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- Title
SECTOR-WISE HERD BEHAVIOUR IN THE INDIAN STOCK MARKET DURING COVID-19.
- Authors
Sharma, Charu; Lodha, Shilpa
- Abstract
The article examines the herd behaviour at sector level in the National Stock Exchange of India. The novel objective of the paper is to analyse the presence of herd behaviour during the whole, pre- and post-coronavirus disease 2019 (COVID-19) pandemic outbreak period. The popular model proposed by Chang et al. (2000) has been deployed to examine herd formation in each sector. Five major sectors namely auto, bank, fast moving consumer goods, information technology and pharma have been considered along with NIFTY50 consisting daily closing prices of 106 companies comprising 58 from five sectoral indices and 48 from NIFTY50 for the period from 2011 to 2021 considering 1 January 2011–29 January 2020 as before COVID-19 outbreak period and 30 January 2020–31 December 2021 as after COVID-19 outbreak period. Results revealed significant evidence of anti-herd behaviour before COVID19 outbreak. At the same time, significant evidence of the existence of herd behaviour in FMCG, auto and pharma sectors have been detected after the outbreak of COVID-19 pandemic which assumes that investors tend to imitate the investment decisions of other market participants during such adverse macro events around the globe. The study tried to enhance the knowledge of investors to develop their trading strategies in the volatile market conditions by investing vigilantly and keeping such phenomenon in concern.
- Subjects
NATIONAL Stock Exchange of India Ltd.; COVID-19 pandemic; FINANCIAL markets; FAST moving consumer goods; ANIMAL herds; MARKET volatility; INFORMATION technology
- Publication
Journal of Commerce & Accounting Research, 2024, Vol 13, Issue 2, p107
- ISSN
2277-2146
- Publication type
Article
- DOI
10.21863/jcar/2024.13.2.010