Performance assessment of growth, income, and value stocks listed in the BSE (2015-2020)

By Riya Jain & Priya Chetty on January 6, 2021

The stock market is the place wherein investors buy or sell shares of listed companies for a profit. The prices of stocks keep changing due to their volatile nature. However, due to unexpected events, crisis, or political changes, the price of stocks fall drastically and investors lose money. This situation of drastic loss is referred to as a “stock market crash” (Ali et al., -2015). In India, the oil price crisis of 2015 and the 2008 recession caused drastic losses in the Bombay Stock Exchange (BSE). The coronavirus pandemic and poor performance of leading Indian banks such as Yes Bank, and fear of recession during the 21-day lockdown caused havoc in the Bombay Stock Exchange (BSE) (Almeida, 2020).

These market crashes reduced the value of stocks, making the investment risky for investors and leading to huge losses. Thus, it is essential to examine the influence of these crashes on the investor’s behaviour.

A review of historical stock performance is a popular way of deciding which stocks to invest in. This stock performance assessment is done by comparing the return-yielding possibility of a particular stock (annual average return) with the market performance (market return). The previous article showed that even during the global financial crisis of 2008, growth stocks were a source of higher returns in the future.

However, during the period from 1st April 2015 to 31st March 2020, the BSE witnessed many crashes. This article compares the long-term returns of three categories of stocks i.e growth, income, and value, for the period 1st April 2015 to 31st March 2020. The annual average return and market return for the concerned period are compared for this purpose.

Comparison of annual average returns and market returns of stocks listed in the BSE from April 1, 2015, to March 31, 2020

The crash of the BSE in 2015, 2016, 2018 and 2020 led to further degradation in the performance of stocks. The market return of BSE has decreased to 0.086 compared to the value of 0.118 in the previous period wherein, the average return of the growth stocks is higher than the market return i.e. 0.119 but has reduced in comparison to the previous period. This further decreased the maximum return to 0.581 compared to 0.355 of BSE and 0.842 in the previous period but has shown a reduction in the minimum value to -0.130.

Variability in the returns earned by investors was also reduced to 0.276 (standard deviation) and 0.076 (variance). A skewness level of 1.049 also shows a reduction in positive skewness in returns distribution by directing them towards symmetry. A kurtosis value of 2.696 which is close to 3 shows the absence of extreme values in the returns distribution of growth stocks. Hence, the crash of the BSE has affected the performance of growth stocks and reduced the average return level but the fluctuation of return over time has decreased.

VariableMeanSt. deviationMinMaxVarianceSkewnessKurtosisMedian
Average Return0.1190.276-0.1300.5810.0761.0492.6960.055
Market Return0.0860.156-0.0320.3550.0241.2472.9110.038
Table 1: Descriptive analysis of growth stock returns

Having a similar behaviour to income stocks, the mean annual average return has witnessed an improvement in the return i.e. 0.224 in comparison to 0.176 in the previous period and 0.086 of the market return. These market crashes though didn’t have much impact on steady income but the volatility of the market has increased raising the standard deviation and variance to 0.633 and 0.401.

Furthermore, the minimum and maximum levels of return also improved i.e. to -0.201 and 1.336 in comparison to -0.356 and 0.749 in the previous period. The skewness value of 1.368 shows the increase in positive skewness compared to market return and even the kurtosis value of 3.076 which is close to 3 shows not many outliers present in the return distribution. Hence, income stocks being the matured and regular source of income prevented the impact of the market crash by providing high returns but also led to having high variability in return.

VariableMeanSt. deviationMinMaxVarianceSkewnessKurtosisMedian
Average Return0.2240.633-0.2011.3360.4011.3683.0760.033
Market Return0.0860.156-0.0320.3550.0241.2472.9110.038
Table 2: Descriptive analysis of Income stock returns

Value stocks followed the growth stocks pattern and have seen a reduction in mean average return to 0.055 compared to 0.064 return values in the previous period and 0.086 market returns. Even the standard deviation and variance of the stocks have increased to 0.450 and 0.203 depicting the increase in variability of returns. Though BSE has crashed and even the mean average return has reduced but still there has been an improvement in the minimum and maximum values to -0.337 and 0.785. The skewness value of 0.882 is between 0.5 and 1 thus representing more positive skewness in the return distribution. A rise in kurtosis value to 2.431 showed a reduction in presence of extreme returns. Hence, value stocks depicted that crash in the market decrease the opportunity to earn but the existence of high variability has led to deviated return possibility for investors.

