Stock Return and Investor’s Strategies to Firm Specific Announcements: A Study of S&P BSE SENSEX
https://doi.org/10.26794/2587-5671-2024-28-5-156-172
Abstract
The objective is to investigate the effect of news on stock behaviour in terms of price and volume traded. Further, it is intended to explore the strategies adopted by the investors for various type of news items.
Methods included collection of 18,014 news items from BSE website and classify as financial and non-financial news. Using paired t-test, the news further classified as good, bad, or indifferent. The effect of news on stock price and volume are found and the scrip return, risk and volatility are also computed pre- and post- announcement. Findings reveal that news has always affected the scrip volume traded on BSE, Mumbai. Non-financial news whether good, bad, or indifferent, has resulted in holding of the shares. It is Concluded that Financial bad news has resulted in holding of the shares except for earnings announcements.
Novelty is effect of news on stock market based on news classified as good, bad, and indifferent or financial and non-financial.
The effect of various types of news in stock market is also found along with the combined effect. The implications are helpful to the corporates, fund managers and individuals to time the information dissemination followed by strategizing trade.
About the Authors
S. Patil
MIT Vishwaprayag University
India
Competing Interests:
India
Sagar Patil, PhD, Assist. Prof.
Maharashtra; Solapur
Competing Interests:
The authors have no conflicts of interest to declare
V. Bagodi
Government Engineering College Talkal
India
Competing Interests:
India
Virupaxi Bagodi, PhD, Principal
Karnataka; Koppal
Competing Interests:
The authors have no conflicts of interest to declare
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For citations:
Patil S., Bagodi V. Stock Return and Investor’s Strategies to Firm Specific Announcements: A Study of S&P BSE SENSEX. Finance: Theory and Practice. 2024;28(5):156-172. https://doi.org/10.26794/2587-5671-2024-28-5-156-172
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