A RESEARCH STUDY PROJECT REPORT ON SHARE MARKET & FINANCIAL SYSTEM
[ SH ARE K H AN LI M I TED]
IS SUBMITTED BY
ANIL KUMAR THAKUR
PGCP (FINANCE +MARKETING) TO SURYADATTA INSTITUTE OF MANAGEMENT & MASS COMMUNICATION
PARTIAL FULFILLMENT OF THE PAPER OF THE INTERNSHIP PROJECT (2007-2009)
THE CORPORATE PROGRAM of MBA course is a well structured and integrated programme. The course of management gives a practical knowledge in our study course. Industries give us much information about the different product and services we use in our day to day life. It is highly said that “practice makes a man perfect” the summer project training which is a part of M.B.A to get a practical understanding and training of the business management. Thus the industrial training which is a part of M.B.A course helps the student to get the knowledge about the actual environment of an organization. Share khan securities ltd. is one of such company dealing in Share market Derivatives, Commodities, Mutual fund IPO distribution with almost branches in overall India. It involved the study of finance activities of the organization. I have under taken industrial training in Share khan securities ltd. at Pune crossing from 1-june2008 to 31-july-2008 as a part of my PGCP course curriculum and I thus, present a project report on it at the best of my ability knowledge and work done.
I feel pleasure for making a report which I visited at Pune named Share khan securities Ltd. this year. The main objective of this practical training information about the real environment of the firm. is to get
I hereby acknowledge my sincere thanks and grateful to our director MR SANJAY.B.CHORDIYA. I also thanks to our faculties, our office superiors and my friend partner which gave full response to us. As a part of MBA programme I have taken training in stock market in Share khan securities Ltd at Pune for a period of 2 months and 25 days . Success cannot come without inspiration, motivation & innovation. We the projectors ascribe our success in this venture to our guide Asmita Joshi .Without her guidance our project completion is a distance dream. I wish to express to humble gratitude to Mr. DURGA PARSAD for his diligent efforts in providing particle tips to tackle complicated situation with limited sources, whose ever presence in mind with helping attitude to encourage me to complete this study and for his untiring help and valuable guidance
ANIL KUMAR THAKUR
Stock market History Trading Market participants Importance of stock market The behaviour of the stock market Bombay stock exchange BSE indices National stock exchange Derivatives Financial system Flow of fund Main function of financial system Financial market Capital market Stock exchange Relation of the stock market with financial system The stock market. individual investors. Research objective
Statement of problem Objective of the research project
4. and financial risk Function of stock exchange Service of stock exchange
2. Research methodology objective and limitation
Problem definition Justification of study Objective of study Research design 4
. Profile of the broking house in the stock market
Kotak securities Share khan India infoline Bonanza Reliance money Karvy Religare securities India bulls Anand rathi
Source of data Limitation of study
. Conclusions and suggestions 6.
It must be noted though that the value of the derivatives market. The world derivatives market has been estimated at about $480 trillion face or nominal value.000 US$ 1. India Bombay Stock Exchange Limited Rajnikant Patel (CEO) INR ~6. of listings MarketCap Volume Indexes Website Stock Exchange Mumbai.bseindia.com/
A stock market. The size of the world stock market is estimated at about $51 trillion.61 trillion (2006) US$ 980 billion (2006) BSE Sensex http://www. or (equity market). 12 times the size of the entire world economy.INTRODUCTION
The Bombay Stock Exchange in India Type Location Owner Key people Currency No. these are securities listed on a stock exchange as well as those only traded privately. because it is stated in terms of 6
. is a private or public market for the trading of company stock and derivatives of company stock at an agreed price.
There are now stock markets in virtually every developed and most developing 7
.or losses.notional values. Bankers in Pisa. In late 13th century Bruges commodity traders gathered inside the house of a man called Van der Beurse. e. The idea quickly spread around Flanders and neighboring counties and "Beurzen" soon opened in Ghent Antwerp and Amsterdam. the Dutch East India Company issued the first shares on the Amsterdam Stock Exchange. The stocks are listed and traded on stock exchanges which are entities a corporation or mutual organization specialized in the business of bringing buyers and sellers of stocks and securities together. institutionalizing what had been. debt-equity swaps. In 1602. which let shareholders invest in business ventures and get a share of their profits . Verona. The stock market in the United States includes the trading of all securities listed on the NYSE. Many such relatively illiquid securities are valued as marked to model.7. which traditionally refers to an actual value. until then. "Japan Goes Dutch". and in 1309 they became the "Brugse Beurse". rather than an actual market price. The Dutch later started joint stock companies. Genoa and Florence also began trading in government securities during the 14th century. Because these men also traded with debts. 2001).g. In 12th century France the courratiers de change were concerned with managing and regulating the debts of agricultural communities on behalf of the banks. European examples of stock exchanges include the London Stock Exchange. the NASDAQ. April 5. The Amsterdam Stock Exchange (or Amsterdam Beurs) is also said to have been the first stock exchange to introduce continuous trade in the early 17th century. the Deutsche Borse and the Paris Bourse. It was the first company to issue stocks and bonds. an informal meeting. the Amex. and cannot be directly compared to a stock or a fixed income security. unit trusts and other speculative instruments. OTCBB and Pink Sheets. disproving the belief that these were invented later by Italians. they could be called the first brokers. much as we know them" (Murray Sayle. In the middle of the 13th century Venetian bankers began to trade in government securities. option trading. merchant banking. This was only possible because these were independent city states not ruled by a duke but a council of influential citizens. as well as on the many regional exchanges.
Historian Fernand Braudel suggests that in Cairo in the 11th century Muslim and Jewish merchants had already set up every form of trade association and had knowledge of many methods of credit and payment. The Dutch "pioneered short selling. In 1351 the Venetian government outlawed spreading rumors intended to lower the price of government funds. London Review of Books XXIII.
India. which then notifies the investor who placed the order. to facilitate the exchange of sellers. If a spread exists. This type of auction is used in stock exchanges and commodity exchanges where traders may enter "verbal" bids and offers simultaneously. The purpose of a stock exchange is securities between buyers and marketplace (virtual or real). thus providing a exchanges provide real-time securities. where all trading is done over a computer network. China (Hong Kong). who can be based anywhere. The other type of exchange is a virtual kind. Germany. Some exchanges are physical locations where transactions are carried out on a trading floor. One or more NASDAQ market of the similar sellers makers 8
. composed of a network of computers where trades are made electronically via traders. also referred to as a listed exchange — only stocks listed with the exchange may be traded.economies. (Buying or selling at market means you will accept any ask price or bid price for the stock. computers play an important role. However. by a method known as open outcry. Orders enter by way of exchange members and flow down to a specialist. who executes the order. facilitating price
The New York Stock Exchange is a physical exchange. The process is to the New York Stock Exchange.
Participants in the stock market range from small individual stock investors to large hedge fund traders. no trade immediately takes place--in this case the specialist should use his/her own resources (money or stock) to close the difference after his/her judged time. Their orders usually end up with a professional at a stock exchange. respectively. buyers and are electronically matched. The specialist's job is to match buy and sell orders using open outcry. France and Japan. UK. Actual trades are based on an auction market paradigm where a potential buyer bids a specific price for a stock and a potential seller asks a specific price for the stock. Canada. especially for so-called "program trading". who goes to the floor trading post to trade stock. Once a trade has been made the details are reported on the "tape" and sent back to the brokerage firm. Although there is a significant amount of human contact in this process.) When the bid and ask prices match. a sale takes place on a first come first served basis if there are multiple bidders or askers at a given price. with the world's biggest markets being in the United States. The NASDAQ is a virtual listed exchange. The trading information on the listed discovery.
and banks). pension funds. with long family histories (and emotional ties) to particular corporations. From time to time. Now that computers have eliminated the need for trading floors like the Big Board's. security trades away from the exchanges to their internal systems. a brokerage-industry consultant . investor groups.will always provide a bid and ask price at which they will always purchase or sell 'their' stock. However. Securities firms.g. That share probably will increase to 18 percent by 2010 as more investment banks bypass the NYSE and NASDAQ and pair buyers and sellers of securities themselves.S. led by UBS AG. such as wealthy businessmen.. worldwide. brokers pay the exchanges less in fees and capture a bigger share of the $11 billion a year that institutional investors pay in trading commissions
Many years ago. In 1986. Prior to the 1980s. mutual funds. active trading (especially in large blocks of securities) have moved away from the 'active' exchanges. The rise of the institutional investor has brought with it some improvements in market operations. is an order-driven. The Paris Bourse. but only after the large institutions had managed to break the brokers' solid front on fees they then went to 'negotiated' fees. Thus. Goldman Sachs Group Inc. and Credit Suisse Group. electronic stock exchange. already steer 12 percent of U. where clients can move big blocks of stock anonymously. the CATS trading system was introduced. buyers and sellers are largely institutions (e. corporate governance (at least in the West) has been very much adversely affected by the rise of (largely 'absentee') institutional 'owners'
. the government was responsible for "fixed" (and exorbitant) fees being markedly reduced for the 'small' investor. according to data compiled by Boston-based Aite Group LLC. it consisted of an open outcry exchange. Over time. hedge funds. but only for large institutions). now part of Euronext. markets have become more "institutionalized". and the order matching process was fully automated. It was automated in the late 1980s. buyers and sellers were individual investors. insurance companies. Stockbrokers met on the trading floor or the Palais Brongniart. the balance of power in equity markets is shifting. By bringing more orders in-house.
and can influence or be an indicator of social mood. Financial stability is the raison d'être of central banks.IMPORTANCE OF STOCK MARKET
The stock market is one of the most important sources for companies to raise money. Exchanges also act as the clearinghouse for each transaction. central banks tend to keep an eye on the control and behavior of the stock market and. on the smooth operation of financial system functions. This is an attractive feature of investing in stocks. Share prices also affect the wealth of households and their consumption. The liquidity that an exchange provides affords investors the ability to quickly and easily sell securities. In this way the financial system contributes to increased prosperity. or raise additional capital for expansion by selling shares of ownership of the company in a public market. History has shown that the price of shares and other assets is an important part of the dynamics of economic activity. for instance. compared to other less liquid investments such as real estate. Rising share prices. in general. tend to be associated with increased business investment and vice versa. The smooth functioning of all these activities facilitates economic growth in that lower costs and enterprise risks promote the production of goods and services as well as employment. and guarantee payment to the seller of a security. This allows businesses to be publicly traded.
