also seen a wave of IPOs (Initial Public
Offerings), with numerous startups and unicorns listing on the stock exchanges to raise
capital. This reflects the growing maturity of the market, with more diverse sectors such as
technology, pharmaceuticals, and renewable energy finding access to public funding.
Additionally, India’s increasing focus on financial inclusion has led to initiatives aimed at
bringing more people into the formal financial ecosystem, further boosting the participation
in stock trading.
However, despite its growth and modernization, the Indian stock market still faces challenges
such as volatility, regulatory hurdles, and market manipulation risks. For example, external
factors such as global economic conditions, currency fluctuations, and political uncertainty
can cause market instability. Nevertheless, with continued reforms, improved investor
education, and technological advancements, the stock market in India remains an attractive
investment destination and a critical component of the nation's economic infrastructure.
Overall, the Indian stock market is not only a crucial element for economic growth but also a
reflection of India's progress in integrating with the global financial system. With its
expanding investor base, technological advancements, and strong regulatory framework, it is
poised for continued growth and remains an important platform for both domestic and
international investors.instrumental role in the development of India's capital markets
BOMBAY STOCK EXCHANGE
The Bombay Stock Exchange (BSE), established in 1875, is one of the oldest and largest stock
exchanges in India and Asia. Located in Mumbai, it plays a crucial role in the Indian financial market
by providing a platform for trading various securities, including stocks, bonds, and derivatives. The
BSE operates with a fully automated trading system, which facilitates transparency and efficiency in
transactions. Over the years, the exchange has become a key barometer of the Indian economy, with
the SENSEX, its benchmark index, widely used to track the performance of the Indian stock market.
The BSE attracts both domestic and international investors, serving as a vital link between businesses

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seeking capital and investors looking for opportunities in a rapidly growing economy. It has also
contributed significantly to the development of India's financial infrastructure, promoting financial
literacy, and fostering corporate governance. With its rich history and continued growth, the Bombay
Stock Exchange remains a symbol of India's evolving financial markets.
The Bombay Stock Exchange (BSE) has played an instrumental role in the
development of India's capital markets. Founded as the Native Share and Stock Brokers'
Association in 1875, the BSE was initially a space for a small group of brokers to trade securities.
Over time, it grew into a comprehensive platform for trading, becoming the first stock exchange in
Asia to be recognized by the Government of India in 1957 under the Securities Contracts (Regulation)
Act. Today, the BSE operates a state-of-the-art electronic trading system, ensuring fast, secure, and
efficient execution of trades.

With over 5,000 listed companies, the BSE provides a diverse array of investment opportunities
across various sectors, from banking and technology to energy and manufacturing. The SENSEX, the
exchange's benchmark index, tracks the performance of 30 of India's largest and most actively traded
companies, serving as a barometer of the broader Indian economy. The SENSEX is closely followed
by investors and analysts, both in India and globally, as an indicator of market sentiment and
economic health.
The BSE also pioneered initiatives in financial inclusion and investor education. It offers various
products, such as equity shares, derivatives, mutual funds, and debt instruments, making it a one-stop
destination for different types of investors. Over the years, it has embraced technological
advancements, introducing electronic trading, algorithmic trading, and a wide range of market indices.
Furthermore, the BSE has played a critical role in providing capital to companies, particularly in
sectors like infrastructure, banking, and energy, thus supporting India's growth trajectory.

In addition to being a hub for Indian companies, the BSE attracts a significant amount of foreign
investment. The liberalization of India's economy in the 1990s and subsequent reforms in the financial
sector have helped increase the participation of foreign investors in the BSE. As a result, the exchange
has become increasingly integrated with global markets, contributing to the rise of India as one of the
world’s most important emerging market economies.
Through its various market initiatives, the BSE has also worked to foster corporate governance and
investor protection. It enforces strict listing requirements and disclosure norms, ensuring that
companies maintain transparency and accountability. In recent years, the BSE has expanded its
offerings to include initiatives like the BSE SME Exchange, which caters to small and medium-sized
enterprises, helping them raise capital and grow their businesses. This expansion reflects the BSE's
commitment to creating an inclusive and well-regulated financial ecosystem for both large
corporations and smaller businesses alike.

NATIONAL STOCK EXCHANGE

The National Stock Exchange (NSE) of India, established in 1992, is one of the leading stock
exchanges in the country and one of the largest in the world by market capitalization and trading
volume. Located in Mumbai, the NSE revolutionized the Indian stock market by introducing an
electronic trading platform, making it the first fully automated exchange in India. This shift from
traditional open outcry trading to an entirely electronic system brought about greater transparency,
speed, and efficiency, which significantly improved the accessibility of the markets for investors.

