Impact of Financial Ratios on Stock Price: A Comparative Study with Hang Seng and Nifty Data
DOI:
https://doi.org/10.33516/rb.v43i2.64-71pKeywords:
Nifty, Hang Seng, Return on Investment.Abstract
Selected financial ratios have impact on share price as financial ratios are used as tools for selecting stocks by investing communities. It is obvious that changes in financial ratios will have immediate effect on demand as well as supply side.
Is the degree of impact same across countries? We have conducted a study taking Nifty stock prices and Hang Seng stock prices as dependent variable and three financial ratios e.g., Price Earnings Ratio, Return on Investment and Earning per Share as independent variables. Result shows that financial ratios have the great impact on share price in both the countries. However, result shows that Hongkong market is slightly ahead of India.
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