Abstract

The investment is stock market is an art as well as science. The objective of stock market investment is to achieve superior returns comparing other investment options. The investment cost is one of the variable contributing towards the performance of the stock. The justified price of the stock is always a matter of discussion but no specific formula or theory exist to recognize the correct price. This paper is an attempt to decompose the market price of the stock listed on Indian exchanges. Using the data for 10 years, explanatory variables are identified which explain market price of the stock. The model identify the significant factors explaining 62 per cent changes in the market price. The findings of the study are useful to all academicians, researchers and market participants to understand the complex dynamics of market price of the stock and its explanatory factors.

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