Role of Institutional Investors in Indian Stock Market
Role of Institutional Investors in Indian Stock Market
S S S Kumar* Abstract
An important feature of the development of stock market in India in the last 15 years has been the growing participation of Institutional Investors, both foreign institutional investors and the Indian mutual funds combined together, the total assets under their management amounts to almost 18% of the entire market capitalization. This paper examines the role of these investors in Indian stock markets and finds that the market movement can be explained using the direction of the funds flow from these investors.
Key Words : Stock Markets, Clout, Augment, Cumulative, Demat accounts. The Indian stock market has come of age and has substantially aligned itself with the international order. Over the last fifteen years the following developments have made the Indian stock markets almost on par with the global markets: period settlement system give way to rolling settlements on T+2 basis has brought down the settlement risk substantially. • • Dematerialization of securities Demutualization of exchanges
• Screen based trading systems replaced the Derivatives trading conventional open outcry system of trading and • everyone acclaims the contribution of the screen based trading in developing the culture of equity investing. Infact, today we have one of the most modern securities • The replacement of the fourteen-day account
S S S Kumar*, Associate Professor, Indian Institute of Management Kozhikode
Role of Institutional Investors in Indian Stock Market
77 Into the country and the year of 1991 marked the announcement of some fiscal disciplinary measures along with reforms on the external sector made, it possible for the foreign capital to reach the shores of the country. As on 31st March 2005 there were 685 (ISMR 2004-05 NSE, Mumbai) registered foreign institutional investors in the Indian stock market. As on that date the net cumulative investments made by Flls are around USD
S S S Kumar* Abstract
An important feature of the development of stock market in India in the last 15 years has been the growing participation of Institutional Investors, both foreign institutional investors and the Indian mutual funds combined together, the total assets under their management amounts to almost 18% of the entire market capitalization. This paper examines the role of these investors in Indian stock markets and finds that the market movement can be explained using the direction of the funds flow from these investors.
Key Words : Stock Markets, Clout, Augment, Cumulative, Demat accounts. The Indian stock market has come of age and has substantially aligned itself with the international order. Over the last fifteen years the following developments have made the Indian stock markets almost on par with the global markets: period settlement system give way to rolling settlements on T+2 basis has brought down the settlement risk substantially. • • Dematerialization of securities Demutualization of exchanges
• Screen based trading systems replaced the Derivatives trading conventional open outcry system of trading and • everyone acclaims the contribution of the screen based trading in developing the culture of equity investing. Infact, today we have one of the most modern securities • The replacement of the fourteen-day account
S S S Kumar*, Associate Professor, Indian Institute of Management Kozhikode
Role of Institutional Investors in Indian Stock Market
77 Into the country and the year of 1991 marked the announcement of some fiscal disciplinary measures along with reforms on the external sector made, it possible for the foreign capital to reach the shores of the country. As on 31st March 2005 there were 685 (ISMR 2004-05 NSE, Mumbai) registered foreign institutional investors in the Indian stock market. As on that date the net cumulative investments made by Flls are around USD