As a Part of MBA Program, Student has to pursue a project duly approved by the Faculty of Concerned area. We had the privilege of undertaking the project on
“Impact of FDI & FIIon Indian Stock Market”
. Main aim of the Project is to measure the relation between theFlow of investment and the stock market.This study assumes that the investment decision is independent variable, weather it is FDI orFII. And the stock Indices is dependent variable. Sensex and S&P CNX Nifty are taken as abenchmark of stock market. This study is dependent on secondary sources that possibility of error may arise on the results.The results of this study are from the twenty years statistics. To measure the relation betweenthe indices and Flow of investment, Correlation Coefficient is used in this study, and furtherfor extreme results the Correlation Determination and Probability Error are being used.This study report contains the in-depth study of Foreign Direct Investment, the variousinvestments avenues for Foreign Direct Investment, Reasons to invest overseas, and whyshould invest in India. As far as the results of study for the relation between the FDI andStock market Indices, the relation is partial positive, but so far the FDI flow of investmentdoes not make any significant change on the value of indices. Foreign direct investment inany country do not invested money in the capital market. They invest in the economy or theInvest in the industry of the country.This study paper also focused on the foreign institutional investment. The various avenues forFII and the rules and regulations for the FII. The FII is the direct way for the investment inthe capital or money market of the country. So far the results of the study indicate that therelation of FII with Stock market indices have partial positive relation. That mean the FIIinvestment flow impacts the value of the indices. The study assumes the Stock market isdependent on the FII Flow of investment.Apart from this FDI & FII this paper includes the detailed description of the main regulatingbodies for the capital market; they are Reserve bank of India, security exchange board of India, national stock exchange, Bombay stock exchange.For measuring the impact of FDI & FII on Indian stock market, here the statistical tools areused, the correlation coefficient of foreign Direct investment & BSE-Sensex, Foreign Directinvestment & S&P CNX Nifty, and further correlation coefficient of Foreign institutionalinvestment & BSE-Sensex, & Foreign Institutional Investment & S&P CNX Nifty, the otherstatistical tools are used to support the results and they are Correlation Determination &Probability Error.