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The NSE is known for its flagship index, the Nifty 50, which tracks the performance of the
50 largest and most actively traded stocks on the exchange. The Nifty 50 is considered a key
benchmark for the Indian equity market and is widely followed by investors and analysts to
gauge the health of the stock market and the broader economy. The exchange also lists a wide
range of financial instruments, including equities, bonds, derivatives (such as futures and
options), ETFs (Exchange-Traded Funds), and index funds.
A significant feature of the NSE is its emphasis on transparency, liquidity, and price
discovery. It offers a fully electronic trading system, which eliminates the need for human
intervention in order processing, resulting in faster and more reliable trades. This system has
also made it more attractive to retail investors, who can trade from anywhere using online
platforms. The NSE’s trading hours generally run from 9:15 AM to 3:30 PM, Monday
through Friday, providing ample opportunities for both domestic and international investors
to participate in the market.
The exchange plays a critical role in the Indian economy, providing a platform for companies
to raise capital through Initial Public Offerings (IPOs) and subsequent listings. By
facilitating access to public funding, the NSE enables businesses to expand, innovate, and
contribute to economic growth. Many of India’s largest companies, including blue-chip firms
in sectors like information technology, banking, and energy, are listed on the NSE, and the
exchange has seen increasing participation from institutional and retail investors alike.
Additionally, the NSE is known for its derivatives market, which has become one of the
largest in the world in terms of volume. This includes futures and options contracts on
indices, stocks, and other financial instruments, allowing investors to hedge risk, speculate, or
enhance returns. The NSE also offers a variety of other products, such as currency derivatives
and commodity futures, further enhancing its position as a comprehensive financial
marketplace.
The Securities and Exchange Board of India (SEBI), the regulatory authority, oversees the
NSE to ensure that the market operates fairly and transparently, enforcing rules related to
trading, listing, and investor protection. SEBI’s initiatives to improve corporate governance,
enhance disclosure requirements, and prevent market manipulation have contributed to
increasing investor confidence in the NSE.
One of the key developments in the NSE’s history was its role in the dematerialization of
shares in the late 1990s. This transition from physical to electronic share certificates reduced
the risk of fraud, made settlement processes faster, and contributed to the modernization of
India’s stock market infrastructure.
In recent years, the NSE has expanded its reach and visibility globally, attracting foreign
institutional investors (FIIs) and global funds, further integrating India into the global
financial system. It also has a growing retail investor base, aided by the proliferation of
internet-based trading platforms and mobile apps that allow easy access to the stock market.
Moreover, the NSE’s initiatives in financial literacy and investor education have helped
broaden the scope of market participation in India.

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OBJECTIVE OF THE STUDY

 To identify risk and return of various pharmaceutical companies listed on Indian stock
market.
 This study has undertaken to focus on risk and return analysis of financial securities
like common stock of sample banks which are taken in this thesis.

RESEARCH METHODOLOGY

The study is based on secondary data and the data for the analysis has taken from different
websites like NSE India, Money control, Yahoo finance and some other banking websites.
Methods used in the study: The study used different statistical techniques like

1.RISK
You cannot talk around income from speculation without having speak me roughly risk as a
result of reality consistency venture choices include purchasing and marketing between
systems. Risk demonstrates the probability that the genuine financing impacts will defer the
expected impacts. Even more especially, purchasers are by and large pressured over real
effects that are substantially lower than expected results. The greater prominent results you
might find, the more the possibility.

2.RETURN:
Return is the fundamental inspiring power that drives a rumour. It is really an acclaim for
financing. Since the venture game is prepared returns (After contemplating danger), the
estimation of uncovered returns is basic to evaluate how appropriately a rumour has executed.
Fur Furthermore, noteworthy returns are often utilized as a contribution for looking forward
return to the future (candidates).

Return = (Ending return – Beginning return) /Beginning

Return: The formula for the total stock return is the appreciation in the price plus any
dividends paid, divided by the original price of the stock. The income sources from a stock
are dividends and its increase in value.

Total stock Return=P1-Po+D/Po

Po= Initial stock Price
P1= Ending stock price
D= Dividends

Average return:
The average return tells an investor what the returns for a stock have been in the pastor what
the returns of a portfolio of companies are. Average return = Σ R/n.

VARIANCE AND STANDARD DEVIATION

Probably the most generally utilized threat determine in account is the difference or root
rectangular which is the typical deviation. Contrasts and in vogue deviations of chronicled

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come back arrangement are launched. The variety believes about all deviations, negative as
large. Financial backers, be that as it may, do at this time don’t see amazing deviation - an
excellent reality, they pleasant. Consequently a few of specialists say that lone negative
deviations must be looked at while estimating risk.
VARIANCE: Variance is the expectation of the squared deviation of a random variable from
its mean.
Variance = Σ(x-X) 2/N
S.D =∑ Rt-R

STANDARD DEVIATION OF RETURN:

Hazard proposes a variable scattering. It really is ordinarily estimated with the guide of
variation or change of best. The particular distinction of the probability dissemination is the
amount of the squared deviations of the original come back from the expected return,
weighed towards the linked possibilities.

