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RESEARCH METHODOLOGY

RESEARCH REPORT ON PORTFOLIO MANAGEMENT

AUTHORS HARSH THAKKER – 111 POOJA TRIPATHI – 113

EXECUTIVE SUMMARY

The evaluation of financial planning has been increased through decades, which can be best seen in customers. Now a day‟s investments have become very important part of income saving. In order to keep the Investor safe from market fluctuation and make them profitable, Portfolio Management Services (PMS) is fast gaining Investment Option for the High Networth Individual (HNI). There is growing competition between brokerage firms in post reform India. For investor it is always difficult to decide which brokerage firm to choose. The research design is analytical in nature. A questionnaire was prepared and distributed to Investors. The investor‟s profile is based on the results of a questionnaire that the Investors completed. The Sample consists of 30 investors from various broker‟s premises. At the time of investing money everyone look for the Risk factor involve in the Investment option. The Report is prepared on the basis of Research work done through the different Research Methodology the data is collected from both the source Primary sources which consist of Questionnaire and secondary data is collected from different sources such as newspaper articles, business magazines and web. Every Individual has their own specific financial need and expectation based on their risk taking capabilities, whereas some needs and expectation are universal

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Jim England Every research requires contribution and participation of wide arrays of sources and resources. Gomathy Thyagarajan my Supervisor who has played an important role in helping us to develop a lucid. the authors have been lucky to be guided by Professor. The writers would also like to thank his family and friends for supporting the authors throughout this interesting journey. In the research. cooperation and coordination of a number of people. Her contribution has been of great acknowledgement that laid the foundation of the research. it became a beautiful journey embedded with beautiful memories of all the people who contributed in the success of the research in a direct and indirect manner.ACKNOWLEDGEMENT There is a great meaning in life for those who are willing to contribute. 2 . The authors would like to appreciate the efforts of the Supervisor for guiding throughout the whole process of research. The University offered the authors all the desired freedom to conduct research in a positive and enthusiastic manner that makes me appreciate their guidance and code of conduct. The journey began as an individual but with the support. The writers would like to appreciate and acknowledge that guidance of everyone who has been an integral part of this research process.

6 Limitation of the Study…………………………………………………….………………………………….....3 Objectives of Portfolio Management ………………………………………11 5......…………………….6 2......10 4...............9 4.6 CHAPTER 3: REVIEW OF LITERATURE………………………………… ......2 What is Portfolio Management……………………………………….……...11 5.10 CHAPTER 5: PORTFOLIO MANAGEMENT………………..............…………………..6 2.....3 Problem Definition …………………………………………………………...11 5..………………………….…………….1 Scope of the Study…....7 CHAPTER 4: RESEARCH METHODOLOGY……………………………….…............…..….9 4...TABLE OF CONTENTS Executive Summary……………………………………...……………….5 CHAPTER 2: SCOPE AND OBJECTIVES.....….....…....2 Research Design…………………………………………………………… ......10 4....………….......5 Period of the Study……………….9 4.2 Objective of the Study…………………………………………………….6 2.....1 Acknowledgements…………………………………………………………….. .1Process of Portfolio Management …………………...11 5..…………………....9 4....……….4 Need for Portfolio Management…………………………………………… 11 3 .2 CHAPTER 1: INTRODUCTION…….…………………. .4 Method of Data Collection……………………………………...3 Sampling Design……....…...……………..……....………..1 Meaning of Portfolio Management ………………………………………...

.. ..…17 Appendix A: Questionnaire ………………………………………………………18 4 .2 Suggestions…………………………………………………………………16 BIBLIOGRAPHY ……………………………………………………………….……....15 7..15 7.CHAPTER 6: DATA ANALYSIS AND INTEPRETATION…………………12 6..2 Findings…………………………………………………………….2 Data Intepretation………………………………………………………….………15 CHAPTER 8: CONCLUSION AND SUGGESTIONS…..12 CHAPTER 7: RESULTS AND FINDINGS……………………...…………….17 Web ……………………………………………………………………………...…………………………......1 Conclusion …………………………………………………………………16 8.…………….1 Data Analysis Procedure ………………………………………………….17 Books ……………………………………………………………………………....16 8..12 6.1 Results………………………….……………..17 Journals ………………………………………………………………….....

