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In today’s complex financial environment, identifying optimal stock investments is challenging. This study applies Multi-Criteria Decision-Making (MCDM) techniques to evaluate NIFTY 50 stocks using nine financial indicators, including returns, P/E ratio, dividend yield, and market capitalization. Daily data from April 2020 to March 2025, sourced from the Prowess database, was analyzed. The Entropy Weighting Method ensured objective assignment of metric importance. Four MCDM models—TOPSIS, VIKOR, SAW, and COPRAS—were used to rank stocks. Ranking discrepancies led to the development of a hybrid model combining normalized ranks with entropy-based weights, creating a composite ranking. Spearman’s rank correlation helped compare the models. The hybrid approach enhances ranking consistency and supports data-driven investment decisions. This methodology can also be applied to sectoral or global equity markets, offering a flexible tool for portfolio evaluation and financial analysis.

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An Empirical Analysis of MCDM Techniques in Stock Market-Nifty 50

  • 会议论文

  • 发表日期：

    2026年

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  • Masood Ahmed Shariff,
  • R. Sushma

摘要

In today’s complex financial environment, identifying optimal stock investments is challenging. This study applies Multi-Criteria Decision-Making (MCDM) techniques to evaluate NIFTY 50 stocks using nine financial indicators, including returns, P/E ratio, dividend yield, and market capitalization. Daily data from April 2020 to March 2025, sourced from the Prowess database, was analyzed. The Entropy Weighting Method ensured objective assignment of metric importance. Four MCDM models—TOPSIS, VIKOR, SAW, and COPRAS—were used to rank stocks. Ranking discrepancies led to the development of a hybrid model combining normalized ranks with entropy-based weights, creating a composite ranking. Spearman’s rank correlation helped compare the models. The hybrid approach enhances ranking consistency and supports data-driven investment decisions. This methodology can also be applied to sectoral or global equity markets, offering a flexible tool for portfolio evaluation and financial analysis.