. Therefore. meaning that they collect and deliver the shares. This eliminates the risk to an individual buyer or seller that the counterparty could default on the transaction.
) In the present context this means that a succession of good news items about a company may lead investors to overreact positively (unjustifiably driving the price up). having priced in all public knowledge. in fact. (Something like seeing familiar shapes in clouds or ink blots.e. Various explanations for large price movements have been promulgated. (But this largely theoretic academic viewpoint also predicts that little or no trading should take place—contrary to fact—since prices are already at or near equilibrium.) But the efficient-market hypothesis is sorely tested by such events as the stock market crash in 1987. non-trending). ought to affect share prices. only changes in fundamental factors. A 11
.THE BEHAVIOR OF THE STOCK MARKET
From experience we know that investors may temporarily pull financial prices away from their long term trend level. many studies have shown a marked tendency for the stock market to trend over time periods of weeks or longer. This event demonstrated that share prices can fall dramatically even though. Moreover. while the EMH predicts that all price movement (in the absence of change in fundamental information) is random (i. theoretically could cause financial markets to overreact. According to the efficient market hypothesis (EMH).6 percent—the largest-ever one-day fall in the United States. when the Dow Jones index plummeted 22.. It also seems to be the case more generally that many price movements are not occasioned by new information. and often will perceive a pattern in what is. a study of the fifty largest one-day share price movements in the United States in the post-war period confirms this. some research has shown that changes in estimated risk. Other research has shown that psychological factors may result in exaggerated stock price movements. such as stop-loss limits and Value at Risk limits. such as profits or dividends. just noise. For instance. Overreactions may occur—so that excessive optimism (euphoria) may drive prices unduly high or excessive pessimism may drive prices unduly low. it is impossible to fix a definite cause: a thorough search failed to detect any specific or unexpected development that might account for the crash. New theoretical and empirical arguments have been put forward against the notion that financial markets are efficient. to this day. Psychological research has demonstrated that people are predisposed to 'seeing' patterns. and the use of certain strategies.
On 31 December 2007. predictions of a DOW average below 5000 were quite common.period of good returns also boosts the investor's confidence. rumors. The Stock Exchange. the average did not rise above 5%). even if that news has no real effect on the technical value of securities itself. In the period running up to the recent Nasdaq crash. Mumbai. euphoria and mass panic. less than 1 per cent of the analyst's recommendations had been to sell (and even during the 2000 . or BSE) is the oldest stock exchange in Asia. popularly called The Bombay Stock Exchange. Around 6. Mumbai.
In one paper the authors draw an analogy with gambling. The players now must give heavy weight to the psychology of other investors and how they are likely to react psychologically.000 Indian companies list on the stock exchange. It is also the biggest stock exchange in the world in terms of listed companies with 6. (And later amplified the gloom which descended during the 2000 . The media amplified the general euphoria. with reports of rapidly rising share prices and the notion that large sums of money could be quickly earned in the so-called new economy stock market. In times of market stress. Inexperienced investors rarely get the assistance and support they need. so that by summer of 2002. making the stock market difficult to predict. the game becomes more like poker (herding behavior takes over). as any other business. is quite unforgiving of amateurs. The Bombay Stock Exchange was established in 1875. It is located at Dalal Street.79 trillion.2002 crash. The BSE SENSEX (SENSitive 12
. stocks and other securities can be battered or buoyed by any number of fast market-changing events. the probabilities are known and largely independent of the investment decisions of the different players. Therefore. and it has a significant trading volume. The stock market. making it the largest stock exchange in South Asia and the tenth largest in the world. however. the equity market capitalization of the companies listed on the BSE was US$ 1.. Over the short-term. reducing his (psychological) risk threshold. the stock market can be swayed tremendously in either direction by press releases.000 listed companies as of August 2007. In normal times the market behaves like a game of roulette. Bombay Stock Exchange T h e B o m b a y S t o c k E x c h a n g e L i m i t e d ( H i n d i : म ुं ब ई श े य र ब ा ज ा र Mumbaī Śeyar Bājār) (formerly. India.
Sometimes the market tends to react irrationally to economic news.2002 crash.
Apart from BSE SENSEX. is a widely used market index in India and Asia. Though many other exchanges exist. also called the "BSE 30".indEX). which is the most popular stock index in India. with the base April 1979 = 100. BSE and the National Stock Exchange of India account for most of the trading in shares in India
The BSE SENSEX (also known as the BSE 30 index) is a valueweighted index composed of thirty scrips. The set of companies which make up the index has been changed only a few times in the last twenty years. These companies account for around one-fifth of the market capitalization of the BSE. BSE uses other stock indices as well: • • • • • • • • • • • • BSE BSE BSE BSE BSE BSE BSE BSE BSE BSE BSE BSE 500 100 200 PSU MIDCAP SMLCAP BANKEX Teck Auto Pharma Fast Moving Consumer Goods (FMCG) Consumer Durables
The BSE Broadcast is a large ticker on the wall of the BSE. 1990. It also displays – on what is described as India's and South Asia's largest video screen –one of the leading businessnews channels in India: NDTV Profit. the Sensex touched the magical four-digit figure for the first time and closed at 1. 1990 On July 25.001 in the wake of a good monsoon season and excellent corporate results. 1000. struck the BSE's opening bell. the Managing Director of New Delhi Television (NDTV) Ltd. when Dr Prannoy Roy. Mr Damodaran. This new system was unveiled on December 15. July 25. said that the ticker would provide information and analysis of the financial world. the Chairman of the Securities and Exchange Board of India (SEBI).
. Following is the timeline on the rise and rise of the Sensex through Indian stock market history. 2006. which continuously displays the latest stock quotes from the market.
2006 crossed the magical figure of 11. 15
. 2005 crossed the magical figure of 9000 to touch 9000.the Sensex -level following brisk buying by foreign and early trading.000. 2005 On September 8.091 on the expectations of a liberal export-import policy. March 21. 1992 On January 15. 6000. 2005. 1999. 4000.000-mark and hit and all time high of 6. 8000. 1992. the news of the settlement between the Ambani brothers boosted investor sentiments and the scrips of RIL. the Sensex crossed the 2. it was on March 27. Reliance Capital. Dr Manmohan Singh. 11. 1992. However. 1992 On February 29. 7000.000-mark and closed at 4. the Sensex surged past the 3000 mark in the wake of the market-friendly
Budget announced by the then Finance Minister.000 points. 3000. 2005 On June 20. The Sensex finally closed above the 10K-mark on February 7. September Stock Exchange's crossed the 8000 domestic funds in 8. 5000. and IPCL made huge gains. February 6. February 11.000-mark and closed at 2. 2006 The Sensex on March 21. 2006 touched 10.2000. It was then that the Harshad Mehta scam hit the markets and Sensex witnessed unabated selling. 1992. the Bombay benchmark 30-share index -. November 28. the infotech boom helped the Sensex to cross the 6. 2000 On February 11. February 29. January 15.020 followed by the liberal economic policy initiatives undertaken by the then finance minister and current Prime Minister Dr Manmohan Singh. Reliance Energy.000.006.32 points during mid-session at the Bombay Stock Exchange on the back of frantic buying spree by foreign institutional investors and well supported by local operators as well as retail investors. 2000.
9000. the Sensex crossed the 4. 2005. 1999 On October 8. the Sensex crossed the 5.000-mark as the BJP-led coalition won the majority in the 13th Lok Sabha election. June 20. 10. 2006 that the Sensex first closed at over 11. March 30. 2005 The Sensex on November 28. October 8. This helped the Sensex crossed 7.000 and touched a life-time peak of 11.000 points for the first time.003 points during mid-session. 2006.001 points during mid-session at the Bombay Stock Exchange for the first time. 1992 On March 30. 2006 The Sensex on February 6.
26 points. It took seven months for the Sensex to move from 14. The Sensex ended with a gain of 22 points at 16.000.000.000.887 . 2007 The Sensex crossed the 19. The market set several new records including the biggest single day gain of 789 points at close. The Sensex finally ended with a gain of 654 points at 16. 2006 The Sensex on April 20.000 to touch 15. The NSE Nifty gained 186 points to close at 4.000-mark and closed at a peak of 12. 2006 crossed the magical figure of 13.12. It took 36 days for the Sensex to move from 13.921. Within minutes after trading began.005 points in afternoon trade. It took just 8 days to cross 18. July 6.000 and closed at 13.000. 2007. October 30. It took 135 days for the Sensex to move from 12. 2006 The Sensex on December 5. 15.000 points. 16.000. April 20. rising by 450 points from the previous close.000 from 15.000.45 points or 0.000.028 points. 2007.327. 2007 The Sensex scaled yet another height during early morning trade on September 26. October 15. 17. The 30-share Bombay Stock Exchange's sensitive index took 53 days to reach 16. 19. 2006 crossed the 14.000. Within minutes after trading began.000.000mark on October 09. 2007 crossed the magical figure of 15.280. 2006 The Sensex on October 30.000 and 123 days to move from 12.040 points for the first time. 2006 crossed the 12. The index zoomed to a new alltime intra-day high of 18.000 to 15.323.down 187 points from the day's high. as well as the largest intra-day gains of 993 points in absolute term backed by frenzied buying after the news of the UPA and Left meeting on October 22 put an end to the worries of an impending election. the Sensex crossed 16. saw the index slip into red to 16. up 113 points. December 5.732.000-mark to touch 14. capital goods and refinery sectors.000 points from the 17. the Sensex crossed the 17.000 to 13. 2007 The Sensex scaled yet another milestone during early morning trade on September 19.000 mark. 2007 The Sensex on July 6. September 19. Some profit taking towards the end. up 117.000. It finally gained 789 points to close at an all-time high of 18. 2007 The BSE Sensex crossed the 18.024.500 to 13.000-mark . 18. October 09.000 to the 14. 2007. September 26. Nifty also touched a new high at 4659. The index gained the 16
14.9%.000-mark backed by revival of funds-based buying in blue chip stocks in metal.000.000 mark. 13.
