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A PROJECT REPORT
SUBMITED TO THE SCHOOL OF MANAGEMENT
In the partial fulfillment of the requirement for the award of the degree of MASTER OF BUSINESS ADMINISTRATION BY THAMIZH.P Reg.No: 35106212
Under the guidance of Mr.P.SARAVANAN B.B.A., M.B.A., PGDCA, M.Phil. Senior Lecturer
SCHOOL OF MANAGEMENT STUDIES FACULTY OF ENGINEERING AND TECHNOLOGY SRM UNIVERSITY SRM NAGAR, KATTANKULATHUR, KANCHEEPURAM DISTRICT – 603203 MAY 2008
SCHOOL OF MANAGEMENT STUDIES FACULTY OF ENGINEERING AND TECHNOLOGY SRM UNIVERSITY SRM NAGAR, KATTANKULATHUR, KANCHEEPURAM DISTRICT-603203
BONAFIDE CERTIFICATE Certified that this project Report titled “A STUDY ON CUSTOMER PERCEPTION TOWARDS INDIAN CAPITAL MARKET WITH SPECIAL REFERANCE TO KARVY STOCK BROKING LTD” Is a bonafide work of THAMIZH.P(Reg no. 35106212) who carried out the research under my supervision. Certified further that to the best of my knowledge the work reported here in does not form part of any other project or dissertation on the basis of which a degree or award was conferred on an earlier occasion on this or any other candidate.
Signature of the Guide (P.Saravanan)
Signature of Dean/ MBA (Dr. Jayshree Suresh)
The project report “A STUDY ON CUSTOMER PERCEPTION TOWARDS INDIAN CAPITAL MARKET WITH SPECIAL REFERANCE TO KARVY STOCK BROKING LTD”, is a described study were a clear description of the organization working and to know the application of management concepts has How to manage the risk. It consists of analysis and findings of the study of the India Infoline Limited. The report talks about the Risk management. The objective of the study is to understand hedging and speculation through the derivative trading. The scope of the study is limited to the company, methodology followed is to study the company and its market analysis for a period of 3 months i.e., from February to April 2008. Calculation have been made from the information obtained from stock market price of the NSE. Finally the report ends with the finding and analysis of the study done at the company and recommendations given to the management of the company for further improvement of their working.
JAYSHREE SURESH. My sincere thanks to honorable founder and chairman Mr. Manager for their support and encouragement. KATTANKULATHUR for providing all the facilities to carryout the project work. Branch Manager.ACKNOWLEDGEMENT I would like to thank KARVY STOCK BROKING LTD. I extend my thanks to my family and all my friends who helped me in completing this project work successfully.B. SRM UNIVERSITY. who was my project guide. I would also like to thank Mr.A. for all the support and constant feedback on my progress made during the project. for his valuable guidance during the project work. M. I extend my sincere thanks to internal guide Mr. SCHOOL OF MANAGEMENT. PGDCA. my sincere thanks to Dean Mrs. Last but not the least. for giving me this opportunity to be associated with an esteemed organization. SARAVANAN.. M.B. S R M UNIVERSITY. ANAND.A. SENTHIL.Phil. . KATTANKULATHUR In particular.. PACHAMUTHU. which helped me to complete this project successfully. I would especially like to express my gratitude towards Mr.P. B.
.Saravanan..A.B.A.. for the award of the Master of Business Administration is the record of original work done by me under guidance of Mr. PGDCA. Phil. faculty Guide .M.B.. School of Management studies.DECLARATION I.P (35106212) do here by declare that this project “A STUDY ON CUSTOMER PERCEPTION TOWARDS INDIAN CAPITAL MARKET WITH SPECIAL REFERANCE TO KARVY STOCK BROKING LTD” submitted to SRM School of Management Studies.B. and this project work has not formed the basis for the award of any other Degree/Diploma/Associate ship/Fellow ship of the similar title to any other Degree to any other University Place : Kattankulathur Signature of the Student Date: . M.P. THAMIZH.
NO 1 CONTENTS INTRODUCTION Pg.No 1 2 COMPANY PROFILE 15 3 REVIEW OF LITERATURE 23 4 RESEARCH METHODOLOGY 24 5 DATA ANALYSIS & INTERPRETATION 46 6 FINDINGS 95 7 SUGGESTIONS 98 8 CONCLUSION 101 102 9 BIBILOGRAPHY 10 ANNEXURE 103 .TABLE OF CONTENTS CHAPTER.
2 48 5.1 PARTICULARS Age vs. Gender vs.3 50 5.5 54 5.8 60 5.7 Reasons for investing in the stock market Time frame of the investment preferred by the respondent 58 5.4 52 5. purpose of investment in share market. Investor’s perception towards stock market The most preferred sector by the investors Percentage of investor’s savings in stock PAGE 46 5.LIST OF TABLES Table 5.6 market 56 5. Gender vs information they seek for investing in stock market.10 Information based on investments are made in stock market Difficulties faced by the investors 64 66 . risk taking ability of the investors.9 Risk taking ability of the investors 62 which 5.10 5.
1 market from risk.3 market 57 5.10 Information based on investments are made in stock market Difficulties faced by the investors Share Price Movement of ICICI Bank Exponential Moving Average (EMA) for ICICI Bank Relative Strength Index for ICICI Bank 65 66 70 71 5.7 5.2 The most preferred sector by the investors Percentage of investor’s savings in stock 54 5.LIST OF CHART Chart PARTICULARS Investor’s perception towards stock PAGE 5.11 72 .6 Risk taking ability of the investors 63 which 5.4 Reasons for investing in the stock market Time frame of the investment preferred by the respondent 59 5.9 5. return and savings point of view 53 5.5 61 5.8 5.
14 HDFC Bank Relative Strength Index for HDFC Bank Comparison between HDFC bank and NSE index Share price movement for SBI Bank Exponential Moving Average for SBI Bank Relative Strength for SBI Bank Comparison between SBI & NSE Stock price movement on PNB bank Exponential Moving Average for PNB Relative Strength Index for PNB Comparison between PNB & NSE 77 5.16 5.20 5.12 73 PAGE 5.23 5.24 78 79 82 83 84 85 88 89 90 91 .19 5.LIST OF CHARTS Chart PARTICULARS Comparison between ICICI Bank & NSE 5.17 5.22 5.15 5.18 5.21 5.13 Share price movement for HDFC Bank Exponential Moving Average (EMA) for 76 5.
encouraging corporate results. While this is the story of the equity market. There was mild volatility whenever there was news about U. The market today is range bound and not much seems to be happening. There could be inflationary pressures and rising trade deficits. the Government's intent to invest heavily in infrastructure. particularly for the developing countries. and mounting forex reserves. The fresh issue of securities takes place in primary market and trading among investors takes place in secondary market. a strong rupee. 1 . interest rates. Equity investors first enter capital market though investment in primary market. In India. Primary market is also known as new issues market.CHAPTER-1 INTRODUCTION INTRODUCTION OF THE STUDY Capital market can be classified as primary and secondary market. common investors participating in the equity primary market is massive. The Indian capital market saw good growth between May 2003 and January 2004 on the back of good GDP growth. There has been higher volatility more recently because of two things — concerns over fiscal deficit and inflation and rising interest rates in the key world economies.S. a quick look at the debt market shows that huge liquidity and low credit off take kept interest rates down most of the period. The number of companies offering equity through primary markets increased continuously.
A person needs to diversify to optimize returns. The monsoon is expected to be good as also the agriculture growth. on market forces. largely. share prices rise and fall depending. The rupee seems to be holding fine while the forex reserves remain comfortable. quantum of return expected. An economic recession. or financial crisis could eventually lead to a stock market crash. This will involve putting money in equities — choosing the type of equity fund that most suits the risk/return profile and also some money in debt funds. It is now fairly well established that making investments only in one channel does not yield the desired results. On the debt side. Therefore the movement of share 2 . there are indications that interest rates might rise. depression. The combination of equity and debt will depend upon the following factors: — risk orientation. Share prices tend to rise or remain stable when companies and the economy in general show signs of stability and growth. Barometer of the economy At the stock exchange. If this does not happen then the markets could see a choppy period ahead. The markets now seem to be waiting for the Government's moves on the economic front. Indian corporates may continue to show good growth and robustness.As for the emerging scenario India's GDP growth promises to be better than what it is now. Diversification and asset allocation is the new mantra. The equity markets are bound to see a big rally. time horizon and objective of making the investment. The balance sheets of Indian banks are getting stronger.
Gilt-edged Market also known as ‘Government Securities Market’ is the market for government and semi government securities. and the expansion of investor population. An important feature of the securities traded in this market is that they are stable in value and are much sought after banks. The regulatory framework has been strengthened and streamlined in order to tackle effectively the problems associated with the massive growth of the market. the turnover on the stock exchanges. INDIAN CAPITAL MARKET The Indian capital market has undergone phenomenal changes.prices and in general of the stock indexes can be an indicator of the general trend in the economy. 3 . It is further classified as primary and secondary market. The main components of Indian Capital market are Guilt-edged Market and the Industrial Securities Market. The magnitude of growth could be gauged in terms of massive jumps in funds mobilization. The fresh issue of securities takes place in primary market and trading among investors takes place in secondary market. Equity investors first enter capital market though investment in primary market. the amount of market capitalization. Primary market is also known as new issues market.
