1Associate Professor, Department of Commerce, Institute of Integrated and honours Studies, Kurukshetra University, Kurukshetra, India, Email id: vivekchawlauck@gmail.com
2Assistant Professor, Department of Commerce, Guru Nanak Khalsa College, Karnal, India, Email id: arya.meenakshi12@gmail.com
Online published on 10 May, 2019.
This paper studies the effect of diversification with the help of analyzing the Markowitz model. It highlights that how many securities should include in a well diversified portfolio. Keeping in view of present study, the main data used in the study is secondary in nature. The present study is for eleven years starting from 1 January, 2008 to 31 December, 2018. The sample size includes a total number of 225 securities and population consists of all securities listed on BSE-500. The study used daily adjusted closing prices of listed 225 securities of BSE-500. The BSE Sensex is taken as the market proxy. The results of the present study suggested that a well diversified portfolio should include 10–15 securities. The results of the study are consistent with the previous studies such as Evan and Archer (1968) and Irala and Patil (2007). In addition the results may be very useful for investors, academicians etc.
Bombay Stock Exchange, Diversification, Investors, Portfolio