000 mark in intra-day trading after 49 trading sessions. 2008 The sensex hit an intra day low of 12.905.90. The 30-share index spurted in the last five minutes of trade to fly-past the crucial level and scaled a new intra-day peak at 20.220.50 points before ending at 5.000-mark on October 15.024.2008 14. 2008. July 2. Reliance Industries.822.last 1. 2008 The sensex touched an intra day low of 13.87 points before ending at its fresh closing high of 19. 15. The major drivers of today's rally were index
Heavyweights Larsen and Toubro.The Nifty gained 242 points to close at 5.096. Bloomberg lists them as the top two gainers for the Sensex. it later fell back due to profit booking.60 points.220 amidst a negative sentiment generated on the Reserve Bank of India hiking CRR by 50 bps.000 points in just four trading days.059. The NSE Nifty rose to a record high 5. a gain of 734.200 mark. ICICI Bank. 2008. This is a bad time for the Indian markets. This is the lowest that it has ever been in the past year.822.670.000 mark on the back of aggressive buying by funds ahead of the US Federal Reserve meeting. on January 10th. 2008 The sensex closed below 15. Indian market suffer with major downfall from January 21. showing a hefty gain of 203.977. then pulled back and ended up at 14. The index took only 10 trading days to gain 1. 20.000.67.70 on July 2nd. Six months ago. closely followed by ICICI Bank and ITC Ltd
. However. October 29. 21.70. 2008 The sensex crossed the 21. the market had hit an all time high of 21206.731 during the early trades. FII outflow continued in this week. This was backed by high market confidence of increased FII investment and strong corporate results for the third quarter. June 25. 12. The index touched a fresh all-time intra-day high of 19.50 points.000.200. January 8.000 points after the index crossed the 19. June 13. and finally ended with a smart gain of 640 points at 19. HDFC Bank and SBI among others.922. 2007 The Sensex crossed the 20. although Reliance and Infosys continue to lead the way with mostly positive results.
Ravi Narain Managing Director INR 1587 US$ 1. of listings MarketCap Indexes Website
Stock Exchange Mumbai. It is the largest stock exchange in India in terms of daily turnover and number of trades. Though a number of other exchanges exist. and between them are responsible for the vast majority of share transactions. known as the Nifty.nse-india. The NSE's key index is the S&P CNX Nifty. an index of fifty major stocks weighted by market capitalisation. for both equities and derivative trading. 72°51′35″E National Stock Exchange of India Limited Mr..
. NSE and the Bombay Stock Exchange are the two most significant stock exchanges in India.NATIONAL STOCK EXCHANGE LIMITED
Type Location Coordinates Owner Key people Currency No.com/
The National Stock Exchange of India Limited (NSE).46 trillion (2006) S&P CNX Nifty CNX Nifty Junior S&P CNX 500 http://www. India 19°3′37″N. is a Mumbai-based stock exchange.
The Capital Market (Equities) segment of the NSE commenced operations in November 1994. cover more than 1500 cities across India .46 trillion. electronic limit order book (LOB) exchange to trade securities in India. banks. while operations in the Derivatives segment commenced in June 2000. 2799 in total. derivatives market) trades in India. NSE is the third largest Stock Exchange in the world in terms of the number of trades in equities.
NSE has remained in the forefront of modernization of India's capital and financial markets. Origins
NSE building at BKC The National Stock Exchange of India was promoted by leading Financial institutions at the behest of the Government of India. 1956.6%. [[Image:National Stock exchange Kolkata. existent market and new market structures have followed the "NSE" model. NSCCL was a landmark in providing innovation on all spot equity market (and later.NSE
is mutually-owned by a set of leading financial institutions. As of 2006. it was recognized as a stock exchange under the Securities Contracts (Regulation) Act. making it the second largest stock exchange in South Asia. In April 1993. anonymous. Since the success of the NSE." in India. the NSE VSAT terminals. and its pioneering efforts include:
Being the first national. the equity market capitalization of the companies listed on the NSE was US$ 1. Setting up the first clearing corporation "National Securities Clearing Corporation Ltd. In October 2007.It is the second fastest growing stock exchange in the world with a recorded growth of 16. NSE commenced operations in the Wholesale Debt Market (WDM) segment in June 1994. insurance companies and other financial intermediaries in India but its ownership and management operate as separate entities. 19
. and was incorporated in November 1992 as a tax-paying company.
in India. particularly on an equity index. first depository in India. After four years of policy and regulatory debate and formulation. which led to the wide popularization of the NSE in the broker community. Being the first exchange that.• • •
Co-promoting and setting up of National Securities Depository Limited. proposed exchange traded derivatives. NSE has also launched the NSE-CNBC-TV18 media centre in association with CNBC-TV18
• • • • •
S&P CNX Nifty CNX Nifty Junior CNX 100 (= S&P CNX Nifty + CNX Nifty Junior) S&P CNX 500 (= CNX 100 + 400 major players across 72 industries) CNX Midcap (introduced on 18 July 2005 replacing CNX Midcap 200) 20
. NSE pioneered commencement of Internet Trading in February 2000. in 1996. the NSE was permitted to start trading equity derivatives Being the first and the only exchange to trade GOLD ETFs (exchange traded funds) in India. NSE has the following major segments of the capital market:
• • • •
Equity Futures and Options Retail Debt Market Wholesale Debt Market
NSE also set up as index services firm known as India Index Services & Products Limited (IISL) and has launched several stock indices. Setting up of S&P CNX Nifty.
For example. just about anything can be used as an underlying asset.
TYPES OF TRADERS IN A DERIVATIVES MARKET
Hedgers. In this way he gets an assured fixed price of his produce. under its programmes of NSE's Certification in Financial Markets (NCFM). The most common underlying assets include stocks. covering different sectors of financial and capital markets. There are even derivatives based on weather data. a European investor purchasing shares of an American company off of an American exchange (using American dollars to do so) would be exposed to exchange-rate risk while holding that stock. Branches of the NSE are located throughout India. Derivatives are generally used to hedge risk. options and swaps are the most common types of derivatives. bonds.
In finance. he sells futures contracts. Most derivatives are characterized by high leverage. commodities. Currently. A person keeps a close watch upon the prices discovered in trading and when the comfortable price is reflected according to his wants. a security whose price is dependent upon or derived from one or more is underlying assets. speculators and arbitrators are the types of traders in derivatives market. Its value is determined by fluctuations in the underlying asset. interest rates and market indexes. Futures contracts. the investor could purchase currency futures to lock in a specified exchange rate for the future stock sale and currency conversion back into euros. The derivative itself is merely a contract between two or more parties. certifications are available in 19 modules. Because derivatives are just contracts. forward contracts. such as the amount of rain or the number of sunny days in a particular region.CERTIFICATIONS
NSE also conducts online examination and awards certification. currencies. 21
. but can also be used for speculative purposes. To hedge this risk.
Hedgers are those who protect themselves from the risk associated with the price of an asset by using derivatives.
Buying a futures contract in anticipation of price increases is known as ‘going long’. Speculators have certain advantages over other investments they are as follows:
If the trader’s judgment is good. or individuals. Selling a futures contract in anticipation of a price decrease is known as ‘going short’. 22
. to change more quickly than real estate or stock prices. They handle trades for their personal clients or brokerage firms. who at one point or another deal in the underlying cash commodity.In general. Speculative participation in futures trading has increased with the availability of alternative methods of participation. but a performance bond. hedgers use futures for protection against adverse future price movements in the underlying cash commodity. he hedge the risk exposure by buying enough future contracts of the produce to cover the amount of produce he expects to buy. They are never interested in actual owing the commodity. Since cash and futures prices do tend to move in tandem. Take an example: A Hedger pay more to the farmer or dealer of a produce if its prices go up. the futures position will profit if the price of the produce rise enough to offset cash loss on the produce. on average.
Speculators are some what like a middle man. They actually bet on the future movement in the price of an asset. he can make more money in the futures market faster because prices tend. They are the second major group of futures players. The money he puts up is not a down payment on the underlying contract. Futures are highly leveraged investments. They will just buy from one end and sell it to the other in anticipation of future price movements. Hedgers are often businesses. For protection against higher prices of the produce. These participants include independent floor traders and investors. The actual value of the contract is only exchanged on those rare occasions when delivery takes place. yet he can ride on the full value of the contract as it moves up and down. The trader puts up a small fraction of the value of the underlying contract as margin.
transactions and claims and liabilities.ARBITRATORS:
According to dictionary definition. analysts. The phenomenon of imbalance in the distribution of capital of funds exists in every economy system. `The four main functions performed by a financial system are given below: The saving function Liquidity function Payment function Risk function
. he will take offsetting positions in both the markets to lock in a profit. managers. lower ring the cost positive directions. a person who has been officially chosen to make a decision between two people or groups who do not agree is known as Arbitrator. A financial system is a composition of various institutions. practices. If he finds future prices of a commodity edging out with the cash price. The financial system helps to determine both the cost and the volume of credit. markets. A financial system functions as an intermediary and a facilitates the flow of funds from the areas of surplus to those of deficit. regulations and laws. employment and growth of the economy .similarly. money. productions. Move over the commodity futures investor is not charged interest on the difference between margin and the full contract value
The financial system is one of the most important inventions of the modern society. Thus we find that a financial system has an impact on the basic existence of an economy and its citizens. The system can affect a rise in the cost of funds which adversely affects consumption. In commodity market Arbitrators are the person who takes the advantage of a discrepancy between prices in two different markets. There are areas or people with surplus funds as also those with a deficit.
That is why one always prefers to store the funds in financial instruments like stocks. increasing society’s standard of living when saving flows decline.the cost and time for transaction are drastically reduced .in India . The financial markets provide the investor the opportunity to liquidate the investments.
3: PAYMENT FUNCTION:
The financial system offers a very convenient mode of payment for goods and services. money is the form of deposits offers the least risk. etc. which promise future income flows. the credit card system 24
. the compromise one makes in such investment is (1) that the risk involved is more and (2) the degree of liquidity conversion of the claims into money is less. but its value is almost eroded by inflations. bonds. The cheque system and credit card system are the easiest methods of payment in the economy .while the cheque system of payment is widely practiced . The funds in the hands of the producers result in production of better goods and services. Financial claims are issued in the money and capital markets. However the growth of the investment and living standard begins to fall
2: LIQUIDITY FUNCTIONS:
Of all financial instruments. debentures.FLOW OF FUNDS
Seekers of funds (mainly business firms and government)
Flow of funds Flow of financial service Income and financial claims
Suppliers of funds (mainly household)
1: THE SAVING FUNCTION:
The public saving finds their way into the hands of those in production through the financial system.
directly between buyers and sellers etc.
