|
An
Empirical Study on Analyzing how Fund Managers in India Analyze
Financial Reports with Special Focus on Quality of Reported
Earning
--
Ruzbeh
J Bodhanwala
Fund
managers are primarily responsible for the performance of
mutual funds. However, very little is known as to how they
decide their investments and disinvestments. The present study
therefore focuses on empirically testing and form hypothetical
portfolios on the bases of ratios fund managers use for portfolio
formation. Thirty six fund managers from eighteen industries
participated in the study. It was found that fund managers
rely primarily on financial statement analysis and key fundamental
variables namely Book to market ratio (B/M) and Price earning
ratio (P/E). For the analysis purpose, they use Balance Sheet,
Income Statement, Profit After Tax. Further, fund managers
regarded financial risk, quality of disclosure in the annual
report by the management, predictability of earnings and corporate
growth prospects as the primary determinants of their decisions.
Many fund managers emphasized on the quality of earning (QE).
The results were analyzed using Kolmogorov-Smirnov test.
©
2006 IUP . All Rights Reserved.
Determinants
of Equity Prices: A Study of Select Indian Companies
-- Monica Singhania
In
the last one and a half decades, many emerging capital markets
have undergone drastic changes in terms of market microstructure
changes, specifically in secondary markets. One of the policy
concerns is the factors determining equity prices in markets.
The author studies the various determinants of equity share
prices with reference to Indian stock market. The mean values
have shown that during the period 1997 to 2004, the market
price was far lower due to various uncertainties prevailing
in the country. The correlation analysis shows positive significant
(1%) association of only price earnings ratio with market
price. Book value, dividend cover, DPS, EPS and growth are
positive but insignificant. At the same time, there is negative
insignificant association of yield with market price (MP).
While regression analysis depicts that book value, dividend
per share, earnings per share and price earnings ratio are
significant determinants, whereas, dividend cover and yield
are insignificant with negative value. Growth remained insignificant
but with positive value. Finally, it can be concluded from
correlation and regression analysis that price earnings ratio,
earnings per share, book value and dividend cover are the
variables, which contributed the most in determining share
prices followed by dividend per share and yield.
©
2006 IUP . All Rights Reserved.
Extremal
Index and Clustering in the Extreme Values: A Study on NSE
CNX Nifty
-- Basabi Bhattacharya
and Debashis Dutta
Financial
Integration of global markets has influenced volatility of
stock market of individual countries, which has evinced much
interest in identification of clusters of extreme values of
financial returns series of specific stock indices. The estimation
of extremal index, commonly interpreted as the reciprocal
of the mean number of exceedances in a cluster, extends a
key role in analyzing the observed volatile behavior of the
stock indices. Such analysis was earlier done by estimation
of clustered extreme values by a class of processes like GARCH.
This paper has applied extremal index approach and compares
it with traditional approaches, using simulation from a GARCH
process. It studies the financial returns series of NSE CNX
Nifty, the leading stock Index of National Stock Exchange
of India and assesses empirically the relative performance
of the estimators of different methods for identification
of clustering of extreme values of NSE CNX Nifty returns series.
lt is found that the two threshold method performs better
than run estimator method in low level of threshold.
©
2006 IUP . All Rights Reserved.
| 
