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investment avenues

investment avenues

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Published by: Pratik R Jain on Sep 18, 2012
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Savings form an important part of the economy of any nation. With the savings invested in various options available to the people, the money acts as the driver for growth of the country. Indian financial scene too presents a plethora of avenues to the investors. Though certainly not the best or deepest of markets in the world, it has reasonable options for an ordinary man to invest his savings. The money you earn is partly spent and the rest saved for meeting future expenses. Instead of keeping the savings idle you may like to use savings in order to get return on it in the future. This is called Investment. One needs to invest to and earn return on your idle resources and generate a specified sum of money for a specific goal in life and make a provision for an uncertain future One of the important reasons why one needs to invest wisely is to meet the cost of Inflation. Inflation is the rate at which the cost of living increases. The cost of living is simply what it costs to buy the goods and services you need to live. Inflation causes money to lose value because it will not buy the same amount of a good or service in the future as it does now or did in the past. The sooner one starts investing the better. By investing early you allow your investments more time to grow, whereby the concept of compounding increases your income, by accumulating the principal and the interest or dividend earned on it, year after year. The three golden rules for all investors are:    Invest early Invest regularly Invest for long term and not short term

This project will also help to understand the investors facet before investing in any of the investment tools and thus to scrutinize the important aspects for the investors before investing that further helped in analyzing the relation between the features of the products and the investors’ requirements.

OBJECTIVES OF THE PROJECT: The purpose of the study was to determine the saving behavior and investment preferences of customers. Customer perception will provide a way to accurately measure how the customers think about the products and services provided by the company. Today’s trying economic conditions have forced difficult decisions for companies. Most are making conservative decisions that reflect a survival mode in the business operations. During these difficult times, understanding what customers on an ongoing basis is critical for survival. Executives need a 3rd party understanding on where customer loyalties stand. More than ever management needs ongoing feedback from the customers, partners and employees in order to continue to innovate and grow. The main objective of the project is to find out the needs of current and future customers. For this report , customer perception and awareness level will be measured in many important areas like: To understand all about different investment avenues available in India. To find out how the investors get information about the various financial instrument To find out how the investor wants to invest i.e. on his own or through a broker. To find out the saving habits of the different customers and the amount they invest in various financial instruments. In which type of financial instrument they like to invest. How long they prefer to keep their money invested. What is the return that they expect from the investment. What are the various factors that they consider before investing. To find out the risk profile of the investor. To give a recommendation to the investors that where they should invest. To give a suggestion to my company where our fund lacks in the market & how it should be rectified. After all as a management trainee I will try to get some valuable knowledge from my seniors in the organization as well as from my faculty guide which will help me in the future. To evaluate the consumer attitude towards saving and decision making regarding investments.

The project is based upon various financial instrument that are available in India and the perception level of the customer about these financial instruments. For which there will be the need of information from the customers about their knowledge of these financial products. The various limitations of the study are: Total number of financial instrument in the market is so large that it needs a lot of resources to analyze them all. There are various companies providing these financial instruments to the public. Handling and analyzing such a varied and diversified data needs a lot of time and resources . As the project is based on secondary data, possibility of unauthorized information cannot be avoided. Reluctance of the people to provide complete information about themselves can affect the validity of responses. Due to time and cost constraint study will be conducted in only selected area of Mohali and Chandigarh. The lack of knowledge in customers about the financial instruments can be a major limitation. The information can be biased due to use of questionnaires.

METHODOLOGY: Source of Data:Primary Data : Questionnaire, visiting organization. journals and magazines.

Secondary Data : Information from the Company, Websites, Sample Size : 100.

Sampling technique : Random sampling.

SAMPLING METHODOLOGY SamplingTechnique: Initially, a rough draft was prepared keeping in mind the objective of the research. A pilot study was done in order to know the accuracy of the Questionnaire. The final Questionnaire was arrived only after certain important changes were done. Convenience sampling technique will be used for collecting the data from the Karvy Stock Broking customers. The consumers are selected by the convenience sampling method. The selection of units from the population based on their easy availability and accessibility to the researcher is known as convenience sampling. Convenience sampling is at its best in surveys dealing with an exploratory purpose for generating ideas and hypothesis.

Sampling Unit: The respondants who were asked to fill out questionnaires are the sampling units. These comprise of employees of MNCs, Govt. Employees, Self Employeds and existing customers of Karvy Stock broking Ltd Sample size: The sample size was restricted to only 100, which comprised of mainly peoples from different regions of Chandigarh due to time constraints. Sampling Area: The area of the research was Chandigarh, Mohali

The project work can only be complete after: Analyzing the data. Referring books and gathering more relevant information from the internet. Drawing detailed and careful inferences from the analysis.

Data Collection Questioning & observing are the two basic methods of collecting primary data. Questionnaire studies are more relevant than observation studies

Importance of Questionnaire When information is to be collected by asking questions to people who may have the desired data, a standardized form called questionnaire is prepared which helps to bring the data as such required for the research work. The questionnaire is a list of questions to be asked to the respondents. Each question is worded exactly as it is to be asked & the questions are listed in an established sequence. Spaces in which to record answers are provided in questionnaire.

Presentation of the data The collected data will be analyzed and will be represented through various charts, graphs, pie charts, tabulation and a master sheet of the surveyed data. The data will be presented to determine market shares and percentage of readers out of the total population. The same pattern will be repeated in the case of advertisers.

Mutual Fund:Mutual fund is a pool of money collected from investors and is invested according to stated investment objectives Mutual fund investors are like shareholders and they own the fund. Mutual fund investors are not lenders or deposit holders in a mutual fund. Everybody else associated with a mutual fund is a service provider, who earns a fee. The money in the mutual fund belongs to the investors and nobody else. Mutual funds invest in marketable securities according to the investment objective. The value of the investments can go up or down, changing the value of the investor’s holdings.NAV of a mutual fund fluctuates with market price movements. The market value of the investors’ funds is also called as net assets. Investors hold a proportionate share of the fund in the mutual fund. New investors come in and old investors can exit, at prices related to net asset value per unit.

Emergence of Mutual Funds:Mutual Funds now represent perhaps the most appropriate investment opportunity for most small investors. As financial markets become more sophisticated and complex, investor need a financial intermediary who provides the required knowledge and professional expertise on successful investing. It is no wonder then that in the birthplace of mutual funds-the U.S.A.-the fund industry has already overtaken the banking industry, with more money under Mutual Fund management than deposited with banks. The Indian Mutual Fund industry has already opened up many exciting investment opportunities to Indian investors. Despite the expected continuing growth in the industry, Mutual Fund is a still new financial intermediary in India. History of Mutual Funds:In the second half of 19th century, investor in UK considered the stock market is good for the investment. But for small investor it is not possible to operate in the market effectively. This led to establishment of an investment company which led to the small investor to invest in equity market. The first investment company was the Scottish-American Investment Company, set up in London in 1860.

One of the options is to invest the money in stock market.Mutual Fund Industry in India:Mutual Fund is an instrument of investing money. the government of India took the initiative by passing the UTI act. Diversification means spreading out money across many different types of investments. In 1963. The designated role of UTI was to set up a Mutual Fund. bank rates have fallen down and are generally below the inflation rate. one doesn't have to figure out which stocks or bonds to buy. This is where mutual funds come to the rescue. Also. In 1994 the foreign Mutual Funds arrives in Indian market. called. In 1987 the other public sector institutions set up their Mutual Funds. But the biggest advantage of mutual funds is diversification. By pooling money together in a mutual fund. The history of Indian Mutual Fund industry can be explained easily by various phases:- . When one investment is down another might be up. In 2001 there is a crisis in UTI and in 2003 UTI splits up into UTI 1and UTI 2. Therefore. In 1992. under which the Unit Trust of India (UTI) was set-up as a statutory body. Nowadays. Mutual funds are highly cost efficient and very easy to invest in. Diversification of investment holdings reduces the risk tremendously. keeping large amounts of money in bank is not a wise option. investors can purchase stocks or bonds with much lower trading costs than if they tried to do it on their own. as in real terms the value of money decreases over a period of time. UTI’s first scheme. A mutual fund is a group of investors operating through a fund manager to purchase a diverse portfolio of stocks or bonds. But a common investor is not informed and competent enough to understand the intricacies of stock market. government allowed the private sector players to set-up their funds.


the units can be sold on a stock exchange at the prevailing market price or the investor can avail of the facility of direct repurchase at NAV related prices by the Mutual Fund. custodial and other fees translate into lower costs for investors. In closed-end schemes. backed by a dedicated investment research team that analyses the performance and prospects of companies and selects suitable investments to achieve the objectives of the scheme. You achieve this diversification through a Mutual Fund with far less money than you can do on your own. delayed payments and follow up with brokers and companies. Return Potential: Over a medium to long-term. Mutual Funds save your time and make investing easy and convenient. Transparency: - You get regular information on the value of your investment in addition to disclosure on the specific investments made by your scheme. Flexibility: - Through features such as regular investment plans. Low Costs: - Mutual Funds are a relatively less expensive way to invest compared to directly investing in the capital markets because the benefits of scale in brokerage. This diversification reduces the risk because seldom do all stocks decline at the same time and in the same proportion. Mutual Funds have the potential to provide a higher return as they invest in a diversified basket of selected securities. Convenient Administration: - Investing in a Mutual Fund reduces paperwork and helps you avoid many problems such as bad deliveries. regular withdrawal plans and dividend reinvestment plans. Diversification: - Mutual Funds invest in a number of companies across a broad cross-section of industries and sectors.Benefits of Investing in Mutual Funds Professional Management: - Mutual Funds provide the services of experienced and skilled professionals. the proportion invested in each class of assets and the fund manager's investment strategy and outlook. the investor gets the money back promptly at net asset value related prices from the Mutual Fund. you can systematically invest or withdraw funds according to your needs and convenience. Affordability: - . Liquidity: In open-end schemes.

