A Study of Impact of Lok Sabha elections on Stock market Returns with special reference to S&P BSE Sensex and Nifty 50
Keywords:
Lok Sabha Elections, Stock Market, S&P BSE Sensex, Nifty 50Abstract
India “The flawed democracy” as characterized by the Economist intelligence unit saw the formation of 17th Lok Sabha in 2019 “the year of pig: fortune and personality” according to Chinese Zodiac 2019. The year since the beginning has also been characterized as a volatile period for the Indian stock market due to the Lok Sabha elections. The objective of the present study is to find out how the stock market fares around the period of election. The S&P BSE Sensex and Nifty 50 returns were studied for a period of 1-week, 1-Month and 3-Months pre and post the election result dates and the results were amusing on an average investing three months before elections and selling three months post give good returns. Six out of eight times 6-Months return were positive for S&P BSE Sensex and four out of seven times for Nifty 50. The stock market returns showed more of greens than red around the election period.
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