*Assistant Professor, A.S College, Khanna, Punjab, India
**Assistant Professor, University School of Applied Management, Punjabi University, Patiala, Punjab, India
Online published on 30 March, 2016.
In financial markets the objective of maximizing return can only be achieved by increasing risk. The risk-return trade-off, which generally emphasize that the is higher risk associated with higher return securities and lower risk is accompanied with lower return. While investing the investor views securities from risk involved and return potential angle. Variation in prices of securities is definitely a signal of riskiness of a security. To some extent risk can be measured by analysing variations in stock prices with some tools and techniques. Variation of a security from average price is a risky signal. There are many tools and techniques of measuring variability of security prices from its standard. The best among them is standard deviation. In this research paper we have endeavoured to measure the variations which take place in stock price due to dividend announcement by companies. Announcements definitely will lead to positive and negative outcome for investors, so efforts have been made to measure variability by taking in account 5 sectors of market and 5 companies in each sector over a period of 5 years from the data base of NSE.