Choice of Schemes: - Mutual Funds offer a family of schemes to suit your varying needs over a lifetime. A mutual fund because of its large corpus allows even a small investor to take the benefit of its investment strategy.Investors individually may lack sufficient funds to invest in high-grade stocks. Well Regulated All Mutual Funds are registered with SEBI and they function within the provisions of strict regulations designed to protect the interests of investors. The operations of Mutual Funds are regularly monitored by SEBI. .

Dilution is also the result of a successful fund getting too big. Dilution: – Because funds have small holdings across different companies. high returns from a few investments often don't make much difference on the overall return. the manager often has trouble finding a good investment for all the new money. which affects how profitable the individual is from the sale. The mutual fund industries are thus charging extra cost under layers of jargon. at the time of purchase.Disadvantages of Investing Mutual Funds:- Professional Management: Some funds doesn’t perform in neither the market. . fund managers don't consider your personal tax situation. thus many investors debate over whether or not the so-called professionals are any better than mutual fund or investor himself. When money pours into funds that have had strong success. Taxes: When making decisions about your money. a capital-gain tax is triggered. when a fund manager sells a security. as their management is not dynamic enough to explore the available opportunity in the market. Costs: – The biggest source of AMC income is generally from the entry & exit load which they charge from investors. For example. It might have been more advantageous for the individual to defer the capital gains liability. for picking up stocks.

Interval Funds:Interval funds combine the features of open-ended and close-ended schemes.Types of Mutual Funds Mutual fund schemes may be classified on the basis of its structure and its objective:By Structure:Open-ended Funds:An open-end fund is one that is available for subscription all through the year. preservation of capital and moderate income. That is. Typically entry and exit loads range from 1% to 2%. each time you buy or sell units in the fund. They are open for sale or redemption during pre-determined intervals at NAV related prices. No-Load Funds:A No-Load Fund is one that does not charge a commission for entry or exit. It could be worth paying the load. That is. Load Funds:A Load Fund is one that charges a commission for entry or exit. Money Market Funds:The aim of money market funds is to provide easy liquidity. In order to provide an exit route to the investors. These do not have a fixed maturity. . These are ideal for Corporate and individual investors as a means to park their surplus funds for short periods. These schemes generally invest in safer short-term instruments such as treasury bills. no commission is payable on purchase or sale of units in the fund. Returns on these schemes may fluctuate depending upon the interest rates prevailing in the market. a commission will be payable. Investors can conveniently buy and sell units at Net Asset Value ("NAV") related prices. The key feature of open-end schemes is liquidity. The advantage of a no load fund is that the entire corpus is put to work. The fund is open for subscription only during a specified period. commercial paper and inter-bank call money. certificates of deposit. some close-ended funds give an option of selling back the units to the Mutual Fund through periodic repurchase at NAV related prices. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the stock exchanges where they are listed. SEBI Regulations stipulate that at least one of the two exit routes is provided to the investor. if the fund has a good performance history. Closed-ended Funds:A closed-end fund has a stipulated maturity period which generally ranging from 3 to 15 years.

1961. It is advisable that an investor looking to invest in an equity fund should invest for long term i. In the order of decreasing risk level.Tax Saving Schemes:These schemes offer tax rebates to the investors under specific provisions of the Indian Income Tax laws as the Government offers tax incentives for investment in specified avenues. 2000. The Act also provides opportunities to investors to save capital gains u/s 54EA and 54EB by investing in Mutual Funds. there are following types of equity funds:- AGGRESSIVE GROWTH FUNDS:- . There are different types of equity funds each falling into different risk bracket. for 3 years or more. Various types of Mutual Funds: Equity Funds: - Equity funds are considered to be the more risky funds as compared to other fund types. but they also provide higher returns than other funds. provided the capital asset has been sold prior to April 1. 2000 and the amount is invested before September 30.e. Investments made in Equity Linked Savings Schemes (ELSS) and Pension Schemes are allowed as deduction u/s 88 of the Income Tax Act.

fund managers aspire for maximum capital appreciation and invest in less researched shares of speculative nature. . Because of these speculative investments Aggressive Growth Funds become more volatile and thus. are prone to higher risk than other equity funds.In Aggressive Growth Funds.

GROWTH FUNDS: Growth Funds also invest for capital appreciation (with time horizon of 3 to 5 years) but they are different from Aggressive Growth Funds in the sense that they invest in companies that are expected to outperform the market in the future. 2500 crore but more than Rs. However. which is otherwise considered as a risky instrument. investment gets risky. Option Income Funds:While not yet available in India. Criteria for some specialty funds could be to invest/not to invest in particular regions/companies. which generate stable income for investors. foreign securities funds are exposed to foreign exchange rate risk and country risk. . There are following types of specialty funds: Sector Funds:Equity funds that invest in a particular sector/industry of the market are known as Sector Funds. blue chip companies (less than Rs. Foreign Securities Funds:Foreign Securities Equity Funds have the option to invest in one or more foreign companies. Without entirely adopting speculative strategies. Mid-Cap or Small-Cap Funds:Funds that invest in companies having lower market capitalization than large capitalization companies are called Mid-Cap or Small-Cap Funds. These funds invest in big. Auto. 500 crore. are comparatively riskier than diversified funds. The exposure of these funds is limited to a particular sector (say Information Technology. Market Capitalization of a company can be calculated by multiplying the market price of the company's share by the total number of its outstanding shares in the market. Proper use of options can help to reduce volatility. and then sell options against their stock positions. Banking. Pharmaceuticals or Fast Moving Consumer Goods) which is why they are more risky than equity funds that invest in multiple sectors. Option Income Funds write options on a large fraction of their portfolio. Market capitalization of Mid-Cap companies is less than that of big. Specialty funds are concentrated and thus. Growth Funds invest in those companies that are expected to post above average earnings in the future. 500 crore) and Small-Cap companies have market capitalization of less than Rs. Foreign securities funds achieve international diversification and hence they are less risky than sector funds. The shares of Mid-Cap or Small-Cap Companies are not as liquid as of Large-Cap Companies which gives rise to volatility in share prices of these companies and consequently. high dividend yielding companies. SPECIALTY FUNDS: Specialty Funds have stated criteria for investments and their portfolio comprises of only those companies that meet their criteria.

However. EQUITY INCOME OR DIVIDEND YIELD FUNDS: The objective of Equity Income or Dividend Yield Equity Funds is to generate high recurring income and steady capital appreciation for investors by investing in those companies which issue high dividends (such as Power or Utility companies whose share prices fluctuate comparatively lesser than other companies' share prices). As per the mandate. Value stocks are generally from cyclical industries (such as cement. a minimum of 90% of investments by ELSS should be in equities at all times. Although debt securities are generally less risky than equities. Value Funds may select companies from diversified sectors and are exposed to lower risk level as compared to growth funds or specialty funds. there can be following types of debt funds:- . The portfolio of these funds comprises of shares that are trading at a low Price to Earnings Ratio (Market Price per Share / Earning per Share) and a low Market to Book Value (Fundamental Value) Ratio. they are subject to credit risk (risk of default) by the issuer at the time of interest or principal payment. are more risky. diversified equity funds invest mainly in equities without any concentration on a particular sector(s). Equity index funds that follow broad indices (like S&P CNX Nifty. steel. Narrow indices are less diversified and therefore. These funds are well diversified and reduce sector-specific or company-specific risk. financial institutions.) which make them volatile in the short-term. To minimize the risk of default. One prominent type of diversified equity fund in India is Equity Linked Savings Schemes (ELSS). ELSS usually has a lock-in period and in case of any redemption by the investor before the expiry of the lock-in period makes him liable to pay income tax on such income(s) for which he may have received any tax exemption(s) in the past. debt funds usually invest in securities from issuers who are rated by credit rating agencies and are considered to be of "Investment Grade". Therefore. VALUE FUNDS:Value Funds invest in those companies that have sound fundamentals and whose share prices are currently under-valued. debt (or income) funds distribute large fraction of their surplus to investors. The portfolio of these funds comprises of the same companies that form the index and is constituted in the same proportion as the index. DEBT / INCOME FUNDS:Funds that invest in medium to long-term debt instruments issued by private companies. governments and other entities belonging to various sectors (like infrastructure companies etc. it is advisable to invest in Value funds with a long-term time horizon as risk in the long term. Sensex) are less risky than equity index funds that follow narrow sectoral indices (like BSEBANKEX or CNX Bank Index etc). Equity Income or Dividend Yield Equity Funds are generally exposed to the lowest risk level as compared to other equity funds. to a large extent. sugar etc. is reduced. ELSS investors are eligible to claim deduction from taxable income (up to Rs 1 lakh) at the time of filing the income tax return. Based on different investment objectives. banks.DIVERSIFIED EQUITY FUNDS: Except for a small portion of investment in liquid money market. Debt funds that target high returns are more risky. like all other funds diversified equity funds too are exposed to equity market risk.) are known as Debt / Income Funds. Debt funds are low risk profile funds that seek to generate fixed current income (and not capital appreciation) to investors. Equity Index Funds: Equity Index Funds have the objective to match the performance of a specific stock market index. In order to ensure regular income to investors.