VariableMeanSt. deviationMinMaxVarianceSkewnessKurtosisMedian
Average Return0.0550.450-0.3370.7850.2030.8822.431-0.014
Market Return0.0860.156-0.0320.3550.0241.2472.9110.038
Table 3: Descriptive analysis of Value stock returns

Comparison of annual average returns and market returns from April 1, 2000, to March 31, 2020

Assessment of the average and market returns for the period from April 1, 2000, to March 31, 2020, provided a direct comparison for the given period. Herein, the growth stocks have the mean average value of 0.287 which is greater than 0.176, the market return. This shows that there is a possibility of earning a higher return for investors directing their money in growth stocks. Minimum and maximum values further depicted that with a minimum level limit less than the market return (-0.481 > -0.583) and a maximum level higher than the marker return (1.228 > 1.008), there is more earning possibility for growth stock investors. Standard deviation and the variance value, however, show that there is the existence of high variability in the growth stocks as compared to the BSE 500 market i.e. 0.482 > 0.389 and 0.232 > 0.151. The skewness value of 0.409 is higher than 0.312 thus there is more positive skewness in growth stock return distribution. The kurtosis value of 2.382 is less than 3.014 (Close to 3), thus representing the presence of more extreme values. Hence, growth stocks due to their higher risk association tend to provide more return to the investors but also have high variability in the market.

VariableMeanSt. deviationMinMaxVarianceSkewnessKurtosisMedian
Average Return0.2870.482-0.4811.2280.2320.4092.3820.258
Market Return0.1760.389-0.5831.0080.1510.3123.0140.167
Table 4: Descriptive analysis of growth stock returns

Income stocks have also shown the possibility of earning higher income as compared to the market return i.e. 0.254 > 0.176 but it is less than the return derived from growth stocks. With the higher minimum value compared to the market level i.e. (-0.645 < -0.583) and also a higher maximum level (1.463 > 1.008), there is the availability of steady income for investors but the volatility is high in the market. Standard deviation and variance level further represent the existence of high variability in returns i.e. 0.606 > 0.389 and 0.367 > 0.151.

This level, however, is less than the growth of stock market volatility. The skewness value of 0.773 is higher than the market value and even between 0.5 and 1 thus showing a high positive skewness presence in return distribution. A kurtosis value of 2.734 is also less than 3.014 but close to 3 representing the availability of less extreme values. Hence, income stock suggests that as the companies issuing income stocks matured but the presence of high volatility in the market ensures the stability of the income by providing a steady source of return.

VariableMeanSt. deviationMinMaxVarianceSkewnessKurtosisMedian
Average Return0.2540.606-0.6451.4630.3670.7732.7340.094
Market Return0.1760.389-0.5831.0080.1510.3123.0140.167
Table 5: Descriptive analysis of Income stock returns

Lastly, the value stocks also have a mean average return higher than the market return i.e. 0.238 > 0.176 but due to the undervaluation of the stocks, the mean value is less in comparison to the growth and income stocks. The variability level of the market represents a standard deviation of 0.576 and a variance of 0.332. Although the level is higher than market return and growth stocks but less than the volatility of income stocks. Minimum and maximum values further show that the presence of less stability in the market ensures the wide variation in both levels i.e. -0.624 and 1.719.

The skewness value of 0.896 is very high compared to market return, growth and income stocks thus showing high positive skewness in the return distribution of value stocks. A kurtosis value of 3.415 though is higher than the market return but this high value represents the existence of outliers in the distribution of return. Hence, value stocks depict that with the existence of undervalued companies, the frequent crashes in the market have hugely impacted the return possibility from income stocks.

VariableMeanSt. deviationMinMaxVarianceSkewnessKurtosisMedian
Average Return0.2380.576-0.6241.7190.3320.8963.4150.146
Market Return0.1760.389-0.5831.0080.1510.3123.0140.167
Table 6: Descriptive analysis of Value stock returns

Good investment despite BSE stocks falling since 2010

Since 2010, with the occurrence of many crises, there has been a rapid fall in the mean value of average returns and market returns. Despite this, some of the stocks were successfully able to benefit investors. Though the mean value of growth stock has reduced compared to its value in the period 2005-2010, the reduction in the volatility in returns and higher return compared to market return enhanced profits. Income stocks being matured companies overcame the impact of high volatility and provided a steady source of income to their investors. On the other hand, value stocks experienced very fewer average returns compared to other stocks. Growth and income stocks were thus the most beneficial ones for investors in terms of profits. It is essential to track the movement of stock prices and effectively predict the future movement of stock returns.


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Priya is the co-founder and Managing Partner of Project Guru, a research and analytics firm based in Gurgaon. She is responsible for the human resource planning and operations functions. Her expertise in analytics has been used in a number of service-based industries like education and financial services.

Her foundational educational is from St. Xaviers High School (Mumbai). She also holds MBA degree in Marketing and Finance from the Indian Institute of Planning and Management, Delhi (2008).

Some of the notable projects she has worked on include:

  • Using systems thinking to improve sustainability in operations: A study carried out in Malaysia in partnership with Universiti Kuala Lumpur.
  • Assessing customer satisfaction with in-house doctors of Jiva Ayurveda (a project executed for the company)
  • Predicting the potential impact of green hydrogen microgirds (A project executed for the Government of South Africa)

She is a key contributor to the in-house research platform Knowledge Tank.

She currently holds over 300 citations from her contributions to the platform.

She has also been a guest speaker at various institutes such as JIMS (Delhi), BPIT (Delhi), and SVU (Tirupati).


I am a master's in Economics from Amity University. Having a keen interest in Econometrics and data analysis, I was a part of the Innovation Project of Daulat Ram College, Delhi University. My core expertise and interest are in environment-related issues. Apart from academics, I love music and exploring new places.