A financial market can be defined as the market in which financial assets are created or transferred in which financial assets represented a claim of the payment of a sum of money sometime in the future and periodic payment in the form of interest or dividend. 2. organizations that facilitate the trade in financial securities.
4: RISK FUNCTION:
The financial markets provide protection against life. the coming together of buyers and sellers to trade financial securities.
Financial markets could mean: 1.e. 25
. Definition. and enable the subsequent trading thereof. i.has entered only recently into urban India and is widely used in these areas for payments of consumption expenditure. stocks and shares are traded between buyers and sellers in a number of ways including: the use of stock exchanges. students of finance will use both meanings but students of economics will only use the second meaning. which provide financing through the issuance of shares or common stock. i.
TYPES OF FINANCIAL MARKETS
The financial markets can be divided into different subtypes: Capital markets which consist of: Stock markets. Financial markets can be domestic or they can be international.e.the financial markets provide immense opportunities for the investor to hedge himself against of reduce the possible risk involved in various investments. In academia. health and income risks. and properly insurance policies . These guarantees are accomplished through the sale of life and health insurance. bonds and warrants. Stock exchanges facilitate the trade in stocks.
They can then lend money from this pool of deposited money to those who seek to borrow. see also forward market. which provide short term debt financing and investment. which provide financing through the issuance of Bonds. Intermediaries such as banks help in this process. borrowers would have difficulty finding lenders themselves. More complex transactions than a simple bank deposit require markets where lenders and their agents can meet borrowers and their agents. A good example of a financial market is a stock exchange. Newly formed (issued) securities are bought or sold in primary markets. which facilitate the trading of
The capital markets consist of primary markets and secondary markets. markets.
To understand financial markets. A company can raise money by selling shares to investors and its existing shares can be bought or sold. The following table illustrates where financial markets fit in the relationship between lenders and borrowers:
Insurance markets. which facilitate the redistribution of various risks. provide instruments for the
Futures markets. Banks take deposits from those who have money to save. and where existing borrowing or lending commitments can be sold on to other parties. what is their purpose? Without financial markets. let us look at what they are used for. Foreign exchange foreign exchange. Derivatives markets. commodities. Banks popularly lend money in the form of loans and mortgages. which provide standardized forward contracts for trading products at some future date. and enable the subsequent trading thereof. i. which facilitate the trading of
Money markets. which management of financial risk. Commodity markets.Bond markets.e. Secondary markets allow investors to sell securities that they hold or buy existing securities.
) Alternatively. via a share buyback. they may seek to make more money on their cash by lending it (e. investing in bonds and stocks.g. These companies tend to be lenders rather than borrowers. Such companies may decide to return cash to lenders (e. There are a few companies that have very strong cash flows. A person lends money when he or she:
• • • • •
puts money in a savings account at a bank.g. They also borrow to fund modernisation or future business expansion.
Companies tend to be borrowers of capital. contributes to a pension plan. or invests in company shares. When companies have surplus cash that is not needed for a short period of time.)
Individuals borrow money via bankers' loans for short term needs or longer term mortgages to help finance a house purchase. pays premiums to an insurance company.Relationship between lenders and borrowers Lenders Financial Intermediaries Financial Markets Borrowers Individuals Companies Central Government Municipalities Public Corporations
Interbank Stock Banks Exchange Individuals Insurance Companies Money Market Companies Pension Funds Bond Market Mutual Funds Foreign Exchange
Many individuals are not aware that they are lenders. Companies borrow money to aid short term or long term cash flows. but almost everybody does lend money in many ways. 27
. they may seek to make money from their cash surplus by lending it via short term markets called money markets. invests in government bonds.
Governments borrow by issuing bonds. Many borrowers have difficulty raising money locally. In the UK. this would cover an authority like Hampshire County Council.
During the 1980s and 1990s. bond prices. Governments also borrow on behalf of nationalised industries. Indeed the debt seemingly expands rather than being paid off. they need to borrow.
Public Corporations typically include nationalised industries. In the UK. Derivative products are financial products which are used to control risk or paradoxically exploit risk. One strategy used by governments to reduce the value of the debt is to influence inflation. interest rates and dividends go up and down. whereby importers/exporters created the initial demand for currency markets. In the financial markets. Government debt seems to be permanent. While this may have been true in the distant past. the government also borrows from individuals by offering bank accounts and Premium Bonds. These may include the postal services. They need to borrow internationally with the aid of Foreign exchange markets. creating risk. importers and exporters 28
. In the UK. railway companies and utility companies. the most obvious buyers and sellers of foreign exchange are importers/exporters. To make up this difference. the total borrowing requirement is often referred to as the public sector borrowing requirement (PSBR).Governments often find their spending requirements exceed their tax revenues. or derivatives for short. stock prices. It is also called financial economics. local authorities and other public sector bodies. currency rates.
Main article: Foreign exchange market Seemingly. Municipalities and local authorities may borrow in their own name as well as receiving funding from national governments. municipalities. a major growth sector in financial markets is the trade in so called derivative products.
but are rather modeled better by Lévy stable distributions. The scale of change. enunciated a set of ideas on the subject which are now called Dow Theory. or volatiliy. The capital market is the market for securities. where companies and governments can raise longterm funds. such as the U. depends on the length of the time unit to a power a bit more than 1/2. The picture of foreign currency transactions today shows:
• • • • •
Banks and Institutions Speculators Government spending (for example. military bases abroad) Importers/Exporters Tourists
ANALYSIS OF FINANCIAL MARKETS
Much effort has gone into the study of financial markets and how prices vary with time. One of the tenets of "technical analysis" is that market trends give an indication of the future. which states that the next change is not correlated to the last change. Securities and Exchange 29
. one of the founders of Dow Jones & Company and The Wall Street Journal. The scale of changes in price over some unit of time is called the volatility. to meet the long term needs of business enterprises . The capital market includes the stock market and the bond market. Charles Dow. who claim that the evidence points rather to the random walk hypothesis.now represent only 1/32 of foreign exchange dealing. The claims of the technical analysts are disputed by many academics. according to BIS. Large changes
Capital market is an organized market for long term funds required . at least in the short term. It was discovered by Benoît Mandelbrot that changes in prices do not follow a Gaussian distribution. This is the basis of the so-called technical analysis method of attempting to predict future changes. Financial regulators.S.
It operates as per well defined rules and regulation. Stock exchange also helps the public sector undertaking and the government in raising long term loans.
It is an organized market for buying. It facilitates marketing in securities and also controls the trading activities. financial and government market for industrial.Commission. It is privately owned by individuals.
FUNCTIONS OF STOCK EXCHANGE
Ready and continuous market Evaluation of securities Encouraging capital formation Providing safety and securities in dealings Encouraging public borrowing Helps speculations Regulating company management
SERVICE OF THE STOCK EXCHANGE
Stock exchange provides various services to companies’ investor and the society at large in the following manner:
. In brief. financial and government securities.
Stock exchange is an organized market for industrial. where existing securities are traded. It is a recognized association and is controlled by the state under a special act. selling and dealing in securities. The capital markets consist of the primary market. oversee the capital markets in their designated countries to ensure that investors are protected against fraud. a stock market or stock exchange is a place where stocks and shares and other term securities are bought and sold as per certain rules and regulations. and the secondary market. where new issues are distributed to investors.
modernization or rationalization. is a gift to the investors. 31
SERVICES TO INVESTORS Stock exchange. who gain confidence by providing continuous marketing facilities. expansion. Listed securities get quicker and better response are from investors. • Stock exchange provides a large marker for the listed securities. Market value of the securities is slightly more in relation to earning and property values.SERVICE TO COMPANIES Companies raising their capital through stock exchange will find better response to their security issues. • Stock exchange increases the credit standing and goodwill of the companies whose securities are listed.therefore purchasing of listed securities because less risky.
LISTING OF SECURITIES:
Listing of securities means including the name of the company security in the official list of the stock exchange for the purpose of trading. Stock exchange authorities properly evaluated the listed secutities. Stock exchange provides capital for industrial growth. • • Stock exchange guides the investors choice of securities to be bought. regarding the
Stock exchange maintains liquidity of securities by enabling the holders to sell them whenever they need liquid fund. They enable the companies to collect adequate capital for formation. This enhances the financial status and increase the bargaining power of the company in the collective ventures.merger. Stock exchange provides information about the value of securities to the investors through daily quotations of listed securities. in fact.
The trend towards forms of saving with a higher risk has been accentuated by new rules for most funds and insurance.g. the trend has been the same: saving has moved away from traditional (government insured) bank deposits to more risky securities of one sort or another 32
. in Sweden. Similar tendencies are to be found in other industrialized countries. e. pension funds. In all developed economic systems.it selects certain securities for transaction. In the 1970s.
REQUIREMENT FOR LISTING:
• Certificate copies of M/A and A/A (Memorandum of association and Article of Association) • Consent of SEBI • Director report • Balance sheets • Agreement with the managing director • Agreement with underwriters • Statement showing distribution of shares
RELATION OF THE STOCK MARKET TO THE MODERN FINANCIAL SYSTEM
The financial system in most western countries has undergone a remarkable transformation. has been an important component of this process. Japan and other developed nations.A stock exchange does not deal in the securities of all the companies . such securities are called listed securities. compared to less than 20 per cent in the 2000s. the United States. permitting a higher proportion of shares to bonds. The general public's heightened interest in investing in the stock market. The major part of this adjustment in financial portfolios has gone directly to shares but a good deal now takes the form of various kinds of institutional investment for groups of individuals. deposit accounts and other very liquid assets with little risk made up almost 60 per cent of households' financial wealth. Statistics show that in recent decades shares have made up an increasingly large proportion of households' financial assets in many countries.. insurance investment of premiums. such as the European Union. either directly or through mutual funds. One feature of this development is disintermediation. hedge funds. A portion of the funds involved in saving and financing flows directly to the financial markets instead of being routed via banks' traditional lending and deposit operations. etc. mutual funds.
