IMPACT OF MARKET VARIABLES ON BOND YIELD by Harish Handa
By: Global Vision Publishing HouseSingle Issue
Single Issue
- IMPACT OF MARKET VARIABLES ON BOND YIELD by Harish Handa
- Price : 200.00
- Published on June 1, 2013
- Global Vision Publishing House
- Language - English
- Published na
About this issue
“Indian debt market lacks depth”- The myth continues even after six years when the secondary market first opened its doors for bond trading in 2003. Since then, the corporate world has used the debt market as a major source of fund because this not only reduced their cost of fund but also enhanced their access to a larger pool of fund. Debt market went hand in hand with the equity market and, hence, followed the trend of ups and downs (volatility) as the equity market did. Several studies have been made on the impact of various macro and micro economic factors on the bond yield and, hence, the fluctuations of the yield curve (bond yield against the maturities). The movement of the yield curve is a complicated matter considering the huge number of factors impacting this movement in different ways that varies with time and market scenarios. This implies the inefficiency of the mathematical models to track these movements. Hence, the necessity of statistical analysis based upon past data arises. This paper intends to carry on a statistical analysis on the impact of five macroeconomic factors on the bold yield. Inflation, USD INR spot rate, crude price and RBI cash balance are the factors chosen on the basis of past research papers and the availability of data. The paper also intends to give a comparative analysis of the impact of these factors on the short-term bond yields against that of the long-term bond yields. Statistical tool like multiple regressions is considered for the analysis of three years of data, which is fairly supported by graphical representations. Finally, the paper, being based only upon the statistical analysis, gives conclusion based upon the historical analysis of the available data.
About IMPACT OF MARKET VARIABLES ON BOND YIELD by Harish Handa
Global Journal of Business Management Vol. 3 No. 2, December 2009