Evaluating Market Volatility: a Comprehensive Study of the Nifty 50 Index from May 2019 to May 2024

This study investigates the volatility and return characteristics of the Nifty 50 Index over a five-year period from May 29, 2019, to May 29, 2024. Utilizing daily closing prices sourced from Yahoo Finance, we calculate the average daily return, standard deviation of daily returns, and their annualized equivalents to provide a comprehensive analysis of the index's performance and risk profile. The findings reveal an average daily return of 0.0599%, indicating a steady growth in the index, while the standard deviation of daily returns at 1.1987% reflects the short-term volatility experienced by investors. When annualized, the average return of 16.3% underscores robust market performance, suggesting healthy growth in the Indian stock market over the analyzed period. The annualized standard deviation of 19.03% highlights the associated risk, reflecting significant fluctuations in annual returns. Additionally, we examine key events and market conditions that contributed to the observed volatility. This study provides valuable insights for investors, portfolio managers, and policymakers seeking to understand the dynamics and risks of the Nifty 50 Index.