but there can be funds that come with a lock-in period and offer assurance of annual returns to investors during the lock-in period. government had to intervene and took over UTI's payment obligations on itself. no AMC in India offers assured return schemes to investors. Eventually. and therefore. These funds are generally debt funds and provide investors with a low-risk investment opportunity. These funds are more volatile and bear higher default risk. To safeguard the interests of investors. though possible.e. specialized and offshore debt funds. Any shortfall in returns is suffered by the sponsors or the Asset Management Companies (AMCs). However. UTI had offered assured return schemes (i. Assured Return Funds: Although it is not necessary that a fund will meet its objectives or provide assured returns to investors. debt funds generally try to minimize the risk of default by investing in securities issued by only those borrowers who are considered to be of "investment grade". issued by companies of a specific sector or industry or origin. the security of investments depends upon the net worth of the guarantor (whose name is specified in advance on the offer document). Any loss incurred. Monthly Income Plans of UTI) that assured specified returns to investors in the future. UTI was not able to fulfill its promises and faced large shortfalls in returns.Diversified Debt Funds: Debt funds that invest in all securities issued by entities belonging to all sectors of the market are known as diversified debt funds. The best feature of diversified debt funds is that investments are properly diversified into all sectors which results in risk reduction. In the past. Currently. focused debt funds are more risky as compared to diversified debt funds. fixed term plans are not listed on the exchanges. Fixed term plan series usually invest in debt / income schemes and target short-term investors. Focused Debt Funds: Unlike diversified debt funds. focused debt funds are narrow focus funds that are confined to investments in selective debt securities. on account of default by a debt issuer. Although not yet available in India. is shared by all investors which further reduces risk for an individual investor. these funds are conceivable and may be offered to investors very soon. although they may earn at times higher returns for investors. Some examples of focused debt funds are sector. funds that invest only in Tax Free Infrastructure or Municipal Bonds. Because of their narrow orientation. Fixed Term Plan Series: Fixed Term Plan Series usually are closed-end schemes having short term maturity period (of less than one year) that offer a series of plans and issue units to investors at regular intervals. . Unlike closed-end funds. High Yield Debt funds: As we now understand that risk of default is present in all debt funds. The objective of fixed term plan schemes is to gratify investors by generating some expected returns in a short period. High Yield Debt Funds adopt a different strategy and prefer securities issued by those issuers who are considered to be of "below investment grade". The motive behind adopting this sort of risky strategy is to earn higher interest returns from these issuers. SEBI permits only those funds to offer assured return schemes whose sponsors have adequate net-worth to guarantee returns in the future. But.

However. However. and therefore. Gilt Funds invest in government papers (named dated securities) having medium to long term maturity period. like all debt funds. hybrid funds are those funds whose portfolio includes a blend of equities. thus making money market / liquid funds the safest investment option when compared with other mutual fund types. gilt funds too are exposed to interest rate risk. fund managers may switch over to equity if they expect equity market to provide good returns and switch over to debt if they expect debt market to provide better returns. Interest rates and prices of debt securities are inversely related and any change in the interest rates results in a change in the NAV of debt/gilt funds in an opposite direction. debts and money market securities. moderate capital appreciation and at the same time minimizing the risk of capital erosion.. The typical investment options for liquid funds include Treasury Bills (issued by governments). There are following types of hybrid funds in India: Balanced Funds: The portfolio of balanced funds includes assets like debt securities. Growth-and-Income Funds: Funds that combine features of growth funds and income funds are known as Growth-and-Income Funds. . Commercial papers (issued by companies) and Certificates of Deposit (issued by banks). and equity and preference shares held in a relatively equal proportion.GILT FUNDS:Also known as Government Securities in India. convertible securities. money market or non-financial (physical) assets like real estate. MONEY MARKET / LIQUID FUNDS:Money market / liquid funds invest in short-term (maturing within one year) interest bearing debt instruments. The objectives of balanced funds are to reward investors with a regular income. HYBRID FUNDS:As the name suggests. ASSET ALLOCATION FUNDS: Mutual funds may invest in financial assets like equity. Asset allocation funds adopt a variable asset allocation strategy that allows fund managers to switch over from one asset class to another at any time depending upon their outlook for specific markets. In other words. It should be noted that switching over from one asset class to another is a decision taken by the fund manager on the basis of his own judgment and understanding of specific markets. Issued by the Government of India. The level of risks involved in these funds is lower than growth funds and higher than income funds. These funds invest in companies having potential for capital appreciation and those known for issuing high dividends. debt. even money market / liquid funds are exposed to the interest rate risk. These securities are highly liquid and provide safety of investment. commodities etc. Balanced funds are appropriate for conservative investors having a long term investment horizon. these investments have little credit risk (risk of default) and provide safety of principal to the investors. Hybrid funds have an equal proportion of debt and equity in their portfolio. the success of these funds depends upon the skill of a fund manager in anticipating market trends.

which further helps in diversification of risks. are known as Specialized Real Estate Funds. but do invest in other Mutual Fund schemes offered by different AMCs. FUND OF FUNDS:Mutual funds that do not invest in financial or physical assets. the expenses of Fund of Funds are quite high on account of compounding expenses of investments into different mutual fund schemes. are known as Fund of Funds. Exchange Traded Funds follow stock market indices and are traded on stock exchanges like a single stock at index linked prices.COMMODITY FUNDS:Those funds that focus on investing in different commodities (like metals. The biggest advantage offered by these funds is that they offer diversification. However. "Precious Metals Fund" and Gold Funds (that invest in gold. Fund of Funds provide investors with an added advantage of diversifying into different mutual fund schemes with even a small amount of investment. gold futures or shares of gold mines) are common examples of commodity funds.) or commodity companies or commodity futures contracts are termed as Commodity Funds. food grains. The objective of these funds may be to generate regular income for investors or capital appreciation. Recently introduced in India. these funds are quite popular abroad. A commodity fund that invests in a single commodity or a group of commodities is a specialized commodity fund and a commodity fund that invests in all available commodities is a diversified commodity fund and bears less risk than a specialized commodity fund. flexibility of holding a single share (tradable at index linked prices) at the same time. . just like conventional mutual funds maintain a portfolio comprising of equity/debt/money market instruments or non financial assets. crude oil etc. EXCHANGE TRADED FUNDS (ETF):Exchange Traded Funds provide investors with combined benefits of a closed-end and an open-end mutual fund. Fund of Funds maintain a portfolio comprising of units of other mutual fund schemes. REAL ESTATE FUNDS:Funds that invest directly in real estate or lend to real estate developers or invest in shares/securitized assets of housing finance companies.

If two AMCs merge. who has sold out. High court. it is called as scheme take over. Trustees oversee the AMC and seek regular reports and information from them. 10 crore at all times. according to the mandate of the investors. An AMC of one fund cannot be Trustee of another fund. Atleast 50% of trustees should be independent. A mutual fund is constituted as a Trust. the stakes of sponsor’s changes and the schemes of both funds come together.AMC should have a net worth of at least Rs. Trustees are required to meet atleast 4 times a year to review the AMC the investors’ funds and the investments are held by the custodian.Sponsor is the promoter of the fund. An AMC cannot engage in any business other than portfolio advisory and management. The AMC gets a fee for managing the funds. . Trustees are appointed by the sponsor with SEBI approval. The trustees appoint the asset management company (AMC) to actually manage the investor’s money. Investors can choose to exit at NAV if they do not approve of the transfer. If the schemes of one fund are taken over by another fund. in the case of open-ended funds. Sponsor should have atleast 5-year track record in the financial services business and should have made profit in atleast 3 out of the 5 years. R&T agents manage the sale and repurchase of units and keep the unit holder accounts. This requires SEBI and trustee approval. Investors’ money is held in the Trust (the mutual fund). Atleast 50% of the AMC’s Board should be of independent members. The trustees make sure that the funds are managed according to the investors’ mandate. They have a right to be informed. The AMC is the business face of the mutual fund. and supervised by the Board of Trustees.FUND STRUCTURE AND CONSTITUENTS:- Mutual funds in India have a 3-tier structure of Sponsor-Trustee-AMC . The mutual fund is formed as trust in India. For close-ended funds the investor approval is required for all cases of merger and takes over. Sponsor creates the AMC and the trustee company and appoints the Boards of both these companies. If one AMC or sponsor buys out the entire stake of another sponsor in an AMC. SEBI and Trustee approval needed. The AMC’s capital is contributed by the sponsor. Trustee Company and AMC are usually private limited companies. No approval is required. exits the AMC. Sponsor and the custodian cannot be the same entity. Sponsor should contribute atleast 40% of the capital of the AMC. The sponsor. there is a takeover of AMC. AMC should be registered with SEBI AMC signs an investment management agreement with the trustees. This needs high court approval as well as SEBI and Trustee approval. with SEBI approval. A trust deed is signed by trustees and registered under the Indian Trust Act.