Indian Capital Market Guilt-edged Market Industrial Securities Market Primary Market Secondary Market INDIAN STOCK MARKET Indian Stock Markets are one of the oldest in Asia. The first stock exchange in India 1894 set up in Mumbai. it was a state subject and Bombay securities Contract Act 1925 used to regulate trading in securities.D. 4 . The earliest records of security dealings in India are meager and obscure. Its history dates back to nearly 200 years ago. The central Legislation was proposed and a committee headed by A.Gorwala went into the Bill for securities regulation. Under this Act. The 1850's witnessed a rapid development of commercial enterprise and brokerage business attracted many men into the field and by 1860 the number of brokers increased into 60. These was organized as voluntary non-profit making associations of brokers to evaluate and protect their interest before the control on securities trading become a central subject under the constitution in 1950. the Bombay stock exchange was recognized in 1927 and Ahmedabad in 1937.
Delhi. or body of individuals where in corporate are not established for the purpose of assisting. Coimbatore. Kutch. Jaipur. organization.The securities contract Act become low in 1956. Ludhiana. shares. A stock exchange is a market where securities i. Vadodara. Bangalore. Meerut. The securities contract act. selling and dealing in securities”. Magadh.e. Industrial Credit and Investment Corporation of India. 5 . Madhya Pradesh.. selected commercial banks and others. Calcutta. 1956. Madras. Mangalore. it was found inevitable to lift the Indian stock market trading system on par with the international standards. all Insurance Corporations. Hyderabad. The two main stock exchanges in India are:• • NSE (National Stock Exchange) BSE (Bombay stock exchange) NSE (National Stock Exchange) With the liberalization of the Indian economy. Industrial Finance Corporation of India. On the basis of the recommendations of high powered Pherwani Committee. Uttar Pradesh. OTC Exchange Of India (Mumbai). Cochin. defines the stock exchange as “an association. the National Stock Exchange was incorporated in 1992 by Industrial Development Bank of India. regulating and controlling of business in buying. debentures and government securities are brought and sold. Pune. Saurashtra. As per April 1998 there were 23 stock exchanges recognized by central Government. They are located in Ahmedabad. Guwahati.
public sector unit bonds. Popularly known as "BSE". commercial paper. treasury bills. There are two kinds of players in NSE: • • Trading members and Participants. It is the first stock exchange in the country to obtain permanent recognition in 1956 from the Government of India under the Securities Contracts (Regulation) Act. SENSEX. Wholesale debt market operations are similar to money market operations institutions and corporate bodies enter into high value transactions in financial instruments such as government securities. certificate of deposit.Trading at NSE can be classified under two broad categories: • • Wholesale debt market and Capital market. Participants include trading members and large players like banks who take direct settlement responsibility. Recognized members of NSE are called trading members who trade on behalf of themselves and their clients. etc. BSE (Bombay stock exchange) Bombay Stock Exchange Limited (the Exchange) is the oldest stock exchange in Asia with a rich heritage.The Exchange's pivotal and pre-eminent role in the development of the Indian capital market is widely recognized and its index. 1956. 6 . it was established as "The Native Share & Stock Brokers Association" in 1875. is tracked worldwide.
The Exchange has a nation-wide reach with a presence in 417 cities and towns of India. 1956. debentures and government securities are brought and sold. The Exchange provides an efficient and transparent market for trading in equity. 1957. 7 . regulating and controlling of business in buying. The surveillance and clearing & settlement functions of the Exchange are ISO 9001:2000 certified. During the year 2004-2005. The systems and processes of the Exchange are designed to safeguard market integrity and enhance transparency in operations. NATURE OF STOCK MARKET A stock exchange is a market where securities i.. selling and dealing in securities”. The securities contract act. or body of individuals where in corporate are not established for the purpose of assisting. debt instruments and derivatives. shares. defines the stock exchange as “an association. The BSE's On Line Trading System (BOLT) is a proprietary system of the Exchange and is BS 7799-2-2002 certified. organization.e. Members of stock exchanges The regulations governing the members of the recognized stock exchanges are uniform in terms of the provisions of the securities contract act. the trading volumes on the Exchange showed robust growth.
000 shareholders are. growth-oriented companies with a paid-up capital of at least Rs. 8 . Less than 21 years. • Engaged as principal or employee in any business other than that of securities.The statutory rules provide that no person shall be eligible to be elected as a member if he is:• • • • • Not an Indian Citizen. Functions The three important functions of secondary markets are • • • Price discovery process which results from the interactions of buyer and sellers in the market when they trade assets. Trading Pattern of the Indian Stock Market Trading in Indian stock exchanges is limited to listed securities of public limited companies. specified\securities (forward list) and non-specified securities (cash list). Member of any other association in India where dealings in securities are carried on. Provisions of liquidity by providing a mechanism for an investor to sell financial assets. put in the specified group and the balance in non-specified group.50 million and a market capitalization of at least Rs. Finally low cost of transactions and information. A judged bankrupt to be insolvent. namely. They are broadly divided into two categories. Equity shares of dividend paying. Convicted of an offence-involving frond.100 million and having more than 20. normally.
the country's first ringless. which affected the small investors to a great extent. Industrial Credit and Investment 9 . electronic stock exchange . unduly long settlement periods and benami transactions. To provide improved services to investors. buy and sell securities on his own account and risk. scripless. The nature of trading on Indian Stock Exchanges are that of age old conventional style of face-to-face trading with bids and offers being made by open outcry.was created in 1992 by country's premier financial institutions . such as. A member broker in an Indian stock exchange can act as an agent. The latter is permitted only in the case of specified shares.Two types of transactions can be carried out on the Indian stock exchanges: (a) spot delivery transactions "for delivery and payment within the time or on the date stipulated when entering into the contract which shall not be more than 14 days following the date of the contract”: and (b) forward transactions "delivery and payment can be extended by further period of 14 days each so that the overall period does not exceed 90 days from the date of the contract". buy and sell securities for his clients on a commission basis and also can act as a trader or dealer as a principal.Unit Trust of India. in contrast with the practice prevailing on New York and London Stock Exchanges. absence of liquidity. lack of transparency. where a member can act as a jobber or a broker only. Over The Counter Exchange of India (OTCEI) The traditional trading mechanism prevailed in the Indian stock markets gave way to many functional inefficiencies.OTCEI . The brokers who carry over the outstanding pay carry over charges (cantango or backwardation) which are usually determined by the rates of interest prevailing.
Industrial Finance Corporation of India. SBI Capital Markets. Securities traded on the OTCEI are classified into:• Listed Securities . 10 . General Insurance Corporation and its subsidiaries and CanBank Financial Services.The shares and debentures of the companies listed on the OTC can be bought or sold at any OTC counter all over the country and they should not be listed anywhere else • Permitted Securities . Trading at OTCEI is done over the centres spread across the country.Corporation of India. Industrial Development Bank of India.Any equity holding at least one lakh debentures of particular scrip can offer them for trading on the OTC.Certain shares and debentures listed on other exchanges and units of mutual funds are allowed to be traded • Initiated debentures .
STATEMENT OF PROBLEM Capital Market Capital market is generally classified in to two Markets. 11 .2. The Statement of Problem is • To analyze investor’s perception towards the Indian capital market.1. They are • Primary Market • Secondary Market The fresh issue of securities takes place in primary market and trading among investors takes place in secondary market.
Secondary Objectives: • • To determine the most preferred sector by the investors.1.3 OBJECTIVES OF THE STUDY Primary Objectives: • • • To analyze investor’s perception towards the Indian capital market. 12 . To study the difficulties faced by investors while investing in stock market. • To find whether the continuous boom witnessed by bank sector will continue in current year. To measure the risk taking ability of investors. To evaluate the performance of banking sector using technical and fundamental analysis.
13 . SCOPE OF THE STUDY • • • The study covers the investors of Chennai. • The study gave an understanding of the investor’s perception towards stock market. • The study also helps us to know the performance of banking sector in the future. investment objective and risk taking ability of common investors.1. It helped in determining the saving habit.4. The study provided an insight into various problems faced by the investors while investing in the stock market. The study helps to know about the objective of investments in the stock market. • The study also helped to evaluate the most preferred sector by the investor for making investment.
1.depth study of each bank was not done due to time constraint. • All the banks would not be studied. because all of them are not listed in Nifty 50.5. • It should be noted that there is possibility for the share price to undergo changes from time to time on account of changes in the trading frequency of stocks. 14 . • In. The respondents were reluctant to disclose their personal decisions on investments. market factors including regulatory changes in the stock market. LIMITATIONS OF THE STUDY • • Due to geographical constraint only the investors in Chennai were surveyed.
is a premier integrated financial services provider. IPOs. In January 1998.CHAPTER-2 COMPANY PROFILE KARVY. Karvy became the first Depository Participant in Andhra Pradesh. With a network of 12 branch offices and 64 services centers across the country. Depository Participants. Insurance Broking. and more importantly. KARVY covers the entire spectrum of financial services such as Stock broking. operations. Karvy has a professional management team and ranks among the best in technology. placement of equity. The company has handled more of public issues that any other registrar in the country. services over 16 million individual investors in various capacities. Commodities Broking. taking the investor as customer for a faster and better service. 15 . bonds. fixed deposit. in research of various industrial segments. The company has come across many challenges and it has met the challenges successfully since its inception. Karvy began its journey 15 years back with total service approach. and provides investor services to over 300 corporate. Merchant Banking & Corporate Finance. Distribution of financial products like mutual funds. Personal Finance Advisory Services. among others. Karvy has built up relationships with over 16 million investors & acting on behalf of over 175 corporate clients. and ranked among the top five in the country in all its business segments.
