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Investigating impact of financial stress on FII flows in Indian equity market

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  • Amanjot Singh
  • Manjit Singh

Abstract

The present study attempts to capture the impact of financial stress prevailing in the Indian as well as US financial system on FII flows in the Indian equity market by employing logistic regression model. The span of monthly data ranges from 2004 to 2014. Owing to non-existence of any standardized index, the study firstly constructs Indian Financial Stress Index. The empirical results have established that with an increase in financial stress in the Indian and US financial system, probability of positive FII flows reduces and consequently the probability of negative flows increases. The results are critically important for the international as well as Indian investors.

Suggested Citation

  • Amanjot Singh & Manjit Singh, 2016. "Investigating impact of financial stress on FII flows in Indian equity market," Cogent Business & Management, Taylor & Francis Journals, vol. 3(1), pages 1190263-119, December.
    • Handle: RePEc:taf:oabmxx:v:3:y:2016:i:1:p:1190263
    DOI: 10.1080/23311975.2016.1190263
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    References listed on IDEAS

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    1. Nathaniel Frank & Heiko Hesse, 2009. "Financial Spillovers to Emerging Markets during the Global Financial Crisis," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 59(6), pages 507-521, December.
    2. Amanjot Singh & Manjit Singh, 2016. "Investigating Impact of US, Europe, Frontier and BRIC Stock Markets on Indian Financial Stress Index," Journal of Banking and Financial Economics, University of Warsaw, Faculty of Management, vol. 2(6), pages 23-44, June.
    3. Ravi Balakrishnan & Stephan Danninger & Selim Elekdag & Irina Tytell, 2011. "The Transmission of Financial Stress from Advanced to Emerging Economies," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 47(0), pages 40-68, May.
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    Cited by:

    1. Wang, Fanyi & Ma, Wanying & Mirza, Nawazish & Altuntaş, Mehmet, 2023. "Green financing, financial uncertainty, geopolitical risk, and oil prices volatility," Resources Policy, Elsevier, vol. 83(C).
    2. Amanjot Singh & Parneet Kaur, 2017. "Does US Financial Stress Explain Risk–Return Dynamics in Indian Equity Market? A Logistic Regression Approach," Vision, , vol. 21(1), pages 13-22, March.

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