Dr. Sandeep Bansal
Abstract:
The assumption of normality plays an important role in finance literature. Modern portfolio
theory, for the most part, assumes that asset returns are normally distributed. This assumption
is, in fact, quite basic to the use of a variety of statistical methods for investment research and
analysis. The assumption of normality is crucial for the validity of the mean-variance analysis.
The present paper is an attempt to test the normality of return distribution on Indian stocks. In
the present study, the tests of normality on 50 companies stocks from specified and unspecified
group, for a period of seven years, is carried out.