AND FINANCIAL RISK
Riskier long-term saving requires that an individual possess the ability to manage the associated increased risks. the noise level in the stock market rises. This is something that could affect not only the individual investor or household. At the same time. and market strategists are all overtalking each other to get investors' attention. Stock prices fluctuate widely. and people who have turned to investing for their children's education and their own retirement become frightened.THE STOCK MARKET. investors find it increasingly difficult to profit.. real estate and collectables). then plummet just as quickly. This is certainly more important now that so many newcomers have entered the stock market. With each passing year. financial writers. The following deals with some of the risks of the financial sector in general and the stock market in particular. Yet. despite all this available information. or have acquired other 'risky' investments (such as 'investment' property. i.
. Stock prices skyrocket with little reason. INDIVIDUAL INVESTORS. Sometimes there appears to be no rhyme or reason to the market. Television commentators. immersed in chat rooms and message boards. individual investors. but also the economy on a large scale.e. only folly. in marked contrast to the stability of (government insured) bank deposits or bonds. analysts. are exchanging questionable and often misleading tips.
Over the years he has built himself a multi-billion-dollar fortune. and $105.This is a quote from the preface to a published biography about the long-term value-oriented stock investor Warren Buffett.000 from seven limited partners consisting of Buffett's family and friends. The quote illustrates some of what has been happening in the stock market during the end of the 20th century and the beginning of the 21st. Buffett began his career with $100.
The company has a full fledged research division involved in macro economic studies sect oral research and company specific equity research combined with a strong and well networked sales force which helps deliver current and up to date market information and news Kotak securities ltd is also national securities depository a depository participant with limited and central depository 35
.PROFILE OF BROKING HOUSE IN THE STOCK MARKET
KOTAK SECURITIES: Kotak securities ltd is India leading stock broking house with a market share of close to 9% as on 31 march 2007. kotak securities ltd has been the largest in IPO distribution.
Sharekhan. Portfolio management from kotak securities comes as an answer to those who would like to grow from exponentially on the crest of the stock market.. Kotak securities have 813 outlets servicing more than 315000 customers and a coverage of 277 cities.providing dual benefits services where in the investor can use the brokerage services of the company for executing the transactions and the depository service for settling them. in the investment advisors category Share khan equity related services include trade execution on BSE. Kotak securities com the online division of kotak securities limited offers internet broking services and also online IPO and mutual fund investment A Kotak security limited manages assets around 2300 crores of assets under management. the retail broking arm of SSKI group and one of the largest stock broking house in the country has won the prestigious awaaz consumer vote awards 2005 for the most preferred stock broking brand in India.sharekhan online trading and investment site www. The portfolio management service provides top class service catering to the high end of the market. with the backing of an expert. 36
.com was launched in 2000 .service limited .NSE derivatives commodities depository services online trading and investment advice .sharekhan.
The reason behind the preferences for brands were unveiled by examines the following: • • • Tangible features of product /service Softer. this is one of the branches in the Pune. a flagship broking firm in the share market. Commodities and Mutual funds are in this firm. The head office of Share Khan is in the Mumbai. Pune in 1962 and has today grown to become the country’s largest integrated share transfer and ranks 37
. Share Khan commissioned its shares and equities at Satara Road. This is not only Share but bulk of the commodities. Share. Established in 1958. equity driving
Tactical measures such as promotional /pricing schemes
ABOUT THE COMPANY
Share Khan Limited. Mutual funds. This is only Share and Equity broking firm in India. Share khan give to more information how to invest in the share market.Sharekhan Bag round network includes over 250 centres across 123 cities in India and having around 120000 customers and equal number of demat customers. is structured into strategic businesses —Equities. the study initiated by awaaz India first dedicated consumer channel and member of the world wide CNBC network and ac Nielsen org marg was aimed at understanding the brand preference of the consumer and to decipher what are the most important loyalty criteria for the consumer in each vertical In order to select the award recipient spontaneous responses rather than prompted responses were garnered with an intention to glean unbiased preferences. intangible preference features like imagery. which types more earn money in the through the share market. Sharekhan won the award by vote of customer around the country. as part of India largest consumer study cover 7000 respondents 21 product and service across 21 major cities.
unsecured credit terms. Unofficial financing known as trade financing usually provides the major part of a company's working capital (day-to-day operational needs). subscriptions and insurance
MARKET SHARE ANALYSIS
. Share Khan acquired two captive markets in Nifty. e. With a strategic intent to achieve vertical integration in the share business. BSE and NSE. Customer provided financing exists when a customer pays for services before they are delivered. debt financing (for example issuing bonds) can be done to avoid giving up shares of ownership of the company. Trade financing is provided by vendors and suppliers who sell their products to the company at short-term.among the top quartile of low broking intra day and delivery charges in the world. Equity and debt financing are usually used for longer-term investment projects such as investments in a new factory or a new foreign market.
MEANS OF FINANCING
Financing a company through the sale of stock in a company is known as equity financing. Alternatively.g. usually 30 days.
i.e. IPO's) Trade in the Secondary Market. 1) Possibility of high returns 2) Easy liquidity 3) Unbeatable tax benefits 4) Income from dividends
SO HOW DOES ONE BUY SHARES?
.e. Compared to your investments in fixed deposits in banks it makes more profits. if any. but the bad news is that you are also expected to bear the losses.OTHER BENEFITS OF INVESTING IN SHARES?
Because they can make big money on it. Stock exchanges
. There are basically two ways in which you can invest in shares: Purchase shares from The primary market (I.
Some of the criteria they follow include:
1) Market capitalization. 4) Industry representation. 5) Listed history
. 3) Continuity. 2) Liquidity.They are selected by the Index committee.
. In India most of the indices are using wealth index for computation of stock market. of Market shares Price on 09/02/06 10 20 20 20/30/100/M a r k e t c a pM a r k e t (Rs.) 300/800/3000/4100/-
TATA INFOSYS IBM TOTAL MARKET CAP
Face value=Rs.) Price on 18/02/06 200/600/2000/2800/30/40/150/Market cap (Rs.COMPUTATION OF STOCK INDEX:
A stock market may either be a price index or a wealth index.10/Base value=100/Index present value= (100*4100)/2800= 146. Company No.
It has recently launched its Investment banking and Institutional Broking business. Portfolio Management Services. Equities and derivatives trading.com/and http://www. India Infoline also owns and manages the websites http://www.indiainfoline. Mutual Funds.
. comprising the holding company. Life Insurance. Mumbai (BSE) and the National Stock Exchange (NSE) and is also a member of both the exchanges. Wealth Advisory Services and Portfolio Management Services. straddle the entire financial services space with offerings ranging from Equity research.5paisa. Commodities trading.The India Infoline group.000 customers India Infoline Limited is listed on both the leading stock exchanges in India. the Stock Exchange. It is registered with NSDL as well as CDSL as a depository participant. viz. providing a one-stop solution for clients trading in the equities market. It offers broking services in the Cash and Derivatives segments of the NSE as well as the Cash segment of the BSE. It has more than 800. India Infoline Limited and its wholly-owned subsidiaries. GoI bonds and other small savings instruments to loan products and Investment banking.com/ The company has a network of 758 business locations (branches and sub-brokers) spread across 346 cities and towns. Fixed deposits. It is engaged in the businesses of Equities broking.
. Client-focused philosophy backed by memberships of all principal Indian Stock and Commodity Exchanges makes Bonanza a preferred service provider in the Industry for value based services. whether you are present or not!
Being a member of the National Stock Exchange (NSE). through a network of experienced dealers across the country. Integrated and innovative use of Technology enabling clients to trade offline.online and Strategic tie-ups with latest technology partners to facilitate trading access and direct processing across more than 900 Branches spread over 310 cities .Bonanza is a leading Financial Services & Brokerage House with acknowledged industry Leadership in execution and clearing services on Exchange Traded Derivatives and cash market products.
Bonanza confidently steers you through a challenging Financial and Trade Market every moment. Key elements that place Bonanza amongst the leading Brokerage Houses and make it the preferred service provider for value based financial services are:
A Client-driven foundation and strategy committed to client-specific investment needs and objectives. and through our comprehensive website. Bombay Stock Exchange (BSE) and dealer with Over the Counter Exchange of India (OTCEI) we handle your trading needs.
Karvy ranks among the top player in almost all the fields it operates. in the realty sector.000 active accounts. Karvy Computershare Limited is India’s largest Registrar and Transfer Agent with a client base of nearly 500 blue chip corporates. 5. Karvy Comtrade. registered with NSDL and CDSL. Over 9. member of National Stock Exchange of India and the Bombay Stock Exchange.000 highly qualified people staff Karvy. Karvy Stock Brokers Limited.00. Karvy Realty Services. which started in 2006.
. managing over 2 crore accounts. Member of NCDEX and MCX ranks among the top 3 commodity brokers in the country. it ranks among the top 5 Depositary Participant in India. Karvy Global offers niche off shoring services to clients in the US. Registered with AMFI as a corporate Agent. has quickly established itself as a broker who adds value. With over 6. India. Karvy is also among the top Mutual Fund mobilizer with over Rs.000 crores under management. ranks among the top 5 stock brokers in India.US The Karvy group was formed in 1983 at Hyderabad. Karvy Insurance Brokers is registered as a Broker with IRDA and ranks among the top 5 insurance agent in the country. Karvy has 575 offices over 375 locations across India and overseas at Dubai and New York.
Local. Mumbai (NCDEX Large numbers across the country participate in the futures market through Emkay's rapidly expanding online trading terminal network extending to even remote areas.
. large numbers of informed participants enter the trading process resulting in increased volumes and market efficiency. national and international agri-information is disseminated through the company's large branch network. unbiased investment advise with the objective of achieving sustainable superior investment returns for our clients To provide flawless execution support to meet diverse client needs on a platform of professionalism and integrity. free in house literature and interactive site sessions raise awareness levels on the futures market.ABOUT EMKAY
Emkay offers futures trading through "Emkay Corporate Services (P) Ltd. Consequently.
To provide research driven. Seminars. Multi Commodity Exchange of India Ltd. We have membership with two of the major Commodity exchanges of the country. Mumbai (MCX National Commodity and Derivative Exchange.".
