Oligopoly Markets are Not Efficient: Evidence from Indian Cement Industry
- June 1, 2018
- Posted by: RSIS
- Category: Management
International Journal of Research and Scientific Innovation (IJRSI) | Volume V, Issue V, May 2018 | ISSN 2321–2705
Oligopoly Markets are Not Efficient: Evidence from Indian Cement Industry
Meenu Baliyan, Punjika Rathi
Assistant Professor (MBA Dept), IMS Engineering College, Ghaziabad, Uttar Pradesh, India
Abstract: – Capital market Efficiency means that any type of information is reflected in the stock prices instantly. This paper has tried to find out the type of capital market efficiency that Indian stock market exists. Since the market is efficient in three forms: weak, semi strong and strong. The type of efficiency any market exhibits will lead to usefulness of fundamental and technical analysis in investment decisions of that market. Hence investor can accordingly plan its approach of investment analysis.
This paper has studied the stock market prices of top players of cement industry of India for 1 year to find out the dependency among stock prices and information by conducting exploratory research. This paper would test the type of efficiency of Indian cement industry and its results could be applied for further portfolio management practices.
Keywords: Market efficiency, oligopoly, fundamental analysis, technical analysis, portfolio management.
I. INTRODUCTION OF THE STUDY
The oligopoly market can be explained by few seller and they are selling homogenous or differentiated products. In other words, the Oligopoly market structure lies between the pure monopoly and monopolistic competition, where few sellers dominate the market and have control over the price of the product. In this study researcher try to find out that oligopoly market are not efficient. For the study cement industry has been considered.
The efficient market model is actually concerned with the speed with which information is incorporated in security prices. This hypothesis states that the capital market is capable in processing information. An efficient capital market is one in which security prices equal their intrinsic values at all times, and where most securities are correctly priced. According to Elton and Gruber, “when someone refers to efficient capital markets, they mean that security prices fully imitate all available information”.
