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Positive Affect of Financial Derivatives onThe Stock Market
- 1 University of Manchester
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Abstract
The derivatives market is widely recognized in financial markets, and it has developed rapidly, but there is little evidence that it contributed to the development of financial and economic markets. This article investigates the dynamic relationship between the Indian derivatives market and the stock market to determine how it affects market pricing. This paper use the DCC-garCH model to examine the dynamics of India from the third quarter of 2018 to 2022, I find that the financial derivatives market is more financially contagious than the equity market. Therefore, I can analyse that the development of derivatives has a positive impact on economic growth.
Keywords
financial derivatives, DCC-garCH model, india stock market
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Cite this article
Liu,Y. (2023). Positive Affect of Financial Derivatives onThe Stock Market. Advances in Economics, Management and Political Sciences,7,163-170.
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