every stockholder. or equity. In theory. most private investors' stakes are insignificant. no matter how small their stake. the extent of your ownership (your stake) in a company depends on the number of shares you own in relation to the total number of shares available For example. if you buy 1000 shares of stock in a company that has issued a total of 100. or 'Epic' symbol. in a company. Your stake may authorize you to vote at the company's annual general meeting. Investors buy stock in the form of shares. b) PERFORMANCE INDICATORS:Here is a list of the standard performance indicators Performance Indicator Definition Closing price High and low 52 week range Volume Net change The last price at which the stock was bought or sold The highest and lowest price of the stock from the previous trading day The highest and lowest price over the previous 52 weeks The amount of shares traded during the previous trading day High and low The difference between the closing price on the last trading day and the closing price on the trading day prior to the last . very few private investors are able to accumulate a shareholding of that size in publicly quoted companies. However. a) STOCKS SYMBOLS:A stock symbol. Company names also have abbreviations called ticker symbols. it's worth remembering that these may vary at the different exchanges where the company is quoted. which represent a portion of a company's assets (capital) and earnings (dividends). In reality. As a shareholder. where shareholders usually receive one vote per share. newspaper stock listings and investment websites. While one per cent seems like a small holding. Management policy is far more likely to be influenced by the votes of large institutional investors such as pension funds. stock (often referred to as shares) is ownership. many of which have a market value running into billions of pounds. you own one per cent of the company. is the standard abbreviation of a stock's name. You can find stock symbols wherever stock performance information is published . however.EQUITY SHARES ABOUT SHARES:At the most basic level. can exercise some influence over company management at the annual general meeting.for example.000 shares.

you need to contact a stockbroker who will buy or sell the shares on your behalf. A stock exchange is an organization that provides a marketplace in which investors and borrowers trade stocks. Firstly. a) Trading shares on the stock exchange: As an investor in the INDIA. you can't buy or sell shares on a stock exchange yourself. The same applies to stocks. Trading is done through computerized systems. The NSE AND BSE are the leading stock exchange in the INDIA. . Details of the trade are transmitted electronically to the stockbroker who is responsible for settling the trade. You need to place your order with a stock exchange member firm (a stockbroker) who will then execute the order on your behalf. You will then receive confirmation of the deal. the stock exchange is a market for issuers who want to raise equity capital by selling shares to investors in an Initial Public Offering (IPO). b) The trading process:If you decide to buy or sell your shares. Each exchange has its own listing requirements. and some exchanges are more particular than others. After receiving your order.THE STOCK EXCHANGES:A marketplace in which to buy or sell something makes life a lot easier. It is possible for a stock to be listed on more than one exchange. To be listed on a stock exchange. This is known as a dual listing. a stock must meet the listing requirements laid down by that exchange in its approval process. the stockbroker will input the order on the SETS or SEAQ system to match your order with that of another buyer or seller. c) Types of shares available on the stock exchange:You cannot trade all stocks on the stock exchange. The stock exchange is also a market for investors who can buy and sell shares at any time.

In the next twenty as we see our investments grow after our children grow and become financially independent. This principle is introduced in most stores where a division is made between the sales clerk and the cashiers department the arrangement dividing the risks of loss. In the first twenty of our life. Insurance is a provision for the distribution of risks that is to say it is a financial provision against loss from unavoidable disasters. The idea is if any one or both die their dependents continue to live comfortably.An insurance policy is primarily meant to protect the income of the family’s breadearners.Insurance People need insurance in the first place. Our finances too tend to change as we go through the various phases of life. Insurance then provide divided responsibilty. we are financially and emotionally dependents on our parents and their are no financial committments to be met. The insurance principle is similarly applied in any other cases of divided responsibilty.In the next twenty years we gain financial independence and provide financial independence to our families. The insurer in accepting the risks so distributes them that the total of all the amounts is paid for this insurance protection will be sufficient to meet the losses that occur. marraige and eventually after a lifetime of work we look forward to life of retirement . As a business however insurance is usually recognized as some form of securing a promise of indemnity by the payment of premium and the fulfillment of certain other stipulations . The protection which it affords takes form of a gurantee to indemnify the insured if certain specified losses occur.The circle of life begins at birth follower by education . The principle of insurance so far as the undertaking of the obligation is concerned is that for the payment of a certain sum the gurantee will be given to reimburse the insured. This is also the stage when our income may be unable to meet the growing expenses of a young household.

An individual can either contribute through regular premiums or make a single premium investments. A whole of life plan is suitable for an individual who is looking for an extended life insurance cover and /or wants to pay premium over as long as tenure as possible to reduce the amount of upfront premium payment. Pension plans Pension plans allow an individual to save in a tax deffered manner. investors have the choice of investing in a lump sum (single premium) or making premium payments on an annual. ULIP investors can shift their investments across various plans/asset classes (diversified equity funds. Endowment plans pay a death benifit in the event of an eventuality should the customer survive the benifit period a maturity benifit is paid to the life insured. It is important to remember that in a ULIP. half-yearly. The investment is denoted as units and is represented by the value that it has attained called as Net Asset Value (NAV). Investors also have the flexibility to alter the premium amounts during the policy's tenure. quarterly or monthly basis. balanced funds. the invested amount of the premiums after deducting for all the charges and premium for risk cover under all policies in a particular fund as chosen by the policy holders are pooled together to form a Unit fund. A Unit is the component of the Fund in a Unit Linked Insurance Policy. In a ULIP. For example. debt funds etc. Once the contract reaches the vesting age . debt funds) either at a nominal or no cost. In a ULIP.e. Conversely an individual faced with a liquidity crunch has the option of paying a lower amount (the difference being adjusted in the accumulated value of his ULIP). if an individual has surplus funds. the individual has the option of choosing an annuity plan from a life insurance company. diversified equity funds. he can enhance the contribution in ULIP. Term insurance is a usefu tool to purchase against risk of early death and protection of an asset. . An annuity is paid till the life the lifetime of the insured or a pre-determined period depending upon the annuity option chosen by the life insured. Since a term insurance contract only pays in the event of eventuality the life cover comes at low premium rates . Unit Linked Insurance Plans Unit linked insurance plan (ULIP) is life insurance solution that provides for the benefits of risk protection and flexibility in investment. i. The policy value at any time varies according to the value of the underlying assets at the time. Savings accumulate over the deferment period.Types of insurance Term insurance plans Term insurance is the cheapest form of life insurance available. balanced funds. the investment risk is generally borne by the investor. Whole of life plans A whole of life plan provides life insurance cover to an individua upto a specified age . Endowment plans Endowment plans are savins and protection plans that provide a dual benifit of protection as well as savings. ULIP investors have the option of investing across various schemes. The returns in a ULIP depend upon the performance of the fund in the capital market.

Service Tax Deductions: Service tax is deducted from the risk portion of the premium. state of health etc.Expenses Charged in a ULIP Premium Allocation Charge: A percentage of the premium is appropriated towards charges initial and renewal expenses apart from commission expenses before allocating the units under the policy. Fund Switching Charge: Usually a limited number of fund switches are allowed each year without charge. Surrender Charges: Deducted for premature partial or full encashment of units. . with subsequent switches. Mortality Charges: These are charges for the cost of insurance coverage and depend on number of factors such as age. Fund Management Fees: Fees levied for management of the fund and is deducted before arriving at the NAV. Administration Charges: This is the charge for administration of the plan and is levied by cancellation of units. subject to a charge. amount of coverage.

Coupon or interest rate is fixed at the time of issuance.. Interest /Coupon payment is made on a half yearly basis on its face value.  The tenor of the security is fixed.03% payable half yearly.    The tenor of the security is also fixed.The market borrowing of the Central Government is raised through the issue of dated securities and 364 days treasury bills either by auction or by floatation of loans.  The securities do not carry any coupon or interest rate. e. Partly Paid Stock is stock where payment of principal amount is made in installments over a given time frame. The key features of these securities are:  They are issued at a discount to the face value. State Government Securities Treasury bills The Central Government borrows funds to finance its 'fiscal deficit'.03% GOI 2012 is a Central Government security maturing in 2012.g.  The security is redeemed at par (face value) on its maturity date.in lieu of the Central Government's market borrowing programme. The difference between the issue price (discounted price) and face value is the return on this security. These do not form part of the borrowing programme of the Central Government Types of Government Securities Government Securities are of the following types:- Dated Securities : are generally fixed maturity and fixed coupon securities usually carrying semi-annual coupon. In addition to the above. The security is redeemed at par (face value) on its maturity date. These are called dated securities because these are identified by their date of maturity and the coupon. Zero Coupon bonds are bonds issued at discount to face value and redeemed at par. and remains constant till redemption of the security.GOVERNMENT SECURITIES Government securities(G-secs) are sovereign securities which are issued by the Reserve Bank of India on behalf of Government of India. 11. which carries a coupon of 11. treasury bills of 91 days are issued for managing the temporary cash mismatches of the Government. 1994 and were followed by two subsequent issues in 1994-95 and 1995-96 respectively. It meets the needs of investors with regular flow of funds and the need of Government when it does not need funds . These were issued first on January 19. The key features of these securities are:   They are issued at face value. The term Government Securities includes:    Central Government Securities.

