Title: – Relationship Between Nifty and Oracle Financial Services Software Ltd.
Author Omkar Ghaskadbi
Introduction
Oracle Financial Services Software Limited (OFSS) is a subsidiary of Oracle Corporation. It is a retail banking, corporate banking, and insurance technology solutions provider for the banking industry. It also provides risk and compliance management, and performance measurement applications, as well as accounting, business process management, human resources, and procurement tools. The company claims to have more than 900 customers in over 145 countries. Oracle Financial Services Software Limited is ranked No. 9 in IT companies of India.
Objective
Calculate Beta and its significance
Data Collection
The raw data was downloaded from National Stock Exchange’s website. Data was cleaned by removing unwanted fields. Then used weekday function to find out the closing price of each weekend. Then with help of this data the weekly return for Nifty as well as equity (OFSS) were calculated.
Data Analysis
Equity Y = 1.209 * Nifty X – -0.572 + e
(7.558)
N = 49, R2 = 0.549, F = 57.126
The above equation tells us about the relationship between Equity weekly return Y and Nifty weekly return X. The positive sign means direct relationship which means if Nifty weekly return increases, then equities weekly return also increases and vice versa.
If Nifty’s weekly return increase by 1% then Equity’s weekly return increases by 1.209%. The T stat of b is shown in bracket i.e., 7.558 and P value for this is 0.0000000011711 which is less than 0.01 meaning b is statistically significant at 1% level
N = 49 and R2 is 0.549 which means 54.9% of Y is explained by X. Balance 45.1% is error.
F is 57.126 and P value for this is 0.0000000011711 which is less than 0.01. Thus, overall model is significant at 1% level
Conclusion
The Beta is 1.209 i.e., greater than 1 means Oracle Financial Services Software Ltd is good for short term investment.