Prakash Kacholia. Director of Emkay was a member of the first Governing council on derivatives segment of BSE. 2000. Ltd Franklin Templeton Mutual Fund HDFC Standard Life Mutual Fund Prudential ICICI Mutual Fund TATA Mutual Fund
Emkay has considerable strength and Domain Knowledge in the booming Derivatives market 1. A partial list is provided below. 1. empathetic and responsive in serving our customers To respect and reinforce our fellow employees and the power of teamwork To strive relentlessly to improve what we do and how we do it. 3. Birla Sun life Mutual Fund Deutsche Asset Mgt (India) Pvt. 6. The first Sensex Futures Contract was executed by Emkay on June 09. 4. He has been the moving spirit behind India’s first EXCHANGE TRADED FUND named SPICE based on the BSE SENSEX launched by Prudential ICICI MF
. Mr. 2. 2. 3... To always earn and be worthy of our customer's trust
Emkay’s institutional clientele includes some of the largest players in the Fund Management business. 5.OUR VALUES
To be fair.
some regional exchanges specializing in specific commodities. needs to switch to commodity derivatives to top the list of developed nations. primarily by the speculative segment of the universe of market participants has remained. Fortunately much of the skill sets have migrated to stock exchanges. and even the retail investors. In these intervening years. Education and awareness has a key role to play in achieving this vision
WHY COMMODITY MARKET?
Commodity derivatives records high volumes in the markets the world over compared to equity derivatives. such forward (futures) trading was banned in the country for a variety of reasons and it is being revived now.
. where the bans were lifted. The ban has meant that two generations have lost touch with the trading skills and the related knowledge levels in the commodity space. Our endeavor is to reach to the producers. at a grassroots level.COMMODITY FUTURES TRADING THROUGH:
India has a deep ingrained knowledge in commodity trading (and particularly forward trading in commodities). especially in the interior heartland. endusers. This has led to a mindset in the common man in the country that commodity exchanges are purely speculative in nature. In an era where risks to investments are on the rise and India being predominantly an agrarian economy. Also large informal trading. For last 40 years or so. have carried on the baton. The hedging and price discovery functions that they perform are largely ignored today by the cross section of the population.
Historically. For those who want to diversify their portfolios beyond shares. l o w ) speculators. Retail investors should understand the risks and advantages of trading in commodities futures before taking a leap. bonds and real estate. the one for commodity futures plays a valuable role in information pooling and risk sharing.
. Like any other market. Commodities actually offer i m m e n s e p o t e n t i a l t o b e c o m e aL i v e Q u o t e s s e p a r a t e a s s e t c l a s s f o r m a r k e t -G o l d a n d S i l v e r ( c u r r e n t b i d . Commodities are easy to understand and are based on the fundamentals of demand and supply. thus providing an efficient portfolio diversification option. h i g h . The market mediates between buyers and sellers of commodities thus making the underlying market more liquid. a r b i t r a g e u r s a n d$ c h a n g e . prices in commodities futures have been less volatile compared with equity and bonds. s a v v y i n v e s t o r s .UNDERSTANDING THE COMMODITIES MARKETS
24 hrs GOLD Spot Price
Indian markets have recently thrown open a new avenue for retail investors and traders to participate: c o m m o d i t y2 4 h r s S I L V E R S p o t P r i c e derivatives. commodities is one of the best options.
5 per share) got a overwhelming response and was subscribed 27. 2008 was Rs. we had 486. asset management and fund based activities have contributed to this growth. respect for professionalism. The issue gave a return of 21% on the date of listing. the company showed a strong top line growth of 91% to Rs.496 Business Locations operated by our Business Partners and us. with just two people running the show. For year ended March 2008.19 bn. We are headquartered in Mumbai and as of June 30. ethical and transparent business practices. was founded in 1987 as a small sub-broking unit.48% of its equity with two leading private equity investors based out of the US – New Vernon Private Equity Limited and Bessemer Venture Partners.648 registered customers. The company got listed on BSE and NSE on September 9.Motilal Oswal Securities Ltd.
. last year. research-based value investing and implementation of cutting-edge technology has enabled us to blossom into an almost 2000 member team.68 bn. In 2006.7 bn as compared to Rs.18 times in turbulent market conditions. the Company placed 9.7 bn and market capitalization as of March 31. had a network spread over 450 cities and towns comprising 1. The issue which was priced at Rs. foreign institutional investors. New businesses like investment banking.3.825 per share (face value Rs. Focus on customer-first-attitude. 2008. Today we are a well diversified financial services firm offering a range of financial products and services such as
• • • • • • • •
Wealth Management Broking & Distribution Commodity Broking Portfolio Management Services Institutional Equities Private Equity Investment Banking Services and Principal Strategies
We have a diversified client base that includes retail customers (including High Net worth Individuals). 2007. 2008. As of end of financial year 2008. As at June 30. mutual funds. financial institutions and corporate clients. the group networth was Rs.
. These are provided to customers through our Wealth Management service called ‘Purple’
BROKING & DISTRIBUTION SERVICES
• • • • • • •
Equity (cash and derivatives) Commodity broking Portfolio Management Services Distribution of financial products Financing Depository Services IPO distribution
We offer these services through our branches. We also have strategic tie-ups with State Bank of India and IDBI Bank to offer our online trading platform to its customers. Shareholding Pattern at on June 30. Business Partner locations. 2008
As of 30th June. family and business wealth creation and management needs.
OUR BUSINESS STREAMS
Our businesses and primary products and services are:
Financial planning for individual. the internet and mobile channels.Rs. The shareholding of institutions stood at 9.26%.08 (YoY) 701 270 156 91% 97% 100%
Credit rating agency Crisil has assigned the highest rating of P1+ to the Company’s short-term debt program.78% and non-institutions at 12. 2008. Crores Total Revenues EBIDTA PAT
FY Growth 2007. the total shareholding of the Promoter and Promoter Group stood at 70.
Through Motilal Oswal Commodities Broker (P) Ltd our fully owned subsidiary. As of June 30th. and FIIs. the internet and mobile channels
PORTFOLIO MANAGEMENT SERVICES
Motilal Oswal Portfolio Management Services offer a range of investments solutions through discretionary services. 2008. These include the Value PMS. insurance companies. Business Partner locations. Bulls Eye PMS.
INVESTMENT BANKING 51
. Trillion Dollar Opportunity and Focused Portfolio Series I. We offer these services through our branches. mutual funds. 2008.92 bn. the assets under management of our various portfolio schemes stood at Rs.
We offer equity broking services in the cash and derivative segments to institutional clients in India and overseas. These clients include companies. We at Motilal Oswal have helped create wealth for our customers through our Portfolio Management Services. Our knowledge of the markets together with our understanding of our customers and their risk profiles has helped us design a range of portfolio offerings for our clients.6. We service these clients through dedicated sales teams across different time zones. we provide commodity trading facilities and related products and services on MCX and NCDEX. our clients also get access to our exclusive Customized Trading Advice on both the trading platforms. Besides access to the best of research in the form of Daily Fundamentals & Technical Reports on highly traded commodities. we were empanelled with over 300 institutional clients including 191 FIIs. financial institutions. banks. Motilal Oswal group has applied to the regulatory bodies for a license to operate as a Domestic Asset Management Company (Mutual Fund) and we expect to begin operations soon. As at March 31.
FOCUS ON RESEARCH
. MOVCAPL has recently launched an INR 750 crores domestic Real Estate Private Equity Fund called “India Realty Excellence Fund” sponsored by Motilal Oswal Financial Services Ltd. restructurings and spin-offs through Motilal Oswal Investment Advisors Private Ltd. in December 2007. share buybacks.
In 2006. the Group has set up a 30 member team which would be responsible for effective deployment of funds into different trading and arbitrage strategies.8 billion and had 18 mandates in hand as at March 31. India Business Excellence Fund. MOIAPL has closed 23 transactions in 2007-08 worth US$ 1. The Fund has deployed/ committed $ 58 mn across 8 deals.4. Motilal Oswal Venture Capital Advisors Private Ltd (MOVCAPL) was appointed as the investment manager and advisor to a private equity fund.
PRINCIPAL STRATEGIES GROUP
For effective management of treasury operations and to capitalize on market opportunities. open offers/delistings and syndication of debt and equity. 2008. private placements (including qualified institutional placements). with investments typically in the range of US$3 mn to US$7 mn. our private equity subsidiary.We offer financial advisory services relating to mergers and acquisitions (domestic and cross-border). the fund obtained commitments of US$125 mn (Rs. divestitures. which was launched with a target of raising US$100 mn. MOVCAPL will manage and advise the fund and other private equity funds. (MOIAPL) We also offer capital raising and other investment banking services such as the management of public offerings. which may be raised in the future. In its final closing.875 mn) from investors in India and overseas. The fund is aimed at providing growth capital to small and medium enterprises in India.
technical and derivatives research perspective. Mr.
STRONG MANAGEMENT TEAM
The organization finds its strength in its team of young. Motilal Oswal and Mr. Our consistent efforts towards quality equity research has reflected in an increase in the ratings and rankings across various categories in the AsiaMoney Brokers Poll over the years Our unique Wealth Creation Study. Our talented pool of people comprises qualified and experienced professionals with an established track record. leadership skills. From a fundamental. Investors keenly await this annual study for the wealth of information it has on the companies that created wealth during the preceding five years. Managing Director. is now in its 13th year. strong technical expertise. We believe that our management's entrepreneurial spirit. authored by Mr. Almost 10% of revenue is invested on equity research and we hire and train the best resources to become advisors. Raamdeo Agrawal. At present we have 28 equity analysts researching over 27 sectors. Raamdeo Agrawal.Research is the solid foundation on which Motilal Oswal Securities advice is based. talented and confident individuals. Qualified professionals carry out different functions under the able leadership of its promoters. insight into market/customer needs provide us with a competitive strength which will help us implement our business
. Motilal Oswal's research reports have received wide coverage in the media (over a 1000 mentions last year).
