Tag Archives: India

Changes to the S&P BSE SENSEX

The methodology of the S&P BSE SENSEX has seen many changes over the last 30 years. In October 2018, it was again modified after an extensive market consultation. The recent changes brought new clarity to the boundaries for entry and exit of stocks in the index. Constituents are selected by size and liquidity. Now, any Read more […]

Do Indian Equity Mutual Funds Generate Alpha When Adjusted for Risk?

Risk-adjusted returns showcase the return accrued for every unit of risk held in a portfolio. If two portfolios have the same returns over a given time period, the one that has the lowest risk will have the better risk-adjusted return. Modern portfolio theory (MPT) assumes that an investment with higher risk should compensate the investor, Read more […]

The Blooming of Passive Investing in India

A few years back on highlighting the benefits of passive investing or index investing; there was skepticism on its ability to get a foothold in Indian financial markets. How the tides have turned! Now, not only do we have the skeptics accepting its value, but also propagating the concept. Undoubtedly, India is still largely an Read more […]

S&P BSE SENSEX During the Modi Administration’s Budget Sessions

Every year in India, the Finance Minister presents the Union Budget, which is perhaps the most important economic activity in the country. “Budget Day” comes with a lot of expectations, and it therefore has a bearing on the capital markets in both the pre- and post-budget sessions. The days before and after the budget session Read more […]

Changes in India’s Investment Sphere – An Overview of 2018

“Change is the only constant,” as quoted by Heraclitus, a Greek philosopher. The recent assembly election results have reiterated this. We saw a leadership change at the Reserve Bank of India (RBI), with Mr. Shaktikanta Das’s appointment as the new RBI Governor, following Mr. Urjit Patel’s resignation. The financial markets have also had their fair Read more […]

Signing Off 2018: India Equity Market Performance

The 2017 calendar year noted significant returns after a couple years with nearly flat returns. Continuing with the excitement from 2017, the 2018 calendar year started with exuberance, as the S&P BSE SENSEX reached more frequent lifetime highs through the end of January 2018. However, it failed to sustain these highs, as immediately after the Read more […]

Passive Investing Opportunities in India

Fifty years ago, there were no index funds—all assets were managed actively. The subsequent shift of assets from active to passive management in the U.S. and European markets could be considered one of the most important developments in modern financial history, and this shift was the consequence of active performance shortfalls.[1] In India, we have Read more […]

Introducing the S&P BSE Diversified Financials Revenue Growth Index

During the first half of 2018, Asia Index Private Limited launched the S&P BSE Diversified Financials Revenue Growth Index. It is the first index of its kind in India, and it seeks to measure the performance of private (non-state-owned) stocks from the S&P BSE 500 in the finance sector. The index includes the top three Read more […]

Low Style Consistency in Large-Cap and Mid-/Small-Cap Fund Categories

Style plays an important role in an investor’s asset allocation decisions. In the SPIVA India Mid-Year 2018 Scorecard, one can notice the low style consistency, especially in the Indian Equity Large-Cap and Indian Equity Mid-/Small-Cap categories. The Securities and Exchange Board of India (SEBI) circular dated Oct. 6, 2017, mandated the following important directives for Read more […]

Adding the “Factor Flavour” to Indexing

Many people believe that index-based investing and market beta are synonymous. With the growing popularity of index-based investing, exchange-traded funds and index funds based on market benchmarks such as the S&P BSE SENSEX, S&P BSE 100, and S&P BSE 500 are slowly gaining ground. Investors have been familiarizing themselves with market returns linked to these Read more […]