Page 333 - IMDR JOURNAL 2023-24

IMDR’s Journal of Management Development & Research 2023-24

contributed to our understanding of this relationship, emphasizing the importance of

exploring their long-term dynamics.

Jain and Bagri conducted a study focusing on the short-term correlation between the Nasdaq
and Nifty indices using daily price data. Their findings indicated a strong positive correlation

between the two indices, particularly during periods of market volatility. However, the study

primarily examined short term fluctuations and did not delve into their long-term dynamics.

Sharma and Verma delved into the long-term relationship between the Nasdaq and Nifty
indices over a 10 years period. Employing statistical techniques such as cointegration

analysis, they identified a significant long-term correlation between the two indices. Their
findings suggested implications for portfolio diversification strategies.

Gupta et al. investigated the impact of global market movements, including those of the

Nasdaq index, on the Indian stock market. Utilizing event study methodology, they analyzed

the immediate and long-term effects of global events on the Nifty index. While their focus
extended beyond the Nasdaq Nifty correlation, their findings highlighted the

interconnectedness of global markets and the need to consider external factors in market
analysis.

Overall, the existing literature offers valuable insights into the correlation between the

Nasdaq index and the Nifty index within the Indian context. However, there remains a need

for further research to comprehensively understand their long-term dynamics and
implications for investors and policymakers. This present study aims to address this gap by

employing historical price data and advanced statistical analysis techniques to assess the
long-term correlation between these two major stock market indices.

Both the Jain and Bagri (2017) study and the Sharma and Verma (2019) study contribute to
our understanding of the correlation between the Nasdaq index and the Nifty index within the

Indian context. However, they differ in their focus and methodology.

Jain and Bagri (2017) specifically examined the short-term correlation between the Nasdaq
and Nifty indices using daily price data. They found a strong positive correlation between the

two indices, particularly during periods of market volatility. However, their study primarily
focused on short term fluctuations and did not delve into the long-term dynamics of their

correlation.

325