REL’s businesses are broadly clubbed across three key verticals. As part of its recent initiatives. diversify and introduce offerings benchmarked against global best practices. backed by the core values of diligence and transparency. catering to a diverse and wide base of clients. plc. All employees of the group guided by an experienced and professional management team are committed to providing financial care. is one of the leading integrated financial services groups of India. Harrison & Co. The vision is to build Religare as a globally trusted brand in the financial services domain and present it as the ‘Investment Gateway of India’. Religare has also partnered with Vistaar Entertainment to launch India’s first Film Fund. Hichens. following a joint venture with the Australia based financial services major. With a view to expand. Following this acquisition Religare now proposes to operate out of 10 countries. Religare’s wealth management subsidiary is now rechristened as Religare Macquarie Wealth Management Limited.Religare Enterprises Limited (REL). Religare has entered into joint ventures with the global major. the group has also started expanding globally and has acquired London’s oldest brokerage & investment firm. the Retail. Institutional and Wealth spectrums.
.Aegon for its Asset Management and Life Insurance businesses in India. REL offers a multitude of investment options and a diverse bouquet of financial services and has a pan India reach in more than 1550 locations across more than 460 cities and towns. Macquarie Bank.
OUR GROUP STRUCTURE
Religare Enterprises Limited Religare Securities Limited • • • • •
Equity Broking Portfolio Management Services Depository Online Investment Portal Institutional Equity Broking
Religare Finevest Limited•
Lending and Distribution business
Religare Commodities Limited –
Religare Insurance Broking Limited • •
Life and Non Life Insurance Reinsurance
Religare Capital Markets Limited
• • •
Investment Banking SEBI Registered Merchant Banker Acquisition in UK through an international arm
Religare Arts Initiative Limited
Art Fund and other businesses of Art Gallery to be launched soon
Religare Realty Limited –
Real Estate Management Company
Religare Venture Capital Private Limited
Private Equity and Investment Manager
Joint Venture between REL.Religare Macquarie Wealth Management Limited
50: 50 joint ventures management business
Religare AEGON AMC
50:50 Joint Venture between REL and Aegon for Asset Management business in India
AEGON Religare Life Insurance • •
Life Insurance Company. We ensure you have a superlative trading experience through • • •
A highly process driven. with its presence in more than 1300 locations across more than 400 towns & cities. you can walk into any of these branches and connect to our highly skilled and dedicated relationship managers to get the best services. Aegon and BCCL for Life insurance business in India
EQUITY & DERIVATIVES
Trading in Equities with Religare truly empowers you for your investment needs. Religare also has one of the largest retail networks. This means. diligent approach Powerful Research & Analytics and One of the “best in class” dealing rooms
Further. How will we Personal Assistance
Dedicated Relationship Managers Dedicated dealers who facilitate trading and serve your post trade needs 56
This plan is suitable for the “Low Risk Low Return” investor with a strategy to invest in blue chip companies. It is suitable for the “High Risk High Return” investor with a strategy to invest across sectors and take advantage of various market conditions. Capital preservation. and use of Derivatives to control
Overall to enhance absolute return for investors. as these companies have steady performance and reduce liquidity risk in the market.
OUR SCHEMES PANTHER
The Panther portfolio aims to achieve higher returns by taking aggressive positions across sectors and market capitalizations.
The Tortoise portfolio aims to achieve growth in the portfolio value over a period of time by way of careful and judicious investment in fundamentally sound companies having good prospects.INVESTMENT PHILOSOPHY
We believe that our investors are better served by a disciplined investment approach.
The Elephant portfolio aims to generate steady returns over a longer period by investing in Securities selected only from BSE 100 and NSE 100 index.
. Focus on minimizing investment risk by following rigorous valuation disciplines. Selling discipline volatility. The scheme is suitable for the “Medium Risk Medium Return” investor with a strategy to invest in companies which have consistency in earnings.
• • • • •
Stock specific selection procedure based on fundamental research for making sound investment decisions. growth and financial performance. which combines an understanding of the goals and objectives of the investor with a fine tuned strategy backed by research.
Exposure to Derivatives is taken within permissible regulatory limits. Investment Banking with Religare offers the following services:
We focus on finding right and relevant partners for our clients. This scheme is suitable for investors with a high risk appetite. We specialize in structured financing and providing advisory services related to financial planning. Private Equity. modeling and advising on financial requirements. stocks in their early stages of an upturn or for those which are in sectors currently ignored by the market. through offerings like Corporate Debt.
Leo is aimed at retail customers and structured to provide medium to long-term capital appreciation by investing in stocks across the market capitalization range. who not only help in adding value but also improve the future valuation of the organization. The investment strategy would be to invest in scrips which are poised to get a re-rating either because of change in business. integrated and best-fit solutions to our corporate customers.CATERPILLAR
The Caterpillar portfolio aims to achieve capital appreciation over a long period of time by investing in a diversified portfolio. GDR/ADR etc. IPO. It is our continuous endeavor to provide value enhancement through diverse financial solutions on an ongoing basis. FCCB.
We provide innovative. This scheme is a mix of moderate and aggressive investment strategies.
• • • •
IPO/FPO/RIGHTS Mergers & Acquisitions Corporate Advisory Services ADR/GDR/FCCB 58
. Its aim is to have a balanced portfolio comprising selected investments from both Tortoise and Panther. business diversification leading to a better operating performance. ECB. potential fancy for a particular sector in the coming years/months.
“Indiabulls Financial Services Ltd is listed on the National Stock Exchange. Morgan Stanley and Farallon Capital. 2007). derivatives trading. Consolidated net worth of the group is around USD 905 million (31st December. consumer secured & unsecured credit. Business of the company has grown in leaps and bounds since its inception. Merrill Lynch. research & advisory services. Indiabulls serves the financial needs of more than 4. Bombay Stock Exchange and Luxembourg Stock Exchange. loan against shares and mortgage & housing finance. Indiabulls became the first company to bring FDI in Indian Real Estate through a JV with Farallon Capital Management LLC.50. Revenue of the company grew at a CAGR of 159% from FY03 to FY07. Indiabulls and its group companies have attracted more than USD 800 million of equity capital in Foreign Direct Investment (FDI) since March 2000.300 million (31st December. Indiabulls has demonstrated deep understanding and commitment to Indian Real Estate market by winning competitive bids for landmark properties in Mumbai and Delhi. a respected US based investment firm. Indiabulls through its group companies has entered Indian Real Estate business in 2005. It is currently evaluating several large-scale projects worth several hundred million dollars. 2007). Indiabulls helps its clients to satisfy their customized financial goals. With around 4000 Relationship Managers. depositary services.•
BUY BACK OF SHARE
Indiabulls is India’s leading Financial Services and Real Estate company having over 640 branches all over India. Goldman Sachs. Some of the large shareholders of Indiabulls are the largest financial institutions of the world such as Fidelity Funds. profits of the company grew at a CAGR of 184%.” Indiabulls Financial Services Ltd
. The market capitalization of Indiabulls is around USD 6. During the same period.000 customers with its wide range of financial services and products from securities.
Change Volume Day 's H/L (Rs)
18.Last traded Time Prev Close
Price* Volume* MF holdings Sales Net profit margin
Computed on last 15 days' trading figures.65 1.293.05 520.10 326.
INDIABULLS FINANCIAL SERVICES LTD.50 .00 .55 (8.278.85 92.75 68...90 543. 16:01 231.213.00 29 Aug.25
. (A) + Edelweiss Capital Lt (A) + IDFC (A) + IFCI Ltd.00
Mkt Cap (Rs Cr) 6337.01%) 3300365 255. VS.65 130.50 HOW HOT IS THIS STOCK?
52wk H/L (Rs) 1028.30 128.238. (A) + India Infoline (A) + Indiabulls Securitie (A) + LIC Housing Fi (A) + Power Finance Co (A) + Reliance Capital (A) Close (Rs) 2.45 44.
Action Compare Compare Compare Compare Compare Compare Compare Compare Compare Compare Company + HDFC (Sensex) + Bajaj Finserv Ltd.
JP Morgan Mutual Fund (15. 86. up from Rs.59% over Rs. the top three funds witnessed a rise in the AUM including ABN Canara Robeco Mutual Fund (16.36%). 5.02%) and ABN AMRO Mutual Fund (14.623 crore. the industry’s growth in assets has been 11%. 9.Net inflow in Mutual Fund is Rs. As per the numbers released by the Association of Mutual Funds in India.724 crore.71 crore as of July 2007.
. an increase of 3.21. 4.18. In the month of July 2008. 5.699 crore.9%). the industry asset base for July 2008 stood at Rs.513.899 crore in June 2008. On a year-on-year basis.MUTUAL FUND
Assets Under management as on 31st July 2008
Assets Under management as on 31st July 2008
The Indian mutual fund industry saw an increase in growth with assets under management (AUM) rising to Rs.40.
In year 2007 Citigroup Venture Capital International joined the group as a financial partner
BROKERAGE & DISTRIBUTION
Equity & Derivatives Brokerage AnandRathi provides end-to-end equity solutions to institutional and individual investors. investment banking. They are supported by dedicated sales & trading teams in our trading desks across the country. The entire firm activities are divided across distinct client groups: Individuals. sector trends and investment strategy has established us a competent and reliable research unit across the country. The firm. Consistent delivery of high quality advice on individual stocks. Research and investment ideas can be accessed by clients either through their designated dealers. founded in 1994 by Mr. AnandRathi. mutual funds and insurance. commodities. today has a pan India presence as well as an international presence through offices in Dubai and Bangkok. corporate advisory. The firm's philosophy is entirely client centric. web or SMS. Corporates and Institutions and was recently ranked by Asia Money 2006 poll amongst South Asia's top 5 wealth managers for the ultrarich. with a clear focus on providing long term value addition to clients.ABOUT US
AnandRathi is a leading full service securities firm providing the entire gamut of financial services. while maintaining the highest standards of excellence. ethics and professionalism. Clients can trade through us online on BSE and NSE for both equities and derivatives. structured products all of which are supported by powerful research teams. Private Clients. email.
. AR provides a breadth of financial and advisory services including wealth management. brokerage & distribution of equities.
In addition to transaction execution. We firmly believe in the importance of selecting appropriate asset allocations based on the client's risk profile. Commodities broking is supported by a dedicated research cell that provides both technical as well as fundamental research. Our success lies in our philosophy of providing consistently superior. registration of shares and dematerialization.A whole new opportunity to hedge business risk and an attractive investment opportunity to deliver superior returns for investors . CDSL Depository NSDL Depository
Commodities broking. Our research covers a broad range of traded commodities including precious and base metals.