STANDARD DEVIATION:
Standard deviation is a number used to tell how measurements for a group are spread out
from the average (mean), or expected value.SD = √variance

EXPECTED RATE OF RETUN:

The anticipated rerun expense is the weighted basic the entirety of the yields extended by
their individual options.

COEFFICIENT OF CORRELATION:
Covariance and relationship are applied with the performance in this the two of them
demonstrate the recognition of co - movement between the 2 factors.

RISK OF PORTFOLIO: The return qualification and the typical deviation of return are
opportunity factual measures used to degree subsidizing possibility. These realities measure
the degree at which usefulness can go as the years progressed. Figuring portfolio forms might
be somewhat more hard than deciding anticipated income.
Covariance is a flat out level of the intelligent risk among protections. To look at the offices
can be normalized. Isolating the covariance between two protections by the standard, worn
out deviation result of each security bears the cost of a normalized degree. This degree is
alluded to as the relationship percentage.

Beta (β):

It measures the market risk or systematic risk. Beta is commonly computed by the under
given formula.β= (Cov (Ra, Rm))/(Var (Rm))
Where, Ra is the return of a stock and Rm is benchmark index return.

Analysis and interpretation

The methods of analysis and presentation are applied as simple as possible. Proper financial
and statistical tools are used and results are presented in table and also shown in diagram.
Interpretation is made in very simple way detail of calculation which cannot be shown in the
main body part, are presented in appendices at the end, summary, conclusion and
recommendation are presented finally.

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Systematic Risk and Unsystematic Risk
Systematic and unsystematic risks are the terms frequently used in the portfolio context.
Combining securities that are not perfect positively correlated helps to reduce the risk of are
portfolios to some extent. Systematic risk has its source factors the affect all the marketable
assets and this cannot be diversified way. Systematic risk is due to the risk factor that affects
the overall market such as changes in national economy, tax reform by the government or
changes in the world energy situation. Unsystematic risk is unique to a particular company or
industry. It is independent of economic, political and other factor that affect all securities in
systematic manner. A wild cat risk may affect only one company a new competitor may begin
to produce essentially the same product or a technological breakthrough can make an existing
product absolute. "For most stocks, unsystematic risk accounts for between 60 to 70 percent
of

CORRELATION BETWEEN BSE SENSEX AND BANKING STOCK RETURNS:

Correlation find out the linear relationship among two variables is measured by the correlation
coefficient. The following Table elaborates the correlation for weekly stock returns of SENSEX and
Banking stock over a span of thirteen years from January 2005 to December 2017. Hypothesis: H01:
There is no correlation with SENSEX and HDFC Bank. H02: There is no correlation with SENSEX
and ICICI Bank. H03: There is no correlation with SENSEX and AXIS Bank. H04: There is no
correlation with SENSEX and SBI Bank.

VI. RISK AND RETURN ANALYSIS OF SENSEX AND DIFFERENT STEEL COMPANIES
indicates the results by means of the assistance of descriptive statistics of daily
market returns of Sensex in addition to the sample steel companies from January
4, 2010 to December 31, 2019.

It has depicted in the table -1 that during the study period i.e. from January 4, 2010 to December 31,
2019, average daily returns of Sensex displayed positive returns whereas all sample steel companies
indices displayed negative returns. The average daily returns recorded highest of 0.0339 designed for
Sensex, however it recorded lowest of -0.1653 designed for Tata steel. Thus from the above certainly
recommend that average daily return of Sensex has performed and provided better return than that of
all sample steel companies indices returns over the study period. In the circumstance of the standard
deviation of Sensex is lowermost as compare to all sample companies returns. Consequently it
designates that investment in Sensex involves lesser risk than that of all other companies returns,
while Tata steel return incorporates higher risk among all the companies as the standard deviation of
Tata steel recorded highest of 4.4251 during study period. The daily returns have fluctuated between -
6.1197 to 5.1859, -162.9761 to 18.2322, -231.1897 to 11.2560, -13.1028 to 18.2322, -9.5581 to
13.4651 for Sensex, Tata Steel, JSW Steel, Visa Steel and SAIL respectively for the study period. The
daily returns distribution of Sensex, Tata Steel and JSW Steel are found to be negatively skewed
whereas daily returns of Visa Steel and SAIL distribution are positively skewed.
Correlation between Sensex and Different Steel Companies Returns

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The Table-2 explains the correlation matrix for daily returns of Sensex along with
sample steel companies from January 4, 2010 to December 31, 2019,

From the Table-2, it can find that average daily return of Sensex is positively correlated with all steel
companies’ average daily returns. The Sensex average daily return is highly correlated with that of
SAIL,on the other hand Sensex average daily return has logged lowermost correlation with that of
Visa Steel.

