Abstract:
This research presents the relationship between portfolio insurance and their stock market implications. The main research objective is to investigate if portfolio insurance has a relationship with the stock market and what marketing implications exist. For testing of the statistical significance of portfolio insurance and the market Implications, various specific objectives were formed from the main objective. The researchers try to see how this would be achieved in the downside performance-risk-measures between the pairs of portfolio insurance techniques/strategies. Secondary data was used in this study. A Monte-Carlo Simulation determined by a Stochastic Model and the model uncertainty was used to arrive at a good analysis. We found out from the analysis that, there exists a significant positive relationship between the portfolio insurance and market implication. The research objectives were achieved by demonstrating strong implication on the portfolio insurance effects when the market price is rising, is falling or when is flat. Again, the study reveals an implication of the market situations to the portfolio insurance by presenting results that, the markets of the stocks have strong and positive implications on portfolio insurance. Portfolio Insurance technique/strategies provide superior downside-protection to the investors, however, if an investor possesses a superior forecasting skill, other active techniques may exist that would generate higher returns as compared to the protected passive stock market investments. In conclusion, the evidence from the results we discussed indicated that stock market potential investors will react with a rapidly to portfolio insurance of firms and there is a positive and strong relationship between the portfolio insurance and the stock market implications. In terms of service quality & investors satisfaction, the portfolio insurance is doing fair which has remains a major factor in competing favourably in the insurance market and in augmenting the companies in contributing to the socio-economic development of the nation. From the research objectives evaluated and portfolio insurance effects from the several market situations, also with the Investors sentiments at each market level, the researchers found out that there are a strong and positive relationship and implication between portfolio insurance and the Stock Market.
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