Over the past one and half decades. enterprising and technology driven organization which will set the highest standards of business and service ethics. finance and people. by combining its human and technological resources. professional integrity and vision helped Karvy attain a leadership position in its field when it handled the largest number of issues ever handled in the history of the Indian stock market in a year.A decade of commitment. To ensure consistency in its service delivery. In the process. Karvy also strives to exceed Customers’ expectations. Karvy aims for complete customer satisfaction. Karvy has evolved as a veritable link between industry. Peat Marwick and incidentally. Karvy is the first certified company in India in their line of business. Karvy embarked upon the ISO 9002 certification exercise. MISSION To be a leading and preferred service provider to the customer. and aim to achieve the leadership position by building an innovative. to provide superior quality financial services. 16 . To achieve and retain leadership. This exercise has helped them in identifying redundancies and streamlining the operations. The registration audit was carried out by KPMG.
SERVICES OFFERED BY KARVY They offer various services such as:• • Corporate Registry services Stock Broking services 17 . • Use state-of-the art information technology in developing new and innovative financial products and services to meet the changing needs of investors and clients. • Strive to be a reliable source of value-added financial products and services and constantly guide the individuals and institutions in making a judicious choice of same. • Provide high quality of work life for all its employees and equip them with adequate knowledge & skills so as to respond to customer's needs.QUALITY OBJECTIVES The Quality Policy of Karvy is to:• Build in-house processes that will ensure transparent and harmonious relationship with its clients and investors to provide high quality of services. • Establish a proper relationship with its investor service agents and vendors that will help in keeping up its commitments to the customers. • Continue to uphold the values of honesty & integrity and strive to establish unparalleled standards in business ethics.
• • • • • • • • • • Financial Product Distribution Corporate Financial services Depository Participant Services IT enabled Services Mutual Fund Investor Servicing Investment banking Shareholder Servicing Personal finance Advisory Services Debt Market Services Global Services IMPORTANT CLINTELE • • • • • • • • • Reliance Industries Indian Oil Corporation IDBI LIC Mutual fund Hindustan Lever Principal Mutual Fund Marico Industries Patni Computers Morgan Stanley 18 .
I -Merchant banker. However. the task of selecting the most suitable scheme gets even more complicated. A Category. Mutual Fund Investment Advisor Investment is the stepping stone to achieving one's financial dreams. First ISO . 19 .I -Registrar to Public Issues. with more and more funds flooding the market. Handled the largest. Handled over 700 Public issues as Registrars. A Category. • • First Depository Participant from Andhra Pradesh. Handling the Reliance Account which accounts for nearly 10 million account holders. Mutual funds offer an opportune way to long-term wealth creation. Largest independent distributor of financial products. Mutual Fund Advisory Service at Karvy guides you through this maze and ensures that your investments are backed by our quality research.ACHIVEMENTS • • • • • • • • Largest mobilize of funds as per PRIME DATABASE.ever Public Issue – TCS. Ranked as “The Most Admired Registrar" by MARG.9002 Certified Registrar in India.
spanning the length and breadth of India. With Indian markets seeing a sea change. 20 . strategy reports etc.) Customized mutual fund portfolios Portfolio revision (depending on changing market outlook and evolving trends) Access to online consolidated portfolio statement About KARVY Insurance Broking Ltd. It proposes to cater all advice to its customer pertaining to personal finance. insurance is no more seen as only a tax saving product but also as a product which provides a financial solution for the customer. With the opening up of the insurance sector. KARVY Financial Planning. KARVY has recently launched its personal financial planning wing. Our wide national network. we are in a position to provide holistic and tailor made policies for different segments of customers. further supports these initiatives. Our strengths include personalized service provided by a dedicated team committed in giving hassle-free service to the clients. high net-worth clients and corporates. both in terms of investment pattern and attitude of investors.Products of 33 AMCs are:• • • • Research reports (existing funds & NFOs. (KIBL) At KIBL we provide both life and non-life insurance products to retail individuals. About KARVY Financial Planning In its ambition to emerge as a complete financial advisor.
Tax free retirement planning. Preparation of theme based reports on important events like Pre budget expectations. This service inter-alia includes the following: • • • Investment planning. Budget analysis. Other innovative strategies on tax planning. New Economic survey etc. 21 .With India emerging as a strong market." KARVY as an Income Tax Advisor In line with KARVY’s ambition of emerging as a personal finance advisor. Personalized assistance in the context of salary structuring. the investments avenues have also increased. we are now launching a tax advisory module. Tax planning. • • • • Regular strategy reports through a fortnightly tax refresher called HUM TUM. to advice our customers the right avenue according to their suitability Our vision is "To cater to the unique needs and requirements of the mass affluent by providing complete financial solutions and thereby enabling them to transform their dreams into reality. thereby providing assistance with respect to personal income tax planning.
Financial Institution Bonds. State Development Loans. In return. both taxable and tax-free. promoters. In a book building offer. tentative issue price etc.Fixed Income Securities & Trading (K-FIST) Products - Central Government securities. the company gives the share to the investors in the company . and Bank bonds of SLR/Non-SLR category. background. the Lead managers decide the price of the issue. State Guaranteed bonds.Initial Public Offer An IPO is a means of collecting money from the public by a company for the first time in the market to fund its projects. It is filed by the Lead Managers with the Securities & Exchange Board of India (SEBI) to provide issue details. the syndicate members decide the indicative price range and the investors decide the price of the issue through a tender method. A draft prospectus provides the information on the financials of the company. 22 . Public Sector Undertaking Bonds. The final prospectus is printed after obtaining the clearance from SEBI and the Registrar of Companies (ROC).In an IPO. IPOs .
encouraging corporate results.CHAPTER-3 REVIEW OF LITERATURE Equity investors first enter in to capital market though investment in primary market. In India. time horizon. quantum of return expected. 23 . The number of companies offering equity through primary markets increased continuously. The study also identifies risk orientation. They also consider market price as a better indicator than analyst recommendations. The study also attempts to find out the most preferred sector by the investors. the Government's intent to invest heavily in infrastructure. The Indian capital market saw good growth between May 2006 and January 2007 on the back of good GDP growth. objective of making the investment and the difficulties faced by the investors in capital market. The market today is range bound and not much seems to be happening. It appeared from the analysis that the investors give more importance to broker’s advice then any other source of information. and mounting forex reserves. a strong rupee. The study concentrates on the investment decisions taken by the investors while investing in capital markets. common investors participating in the equity primary market is massive.
a research design is “the logical and systematic planning and directing a piece of research.CHAPTER-4 RESEARCH METHODOLOGY RESEARCH refers to the systematic method of enunciating the problem formulation of the hypothesis. It deals with cognitive processes imposed on research by the problems arising from the nature of its subject matter”. the correlation study which investigates the relationship between variables to developmental studies seek 24 . According to Pavline Young (1949). collecting the facts or data analyzing the facts and reaching conclusions towards the concerned problem. The method uses the survey which describes the status quo. RESEARCH DESIGN Research design is the plan structure and the strategy of investing conceived so as to obtain answer to research questions and to control variance. NATURE OF STUDY Descriptive Research Descriptive research is used to obtain information concerning the current status of the phenomena to describe “what exists” with respect to variables or conditions in a situation. METHODOLOGY is defined as “the study of methods by which we gain knowledge. translating a general scientific model to a varied research procedure”. The design according to her is the result.
to determine changes over time. The primary data are collected with specific set of objective to assess the current status of any variable studied. Primary Data Primary data is the data that is collected for the first time by the researcher. Data Collection Method Data refers to information or facts. 25 . The information has been collected by conducting a survey amongst the various retail investors available in Chennai. Primary data is useful only particular period. such as primary data and secondary data. in my study analytical research is used to evaluate the Beta behavior of the securities and the investments of the portfolio. Analytical Research Analytical research is designed to analyze the facts/information already available to make a critical evaluation of the material. The method of data collection includes two types for the study. Thus. The information for doing this research is collected from the NSE website. It is not only refers numerical figures but also includes descriptive facts. Primary data has been collected by conducting a survey among the various investors available in Chennai.
The secondary data required for the study was obtained from already available data in different sites like nseindia. Secondary Data For the secondary data the sample size was: Banks listed in Nifty 50.Secondary Data Secondary data is the data collected from the already available data which is well structured and organized. Sampling Technique Primary Data For the primary data the sampling method used was convenience sampling. Sampling Unit Primary Data Retail investors in Chennai. etc. A convenience sample is obtained by selecting ‘convenient’ population units. 26 . amfi. Sample Size Primary Data For the primary data the sample size collected was 250.com. moneypore. Secondary Data Banks listed n the S&P CNX NIFTY for the period of 5 years (Jan 2003 – Dec 2007).com.com.
which have been listed in the NSE for over a period of five years and information on their share prices were already available. The sampling technique was based on the information available on stock prices over the past five years. NSE index NIFTY is used to calculate market returns. Hence this sample is used for the comparative study.com Website.nseindia. Tools for Analysis Primary Data • • • • • Simple Percentage Calculation Weighted Average Calculation Chi-Square Test Pie charts Bar diagrams Secondary Data • • • • Technical analysis Fundamental analysis Candlestick method Exponential Moving Average 27 . The sample includes four banks.Secondary Data Closing price of each company’s share price for the past five years is downloaded from www.
com • Tools Used : Fundamental analysis. relative strength index. exponential moving average. Pie charts and Bar diagrams Secondary Data • • • Nature of Data Sample Size Method of Data Collection : Secondary data : Four banks listed in Nifty 50 : Secondary data collection –closing price of each bank’s share price for the past five years is down loaded from www.nseindia. candlestick chart. technical analysis. 28 . Weighted Average Calculation.Square Test.IN SHORT THE RESEARCH METHODOLOGY ARE Primary Data • • • • • • Sample Size Sampling Unit Sampling Type : 250 : Retail investors of various branches in Chennai : Descriptive Sampling Method : Convenient sampling Contact Method Tools Used : Personal interview & Telephonic Interview : Simple Percentage Calculation. and Chi .
