• Dr. Simranjeet Kaur Sandhar
• Dr. Neetika Jain
• Ruchi Kushwah

Portfolio construction is a widely-used theory on how investors can construct investment portfolios to maximise expected returns and minimise risk. The practice of portfolio construction includes implementing an asset allocation strategy, which involves balancing investment risk and return by adjusting the percentage of a portfolio allocated to each asset class. Asset allocation is devised based on an investor’s risk tolerance, investment goals and investment timeframe. An attempt is made here to get an insight into the idea embedded inSharpe’s single index model and to construct an optimal portfolio empirically using thismodel. The study aimed to construct an optimal portfolio by using Sharpe’s single index model. For this purpose the monthly closing prices of companies listed in NSE and NSE index (Nifty) for the period of Jan 2010 – Dec 2016 has been considered. Ultimately it is recommended that among the sample companies all the stocks are undervalued except three stocks (Maruti, Tata Steel and HDFC) thus the investors can pick these stocks to revise their portfolio.

Sharpe’s Single Index Model, Return and Risk Analysis, Risk Characteristic Line, Portfolio Analysis, Optimal Portfolio Construction

"OPTIMAL PORTFOLIO CONSTRUCTION: A CASE STUDY OF NSE", International Journal of Emerging Technologies and Innovative Research (www.jetir.org), ISSN:2349-5162, Vol.5, Issue 8, page no.512-520, August-2018, Available :http://www.jetir.org/papers/JETIRA006093.pdf

"OPTIMAL PORTFOLIO CONSTRUCTION: A CASE STUDY OF NSE", International Journal of Emerging Technologies and Innovative Research (www.jetir.org | UGC and issn Approved), ISSN:2349-5162, Vol.5, Issue 8, page no. pp512-520, August-2018, Available at : http://www.jetir.org/papers/JETIRA006093.pdf