overall risk needs to be maintained at the acceptable level by developing a balanced and efficient portfolio. design of achieving these objectives and the expected outcomes/deliverables of the study. Thus. The objectives of portfolio management are applicable to all financial portfolios. this study gives a brief idea about the investor‟s idea and the risk involved during the time of investment. Hence. A research proposal is a formal document that presents the research objectives. Furthermore. This framework or plan is termed as the „Research Proposal‟. a good portfolio of growth stocks often satisfies all objectives of portfolio management 5 . That is why professional investment advice through portfolio management service can help the investors to make an intelligent and informed choice between alternative investments opportunities without the worry of post trading hassles. For a study to qualify research. Investors choose to hold groups of securities rather than single security that offer the greater expected returns. results in a proper analytical approach towards the growth of the portfolio. if considered. the researcher needs to formalize thus plan of pursuing the study. They believe that a combination of securities held together will give a beneficial result if they are grouped in a manner to secure higher return after taking in to consideration the risk element. These objectives. Finally.CHAPTER 1: INTRODUCTION Research always begins with a purpose. it must be planned and systematic.

Understanding the investment pattern and the perception of an investor before investing in a particular security 6 .1 Scope of the study  To understand the investor behavior with regards to the investment patterns  To measure and understand the level of risk associated with an investment  To understand the concept and importance of portfolio management in today‟s scenario.  To understand the perception of an investor with regards to a particular investment 2.CHAPTER 2: SCOPE & OBJECTIVES 2.3 Problem Definition  To understand the reasons underlining the decision of an investor to do portfolio management in order to reduce the level of risk associated with the investment.  To gather useful information from different kinds of investors.2 Objectives of the study  To find out optimal portfolio.  To compare the return on a portfolio using different investment ways 2. which will give optimal returns at a minimum risk to the investor  To study whether the portfolio risk is less than individual risk on whose basis the portfolio are constituted.

CHAPTER 3: REVIEW OF LITERATURE 7 .

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9 .3 Sampling Design  The sample that has been selected for our study is a random sample of 30 respondents the reason for selecting this sample is because it was convenient  The sample selected is a true representation of the total population  The sample of respondents is from the western region of Mumbai.1 Process of Portfolio Management Portfolio management is a complex activity which may be broken down into the following steps:        Specification of invest objectives & constraints Choice of the asset mix Formulation of portfolio Strategy Selection of Securities Portfolio Execution Portfolio Revision Performance Evaluation 4.CHAPTER 4: RESEARCH DESIGN AND METHODOLOGY 4. → Under exploratory research the method used is secondary resource analysis 4.2 Research Design → The study is about understanding the investment pattern and the preferences/perception of investors → The research method selected for the study is exploratory research and descriptive research.

4.  The Primary data will be collected by means of survey that would be conducted on the sample population from the western region of Mumbai  The Secondary data will be collected from  Magazines and periodical journals  Newspapers  Websites 4.4 Method of Data Collection  The data for the study will be collected both from primary sources and secondary sources.6 Limitation of The Study → The limitation of the study is that it was carried out for a limited period of days and the sample size selected for the study was small which not a true representation of the total population.5 Period of Study  The study was carried out for a period of one month starting from 10th February to 10th of March 2013. 4. 10 .

risk in price or inflation erodes the value of money and hence investment must provide a protection against inflation. 5. It involves construction of a portfolio based upon the investor‟s objectives. The changes in the portfolio are to be effected to meet the changing condition.CHAPTER 5: PORTFOLIO MANAGEMENT 5. The objective of this service is to help the unknown and investors with the expertise of professionals in investment portfolio management. The portfolio is reviewed and adjusted from time to time in tune with the market conditions. Thus it seems logical that the expected return of the portfolio. since it is really desirable to invest the entire funds of individual or an institution or a single security” It is essential that every security be viewed in a portfolio context. 11 . judgment and action. It is a dynamic and flexible concept and involves regular and systematic analysis.3 Objectives of Portfolio Management: The main objective of investment portfolio management is to maximize the returns from the investments and to minimize the risk involved in investment.1 Meaning of Portfolio “A portfolio is a collection of securities. The evaluation of portfolio is to be one in terms of targets set for risk and returns.2 What is Portfolio Management? Portfolio Management refers to the management of portfolios for others by professional investment managers it refers to the management of an individual investor‟s portfolio by professionally qualified person ranging from merchant banker to specified portfolio company. Portfolio Analysis considers future risk and return in holding various blends of individual securities 5. 5. constrains. preference for risk and returns and ta x liability.4 Need for Portfolio Management: Portfolio Management is a process encompassing many activities of investment in assets and securities. Moreover.

