Abstract
PurposeThe purpose of the study is to find out the impact of gold and oil prices on the stock market.Design/methodology/approachThis study uses the data on gold prices, stock exchange and oil prices for the period 1991–2016. This study applied descriptive statistics, augmented Dickey–Fuller test, correlation and autoregressive distributed lag test.FindingsThe data analysis results showed that gold and oil prices have a significant impact on the stock market.Research limitations/implicationsFollowing empirical evidence of this study, the authors recommend that investors should invest in gold because the main reason is that hike in inflation reduces the real value of money, and people seek to invest in alternative investment avenues like gold to preserve the value of their assets and earn additional returns. This suggests that investment in gold can be used as a tool to decline inflation pressure to a sustainable level. This study was restricted to use small sample data owing to the availability of data from 1991 to 2017 and could not use structural break unit root tests with two structural break and structural break cointegration approach, as these tests require high-frequency data set.Originality/valueThis study provides information to the investors who want to get the benefit of diversification by investing in gold, oil and stock market. In the current era, gold prices and oil prices are fluctuating day by day, and investors think that stock returns may or may not be affected by these fluctuations. This study is unique because it focusses on current issues and takes the current data in this research to help investment institutions or portfolio managers.
Highlights
Investment is such money that is put away for future use
This study provides information to the investors who want to get the benefit of diversification by investing in gold, oil and stock market
The results indicated that the stock markets in the emerging economies are more vulnerable to bad news and events that result in uncertain economic conditions
Summary
Investment is such money that is put away for future use. There are many ways through which investors can invest their money, for example, in the shape of gold and foreign currency. In the shape of investment in gold, the investors have found significant benefits. The investment in gold is known as tangible assets investments. Gold is known as a much-trusted investment. Gold is known as quite a safe investment from the financial crisis. It has been seen that gold is a less risky investment
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: Journal of Economics, Finance and Administrative Science
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