The security is redeemed at par (face value) on its maturity date. The coupon is reset every six months. Recently RBI issued a floating rate bond.  Though the benchmark does not change. Coupon or interest rate is fixed as a percentage over the wholesale price index at the time of issuance. in year 2007. The security is redeemed at par (face value) on its maturity date. These provide investors with an effective hedge against inflation. Interest /Coupon payment is made on a half yearly basis on its face value. bank rate etc. Bonds with Call/Put Option: First time in the history of Government Securities market RBI issued a bond with call and put option this year. There may be a cap and a floor rate attached thereby fixing a maximum and minimum interest rate payable on it.immediately. The key features of these securities are:   They are issued at face value. but this amount is paid in installments over a specified period. 1995. Capital indexed Bonds are bonds where interest rate is a fixed percentage over the wholesale price index. The key features of these securities are:   They are issued at face value. Coupon or interest rate is fixed as a percentage over a predefined benchmark rate at the time of issuance. The tenor of the security is also fixed. The benchmark rate may be Treasury bill rate. the rate of interest may vary according to the change in the benchmark rate till redemption of the security. . 1995.  The tenor of the security is fixed. Therefore the actual amount of interest paid varies according to the change in the Wholesale Price Index. The key features of these securities are:   They are issued at face value. Such stocks have been issued a few more times thereafter. 1994 for Rs. followed by another issue on December 5. 1997 on tap basis. In other words it means that holder of bond can sell back (put option) bond to Government in 2007 or Government can buy back (call option) bond from holder in 2007. This bond has been priced in line with 5 year bonds. This bond is due for redemption in 2012 and carries a coupon of 6.e. They were of five year maturity with a coupon rate of 6 per cent over the wholesale price index. However the bond has call and put option after five years i.    The tenor of the security is also fixed. the coupon of which is benchmarked against average yield on 364 Days Treasury Bills for last six months. These bonds were floated on December 29. Floating Rate Bonds are bonds with variable interest rate with a fixed percentage over a benchmark rate. The principal redemption is linked to the Wholesale Price Index. 2000 crore.   Interest /Coupon payment is made on a half yearly basis on its face value. The first issue of such stock of eight year maturity was made on November 15. Floating rate bonds of four year maturity were first issued on September 29. and remains constant till redemption of the security. Coupon or interest rate is fixed at the time of issuance.72%.

State Government Securities can be purchased for a minimum amount of Rs 1. partnership firms. Minimum Amount In terms of RBI regulations. mutual funds.  For Gilt Account Holders. Day Count . Provident Funds.000/only.. 10. PNB Gilts Ltd. corporate bodies. companies.  In addition government securities can also be held in dematerialized form in demat accounts maintained with the Depository Participants of NSDL. Primary Dealers. government dated securities can be purchased for a minimum amount of Rs. Features of Government Securities Nomenclature The coupon rate 12. research organisations. and is actively involved in the trading of government securities.only. institutions. the Bank/Primary Dealers. Nepal Rashtra bank and even individuals are eligible to purchase Government Securities. financial institutions. which is the borrower. trusts. State Governments. firms.  Entities having a Gilt Account with Banks or Primary Dealers can hold these securities with them in dematerialized form. GOI denotes Government of India.only and in multiples thereof. Availability Government securities are highly liquid instruments available both in the primary and secondary market.the maturity proceeds would be collected by their DP's and they in turn would pay the demat Account Holders. Eligibility All entities registered in India like banks. Foreign Institutional Investors. Forms of Issuance of Government Securities  Banks. the maturity proceeds would be credited to their current accounts with the Reserve Bank of India.25% is the coupon rate.  Interest /Coupon payment is made on a half yearly basis on its face value. is a leading Primary Dealer in the government securities market. 2008 is the year of maturity.25% and year GOI of maturity 2008 identifies indicates the government the security. following: Example: 12. would receive the maturity proceeds and they would pay the Gilt Account Holders. Primary Dealers and Financial Institutions have been allowed to hold these securities with the Public Debt Office of Reserve Bank of India in dematerialized form in accounts known as Subsidiary General Ledger (SGL) Accounts.000/.  For entities having a demat acount with NSDL. The principal redemption is linked to the Wholesale Price Index. Repayment Government securities are repaid at par on the expiry of their tenor. The different repayment methods are as follows :  For SGL account holders. They can be purchased from Primary Dealers.Treasury bills can be purchased for a minimum amount of Rs 25000/.

100/. Since the settlement is on October 3.10 lacs X 101. The bidders submit bids in terms of the price. and 3rd November every year.@ Rs. Therefore the principal amount payable is Rs.40% GOI 2012 for face value of Rs. i. Transparency in transactions and simplified settlement procedures through CSGL/NSDL of securities are Issuance issued by of various methods. 10.33 Benefits of Investing in Government Securities No tax deducted at source      Additional Income Tax benefit u/s 80L of the Income Tax Act for Individuals Qualifies for SLR purpose Zero default risk being sovereign paper Highly liquid. 10 lacs.48.40% X 150 = Rs. 2002.80 for every unit of government security having a face value of Rs.000 Last interest payment date was May 3. 2002) (28 days of May.101. 10 lacs.e. Interest payable = 10 lacs X 7. up to 30th May + 30 days of June.833. What is the amount to be paid by the client? The security is 7.18.For government dated securities and state government securities the day count is taken as 360 days for a year and 30 days for every completed month.  In an yield based auction. the Reserve Bank of India announces the issue size(or notified amount) and the tenor of the paper to be auctioned. July. the client pays Rs. including 3rd May. Therefore the interest has to be paid for 150 days (including 3rd May.101.The settlement is due on October 3.33.40% GOI 2012 for which the interest payment dates are 3rd May. August and September + 2 days of October).  In a price based auction.33=Rs. The bidders submit bids in terms of the yield at which they are ready to buy the security. Government which are as Securities follows: Methods Government Auctions: Auctions for government securities are either yield based or price based. 2002. the tenor of the paper to be auctioned. 2002. the Reserve Bank of India announces the issue size(or notified amount). 360 X 100 Total amount payable by client =10.80% =10. The basic features of the auctions are given below: .000+30833. that date is excluded.80%. The last interest payment date for the current year is 3rd May 2002. However for Treasury bills it is 365 days for a year.18.101. The calculation would be made as follows: Face value of Rs. as well as the coupon rate.80. and excluding October 3. 2002 and settlement date is October 3.@ Rs. This method of auction is normally used in case of reissue of existing government securities. 30833. Example : A client purchases 7.

  Bids: Bids are to be submitted in terms of yields to maturity/prices as announced at the time of auction. for the underwriting which has been accepted.  Cut off price: It is the minimum price accepted for the security. the interest dates and the date of maturity remain the same as determined in the initial primary auction. Bids at prices lower than the cut-off are rejected and at higher than the cut-off are accepted. The coupon rate. In case of the auction being fully subscribed.   Underwriting fee is paid at the rates bid by PDs . the underwriters do not have to subscribe to the issue necessarily unless they have bid for it. thereby getting a lower yield. The unsubscribed portion devolves on RBI or on the Primary Dealers if the auction has been underwritten by PDs. bids are invited from the Primary Dealers one day before the auction wherein they indicate the amount to be underwritten by them and the underwriting fee expected by them. After the initial primary auction of a security. Underwriting in Auctions  For the purpose of auctions. On-tap issue This is a reissue of existing Government securities having pre-determined yields/prices by Reserve Bank of India. Bidders who have bid at higher than the cut-off price pay a premium on the security. Price based auctions lead to finer price discovery than yield based auctions. Cut off yield: is the rate at which bids are accepted.  Notified amount: The amount of security to be issued is ‘notified’ prior to the auction date.  The auction committee of Reserve Bank of India examines the bids and based on the market conditions. If there is a devolvement. the issue remains open to further subscription by the investors as and when considered appropriate by RBI. Coupon rate for the security remains unchanged. Bids at yields higher than the cut-off yield is rejected and those lower than the cut-off are accepted. for information of the public. The period for which the issue is kept open may be time specific or volume specific. The cut-off yield is set as the coupon rate for the security. Reserve Bank of India may sell government securities through on tap issue at lower or higher prices than the prevailing . the successful bids put in by the Primary Dealers are set-off against the amount underwritten by them while deciding the amount of devolvement. The bids are accepted at the same prices as decided in the cut off. Multiple/variable Price Based or French Auction procedure is used in auctions of Government dated securities and treasury bills. takes a decision in respect of the amount to be underwritten and the fee to be paid to the underwriters. The devolvement is at the cut-off price/yield.  Method of auction: There are two methods of auction which are followedUniform price Based or Dutch Auction procedure is used in auctions of dated government securities. Bids are accepted at different prices / yields quoted in the individual bids. The Reserve Bank of India (RBI) may participate as a non-competitor in the auctions. Bidders who have bid at lower than the cut-off yield pay a premium on the security. since the auction is a multiple price auction.

Open Market Operations (OMO) Government securities that are privately placed with the Reserve Bank of India are sold in the market through open market operations of the Reserve Bank of India. Fixed coupon issue Government Securities may also be issued for a notified amount at a fixed coupon. The issue is priced at market related yields. Reserve Bank of India may later offload these securities to the market through Open Market Operations (OMO).000. is a time-tested tax saving instrument that combines adequate returns with high safety. NSCs are an instrument for facilitating long-term savings. Rs. Post office agents are active in nooks and corners of the country. popularly known as NSC. Open market operations are used by the Reserve Bank of India to infuse or suck liquidity from the system. Joint 'A' Type Certificate: Issued jointly to two adults payable to both holders jointly or to the survivor. & Rs. getting double benefits. The yield at which these securities are sold may differ from the yield at which they were privately placed with Reserve Bank of India. . Who can Invest An adult in his own name or on behalf of a minor A trust Two adults jointly Denomiations and Limit National Savings Certificates are available in the denominations of Rs. and whenever it wishes to suck out the liquidity from the system. This is usually done when the Ways and Means Advance (WMA) is near the sanctioned limit and the market conditions are not conducive to an issue. 100 Rs 500. After having auctioned a loan whereby the coupon rate has been arrived at and if still the government feels the need for funds for similar tenure. it may privately place an amount with the Reserve Bank of India. They not only save tax on their hard-earned income but also make an investment which are sure to give good and safe returns. Most State Development Loans or State Government Securities are issued on this basis. it purchases government securities from the market. Such an action on the part of the Reserve Bank of India leads to a realignment of the market prices of government securities. Tap stock provides an opportunity to unsuccessful bidders in auctions to acquire the security at the market determined rate. 10. it sells government securities in the market. A large chunk of middle class families use NSCs for saving on their tax. RBI in turn may decide upon further selling of the security so purchased under the Open Market Operations window albeit at a different yield. 1000. How to Invest National Savings Certificates are available at all post-offices. Joint 'B' Type Certificate: Issued jointly to two adults payable to either of the holders or to the survivor. 5000. Rs. Following types of NSC are issued: Single Holder Type Certificate: This can be issued to: (a) An adult for himself or on behalf of a minor (b) A Trust.market prices. Private Placement The Central Government may also privately place government securities with Reserve Bank of India. Whenever the Reserve Bank of India wishes to infuse the liquidity in the system. The application can be made either in person or through an agent. National Savings Certificate National Savings Certificate.