Analysis t-Test: Paired of Sensex

Table 3
reviews the consequences of daily returns of Sensex and Tata steel from January 4, 2010 to December
31, 2019 with the assistance of t-test. The t test results of average daily returns delivers that Sensex
has provided higher return as compared to that of the Tata steel; leading to the conclusion that mean
daily returns of Sensex has performed better and provided higher returns. Conversely, lesser variance
for Sensex daily returns as compared to Tata steel daily returns undoubtedly specifies that former is
more consistent than the latter. Again, the correlation value is 0.1831 signifies positive correlation
between both the indices. The p-value of 0.0118, which is less than 0.05, indicates that there is a
significant difference in the daily returns of Sensex and Tata steel at 5 percent level of significance.
Consequently here the null hypothesis (there is no significant difference between average daily returns
of Sensex and sample steel companies) is rejected.

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Table 4 t-Test: Paired of Sensex and JSW Steel

Table 4 reveals the outcomes of daily returns of Sensex and JSW Steel from January 4, 2010 to
December 31, 2019 with the help of t-test. The t test result shows that Sensex average daily return is
higher as compared to that of the JSW steel; which means that average daily returns of Sensex has
achieved superior result and provided better returns. On the contrary, lesser variance for Sensex
(0.9134) daily returns as compared to JSW steel (27.2722) daily returns certainly agrees that Sensex is
more reliable than the JSW. In the case of relationship between Sensex and JSW with a correlation
value (0.9134) shows positive correlation between Sensex and JSW. The p-value of 0.1854, which is
more than 0.05, indicates that there is no significant difference in the daily returns of Sensex and JSW
steel at 5 percent level of significance. Accordingly in this case the null hypothesis (there is no
significant difference between average daily returns of Sensex and sample steel companies) is
accepted.
Analysis t-Test: Paired of Sensex and Visa Steel
Table 5 analyses the values of daily returns of Sensex and Visa Steel from January 4, 2010 to

December 31, 2019 with the support of t-test. The t test result for the average daily returns delivers
that Sensex return is healthier as compared to that of the Visa Steel; which indicates that average daily
return of Sensex has done better and provided higher return. On the contrary, smaller value of
variance for Sensex average daily return as compared to Visa steel daily return unquestionably agrees
that former is more stable than the latter. Again, the correlation value of 0.0575 specifies that positive
correlation among the Sensex and Visa Steel. The p-value of 0.0443 (null hypothesis (there is no
significant difference between average daily returns of Sensex and sample steel companies) is
rejected.

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Analysis t-Test: Paired of Sensex and SAIL

Table 6 appraisals the significances of daily returns of Sensex and SAIL from January 4, 2010 to
December 31, 2019 with the help of t-test. The result directs that the average daily return of Sensex
performs higher as compared to that of SAIL; leading to the conclusion that average daily return of
Sensex has accomplished better outcome and provided higher returns. Contrariwise, lesser variance
for Sensex average daily return as compared to SAIL average daily return definitely states that Sensex
is more regular than the SAIL. Again, the correlation value is 0.5583 between Sensex and SAIL
shows that there is a positive correlation among Sensex and SAIL. The p-value of 0.0033, which is
less than 0.05, points that there is a significant difference in the daily returns of Sensex and SAIL at 5
percent level of significance. As a result at this juncture the null hypothesis (there is no significant
difference between average daily returns of Sensex and sample steel companies) is rejected.

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 VII. CONCLUSION

Average daily returns of Sensex displayed positive returns whereas all sample
steel companies displayed negative returns. Thus certainly recommend that
average daily return of Sensex has performed and provided better return than
that of all sample steel companies return over the study period. In the
circumstance of the standard deviation of Sensex is lowermost as compared to
all sample companies returns. Consequently it designates that investment in
Sensex involves lesser risk than that of all other indices returns, while Tata steel
return incorporates higher risk in all the companies. The average daily return of
Sensex is positively correlated with all steel companies’ average daily returns.
The Sensex average daily return is highly correlated with that of SAIL and has
logged lowermost correlation with that of Visa Steel. It has found from the t test
that there is a significant difference between returns of Sensex and sample steel
companies except JSW steel, therefore the null hypothesis (there is no
significant difference between returns of Sensex and sample steel companies) is
rejected for Tata Steel, Visa Steel and SAIL. Whereas, the null hypothesis is
accepted for JSW Steel.

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