This is an attractive feature of investing in stocks. tend to be associated with increased business investment and vice versa. The liquidity that an exchange provides affords investors the ability to quickly and easily sell securities. Rising share prices. thus believed to be a good way of getting good returns. Investment equities. or raise additional capital for expansion. central banks tend to keep an eye on the control and behavior of the stock 29 . it could be encashed very quickly. Therefore. it has the benefit of liquidity that is. Share prices also affect the wealth of households and their consumption. IMPORTANCE OF STOCK MARKET Function and Purpose The stock market is one of the most important sources for companies to raise money. History has shown that the price of shares and other assets is an important part of the dynamics of economic activity. for instance. Secondly. compared to other less liquid investments such as real estate. unlike other assets classes. it is preferred by millions of people world over.THEORY Why Investors Prefer to Invest in Share Market? Investment in equities is one of the asset classes that bring better returns over Years Company to investment in bullion and real estate apart from conservative form of investments in fixed deposits etc. This allows businesses to go public. Thirdly though investment in equities is risky. and can influence or be an indicator of social mood.
• • • • • • • • Uncertainty and changing market prices No Guarantee of Profits Problems in dealing with brokers Oversubscription of new issues Need for constant Watch Correct Timing Uncertain Government Policies Seeking professional guidance 30 . Exchanges also act as the clearinghouse for each transaction. on the smooth operation of financial system functions. Financial stability is the raison d'être of central banks. and guarantee payment to the seller of a security. in general. In this way the financial system contributes to increased prosperity.market and. This eliminates the risk to an individual buyer or seller that the counterparty could default on the transaction. 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. disadvantages and problems associated with investment in shares. Disadvantages There are some difficulties. meaning that they collect and deliver the shares.
The system aims to work on the market trend mechanism and take benefit from both sides of the market enjoying the profits from the ups and downs of the stock market.Recent Trend in Share Market Generally. Considerations Price One of the first rules of trend following is that price is the main concern. trend following is an investment strategy that tries to take advantage of long-term moves that seem to play out in various markets. they simply jump on the trend and ride it. Traders who subscribe to a trend following strategy do not aim to forecast or predict markets or price levels. trend following is the imitation of what is the current fashion also called trend. Traders who use this approach can use current market price calculation. moving averages and channel breakouts to determine the general direction of the market and to generate trade signals. In finance. The current price and only the price tell you what the market is doing. not what the market might do. A trader need only be worried about what the market is doing. 31 . Traders may use other indicators showing where price will go next or what it should but as a general rule these should be disregarded.
Another decisive factor of trend following is not the timing of the trade or the indicator, but rather the decision of how much to trade over the course of the trend.
A cut loss is the rule. This means that during periods of higher market volatility, the trading size is reduced. During losing periods, positions are reduced and trade size is cut back. The main objective is to preserve capital until more positive price trends reappear.
Trend following should be systematic. Price and time are pivotal at all times. This technique is not based on an analysis of fundamental supply or demand factors.
Trend Following answers the questions:• • • • •
How and when to enter the market. How many contracts or shares to trade at any time. How much money to risk on each trade. How to exit the trade if it becomes unprofitable. How to exit the trade if it becomes profitable.
In investing, financial markets are commonly believed to have market trends that can be classified as primary trends, secondary trends (short-term), and secular trends
(long-term). This belief is generally consistent with the practice of technical analysis and broadly inconsistent with the standard academic view of financial markets, the efficient market hypothesis. That market prices do move in trends is one of the major assumptions of technical analysis, and the description of market trends is common to Wall Street.
Market trends are described as periods when bulls (buyers) consistently outnumber bears (sellers), or vice versa. A bull or bear market describes the trend and sentiment driving it, but can also refer to specific securities and sectors.
Primary market trends
A bull market tends to be associated with increasing investor confidence, motivating investors to buy in anticipation of further capital gains. The longest and most famous bull market was in the 1990s when the U.S. and many other global financial markets grew at their fastest pace ever.
In describing financial market behavior, the largest group of market participants is often referred to, metaphorically, as a herd. This is especially relevant to participants in bull markets since bulls are herding animals. A bull market is also described as a bull run. Dow Theory attempts to describe the character of these market movements.
Secondary market trends
A secondary trend is a temporary change in price within a primary trend. These usually last a few weeks to a few months. A temporary decrease during a bull market is 33
called a correction; a temporary increase during a bear market is called a bear market rally. Whether a change is a correction or rally can be determined only with hindsight. When trends begin to appear, market analysts debate whether it is a correction/rally or a new bull/bear market, but it is difficult to tell. A correction sometimes foreshadows a bear market.
Risk in a Traditional Sense
Risk in holding securities is generally associated with the possibility that realized the return will be less than the returns that are expected. The source of such disappointment is the failure of dividends (interest) and / or the security’s rice to materialize as expected.
Forces that contribute to variation in return- price or dividend- constitute elements of risk. Some influences are external to the firm, cannot be controlled, and affect large numbers of securities. Other influences are internal to the firm and controllable to a large degree. In investments, those forces that are uncontrollable, external, and broad in their effect are called Source of Systematic Risk. Conversely, controllable, internal factors somewhat peculiar to industries and /or firms are referred to as Sources of Unsystematic Risk.
Systematic Risk refers to that portion of total variability in return caused by factors affecting the prices of all securities. Economic, political and sociological changes are sources of systematic risk. 34
If he expects the security's price to rise. TECHNICAL ANALYSIS Technical analysis is the study of price using charts in order to "anticipate" their future performance. Unsystematic factors are largely independent of factors affecting securities markets in general. Because these factors affect one firm they must be examined for each firm. Technical analysis isn't a crystal ball that predicts the future.Unsystematic Risk is the portion of total risk that is unique to a firm or industry. Sentiment drives the market The price at which an investor is willing to buy or sell depends primarily on his expectations. Technical analysis is really a study of past or historical price and volume movements so as to predict the future stock price behaviour. but it is an investing strategy that helps to spot stock patterns that have the potential to make huge moves. he will sell it. The basic premise of technical analysis is that price moves in trend or waves which may be upward or downward. It is believed that present trend are influenced by the past trends and that projections of future trend is possible by an analysis of past price trends. consumer preferences. he will buy it. it 35 . As any trade requires a buyer and seller. Factors such as management capability. and labor strikes cause systematic variability of return in a firm. The market can go up or down at any time. it is only the probability (of each move) that varies. if the investor expects the price to fall.
This includes FII inflows. In other words. analyst reports. crude oil. The collective majority of market participants ultimately decide the direction of the stock price and the market. monthly charts) and across equities. gold. it makes sense to study price movements. Since everything about a stock is reflected in the price. "what is happening" is more important than "why it is happening”. Price reflects everything Price is a function of demand and supply and nothing else. The price of a stock reflects everything about the stock. weekly. daily. government policies. balance sheets. politicians and their antics and whatever you may care add. Trying to identify the "why" is an exercise in futility. 36 . One can arrive at any number of reasons depending on how many "experts" you choose to listen to. impact of crude and interest rates. Different people have varying degrees of access to this information and form their own perception (rightly or wrongly) . aluminum etc). commodities (rice.automatically means they have entirely opposite views on the stock.this ultimately decides the current price of the stock. The beauty of technical analysis is that it applies to all time frames (intraday.
bearish or flat. There are always corrections (in bullish markets) and pullbacks or relief rallies (in bearish markets). we can always be on the "right" side of the market.. Take the following chart. By identifying trends and reversals.. Markets are either bullish. a trend is in effect till it is reversed. A trend can be bullish. This is the most basic chart. However markets never go up or down in a straight line. we can enter and exit trends at the correct time and earn excellent profits with minimum risks.") from analytical decisions. the persistence of a security's price to move in a particular direction. Line charts are plotted using the "closing" price of the stock. 37 . The red line represents the 50 day moving average (DMA). or bearish or flat. Also. A simple look reveals that the stock has been in an uptrend and has minor corrections from time to time. Trend analysis will also discourage you from going short in a bullish market or going long in a bearish market What is a trend A trend is simply. Trend analysis helps distinguish emotional decisions ("I think it's time to sell. ("I will hold until the current rising trend is broken").The easiest and safest way to earn excellent profits consistently is to simply follow the trend and trade By following the trend.
38 . The opening price and the closing price of the day which would fall between the highest and the lowest price would be represented by a rectangle so that the price bar chart looks like a candlestick. The highest price and the lowest price are joined by vertical bar. the lowest price. the highest price.Japanese Candlesticks Chart Japanese Candle sticks (a 300 year old Japanese technique) give the same information as a bar but are visually easier to read. Blue candles means stock closed higher relative to the previous close. In this chart. Red candles mean stock closed lower relative to the previous close. the opening piece and the closing price of the share on a day-to-day basis.
39 . Moving averages are not "predictive" but are "lagging" indicators as a time delay is always present. Blue candlestick indicated a bullish trend and the red indicates a bearish trend. the blue. When the stock cuts the MA from above. the red and the doji or neutral candlestick. A doji candlestick is one where the closing price and the opening of the day are same. Moving averages are an extremely simple and convenient way to trade. One should remain long as long as the stock remains above the MA. A black candlestick is used when the closing price of the day is lower than the opening price.There are three types of candlestick. The moving average removes emotions from the stock. A blue candlestick is used is represent a situation where the closing price is higher than the opening price. They are excellent in strongly trending markets but are practically useless in sideways markets as they tend to generate too many whipsaws. it indicates exit position. Moving averages provide an excellent way to identify trends or confirm reversals.