There is no maximum limit on the purchase of the certificates. Public Provident Fund Public Provident Fund. as amended from time to time. forfeiture by a pledgee and when ordered by a court of law. How to Open Account Public Provident Fund account can be opened at designated post offices throughout the country and at designated branches of Public Sector Banks throughout the country. on behalf of a minor of whom he is a guardian. This is of course a huge benefit for you can decide as much as your budget allows. Maximum deposit limit is Rs. The balances in PPF account cannot be attached by any authority normally. is a savings cum tax saving instrument. . Presently interest paid is 8 % per annum half yearly compounded. Who can Open Account The account can be opened by an individual in his own name. 500 in a financial year. Tax Benefits Interest accrued on the certificates every year is liable to income tax but deemed to have been reinvested. popularly known as PPF. Income tax relief is also available on the interest earned as per limits fixed vide section 80L of Income Tax. Maturity Period of maturity of a certificate is six years. Maximum number of deposits is twelve in a financial year. Maturity value of a certificate of any other denomination is at proportionate rate.000 in a financial year. Income Tax rebate is available on the amount invested and interest accruing under Section 88 of Income Tax Act. It also serves as a retirement planning tool for many of those who do not have any structured pension plan covering them. So it is for you to decide how much you want to put in the NSCs. Tabs on Investment Minimum deposit required in a PPF account is Rs. as amended from time to time. 70. Premature encashment of the certificate is not permissible except at a discount in the case of death of the holder(s).

to a limit of 50% of the amount at credit preceding three year balance. The account holder also has an option to extend the PPF account for any period in a block of 5 years at each time. the account will be treated as discontinued. The amount of deposit can be varied to suit the convenience of the account holders. Nominee/legal heir of PPF Account holder cannot continue the account after the death.is mandatory in each financial year. One deposit with a minimum amount of Rs.500/. . The account holder can retain the account after maturity for any period without making any further deposits. Premature withdrawal is permissible in the 7th year of the account subject. In this case the account will continue to earn interest at normal rate as admissible till the account is closed. Lapse in Deposits If deposits are not made in a PPF account in any financial year.50/.for each defaulted year. Rate of interest is 8% compounded annually. The discontinued account can be activated by payment of the minimum deposit of Rs.Maturity The maturity period of the account is 15 years. Thereafter one withdrawal in every year is permissible. Account Transfer The Account is transferable from one post Office / bank to another and from post Office to bank or from a bank to a post office. after the maturity period of 15 years. The interest on deposits is totally tax free. Deposits are exempt from wealth tax.with default fee of Rs. Premature Closure or Withdrawl Premature closure of a PPF Account is not permissible except in case of death.500/. Tax Benefits Deposits in PPF are eligible for rebate under section 80-C of Income Tax Act.

Some bonds have been issued with maturities of up to one hundred years. long term (bonds): maturities greater than ten years. a market developed in euros for bonds with a maturity of fifty years. The net proceeds that the issuer receives are thus the issue price. However government bonds are instead typically auction. Treasury securities. termed maturity. principal or face amount — the amount on which the issuer pays interest. On coupon dates the bond holder would give the coupon to a bank in exchange for the interest payment. there are three groups of bond maturities: short term (bills): maturities up to one year. forming a syndicate. medium term (notes): maturities between one and ten years. The most important features of a bond are: Nominal. which will typically be approximately equal to the nominal amount. in the case of government bonds. Bonds must be repaid at fixed intervals over a period of time Bonds are issued by public authorities. Maturity date — The date on which the issuer has to repay the nominal amount. the issuer has no more obligations to the bond holders after the maturity date. credit institutions. buy an entire issue of bonds from an issuer and re-sell them to investors. Usually this rate is fixed throughout the life of the bond.S. physical bonds were issued which had coupons attached to them. companies and supranational institutions in the primary markets. The security firm takes the risk of being unable to sell on the issue to end investors. to finance current expenditure. The length of time until the maturity date is often referred to as the term or tenor or maturity of a bond.BONDS A bond is a debt security. Coupon — The interest rate that the issuer pays to the bond holders. The name coupon originates from the fact that in the past. The most common process of issuing bonds is through underwriting. and which has to be repaid at the end. In early 2005. the bond holder is the lender. As long as all payments have been made. one or more securities firms or banks. Most bonds have a term of up to thirty years. and some even do not mature at all. In underwriting. depending on the terms of the bond. although debt securities with a term of less than one year are generally designated money market instruments rather than bonds. Certificates of deposit (CDs) or commercial paper are considered to be money market instruments and not bonds. The maturity can be any length of time. It can also vary with a money market index. It is a formal contract to repay borrowed money with interest at fixed intervals. or. Bonds provide the borrower with external funds to finance long-term investments. . Issue price — The price at which investors buy the bonds when they are first issued. in which the authorized issuer owes the holders a debt and. and the coupon is the interest. is obliged to pay interest (the coupon) and/or to repay the principal at a later date. or it can be even more exotic. such as LIBOR. In the market for U.[1] Thus a bond is like a loan: the issuer is the borrower. less issuance fees.

This is mainly the case for high-yield bonds. coupon dates — the dates on which the issuer pays the coupon to the bond holders. These have very strict covenants. In the U. If that is not the case. see call option. and CPI (the Consumer Price Index). restricting the issuer in its operations. such as actions that the issuer is obligated to perform or is prohibited from performing. Coupon examples: three month USD LIBOR + 0. This is a special case of a Bermudan callable. An American callable can be called at any time until the maturity date. but only at a high cost. Most callable bonds allow the issuer to repay the bond at par. it grants option-like features to the holder or the issuer: Callability — Some bonds give the issuer the right to repay the bond before the maturity date on the call dates. In the U. The terms may be changed only with great difficulty while the bonds are outstanding. This will depend on a whole range of factors. which means that they pay a coupon every six months. the issuer has to pay a premium. or . There are four main categories. federal and state securities and commercial laws apply to the enforcement of these agreements. see put option.20%. Indentures and Covenants — An indenture is a formal debt agreement that establishes the terms of a bond issue. Covenants specify the rights of bondholders and the duties of issuers.K. most bonds are semi-annual. which influences the probability that the bondholders will receive the amounts promised. Also known as a "survivor's option". while covenants are the clauses of such an agreement. The entire bond issue can be liquidated by the maturity date.The quality of the issue. These bonds are referred to as callable bonds. Putability — Some bonds give the holder the right to force the issuer to repay the bond before the maturity date on the put dates. To be free from these covenants. or. "Puttable" denotes that it may be putted. A death put is an optional redemption feature on a debt instrument allowing the beneficiary of the estate of the deceased to put (sell) the bond (back to the issuer) in the event of the beneficiary's death or legal incapacitation.S. Common indices include: money market indices. at the due dates. Issuers may either pay to trustees. Floating rate notes (FRNs) have a coupon that is linked to an index. exchangeable bond allows for exchange to shares of a corporation other than the issuer. such as LIBOR or Euribor. which are construed by courts as contracts between issuers and bondholders. convertible bond lets a bondholder exchange a bond to a number of shares of the issuer's common stock. High yield bonds are bonds that are rated below investment grade by the credit rating agencies. alternatively. A Bermudan callable has several call dates. that is.S.) call dates and put dates—the dates on which callable and putable bonds can be redeemed early. and also in the U. A European callable has only one call date. As these bonds are more risky than investment grade bonds. the so called call premium. investors expect to earn a higher yield. With some bonds. purchase bonds in open market. These bonds are also called junk bonds. which in turn call randomly selected bonds in the issue.. then return them to trustees. sinking fund provision of the corporate bond indenture requires a certain portion of the issue to be retired periodically. the issuer can repay the bonds early. with amendments to the governing document generally requiring approval by a majority (or super-majority) vote of the bondholders. usually coinciding with coupon dates. Fixed rate bonds have a coupon that remains constant throughout the life of the bond. Optionality: Occasionally a bond may contain an embedded option. and Europe. (Note: "Putable" denotes an embedded put option. then the remainder is called balloon maturity.

