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In the current scenario of high volatility in the stock exchange, it's crucial for investors to make informed decisions. The surge of millennial investors into the market, aiming for substantial returns, highlights the importance of a solid grasp of statistical tools and measures for sound decision-making. This study delves into the risk and return analysis of various stocks alongside their benchmark indices to decode the stock movements in relation to the market. The primary goal for any investor is to amplify profits while minimizing risks. This research aids investors by offering insights into various statistical methods for analyzing stock risks and returns. The research concentrated on gathering daily data, including the closing prices of stocks from 2019 to 2023, from the stock market. It calculated the daily returns of these stocks and measured their standard deviations, focusing on key sectors such as Automobile, Banking, Finance, FMCG, and IT. These sectors are pivotal in reflecting the country's economic health. Further analysis was conducted using beta and regression analysis to assess the risk associated with the indices compared to market indices like NIFTY AUTOMOBILE, BANK NIFTY, NIFTY FINANCE, NIFTY FMCG, and NIFTY IT Service. This helped in understanding the indices' performance versus the benchmark indices and integrating various statistical tools to differentiate the risk and return profiles across sectors. The study aims to identify which sector presents a favorable investment opportunity in terms of risk and return.
Ramlingayya et al. (Sat,) studied this question.