Question Bank - Banking & Financial Services

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The volatility in the Indian share market is due to -(A) Inflow and outflow of foreign funds (B) Fluctuations in foreign capital markets (C) Changes in the monetary policyWhich of the above-mentioned causes are correct?

A.
(A) and (B)
B.
(A) and (C)
C.
(A), (B) and (C)
D.
(B) and (C)

Solution:

The correct answer is (A), (B) and (C). Volatility in the Indian share market is due to Inflow and outflow of foreign funds Fluctuations in foreign capital markets Changes in the monetary policyIndia VIX Index, an indicator of the volatility of the stock marketVolatility Index (VIX) is a measure of the markets expectation of volatility over the near term. Volatility is often described as the œrate and magnitude of changes in prices and in finance often referred to as risk. It is a measure, of the amount by which an underlying Index is expected to fluctuate, in the near term, (calculated as annualized volatility, denoted in percentage e. g. 20%) based on the order book of the underlying index options. Additional Information Bombay Stock Exchange is an Indian stock exchange located on Dalal Street in Mumbai. Established in 1875 it is Asia's oldest stock exchangeNational Stock Exchange of India Limited (NSE) is the leading stock exchange of India, located in Mumbai, Maharashtra. NSE was established in 1992 as the first dematerialized electronic exchange in the country.

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