AR Depository Services provides you with a secure and convenient way for holding your securities on both CDSL and NSDL. Our commodities broking services include online futures trading through NCDEX and MCX and depository services through CDSL. guar. agri-commodities such as wheat. jeera and cotton. Oils and Oilseeds. independent and unbiased advice to our clients backed by in-depth research. We offer you daily updated internet access to your holding statement and transaction summary. Our depository services include settlement. We have a dedicated mutual fund research cell for mutual funds that consistently churns out superior investment ideas. chana. investment ideas and arbitrage opportunities.MUTUAL FUNDS
AR is one of India's top mutual fund distribution houses. picking best performing funds across asset classes and providing insights into performances of select funds.
. guar gum and spices such as sugar. we provide our clients customized advice on hedging strategies. clearing and custody of securities.
Risk management includes identification. measurement and assessment of the risk and handling of the risk. We lay strong emphasis on timely claim settlement and post sales services. both within the business as well as on the personal front. Our guiding philosophy is to manage the clients' entire risk set by providing the optimal level of cover at the least possible cost. Our IPO research team provides clients with indepth overviews of forthcoming IPOs as well as investment recommendations.INSURANCE BROKING
As an insurance broker. The entire sales process and product selection is research oriented and customized to the client's needs. of our vast of branches a dedicated team
We have been consistently ranked among the top 10 distributors of IPOs on all major offerings.
. we provide to our clients comprehensive risk management techniques. The firm deals with both life insurance and general insurance products across all insurance companies. strong distribution capabilities and research the country. Online filling of forms is also available. a wide network across India. Our services
• • • • • •
Risk Management Due diligence and research on policies available Recommendation on a comprehensive insurance cover based on clients needs Maintain proper records of client policies Assist client in paying premiums Continuous monitoring of client account
Assist client in claim negotiation and settlement
We are a leading primary market distributor across Our strong performance in IPOs has been a result experience in the Primary Market. of which insurance is an integral part.
AR Investment Banking provides comprehensive services to clients including raising money in the equity capital markets to identifying strategic alliances.
. collateral etc. The team has also built an impressive track-record in debt restructuring based on its superior understanding of business needs and relationships with key lenders. in a comprehensive manner and finally negotiating with the prospective lenders / buyers. fixed-floating. hospitality. mergers and acquisition opportunities and debt financing & restructuring advisory. Corporate Finance The AR Corporate Finance team helps clients manage their debtfinancing needs by profiling business and cash-flow risks. defining the alternative sources of funding . tenure. textiles and sugar. The Corporate Finance team has handled assignments in businesses like paper. building in multiple variables such as currencies.
To review the concept and technique of price and trend analysis 66
. To explain stock exchange. money and capital market. and banking system.RESEARCH OBJECTIVE
STATEMENT OF PROBLEM Are people really getting benefits from the various predictions being made by the analysis? Objective of the research project • • • • • • • To understand the importance of economic analysis of firm as a producing unit To learn the role of money. To understand the function of financial system. To understand the financial. To explain analysis of equity data.
• • •
To asses the advantage and disadvantage of stock prediction If possible to design how stock prediction technique. To make the people move aware about market
various people have undergone huge losses in the stock market lot of material has been collected from the internet.” For this our research contains two parts68
. DEFINING THE OBJECTIVES: The aim of this project as has already been mentioned was to “sales and analysis of mutual funds.RESEARCH METHODOLOGY AND LIMITATION
RESEARCH DESIGN Problem is complex and real in nature. lot of efforts have undergone for the research by meeting various people and asking them about their experience . The research methodology consisted following steps: 1.
But other approaches also used such as observation research. and used to generate information as required.a. DATA COLLECTION: Base on the above questionnaire data are collected by survey methods. SECONDARY DATA
This type of data already exists. SAMPLING METHOD: 69
. company magazines. DATA SOURCES Data was collected various sources are: i. Primary data tells us present scenario of financial market. RESEARCH APPROACH The research approach adopted here was the survey method. it is originated by primary sources like personal interaction or field back forms. We collect the secondary data through Internet. the information is collected. To sale the products we have to first generate database on the basis of marketing research. talking with people and convince. books. journals and magazines of the company. The
This type of data does not exist. various company broachers. Analysis of different schemes of share market. from primary and secondary data. 3. sampling plan and contact methods.
2. b. talking with people. COLLECTING THE INFORMATION With respect to primary and secondary data. 1. ii. DEVELOPING THE RESEARCH PLAN: This step called for decision on the data sources. Secondary data means that to get the data from the internet. questionnaires that act as tools for collecting data.
All the views and data obtained were also interpreted as clearly as possible. The questionnaire consists of closed ended questions.. The present study identifies views of customers & analysis of share market along with the selfanalysis. The questionnaire designed was given to us from our immediate boss. 70
. percentage method was used. which is adopted. The Analysis of survey has been done on % basis. 2. and the final data was analyzed systematically to achieve the desired result. DATA ANALYSIS: 3. A part of Questionnaire was targeted to know the personal details of the respondents. DATA ANALYSIS For analyzing the data obtained after conducting the survey.
SECONDARY DATA The secondary data was collected by referring through web sites.
PRIMARY DATA The primary data to be selected was based upon the response of the respondents to the questionnaire designed.. The sampling method. is Random Sampling. Another part comprised of the selfdesigned questionnaire and will consist of closed ended questions with every question having its own importance and meaning. STUDY The present investigation is a descriptive and marketing type of study undertaken to estimate the comparative study of share market analysis.
This procedure gives each item an equal probability of being selected. This type of sampling is also known as chance sampling or probability sampling where each and every item in the population has an equal chance of inclusion in the sample and each one of the possible samples. The target group of the respondent was job holders and an earning person whatever his/her age may be.
SAMPLING METHOD The sampling method chosen for the project was “Random Sampling”. SAMPLE SIZE For the purpose of analysis a sample size of respondents was selected.
COMPARATIVE ANALYSIS AND INTERPRETATIONS
ANALYSIS OF MALES AND FEMALES SURVEYED:
. The sample size taken was 60.
Thus.like undergone earlier to there improve was the only
. we came to know that 73% of the users were males and the remaining 27% were females. lot of efforts have been . it was found that out of customers were males and was females.
LIMITATION OF STUDY
1.27% m ale fem ale 73%
male and female
50 45 40 35 30 25 20 15 10 5 0 male female
The diagram helped us in judging the number and percentage of males and females after conducting the survey.
fundamental analysis being used but now technical analysis has come into existence 2. Once the people who are involved in it. They play it like gambling and they think that its same it is difficult to change their mindset. 3. It’s difficult to make people aware about the market
knowledge it is very vast. 4. Last of technical thing are involved in it difficult for everyone to go through it.
CONCLUSION AND SUGGESTIONS
Today various people are investing in stock without having proper knowledge about it , they only listen to their broker sayings and in the end face huge losses , stock predication is very difficult or say impossible no one can predict the future as has been brilliant shown in the Hollywood movie paycheck If people know the truth and have knowledge about the market than can take some risks. Stock cant be predicted no one is sure what going to happen the next movement it’s a much volatile market. If someone is sure about the up trepanned than why the stop loss being set if because there is no surety Therefore, people should have knowledge about the market than they should enter it as it would lead in minimizing the losses and playing a more safe game of investing money. More reliable techniques should come to facilitate people and it should be simple also.
QUESTIONNAIRE 1. What is a commodity?
ANS: The term 'commodity' includes all kinds of goods. FCRA defines 'goods' as 'every kind of movable property other than actionable claims, money and securities'
2. What are commodity futures?
ANS: Commodity Futures are contracts to buy specific quantity of a particular commodity at a future date. It is similar to the Index futures and Stock futures but the underlying happens to be commodities instead of Stocks and Indices
3. Why Trade in Commodity Exchanges?
hike in federal rates bring down the dollar. which comes under the purview of the Ministry of Food. National Multi Commodity Exchange. natural calamities etc Government Policies .e. Mumbai (MCX B. Individuals.e. Multi-Commodity Exchange of India Ltd. Hedgers 2. Agriculture and Public Distribution
C. National Commodity Mumbai (NCDEX and Derivatives Exchange of India. consumption and carry-over quantity of stocks Economic policies and conditions Interest Rates . minimum support prices Annual production. Who are the players in the Commodity Market
ANS: Hedgers: Hedgers enter into commodity contracts to be assured access to a commodity. CBOT. LME etc
4. at a guaranteed price Speculator: Speculators are participants who wish to bet on future movements in the price of an asset. commodity exchanges are regulated by the Forwards Market Commission (FMC).g. Who regulates the commodity exchanges?
Just as SEBI regulates the stock exchanges. willing to absorb risk Arbitrageur: A type of investor who attempts to profit from price inefficiencies in the market by making simultaneous trades that offset each other and capture risk-free profits
5. Higher Leverage: Get high exposures for the margin provided 4. CME. Prices are pegged to international markets of NYMEX. EXIM Policies like tariff rates.ANS: 1. or the ability to sell it.g. Ahemdabad (NMCE
. thereby increasing lucrative-ness of investment in precious metals
5. No counter party risks 3. What are the major commodity exchanges
A. How do commodity prices move?
Natural Factors: Soil and climatic conditions.
com www.com www.8. How risky are these markets compared to stock & bond markets?
Commodity prices are generally less volatile than the stocks and this has been statistically proven.com www. However all investments are subject to market risk and depend on the individual’s decision
10.karvay.google.indiabulls.sharekhan.wikipedia. only Saturday: 10 am to 2 pm
. which are not intended for delivery. Also the regulatory authorities ensure through continuous vigil that the commodity prices are marketdriven and free from manipulations.com www.m.30 pm (Agri-commodities up to 5 p. Therefore it's relatively safer to trade in commodities. What are the commodity derivatives market timings?
The commodity derivatives timings are: NCDEX & MCX Monday to Friday: 10 am to 11.com Indiainfoline.com www. What are the charges involved in trading on the exchanges
Brokerage Service Tax Transaction Charges: Rs. are settled in cash
BIBLIOGRAPHY Websites: www.4 per lakh on both NCDEX and MCX On NCDEX it is always on 20th of every month On MCX it differs from commodity to commodity All open contracts.
Books.s kothari) Economic times Financial management (paresh shah)
. magazines& newspaper Business times Research methodology(c.