Foreign institutional investors, persons of indian origin and non-resident indians are allowed to invest in indian stock market through portfolio investment scheme to acquire an interest in indian companies through stock exchange on the following basis. Bose suchismita et al (2005) has examined the impact of reforms of the foreign institutional investors' (fiis) investment policy, on fii portfolio flows to the indian stock markets, an aspect, studies on determinants of fii flows to india so far have not taken into consideration. Relationship between fii and indian stock market key terms – fii, indian stock market , influence of fii on indian stock market , correlation and regression , trends of fii in india etc.
Order to measure the impact of fii on stock market, this study has made an attempt to find the correlation between net fii flows and the select market index of sensex. Indian stock market is affected by all hot news as these hot news act as an triggering point for the market apart from hot news fii has also got major impact on the stock market generally fii pump money or wipe out money from bse and nse day trader keep there eye on hot news and on fii activities to get maximum benefit. 4) fiis have less impact on indian stock indices and other unexplained variables are also influencing the indices 5) in bearish trend of 2008 the volatility in indian stock indices due to fiis is more than in bullish trend of 2007 no doubt fii inflow is more in 2007.
The investment by foreign institutional investors (fiis) has become a dynamic force in the development of indian stock market and is increasingly seen as an important cause of stock market volatility.
“impact of foreign institutional investment of foreign institutional investment on stock market and indian economy also attempts kumar (2001) investigated the effects of fii inflows on the indian stock market represented by the sensex using monthly data from january 1993 to december 1997. There is a lot of impact due to fii investment, fii is where the entity entirely based in a foreign country entering the secondary market of another country say india so foreign investment boost the buying and takes back a market out of bearish trends.
Since indian stock market is vast and attract investors as a hotspot of investment the indian market is steadily growing and had allured domestic investors community and foreign investors group in the past the major part of investment in indian. Markets for two reasons they invest a large quantum of funds in the stock market and fii are known to be active traders dey subarna & mishra bishnupriya (2004) in their study examined the casual relationship between net fii investment & the indian stock market represented by market capitalization of bse & nse. An empirical study on impact of fii and other stock exchanges volatility on bse stock 10 gandhi, d k (2015) a study of foreign institutional inflows andndian stock market volatility 4 juneja, s (2013) understanding the relation between fii and stock market 7 shrivastav, a (2013) influence of fii flows on indian stock market 31 68. Of foreign institutional investment on stock market and indian economy also attempts to present the correlation between fii and bse sensex by the karl pearson’ coefficient.
India during 1991-2007 period means ie during post liberalization period & influence of fii on movement of indian stock exchange during the post liberalization period that is 1991to 2007 the key findings of this research are that net fdi in india during 2005-2006 was valued at $47 billion during 2006-2007, it got tripled, to $157 billion. Request pdf on researchgate | impact of fiis investment on volatility of indian stock market: an empirical investigation | the investment by foreign institutional investors (fiis) has become a.