They are issued at a substantial discount to par value. with the current value of principal near zero. . The main examples of subordinated bonds can be found in bonds issued by banks. [2] U. Bearer bonds are very risky because they can be lost or stolen. any Index could be used as the basis for the coupon of an FRN. are sent to the registered owner. for example equity-linked notes and bonds indexed on a business indicator (income. the person who has the paper certificate can claim the value of the bond. First the liquidator is paid. Subordinated bonds are those that have a lower priority than other bonds of the issuer in case of liquidation. Often they are registered by a number to prevent counterfeiting. However. etc. In theory. then government taxes. See IO (Interest Only) and PO (Principal Only).twelve month CPI + 1. FRN coupons reset periodically. Therefore. As a result.S. so long as the issuer and the buyer can agree to terms. government. and the principal upon maturity. but may be traded like cash. bearer bonds were seen as an opportunity to conceal income or assets. The most famous of these are the UK Consols.e. The latter are often issued in tranches. subordinated bonds usually have a lower credit rating than senior bonds. Examples of asset-backed securities are mortgage-backed securities (MBS's). typically every one or three months. Zero-coupon bonds may be created from fixed rate bonds by a financial institutions separating "stripping off" the coupons from the principal. the U. The senior tranches get paid back first. corporations stopped issuing bearer bonds in the 1960s. although the amounts are now insignificant. the subordinated tranches later. the subordinated bond holders are paid. or by a transfer agent. the separated coupons and the final principal payment of the bond are allowed to trade independently. In other words.S. Treasury Inflation-Protected Securities (TIPS) and I-bonds are examples of inflation linked bonds issued by the U. Asset-backed securities are bonds whose interest and principal payments are backed by underlying cash flows from other assets. It is the alternative to a Bearer bond.S.50%. 24th century)) are virtually perpetuities from a financial point of view. The government of the United Kingdom was the first to issue inflation linked Gilts in the 1980s. Treasury stopped in 1982. Inflation linked bonds. Some ultra long-term bonds (sometimes a bond can last centuries: West Shore Railroad issued a bond which matures in 2361 (i. They have no maturity date. which are also known as Treasury Annuities or Undated Treasuries. and state and local tax-exempt bearer bonds were prohibited in 1983. Perpetual bonds are also often called perpetuities. added value) or on a country's GDP. government. the risk is higher. The first bond holders in line to be paid are those holding what is called senior bonds. Zero-coupon bonds don't pay any interest. Other indexed bonds. Bearer bond is an official certificate issued without a named holder. there is a hierarchy of creditors. collateralized mortgage obligations (CMOs) and collateralized debt obligations (CDOs). After they have been paid.[3] Registered bond is a bond whose ownership (and any subsequent purchaser) is recorded by the issuer.S. The bond holder receives the full principal amount on the redemption date. Some of these were issued back in 1888 and still trade today. and asset-backed securities. the payments increase with inflation. The interest rate is normally lower than for fixed rate bonds with a comparable maturity (this position briefly reversed itself for short-term UK bonds in December 2008). Especially after federal income tax began in the United States. as the principal amount grows. Interest payments. In other words. in which the principal amount and the interest payments are indexed to inflation. In case of bankruptcy. An example of zero coupon bonds are Series E savings bonds issued by the U.

Territory. This can be damaging for professional investors such as banks. Interest income received by holders of municipal bonds is often exempt from the federal income tax and from the income tax of the state in which they are issued. and bonds' interest payments are often higher than the general level of dividend payments. Note that this drop in the bond's market price does not affect the interest payments to the bondholder at all. the bond holder has no recourse to other governmental assets or revenues. meaning that their market prices will decrease in value when the generally prevailing interest rates rise. reflecting investors' ability to get a higher interest rate on their money elsewhere — perhaps by purchasing a newly issued bond that already features the newly higher interest rate." meaning that in the event of default. Bonds are liquid – it is fairly easy to sell one's bond investments. so long-term investors who want a specific amount at the maturity date need not worry about price swings in their bonds and do not suffer from interest rate risk. Interest is paid like a traditional fixed rate bond. Sometimes. but this perception is only partially correct. War bond is a bond issued by a country to fund a war. a decrease in the market price of the bond means an increase in its yield. Price changes in a bond will also immediately affect mutual funds that hold these bonds. U. the market price of bonds will fall.Municipal bond is a bond issued by a state. if a company goes bankrupt. In effect. Still. 5-year serial bond would mature in a $20. More relevantly. Revenue bond is a special type of municipal bond distinguished by its guarantee of repayment solely from revenues generated by a specified revenue-generating entity associated with the purpose of the bonds. Since the payments are fixed. Serial bond is a bond that matures in installments over a period of time. pension funds and asset managers (irrespective of whether the . though not nearly as easy as it is to sell stocks – and the comparative certainty of a fixed interest payment twice per year is attractive. Some of these redemptions will be for a higher value than the face value of the bond. nearly 10% of all bonds outstanding are held directly by households. local government. bond markets rise (while yields fall) when stock markets fall. in the U. its bondholders will often receive some money back (the recovery amount). bonds can also be risky: Fixed rate bonds are subject to interest rate risk.S. the value of the portfolio will also have fallen. Thus bonds are generally viewed as safer investments than stocks. issuers (and banks that used to collect coupon interest for depositors) have tried to discourage their use.000 annuity over a 5-year interval. Revenue bonds are typically "non-recourse.. even to investors who prefer them. the volatility of bonds (especially short and medium dated bonds) is lower than that of shares. insurance companies. Most individuals who want to own bonds do so through bond funds. usually a European state. Bondholders also enjoy a measure of legal protection: under the law of most countries. [edit] Investing in bonds Bonds are bought and traded mostly by institutions like pension funds. However. As physically processing paper bonds and interest coupons became more expensive. a $100. Book-entry bond is a bond that does not have a paper certificate. If the value of the bonds held in a trading portfolio has fallen over the day. although municipal bonds issued for certain purposes may not be tax exempt. Bonds do suffer from less day-to-day volatility than stocks. but the issuer will redeem randomly selected individual bonds within the issue according to a schedule. Some book-entry bond issues do not offer the option of a paper certificate. insurance companies and banks. or their agencies. whereas the company's stock often ends up valueless.S. When the market interest rate rises.[4] Lottery bond is a bond issued by a state.000. city.

As with interest rate risk. If there is any chance a holder of individual bonds may need to sell his bonds and "cash out". Bond prices can become volatile depending on the credit rating of the issuer . Bank lenders. as opposed to liquidation. . this risk does not affect the bond's interest payments (provided the issuer does not actually default). This creates reinvestment risk. often through an exchange for a smaller number of newly issued bonds. bondholders are in line to receive the proceeds of the sale of the assets of a liquidated company ahead of some other creditors. As an example. meaning that even though the company has agreed to make payments plus interest towards the debt for a certain period of time. meaning the investor is forced to find a new place for his money. Efforts to control this risk are called immunization or hedging. and the investor might not be able to find as good a deal. bonds' market prices would increase if the prevailing interest rate were to drop.for instance if the credit rating agencies like Standard & Poor's and Moody's upgrade or downgrade the credit rating of the issuer. A company's bond holders may lose much or all their money if the company goes bankrupt. interest rate risk could become a real problem. and holders of individual bonds who may have to sell them. in 2004 its bondholders ended up being paid 35. bondholders may end up having the value of their bonds reduced. Under the laws of many countries (including the United States and Canada). which affects mutual funds holding these bonds. A downgrade will cause the market price of the bond to fall. In a bankruptcy involving reorganization or recapitalization.value is immediately "marked to market" or not). (Conversely. as it did from 2001 through 2003. deposit holders (in the case of a deposit taking institution such as a bank) and trade creditors may take precedence. There is no guarantee of how much money will remain to repay bondholders. especially because this usually happens when interest rates are falling. Some bonds are callable. after an accounting scandal and a Chapter 11 bankruptcy at the giant telecommunications company World com. but puts at risk the market price. the company can choose to pay off the bond early.) One way to quantify the interest rate risk on a bond is in terms of its duration.7 cents on the dollar.

at a fixed date and price in the future. commodity-based products have a variety of uses. and standardized futures contracts. but futures contracts have an expiry date and are deliverable. Trading futures is easy. Traditionally. or metals that are used in production or as a traditional store of wealth and a hedge against inflation. as well as investment in managed futures and hedge fund products. the investor benefits of commodity or commodity-based products lie primarily in their ability to offer risk and return trade-offs that cannot be easily replicated through other investment alternatives. these commodities include grains such as wheat. Futures contracts give the investor ease of use and the ability to buy or sell without delay. exchangeable. there is an expectation when trading commodity futures of achieving higher returns compared to shares or real estate. The full list of commodity markets is numerous and too detailed. As is true for stock and bond performance. However. as it is not practical to trade the physical commodities. Futures contracts can be broken by simply offsetting the transaction. Short-selling is the ability to sell commodity futures creating an open position in the expectation to buy-back at a later time to profit from a fall in the market. if you buy one futures contract to open then you sell one futures contract to close that market position. as mentioned above. The reason is because the biggest advantage to trading commodity futures. If you wish to trade the up-side of commodity futures. and can be accessed by using the services of any full or on-line futures brokerage service. The commodity markets will always produce rising of falling trends. Besides being a source of information on cash commodity and futures commodity market trends. Previous research that direct stock and bond investment offers little evidence of providing returns consistent with direct . then it will simply be a buy-to-open and sell-to-close set of transactions similar to share trading. The execution method of trading futures contracts is similar to trading physical shares. A futures contract is used to buy or sell a fixed quantity and quality of an underlying commodity. they are used as performance benchmarks for evaluation of commodity trading advisors and provide a historical track record useful in developing asset allocation strategies. corn and rice or metals such as copper. The best way to trade the commodity markets is by buying and selling futures contracts on local and international exchanges. must be facilitated by the use of trading liquid. The increased use of commodity trading vehicles in investment management has led practitioners to create investable commodity indices and products that offer unique performance opportunities for investors in physical commodities. so successful investors can expect much higher returns compared to more conventional investment products. gold and silver.Futures contracts have an expiry date and need to be occasionally rolled over from the current contract month to the following contract month.COMMODITIES A commodity is a normal physical product used by everyday people during the course of their lives. For example. For example. and with the abundance of information and trading opportunities available there is no reason for any investor to exclusively trade the share market when there is potential profits from trading commodity futures. for the private investor is the opportunity to legally short-sell these markets. The process of trading commodities.