Overbought means great strength. In an uptrend. As one can see from the chart. Oversold means great weakness. 40 . It is normal for a stock to remain overbought for considerable periods of time. It is normal for a stock to remain oversold for considerable periods of time.The chart below has 20 DMA (grey). Sometimes. Oversold and overbought stocks Interpretation of this is difficult and should be done in the context of the prevailing trend. This means the stock is rangebound and the direction will be clear only a break out of the trading range. 50 DMA (red) and 200 DMA (blue). the 20 DMA has generated the highest whipsaws while the 200 DMA has only given a hold (in relation the timeframe). It does NOT mean stock will rally immediately. the moving average will give a "whipsaw" or false buy / sell signals. It does NOT mean stock will correct immediately.
one should exit overbought stocks (sell on rallies). negative or zero. One should buy a share that is oversold and sell a share that is over brought. 41 . They help to identify overbought and over sold conditions and also the possibility of the trend reversal.oversold stocks present a good buying opportunity near supports (buy on declines). the overbought zone is above the zero line and oversold zone is below the zero line. while a downside crossing indicates selling opportunities. Rate of Change Indicator It is a very popular oscillator which measures the rate of change of the current price as compared to the price of a certain number of days or weeks back. Oscillators Oscillators are mathematical indicators calculated with the help of the closing price data. Upside crossing indicates buying opportunities. each day’s price is dividend by the price which prevailed 7 days ago and then 1 is subtracted from the price ratio. In ROC chart. In a downtrend. These indicators are called oscillators because they move across a reference point. ROC has to be used along with the price chart. The ROC values may be positive. To calculate a 7 day rate of change. The buying and the selling signals indicated by the ROC should also be confirmed by the price chart. Many analysts use the zero line for identifying buying and selling opportunities.
ROC is calculated by using the following formula:- ROC = Current Price Price ‘n’ period age -1 Relative Strength Index (RSI) This is the most commonly used time period for the calculation of RSI I 14 days. Similarly losses are added up and divided by 14 to get the average loss per day. For calculation a 14 days RSI. the concept of trailing stoplosses is used. 42 . the gain per day or loss per day or loss per day is arrived at by comparing the closing price of a day with that of the previous day for a period of 14 days. RSI is calculated by using the following formula:- RSI = Average gain per day Average loss per day Buy and Sell signals These are generated using custom designed swing trading algorithms. As one can never know with certainty the extent of gains or losses. The gains are added up and divided by 14 to get the average gain per day.
Obviously a 2 day swing will generate more signals than a 20 day swing. whipsaws and false signals All technical indicators will fail in range bound stocks / markets and will generate whipsaws and false signals. At this point. A break above a "peak" gives a resistance break. 43 . it means the stock is range bound.If a stock is in a downtrend. These levels form the basis for calculation of targets. The methodology is similar moving averages / crossovers. Similarly a break below a "trough" generates a support break. The advantage is reduced whipsaws and more efficient stoplosses. Rangebound trades. Only a break above these levels will create a new trend. a buy signal is generated if the stock closes above its "N" days highest high. The trailing stoploss is the "N" days lowest low and will change everyday till an exit is given. Here "N" refers to 2 or 5 or 20 days. Whenever a swing trade results in a loss. For best results. use the 2 day or 5 day swing to buy only if the stock is trading above the 20 day swing low. Support and Resistance levels / targets This is nothing but a "peak" and "trough" based on 5% change. one should study the chart and identify areas of support and resistance.
At the time of liquidation. the growth rate and the risk exposure of the company have a direct bearing on the share . The ratio is calculated by dividing net profit after tax and dividend by number of outstanding shares. 44 . debentures holders and preference shareholders. The valuation ratio provides a comprehensive measure of the performance of the firm itself.FUNDAMENTAL ANALYSIS The earnings of the company. The value of the share depends on the performance of the firm and the market factors. BVP can be calculated as:- BVP= Equity share capital + Reserve Total number outstanding of equity shares Earnings per Share (EPS) Earnings per share is the earnings after tax dividend by number of common shares outstanding.The shareholders are interested in assessing the value of the shares. Book Value per Share (BVP) This ratio indicates the share of equity shareholders after the company has paid all its liabilities. the shareholders can know what remains after making all the payments. creditors.
It’s the multiplying factor that the market is willing to offer to the company’s future earning. It relates the share price with earnings per share.EPS can be calculated as:- EVP = Earnings After Tax Number of share outstanding Price Earning Ratio (P/E) One of the most common financial parameters used in the stock market is the price earning ratio. Most of the news papers along with the stock price quotations give the P/E ratio too. P/E ratio can be calculated as:- Price Earning Ratio = Market price per share Earnings per share 45 .
CHAPTER-5 DATA ANALYSIS AND INTERPRETATION CHI-SQUARE TEST-1 Background A survey had been conducted among the investors of various branches and question were asked to determine if there was a relationship between the age group of the investors and purpose of investment in share market. purpose of investment in share market Capital Appreciation Age Savings Liquidity Dividend TOTAL 18-40yrs 50 25 85 5 165 41-60yrs 60yrs& Above 15 10 35 5 65 5 5 5 5 20 TOTAL 70 40 125 15 250 46 . TABLE-5.1 Table showing age vs. ALTERNATE HYPOTHESIS-H1: There is significance difference between the age group of the investors and purpose of investment in share market. NULL HYPOTHESIS -HO: There is no significance difference between the age group of the investors and purpose of investment in share market.
4 -0.4 1. There is significance difference between the age group of the investors and purpose of investment in share market. 47 .592 INFERENCE: As the calculated value is more than table value.0125 0.1 3.015384615 1.425252525 0.5 -5 -4.6 -1.2 18.9 1.2 82.075757576 0.8 [[O(i)-E(i)]^2]/E(i) 0.CALCULATION: Observed Frequency O(i) 50 15 5 25 10 5 85 35 5 5 5 5 TOTAL Expected Frequency E(i) 46. null hypothesis H0 is rejected.064285714 0.2 5.074242424 0.31025641 12.6 26.9 3.4 10.57851177 RESULT: Calculated Value Degree Of Freedom Table Value @ 5% Significance 19.312554113 0.9 1.192307692 2.8 -3.03333333 19.562637363 0.2 O(i)-E(i) 3.4 3.2 -0.5 32.5 2.5 2.8 2.57851 6 12.5 10 9.
NULL HYPOTHESIS . Newspapers.2 Table showing gender vs information they seek for investing in stock market.HO: There is no significance difference between the gender and information they seek before investing in the stock market. Information Male Female TOTAL Brokers 45 30 75 TV.H1: There is significance difference between the gender and information they seek before investing in the stock market. TABLE-5. ALTERNATE HYPOTHESIS .CHI-SQUARE TEST-2 Background A survey had been conducted among the investors of various branches and question were asked to determine if there was a relationship between the gender and information they seek before investing in the stock market. internet 40 15 55 Self analysis 40 20 60 Colleagues & Friends 40 20 60 TOTAL 165 85 250 48 .
409090909 0.4 0. 49 .7 -0.732085561 0.7 20.4 4. There is no significance difference between the gender and information they seek before investing in the stock market.5 18.4 0.336196186 Degree Of Freedom 3 Table Value Significance @ 5% 7.377134986 0.CALCULATION: Observed Frequency O(i) 45 40 40 40 30 15 20 20 Total Expected Frequency E(i) 49.4 O(i)-E(i) [[O(i)-E(i)]^2]/E(i) -4.794117647 0.5 -3.815 INFERENCE: As the calculated value is less than table value.004040404 0.336196186 RESULT: Calculated Value 2.6 39. null hypothesis H0 is accepted.007843137 2.5 36.004040404 0.7 0.3 39.4 -0.007843137 0.6 25.5 3.4 20.
risk taking ability of the investors.HO: There is no significance difference between the gender and risk taking ability of the investors. TABLE-5. NULL HYPOTHESIS . Risk Male Female TOTAL <10% 50 30 80 25% 60 20 80 50% 15 5 20 Not at all 40 30 70 TOTAL 165 85 250 50 .CHI-SQUARE TEST-3 Background A survey had been conducted among the investors of various branches and questions were asked to determine if there was a relationship between the gender and risk taking ability of the investors.3 Table showing gender vs. ALTERNATE HYPOTHESIS .H1: There is significance difference between the gender and risk taking ability of the investors.
8 13.8 -6.148484848 0. There is no significance difference between the gender and risk taking ability of the investors.905882353 0. null hypothesis H0 is accepted.8 7.61512605 6.288235294 1.476470588 1.2 27.8 -2.8 -7.2 -1.2 6. 51 .245454545 0.493506494 3 5% 7.2 1.2 46.2 0.8 52.CALCULATION: Observed Frequency O(i) Expected Frequency E(i) O(i)-E(i) [[O(i)-E(i)]^2]/E(i) 50 60 15 40 30 20 5 30 Total 52.8 6.832034632 0.493506494 RESULTS: Calculated Value Degree Of Freedom Table Value @ Significance 6.2 27.8 23.815 INFERENCE: As the calculated value is less than table value.2 2.981818182 0.
86 2 Savings point of view 2. TABLE-5.4 Table showing investor’s perception towards stock market Rank Perception Weighted Average 1 Return point of view 2.80 3 Risk point of view 2. return and savings point of view. From savings point of view 35% of the respondent consider stock market as a good option.INVESTOR’S PERCEPTION TOWARDS STOCK MARKET Background: A survey had been conducted among the retail investors of various branches and question were asked to determine their perception towards stock market from risk. 52 .36 INFERENCE: On the basis of weighted average method it has been found that the majority of the respondents (36%) consider stock market is a best avenue for investment from return point of view. Only 29% view it from risk point of view.
return and savings point of view 29% 36% Return point of view Savings point of view Risk point of view 35% 53 .CHART-5.1 Chart showing investor’s perception towards stock market from risk.
