CONSTRUCTION OF OPTIMAL EQUITY PORTFOLIO USING THE SHARPE INDEX MODEL WITH REFERENCE TO BANKING AND INFORMATION TECHNOLOGY SECTORS IN INDIA FROM 2009-2013

Indian securities market is a highly volatile and sensitive market where portfolio construction is highly important to get good returns. Thus the main focus of this research is to construct an optimal equity portfolio with the help of Sharpe index model. In this research, media and entertainment sector has been taken into consideration for constructing the optimum portfolio. Twenty companies like PVR, Sun Network, INOX, Raj television have been selected and excess to beta ratio has been calculated and ranked the companies based on that ratio. The cut-off point was calculated based on the highest value and cut-off point should be used to calculate the proportion of money to be invested in each stocks. This research findings and suggestions would be helpful to investors for investing in media and entertainment sector.