Author: Shravani Kalage-15<\/p>\n
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Introduction:<\/p>\n
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This study examines the relationship between the performance of the Nifty Fifty index and the stock returns of Standard Industries Limited. The objective is to analyze how movements in the overall market influence the returns of Standard Industries Limited . For this purpose, secondary data on daily or monthly returns of both Nifty Fifty and Standard Industries Limited is collected and analyzed using regression analysis. The methodology helps estimate the beta value and determine the extent to which market fluctuations affect the company\u2019s stock performance.<\/p>\n
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Objective: Calculation of Beta and observe it\u2019s significance<\/p>\n
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Literature review:<\/p>\n
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John Lintner (1965) explained the CAPM framework and emphasized that beta is a crucial determinant in pricing risky securities in equilibrium markets.<\/p>\n
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Jan Mossin (1966) further developed CAPM and confirmed the relationship between expected return and beta under conditions of market equilibrium.<\/p>\n
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Data collection:<\/p>\n
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Data for Nifty 50 and Standard Industries Limited was downloaded by www.nseindia.com for the period 1\/1\/2025 to 31\/12\/2025 Friday closing price for Nifty 50 and Standard Industries Limited were calculated. Weekly returns of Nifty 50 were taken as X and Weekly return of Standard Industries Limited were taken as Y. Y was regressed on X.<\/p>\n
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Data Analysis:\u00a0<\/p>\n
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Y= \u22121.30972+1.205748X B=1.2057<\/p>\n
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N = 48, R2= 0.2448, F = 14.91, t Stat = 3.8624, P-value = 0.000349<\/p>\n
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The above Equation shows the relationship between Nifty 50 and standard industries ltd. Positive means their Direct relation which means if Nifty 50 rises Standard Industries Limited stock rise and vice versa. If Nifty 50 increases by 1 unit, the Standard Industries Limited stock increases by 1.20 unit. Number of observations is 48. T-stat for beta is 3.8624. The P value is 0.000349 less than 0.5 meaning Beta is statistically significant at 5% level. R square is 0.2448 meaning 24.48% is explained by market return and 75.52% is the error due to the variable not included in model. F is 14.9182 and P value is 0.00035 less than 0.5 meaning Beta is statistically significant at 5% level.<\/p>\n
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Conclusion:<\/p>\n
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B>1 , Hence invest for short term if Nifty 50 rise<\/p>\n
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Reference:\u00a0<\/p>\n
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Lintner, John. (1965). The valuation of risk assets and the selection of risky investments in stock portfolios and capital budgets. Journal of Finance, 20(1), 13\u201337.<\/p>\n
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Mossin, Jan. (1966). Equilibrium in a capital asset market. Econometrica, 34(4), 768\u2013783.<\/p>\n
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