08 2.54 0. IT (18%). Its clear that majority of them prefer banking sector (52%) followed by Oil & Gas (44%).30 INFERENCE: The above table shows the top eight sectors from investor’s point of view. Infrastructure (34%).SECTOR Background A survey had been conducted among the retail investors of various branches and question were asked to determine the most preferred sector by them.7 0.16 3.5 Table showing the most preferred sector by the investors Rank 1 2 3 4 5 6 7 8 Sector Banking Oil & gas Construction Infrastructure Steel I. Automobiles (16%) and others (30%).T Automobile Others Weighted Average 4.28 1. Other sector includes FMCG.88 0. TABLE-5.Steel (22%). Retail. Construction (38%). Cement and Pharmaceutical. 54 .32 0.
T l St ee on nk in ga tu r i le ob c ti uc l& t ru Oi Co ns ra In f Au to m Ba s tr Ot he rs g s e 55 .88 0.5 2 1.2 Chart showing the most preferred sector by the investors 4.5 4 3.54 0.3 I.5 3 2.28 1.16 3.5 1 0.08 2.7 0.5 0 4.CHART-5.32 0.
6 Table showing the percentage of investor’s savings in stock market Saving Percentage In stock market <10% 11-30% 31-50% 50% & above Not at all investing Total No. of Respondents 75 70 35 15 55 250 Percentage (%) 30 28 14 6 22 100 INFERENCE: It is inferred from the above table that 30% of the investors invest less than 10% of their in share market. 56 . Only 6% invest above 50% in the share market. TABLE-5. 22 % do not invest in the market.PERCENTAGE OF INVESTOR’S SAVING IN STOCK MARKET Background A survey had been conducted among the retail investors of various branches and question were asked to determine their percentage of savings in stock market. However. 28% of them invest 11-30% and 14% of them invest 31-50% of their savings in share market.
CHART-5.3 Chart showing the percentage of investor’s savings in stock market 80 70 60 50 40 30 20 10 0 75 70 55 35 15 <10% 11-30% 31-50% 50% & above Not at all investing savings in share market 57 .
While 28% of them invest for saving purpose and 16% for liquidity. Only 6% invest for earning dividend.7 Table showing various reasons for investing in the stock market Reason for investing in share market No.REASON FOR INVESTING IN STOCK MARKET Background A survey had been conducted among the retail investors of various branches and question were asked to determine different factors based on which they save in the stock market TABLE-5. 58 . of Respondents Percentage (%) Savings Liquidity Capital Appreciation Dividend Total 70 40 125 15 250 28 16 50 6 100 INFERENCE: Above table shows that majority of the (50%) investors invest in stock market for capital appreciation.
4 Chart showing various reasons for investing in the stock market Savings 6% 28% Liquidity Capital Appreciation 50% 16% Dividend 59 .CHART-5.
TABLE-5. of Respondents Percentage (%) Short term Medium term Long term Total 125 75 50 50 30 20 250 100 INFERENCE: The table shows that 50% of the respondents prefer short-term investment in the stock market.8 Table showing the time frame of the investment preferred by the respondent Time frame of the investment preferred by the respondent No. and only 20% of the investors prefer long term. 60 .TIME FRAME OF THE INVESTMENT PREFERRED BY THE INVESTORS Background A survey had been conducted among the retail investors of various branches and question were asked to determine the term of investment they prefer. While 20% of them would like to go for medium term.
5 Chart showing the time frame of the investment preferred by the respondent 20% 50% 30% Short term Medium term Long term 61 .CHART-5.
While 28% of then will bear 10% of risk. Only 8 % of them are ready to take more than 50% of risk. of Respondents Percentage (%) 10% 25% 50% Not at all Total 70 90 20 70 250 28 36 8 28 100 INFERENCE: The above table shows that majority of the investors (36%) will take 25% of risk on their invested capital. However. TABLE-5. 62 .9 Table showing the risk taking ability of the investors Risk No. 28% of the investors are not ready to take any risk on their invested capital.RISK TAKING ABILITY OF THE INVESTORS Background A survey had been conducted among the retail investors of various branches and question were asked to determine risk-bearing capacity.
CHART-5.6 Chart showing the risk taking ability of the investors 10% 28% 28% 25% 50% 8% 36% Not at all 63 .
of Respondents Percentage (%) Brokers Self analysis TVchannels. Newspapers& Internet Colleagues & Friends Total 70 60 60 28 24 24 60 250 24 100 INFERENCE: The table shows that 28% of the respondents will seek stockbroker’s advice before investing in stock market.\INFORMATION BASED ON WHICH INVESTMENTS ARE MADE IN THE STOCK MARKET Background A survey had been conducted among the retail investors of various branches and question were asked to determine whose advice they would seek before investing in stock market. TABLE-5. internet or colleges & friend for stock market information and performances.10 Table showing information based on which investments are made in stock market Information No. 64 . While rest of the investors would make investment decision based on self analysis or TV channels.
Newspapers& Internet Colleagues & Friends 65 .CHART-5.7 Chart showing information based on which investments are made in the stock market Brokers 24% 28% Self analysis 24% 24% TVchannels.
66 . of Respondents 60 60 Percentage (%) 24 24 25 55 10 22 Lack of funds High brokerage Total 30 20 250 12 8 100 INFERENCE: It is inferred from above table that majority of the respondents(24%) consider lack of knowledge about the stock market is the biggest difficulty they face closely followed by false information and rumors(22%). 24% of the respondents do not face any difficulty while trading.DIFFICULTIES FACED WHILE INVESTING IN STOCK MARKET TABLE-11 Background A survey had been conducted among the retail investors of various branches and question were asked to determine what are the difficulties faced by them while investing in the stock market. While other difficulties includes lack of funds (12%). being cheated by brokers (10%) and high brokerage (8%). showing the Difficulties faced by the investors Difficulties No difficulties Lack of knowledge about the market Being cheated by the brokers False rumors information/ No. However.
CHART-5.8 Chart showing the Difficulties faced by the investors while investing in Stock market No difficulties 30 55 60 Lack of knowledge about the market Being cheated by the brokers High brokerage 20 25 60 False information/ rumors Lack of funds 67 .
00 billion (US$ 96 billion) at December 31. South Africa. Sri Lanka. 3. Hong Kong. Qatar and Dubai International Finance Centre and representative offices in United Arab Emirates. Thailand. ICICI Bank is second amongst all the companies listed on the Indian stock exchanges in terms of free float market capitalisation. UK subsidiary has established a branch in Belgium. ICICI Bank is India's secondlargest bank with total assets of Rs. ICICI Bank's equity shares are listed in India on Bombay Stock Exchange and the National Stock Exchange of India Limited and its American Depositary Receipts (ADRs) are listed on the New York Stock Exchange (NYSE) 68 .687 ATMs in India and presence in 17 countries. Russia and Canada. 2007 and profit after tax of Rs. Malaysia and Indonesia.767. China. ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialised subsidiaries and affiliates in the areas of investment banking. The Bank has a network of about 955 branches and 3. life and non-life insurance. 30. an Indian financial institution. 2007.08 billion for the nine months ended December 31. Singapore. and was its wholly-owned subsidiary. Bangladesh. Bahrain. branches in Unites States.ICICI BANK Business Profile ICICI Bank was originally promoted in 1994 by ICICI Limited. venture capital and asset management. The Bank currently has subsidiaries in the United Kingdom.
3.34. 44.56 Face value : Rs. in cores) :Rs.24 Book Value per Share (BVP) :3.766.2 Asset size (Rs.00 / 720 Sales (Rs.123. in cores) : Rs.0% (For one year) Earnings per Share (EPS) : Rs.35 Percentage of change in price :-7.45 Price Earning Ratio (P/E) :22. 918.10 52 weeks high/ low : 1456.29957.11 69 .05 Price : Rs.FUNDAMENTAL ANALYSIS Date of incorporation : 1944 Market capitalisation (Rs.658. in cores) : Rs.
In the last quarter of 2007 the performance of the bank was at its peak. The price has increased from Rs. White candles indicate bullish trend.9 Chart showing Share Price Movement of ICICI Bank INFERENCE: The above chart shows that the performance of the bank is good.1500.TECHNICAL ANALYSIS CHART-5. In the beginning of 2008 do to various global phenomenons the price of the stock was affected.120 to Rs. Most of the times the closing price of the day was higher than its opening price. The price line shows an increasing trend. 70 .
Throughout the year 2005. Whenever the short term EMV (10 days) intersects the long term EMA (200 day) from below it indicates the buy signal.CHART-5. which will future increase the price of the share. In the beginning of 2003.10 Chart showing Exponential Moving Average (EMA) for ICICI Bank INFERENCE: Movement of stock price line above the 200 days EMA indicates a buy signal.days EMV from below. Over all perform of the stock was good in the past. which indicates a sell signal for the investors. it has been a bullish trend. and in the second quarter 2004. 71 . 2006 and 2007 the 10-days MVA has cut 200.
When the line cross 80 it’s the indication to sell the stock and below 20 indicates to buy the stock. In the first quarter of 2003 the stocks were over sold.11 Chart showing Relative Strength Index for ICICI Bank INFERENCE: RSI values above 80 indicate that the stock is over bought and below 20 indicates that the stock is over sold. During the year 2005 the stock was initially over bough and quickly it reached below 20 and there was a huge selling which followed for few months.CHART-5. 72 .