The commodities that are traded in the market        Gold Copper Silver Sugar Wheat Zeera Guar . Thus for investors. commodity-based firms may not be exposed to the risk of commodity price movement. direct commodity investment may be the principal means by which one can obtain exposure to commodity price movements.commodity investment.

company sales executives and friends and relatives.Analysis  Do you know about the following financial instruments? 120 100 80 60 40 20 0 EQUITY SHARES MUTUAL FUNDS BONDS INSURANCE FIXED DEPOSIT YES NO The sample size consists of 100 respondents and out of which almost all the people are fully aware about investment avenues like gold and fixed deposits and almost 95 are aware about equity shares and mutual funds  How do you get information about the following investment avenues? INFORMATION ADVERTISEMENT EXECUTIVE FRIENDS MAGAZINES Out of the 100 respondents about 50% of them get the information from advertisements on the television and internet and the rest from the magazines .  Rate the following according to your preference? .

What is your age? AGE 20-30 31-40 41-50 51-60 60 ABOVE Out of the respondents that were surveyed the maximum were of the age group of 31-40 What are the factors that you consider while investing in any financial instrument? .90 80 70 60 50 40 30 20 10 0 MORE PREFERRED MODERATE LESS PREFERRED Out of the 100 respondents asked the most preferred financial instrument is fixed deposits and the then the rest like equity shares with 70 % and insurance.

60 50 40 30 20 10 0 RETURN TAX SAVING LIQUIDITY REGULAR INCOME SAFETY Column1 Column2 Column3 Out of the respondents 50% were of the opinion that return and safety are the main reasons behind their investment decisions .  On what basis you invest in any particular financial instrument? 35 30 25 20 15 10 5 0 Column2 Column1 Series 1 The respondents were mostly of the opinion that portfolio is the most important factor before investing and then fundamental analysis done by them or by the financial advisor and then the other factors  How will you invest your money in any financial instrument? .

HOW DO YOU INVEST BROKER SUB BROKER AGENTS BANKS Most of the respondents surveyed that they mostly invest their money through a broker and then through sub brokers and agents What is your annual income? INCOME 15% 58% 1-3LAKHS 3-5LAKHS 5-10LAKHS MORE THAN10LAKHS 22% Out the total respondents around 60 %were in the income group of 1.3lakhs and 22% in the 3-5lakhs bracket How much of your money you invest in financial instruments? .

How long do you prefer to keep your money invested? 70 60 50 40 30 20 10 0 6 MONTHS 1 YEAR 1TO 3 YEAR 3 TO 5 YEAR Column1 Out of the 100 respondents mostly were of the view that they invested there for a money at least for a period of 1year to 3 years How much return do you expect from your investments? .60 50 40 Column1 30 20 10 0 10%to20% 20%to30% 30%to50% MORE THAN 50% Column2 Column3 Most of the respondents surveyed were mostly those people who invest 10 to 30 % of their money in these instruments.

more disposible income.Column1 50 45 40 35 30 25 20 15 10 5 0 10 TO 20% 20 TO 30% 30 TO 50% MORE THAN 50% Column1 CONCLUTION AND RECOMMENDATIONS The over all project is depending up on the findings that has been explained previously.000 Rs per month disposible income. Mutual funds can be an option but that must be a debt fund to invest. most of the investors are from the 10. The age group of 31-40 years.and Fixed Deposits as investment instrument. and the time horizon is perfect 3-5 years. Company will get a good investor with diluted risk profile. Company should try to reach them and tap the investor. According to my view the age group of 21-30 can be a great potential investors for the company as the has high risk profile.000-20.   Mutual Funds can also be offered as they have high risk profile.  Recommendation for this category is company must follow up these high potential customers. Company can offer them ULIPs. This group of customers can also be offerd Mutual funds because in that also the exposure is in equities. After completing the survey and watching the analysis I come to this conclusiion that the before investment investors do have focus on Tax savings. Income.The ULIP has a 20%-22% return which good enough for investment. investors are with ‘Moderate’ risk profile.000 Rs disposible income group.000-15. investors are from the 15. They also have a predetermination of the time period of investment. All my survey findings are corelated and being explain in the above graphs. Investor in this group are invested in Insurance sector. The main focus should be to reach to the customer. the primary focus of these investors are . Capiatal preservation etc.  The age group of 41-50 years. they can be offered Equity shares because this group of people have a high risk profile and they can afford to takes risks which is usually associated with equity shares. these customers are aware of ULIPs and aware of other product. ULIPS can also be offered to this group. Company should take initiative to get demat account of these customers.

20.5000 per month are basically safe investors and have not and do not prefer investing in mutual funds and ULIP.000 who least prefer investing in mutual fund. Mutual Fund and ULIPs. insurance and fixed deposits.5. Most investor are with negative return acceptability and time horizon is < 3 years. Company should try to minimise the risk tolerence by offering Fixed deposits. This is also good potential group for the retirement plan in ULIPs.10. Apart from this company should offer to open demat account with them. and offer FDs.15.Moderate’.  For the age group of above 50 years. the risk profile is high-very high. ULIPs.  Disposible Income Bracket of Rs. Investors have invested in insurance sector but in this age insurance would not be a good option for investor.  Recommendation company shoul tap these class by innovative marketing strategies as they already invested. the rish profile would be low moderate. Disposible Income  The disposible income bracket less than Rs.  Though there is a small percentage of respondents in disposible income bracket above Rs.  For the business class.000-Rs.20. Depending upon the data I conclude that the srevice class has a time horizon of 3-5 years and risk tolerence ‘Low. Fixed deposits can be a good option for them. OCCUPATION If we see the survey data it will seen that respondents are majorly Service peopole and Business Class.  In the survey there were lot of people who were in the age group of above 60.000 have mainly invested in insurance and real estate. Thus positioning of these products should be such that people are attracted towards this scheme.retirement and time horizon is likely to be 6-9 years.  Respondents under disposible income bracket Rs. Moreover there is mixed preferences for their investments thus proper segmentation of the sample should be done accordingly marketing strategies should be adopted.as the term is not more than 3 years. But this is the segment which can be well targeted and their . But when survey was done and their preferences was asked these respondents strongly preferred investing in these strategies. For this group of people the company can target Fixed deposits which gives continues return like monthly interests so that they can keep on getting returns. Mutual fund can be a lucrative offer if the Fund is any moderate fund or debt fund.000 are the strong contenders for investing their money and these people have invested in real estate.000-Rs. Equity shares. Company should offer Mutual funds with risk profile High to very high thus investor can get a high return. They invested in FDs. Emphasis on marketing of the products should be given.

icicidirect.com www.com www.com www.com www.bseindia.scribd.karvy.com www.nseindia.com Business Today The Economic Times The Mint Karvy Finapolis .mcx. Thus emphasis for selling ULIP in this income bracket.com www.portfolio should be such that gives them more returns. The case of ULIP is different as people strongly prefer investing in this investment strategy. REFERENCE www.mutualfundsindia.equitymaster.com www.

Securities o Real Estate o IPO’ o Gold Yes Yes Yes Yes Yes Yes Yes Yes Yes No No No No No No No No No o If any other please specify…….Questionnaire Name Occupation Contact No Email id : : : : 1. More preferred Mutual fund Insurance Equity Shares Bonds Fixed Deposits Govt. Do you know about the following Financial Instrument? o Mutual Fun o Bond o Insurance o Equity Shares o Fixed Deposits o Govt. 3. 2.…………………………………………………………………………. Please rate the Financial Instruments as per your Preference.What is your age? . How do you get information regarding these Financial Instrument? o Advertisement o Company Sales force o Friends / Relatives o Magazines /Newspaper o If any other please specify………………………………………………………………………………….securities Real estate IPO’s Gold Moderate Less preferred 4..

o Sub broker/ Agents o Through Banks o If any other please specify………………………………………………………………………….. What are the factors which you consider while investing in any Financial Instrument? o Return (capital appreciation) o Tax Saving o Liquidity o Regular income flow o Safety o Risk o If any other please specify……………………………………………………………………. What is your annual income? 1lac to 3 lac 3lac to 5lac 5lac to 10lac more than 10 lacs 10. Please specify name…………………………. How will you invest your money in any Financial Instrument? o Yourself o Through any stock broking company.. 6. How much of your money you invest in any Financial Instrument? o 10% to 20% o 20% to 30% . On what basis you will invest in any particular Financial Instrument? o Past Performance o Portfolio o Fund Manager o Fundamental/Technical Analysis o Market Sentiment o If any other please specify………………………………………………………………………… 7. In what type of Financial Instrument you like to invest? o Equity based o Debt based o Balanced Fund o Hybrid Fund o ELSS (equity linked saving scheme) o If any other please specify 9.15-20 21-40 41-50 51-60 60 above 5. 8.

Are you satisfied with your investment decision.. How much return you expect from any Financial Instrument? o 10% to 20% o 20% to 30% o 30% to 50% o More than 50% o If any other please specify………………………………………………………………………………………. How long you prefer to keep your money in any Financial Instrument? o Less than 6 months o 6 months to 1 year o 1 year to 3 year o More than 3 years o If any other please specify 12. ……………………………………………………………………………………………………………………… ……………………………………………………………………………………… ……………………………………………………………………………………………………… ……………………………………………………………………………………………………… No 14. Any other comments.. Please rate? . Will you invest your money for saving the Tax in any Financial Instrument? Yes o Highly satisfied o Satisfied o Less satisfied o No satisfaction 15. 13.o 30% to 50% o More than 50% o If any other please specify……………………………………………………………………………………. 11.

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