Dynamic Interrelationship between Indices of BRICS EconomiesDownload PDF
As equity markets developed, different categories of investors started participating in the market. BRICS is a grouping acronym that refers to the countries of Brazil, Russia, India, China& South Africa which are all deemed to be at a similar stage of newly advanced economic development. There is a lot of importance being associated with BRICS nations in the recent past saying that they are going to be the next super powers in the world markets by 2050 (Goldman Sachs Report). His paper examines the dependence structure between the emerging stock markets of the BRICS countries. The Study will use closing price of respective indexes of last year 2013 to check the normality and relationship that exist in BRICS Countries. This paper analyzes the dynamic interrelationship among the emerging countries specially BRICS countries in condition of financial turmoil. Popular Indices of BRICS countries have taken as the proxy of their Stock market. Several statistical tests have been applied in order to study the behavior and dynamics of time series of BRICS countries indices. The period for the study was taken from January to December 2013 using the daily closing points. These results have implications for international investors in terms of risk management which should vary according to changes in the economic and financial global factors.
Keywords: Equity, Correlation, BRICS, Indices, Volatility