It has out performed the market index.CHART-5. The performance of the bank is good.12 Chart showing comparison between ICICI Bank & NSE INFERENCE: While comparing the ICICI’s price line with the NSE index. 73 .
India. The paid-up capital is Rs.. with its registered office in Mumbai.9 crore (Rs. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited'. effective February 26.75 shares of Times Bank. Roughly 31. Times Group) was merged with HDFC Bank Ltd. for the fifth consecutive time. Times Bank Limited (another new private sector bank promoted by Bennett.5 billion)..311. As per the scheme of amalgamation approved by the shareholders of both banks and the Reserve Bank of India. The authorised capital of HDFC Bank is Rs.000 shareholders. The bank's American Depository Shares are listed on the New York Stock Exchange (NYSE) under the symbol .1 billion).1% of the bank's equity and about 19.3% of the equity is held by Foreign Institutional Investors (FIIs) and the bank has about 190. shareholders of Times Bank received 1 share of HDFC Bank for every 5.HDFC BANK The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector. 74 . as part of the RBI's liberalisation of the Indian Banking Industry in 1994. Mumbai and the National Stock Exchange.4. 2000.In a milestone transaction in the Indian banking industry. Coleman & Co. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.3.. The bank has won the Business Today Best Bank Award 2008. The HDFC Group holds 22. The shares are listed on the Stock Exchange.450 crore (Rs.4% of the equity is held by the ADS Depository (in respect of the bank's American Depository Shares (ADS) Issue).
00 Sales (Rs.10 52 weeks high/ low : 1825. 8483. 51.6 Asset size (Rs.60 Percentage of change in price : 37.40.00/895. in cores) :Rs.15 Face value : Rs.31 :1272. in cores) Price (Rs. in cores) :Rs.FUNDAMENTAL ANALYSIS Date of incorporation : 1994 Market capitalization (Rs. 09.441.1% (One year) Earnings per Share (EPS) : Rs.63 Book Value per Share (BVP) :7.15 Price Earning Ratio (P/E) :31.1.718.39 75 .) : Rs.
76 .From the white candle.13 Chart showing share price movement for HDFC Bank INFERENCE: The price of the share has increased over a period from Rs200 to Rs. This indicates a bullish trend.3000. it is clear that most of the day closing price of the share was higher than its opening price. The price line touched Rs.3000 in the year 2007.TECHNICAL ANALYSIS CHART-5. Even the volume traded was high in 2007 it touched ten millions.
77 .CHART-5. Only in the middle of the 2006 the stock was over sold. it was flat. Marjory of the times it has indicated the signal to buy.14 Chart showing Exponential Moving Average (EMA) for HDFC Bank INFERENCE: Through out the year there has been lots of intersection between two EMV’s lines. From 2003 to 2005 there isn’t much variation. From 2006 to 2007 the 10 days MVA has moved above the 200 days EVA.
15 Chart showing Relative Strength Index for HDFC Bank INFERENCE: In the beginning of the year 2003 it was a bearish trend. In the last three quarter of 2007 the stock was never over sold and was bullish trend. Later it gained momentum and was over bought. 78 .CHART-5. Most of the time the line has crossed touched 80 which indicate the stock is over bought.
CHART-5.16 Chart showing comparison between HDFC bank and NSE index INFERENCE: Comparing the NSE index with HDFC bank. the performance of the bank and the market index is almost same. In the year 2007 the stock has out performed the market index. 79 . with little variation.
562. 50. 1959 . The Imperial Bank of India was founded in 1921 under the Imperial Bank of India Act 1920. State Bank of India is the country’s largest commercial Bank in terms of profits.500 shares of Rs. 80 . merchant banking and mutual funds. such as through e-mail.000 divided into 562.100 each. On 1st July State Bank of India was constituted under the State Bank of India Act 1955. analysts’ meet and attendance at Investor Conference throughout the world. and an issued and paid up capital of Rs. with its heritage dating back to the year 1806. branches and employees. It belives on the path of transparency and allow complete access to all the stakeholders enabling total awareness about the Bank. website. for the purpose of taking over the undertaking and business of the Imperial Bank of India.STATE BANK OF INDIA Business Profile The Bank is actively involved since 1973 in non-profit activity called Community Services Banking.20 crores. one-on-one meeting. conference call. assets. foreign exchange. deposits. strives to continuously provide latest and upto date information on its financial performance. All our branches and administrative offices throughout the country sponsor and participate in large number of welfare activities and social causes. The Bank communicates with the stakeholders through a variety of channels. The Bank transacts general banking business of every description including. SBI.The SBI was registered with an Authorised capital of Rs.
10 52 weeks high/ low : 2419. 66.44 Price Earning Ratio (P/E) :13.62 Sales (Rs.120.98 Face value : Rs.565.24 81 . 31.31 Book Value per Share (BVP) :1.05 Percentage of change in price : 83. in cores) : 469990. in cores) Asset size (Rs.1605.0 :Rs.7% (For one year) Earnings per Share (EPS) : Rs.56/852. in cores) : Rs.FUNDAMENTAL ANALYSIS Date of incorporation : 1955 Market capitalization (Rs.33 Price : Rs.1.5.525.
From the white candle. 82 . In the beginning of 2007 the performance of the stock has come down. it is clear that most of the day closing price of the share was more than its opening price.CHART-5. It was bullish trend.17 Chart showing share price movement for SBI Bank INFERENCE: The price of the share has increased over a period from below Rs290 to Rs.2500. But in the following months it has performed well.
Later it has cut the 200 days EVA from above. 83 . In 2007 it has cut the 200 days EVA from below and the price was at its peak. which indicates a sell signal to the investors which followed for few months.18 Chart showing Exponential Moving Average for SBI Bank INFERENCE: The chart indicates that till the first quarter of 2004 the 10 days EVA was above to 200 days EVA.CHART-5.
It was a bullish trend.19 Chart showing Relative Strength for SBI Bank INFERENCE: Through the period the stock was over bought. 84 . The performance of the stock was good in the year 2007. Only on few occasions it has toughed 20.CHART-5.
20 Chart showing comparison between SBI & NSE INFERENCE: While comparing the NSE market index with SBI bank. But in 2007 the stock movement has out performed the market index. 85 . till 2006 there is little variation between the two.CHART-5.
medium and small industrial units. Among the clients of the Bank are Indian conglomerates.PUNJAB NATION BANK Business Profile With its presence virtually in all the important centres of the country. apart from the PNB's over 1094 ATMs and tie up arrangements with other Banks. Bank has Rupee Drawing Arrangements with 15 exchange companies in the Gulf and one in Singapore. It enables the card holder to buy goods and services at over 99270 merchant establishments across the country. non-resident Indians and multinational companies.largest amongst Nationalized Banks. Besides. With its state-of-art dealing rooms and well-trained dealers. industrial finance. The large presence and vast resource base have helped the Bank to build strong links with trade and industry. Another step taken by PNB in meeting the changing aspirations of its clientele is the launch of its Debit card. which is also an ATM card. exporters. the card can be used to withdraw cash at more than 25000 ATMs. Bank is a member of the SWIFT and over 150 branches of the bank are connected through its computer-based terminal at Mumbai. Punjab National Bank offers a wide variety of banking services which include corporate and personal banking. agricultural finance. Punjab National Bank is serving over 3. financing of trade and international banking. 86 .5 crore customers through 4540 Offices including 421 extension counters . where the 'Maestro' logo is displayed. the bank offers efficient forex dealing operations in India.
Date of incorporation
Market capitalization (Rs. in cores)
: Rs.18, 850.21
Earnings per Share (EPS)
Price Earning Ratio (P/E)
Book Value per Share (BVP) :1.31
52 weeks high/ low
Sales (Rs. in cores)
Asset size (Rs. in cores)
CHART-5.21 Chart showing stock price movement on PNB bank
INFERENCE: The performance of the bank was moderate. In the year 2003 the stock was traded in the huge volume. The price was highly volatile. The trading volume has also decreased. The maximum price was reached in 2007.
CHART-5.22 Chart showing Exponential Moving Average for PNB
INFERENCE: There isn’t huge variation between two EVA lines. The stock was over sold in middle of 2006. Even in 2007 there was both bulling and selling by the investors.
90 . majority of the times the stock of over sold.23 Chart showing Relative Strength Index for PNB INFERENCE: Above chart shows that. Only on few occasion it was over bought i.e.CHART-5. only in year the 2004 it crossed 80.
the bank is traded lower then the market index.24 Chart showing comparison between PNB & NSE INFERENCE: Comparing the NSE market index and the price movement of PNB. 91 .CHART-5.
There was a huge fall in price of ICICI bank share. But in the beginning of 2008 due to various global phenomena the price of both the stock has decreased.25 Chart showing comparison between ICICI Bank & HDFC Bank INFERENCE: While comparing two Private sector banks performance of HDFC bank is good compare to ICICI. 92 .CHART-5.
93 .CHART-5. It is far a head of Punjab Nation Bank.26 Chart showing comparison between SBI & PNB INFERENCE: While comparing two Public Sector Banks the performance of SBI is good in terms of investment and return.
94 .CHART-5.27 Chart showing comparison between SBI & HDFC INFERENCE: While comparing the performance of HDFC bank from private sector and SBI from public sector. there isn’t much variation. Most of the times SBI was trading ahead of HDFC. It’s only few points a head of HDFC bank.
