Fuzzy Clustering Analysis of Selected IT Companies in India

Abstract

This paper applies fuzzy clustering algorithm in classifying IT companies in India according to some general financial indexes, such as Equity capital, Earning per Share, Price to book value, net profit margin and dividend payout. By constructing and normalizing initial partition matrix, getting fuzzy similar matrix with Minkowski metric and gaining the transitive closure, the dynamic fuzzy clustering analysis for IT companies is shown clearly that different clustered results change gradually with the threshold reducing, and then, it's shown that there is similar relationship with the prices of those companies in the stock market. In this way, it is greatly valuable in contrasting the IT companies financial conditions in order to identify some good opportunities of investments.