Automobiles (16%) and others (30%). • It was also found that there is no significance difference between the gender and information they seek before investing in the stock market. Steel (22%). Infrastructure (34%). • Based on the survey it was found that there is significance difference between the age group of the investors and purpose of investment in share market. namely S&P-CNX NIFTY. • It was found that there is no significance difference between the gender and risk taking ability of the investors. • From savings point of view 32% of the investors consider stock market is average and only 8% as very good. 95 . • According to the 36% of the investors. And 29% from risk point of view. Construction (38%).CHAPTER-6 FINDINGS This study has dealt with investors’ confidence in Indian capital market and the technical and fundamental analysis of the banks that constitute the market index. • Majority of the investors prefer banking sector (52%) followed by Oil & Gas (44%). • From return point of view 36% of the investors consider stock market is average and only 14% consider it as very good. IT (18%). stock market is better avenue for investment from return point of view closely followed by savings (35%). Most important findings of this study are as follows.
However 26% are not interested in stock market • Majority of the investors (50%) invest in the stock market only for capital appreciation. gender. • Most of the investors prefer short-term investment (50%) for investment in stock market. • 30% of the investors would like to invest less than 10% of their saving in stock market. occupation and education are lack of knowledge about the market and the false information & rumors. irrespective of their age.• From risk point of view majority of the investors (38%) consider it as poor avenue and 3% as good. internet or colleges & friend for stock market information and performances 96 . Only 6% male investors below 40yrs of age are willing to invest above 50% of their savings in the stock market. Only 8% of the investors take more than 50% of risk. But there are 28% of the investors who are not willing to take any risk • The most commonly faced difficulties by the investors. While rest of the investors would make investment decision based on self analysis or TV channels. While 28% of the investors would like invest 11-30% of their saving in the stock market. Investors below 40yrs of the age are the maximum risk takers. Only 20% of the investors below 40yrs of age would like to invest for long term • It was determined from the study 28% of the investors take investment decision based on broker’s advice. Followed by savings (28%) and liquidity (16%). • Majority of the investors (36%) are willing to take 25% of risk on their invested capital in the share market.
• Private Banks have a higher growth rate on a much smaller base compare to PSBs .91 times. • Private Banks in aggregate enjoys 30% higher market capitalisation than their PSBs. or deposits. One year forward target price. • Public Sector Banks (PSBs) are good and appear to be so. recoveries of NPA’s and asset quality.12 to 2. 66.1. • Public Sector Banks have positive and strong equation with the regulation by their sheer size. 31. • Strong entry barrier for foreign/private banks in growing rural market where PSBs have an edge. market capitalisation of PSBs is expected to climb 36%-Private sector-16%On Price to Book Value basis. • Comparing the share premium PSUs has less share premium of 3-31% as against 41-49% premium built in private banks.89 times.525. 5. 97 .be it number of branches.565.24crs. • State Bank of India is at the top with market capitalization of Rs.53 crs and asset size of Rs. while private banks trade at much expensive valuation of 1. • PSBs have shown significant improvement in reducing gross and net Non Performing Asset (NPA). operating expenses. the PSBs are trading much cheaper in the range of 1. lineage and pan. They have improved a lot in the last five years. total credit and advances.India presence.• Investors feel that the current market price is a better indicator for investors to invest.89 to 8.
Investors should be educated about the market trends. price movements. Information related to promoters background and project implementation experience should be made available. There should be more transparency in activities of the company. • Moral character of Board of Directors to be checked. • There should be regulation to control scandals. Dishonest promoters should not be allowed to raise funds the promoter should at least have five years of experience in the industry. Awareness about the primary market should be improved. • Advertisements on the improvements taking place in the market should be released regularly. • Transparency in the system should be maintained. 98 . regulatory bodies should prevent corporate frauds.CHAPTER-7 SUGGESTIONS • There should be latest and easy availability of information to the public. Only experienced promoters should be allowed to raise funds in the capital market. they should have a wide knowledge about the market. • Sensitive information should be made available to everyone at the same time. There should be more liquidity in primary market investment. Insider trading should be completely curbed in order to have transparent transactions.
Government should improve infrastructure and economic condition. 99 . • Government should reduce political interference in markets. It should check corruption at various levels and take steps to protect small investors. Demat account information should be proper and regular. Grievance redresses machinery should be more efficient.• More active investor associations to be provided. • • • • Shareholders’ interest should be considered while companies take decisions. • Honesty and fair dealing in brokers should be encouraged Action should be take action against brokers with bad conduct • Proper information on post listing activities should be made available by stock exchanges to investors. General investors should understand the riskiness associated with investment in shares. Action should be taken against the issue managers. • Since most of the investors make investment decision based on broker’s advice brokers should guide them properly. • Capital Gain Tax can be reduced by the Income Tax Department out of profits made on intra day transactions. . Bogus companies should not be allowed to raise funds in the capital market Insurance of stock market investments should be developed. Price rigging before issue of securities to be controlled. analysts and company for providing over optimistic and false information • • • • Companies should be encouraged to buyback shares if not listed or saleable.
This year (2008) could be a year of consolidation. Sensex will be around 15000-18000points for the next six to eight months. And they should make long term investment and should seek professional advice before investing. And should also have broader view about the market before investing. • The Indian equity markets. • It is prudent to invest in large-cap stocks from these sectors-public sector banks. capital goods. • Market related investment may not pay the same level of return they have given in the last three years. 100 . . Do own research and not fall prey to rumors. infrastructure and oil refineries. as experts believe. • Investors should be guided by the company’s fundamental and not by expectation of immediate return. • There is a positive correlation between stock price and the company’s brand visibility. will continue to follow the global trends. Volatile will persist for few months.• Investors should not invest in the same sector.
So. market related investment may not pay the same level of return they have given in the last three years. That will mean a slower growth in the markets. 912 in January 2004 to 6.CHAPTER-8 CONCLUSION The dream run in Indian capital market. Four initial IPO’s which were launched in 2008. Moreover. The Economic Survey points out that Indian stocks reflected price to earning multiples of around 27 times at December end 2007 . The Indian equity markets. In the mid January. The Sensex and the Nifty tripled during this period from 1. 101 . respectively. 100 IPO’s (Initial Public Offer) were floated compared to 75 in 2006. So. will continue to follow the global trends. 079 in December 2007. corporate earnings may get affected. which started in 2003. were withdrawn due to poor investor interest. as experts believe. continued till 2007. if the economic growth moderates. the highest among the select emerging market economies. In 2007. Indian market came under global selling pressure and the global meltdown coincided with higher valuation of the market. as is expected. the fate of the primary market will dependent of the secondary markets. The Economic Survey says market cap was 150 percent of the GDP. Investors’ risk appetite reduced after the sharp corrections. This year (2008) could be a year of consolidation.
Financial Management (8th edition).valueresearchonline.com www. Fisher & Ronald J. Investments.com/equities/techanalysis/tech_analysis. 2006.com/stocks/snapshot. • Donald E.2003.yahoo.com/ http://www.indiabulls.A. Pandey.capitalmarket. A & Marcus. Tats McGraw-Hill.CHAPTER-9 BIBILOGRAPHY BOOKS • Bodie. • I.moneycontrol. Security Analysis And Portfolio Management (6th edition).asp?code=1622 http://www. New Delhi.com 102 .equitymaster. Pretice –Hall of India Orivate Ltd. Z.nseindia. New Delhi.asp http://www.investopedia.asp http://galatime. J.Jordan. WEBSITES • • • • • • • • • http://finance.M.com/charts/banks. 2002.com/stocksmarketsindia/ http://www. & Kane. New Delhi .html www. Vikas Publishing House Private Ltd.com/tm.com www.
50% & above ( ) 8. Capital appreciation ( ) d. Medium term ( (6months-1yr) ) c. Short term ( (<6months) ) b. Female ( ) 4. Occupation: a. Business ( ) d. Male ( ) b. Dividend ( ) 9. Name (Optional) : 2. Others ( ) 6. For what purpose investment are made in stock market? a.11-30% ( ) c. Time frame of investment preferred by you for making investment: a. Liquidity ( ) c. Service ( ) b. Graduates ( ) b. Educational Qualification: a.Others ( ) 5. Professionals ( ) d . 31-50% ( ) d. 41-60yrs ( ) c. Professional ( ) c. 21-30 % ( ) d. <10 % ( ) b. What percentage of income would you save? a.11-20 % ( ) c. Not investing ( ) ) b. What percentage of savings would you invest in stock market? a.18-40 yrs ( ) b. 61yrs & above ( ) 3. Long term ( (>1yr) ) 103 .ANNEXURE QUESTIONNAIRE 1. Saving ( ) b. 31-50 % ( ) 7. Gender: a. Post Graduates ( ) c. Age: a. 0-10 % ( e.
Colleague & Friends ( ) ) 13.Contruction c. Automobile b. Brokers ( c. 25% ( ) c. Newspapers or Internet ( d. High brokerage ( ) d. Lack of knowledge about the market ( c. Your suggestions so as to enable you to make stock market a good avenue for investment. Retail ( ( ( ( ( ) ) ) ) ) 14. No ( ) 15. Self. What are the difficulties faced by Investors? a. 104 . FMCG d. Yes ( ) b. Not at all ( ) 11.Analysis ( ) ) b.10. False information / rumors ( ) b.10% ( ) b. Banking h Cement i. Infrastructure j. Do you face difficulties while investing in stock market? a. Your general perception about the stock market. TV channels. Poor Return point of view Risk point of view Savings point of view Very poor Average Good Very good 12. Steel ( ( ( ( ( ) ) ) ) ) f. Before investing in stock market whose advice do you seek? a. Lack of funds ( ) ) ) 16. Oil & gas g. Being cheated by the brokers ( e. a. IT e. Maximum risk you are ready to take on your invested capital.50% ( ) d. Sector preferred for making investment a.
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