place and things and thus it becomes very necessary to analyze all these in an effective and efficient manner. It need to understand that every individual has a different mindset and opinion about people.1) Which field of investment interest you the most?  Mutual funds  Annuities  Fixed deposit  Real estate  Shares Majority of the investors preferred investing in mutual funds as mutual funds had a low risk factor and good returns.  Qualitative Analysis. There is no denying that both the analysis plays an important role in the success of the research and should be showcased in an analytical and informative manner.1 Data Analysis Procedure: This section will give an overview of the quantitative and qualitative analysis in an informative manner. 6.  The data analysis procedure is based on the data garnered from the questionnaire and will be illustrated through qualitative and quantitative analysis.Qualitative analysis highlights the responses given by the respondents.2 Data Interpretation Q.CHAPTER 6: DATA ANALYSIS & INTERPRETATION 6. 12 . The descriptive responses of the respondents are analyzed well to understand the mindset of the respondents. That is why qualitative analysis needs to be done effectively as it‟s a very crucial in guiding the authors towards a meaningful and focused outcome of the research. This will make the whole research defined and informative. Other investors preferred investing more amount of money in fixed deposit as it is secured and yields a risk free return.

00.000 -50.000-50.000. Q. 00.00.000 – 1.000). 13 .000 to 4.00.000 and Above The investors were ready to invest a sum of Rs.and above in fixed deposit as it was a risk free return.000/. Q. 00.000  50.4.00.20% of the investors who were risk averse preferred investing a low sum of money and the remaining who were risk takers invested 2.000-2.00  4.00.000  2.00.4) What would be the period of your investment?  Long term (more than 4years )  Mid-term (2-4 years)  Short term (1-2 years) The respondents choose midterm investments as the most preferred as it was ideal return period as compared to all investment categories prevailing in the market.3) If the investment amount falls due to bad market condition.000-4.Hence it was observed that majority of the people preferred investing less amount (10.2) What is the total amount that you are ready to invest?  10.000  1. 00. would you withdraw your investments or wait for recovery?  YES  NO 90% of the investors selected NO as an option and preferred waiting for the stock to rise rather than withdrawing their money and incurring a loss.Q.

Q. 14 . please mention _________________________________ The above question was given an open ended option in order to understand the perception of the investor in a better way and hence it was observed that 100%of the respondents choose to have a portfolio of balanced investments with risky and risk free returns as it would give them a balanced favourable return on their investments even during bad times.5) Tick the following that is applicable to you  Maximise returns on investment with maximum risk  Minimise risk and investment  Balanced investments with risky and risk-free assets  Others.6) What is the risk factor that you are willing to take while investing  Low  Medium  High The above question was asked to know the risk taking ability of different investors and hence it was found that out of the 30 respondents 24 of them was risk averse and preferred a low risk investment. This shows that people like to invest more in fixed deposits and mutual fund investments as they are low risk bearing. Q.

) Since the term “returns” from an investment refers to the benefits that an investor receives from that particulars investment. hence we can infer that portfolio is generating more returns when compared to individual 2. 7. which will give optimal returns at a minimum risk to the investor  The study found out that the portfolio risk is less than individual risk on whose basis the portfolio is constituted.2 Findings During the study.  Majority of the people prefer investing taking less risk & thus their investment is also low.1 Results  The optimal portfolio has been prepared. 15 . portfolio has low risk to that of individual risk. . 1.CHAPTER 7: RESULT & FINDINGS 7. investors prefer taking high risk and invest high amount of money.) If risk parameter is taken in consideration.  Investor preferred investments that would yield a return from a period of 2-4 years. following are some of the observations that are found out When the market is doing well.

 Investors should hold on to the security rather than selling it and making a loss when the share prices are down. 8.  If the investor is a risk-averse investor. then he should invest in less risky securities and enjoy normal return. investor should invest in more risky securities as a risk taker  Investors should invest in different securities rather than investing in only shares.CHAPTER 8: CONCLUSION AND SUGGESTIONS 8. The overall objectives were well aligned with the achievement and thus helped in bringing the true and ideal picture of the research. The research has been conducted in a professional manner.1 Conclusion The research has been presented by setting objective along with developing a systematic approach to achieve those objectives. The aims and objectives of the research have been covered through wide arrays of research tools.2 Suggestions Following are some of the suggestions:  In order to enjoy more returns. honest and ethical manner. 16 .the investors portfolio should include both risk free as well as risky returns. he should invest more. It can assume that the objectives have been achieved in a positive.

BIBLIOGRAPHY 17 .

00.000-2.APPENDIX QUESTIONNAIRE Name:Age:Sex:Occupation:Q.000  50.3) If the investment amount falls due to bad market condition.1) Which field of investment interest you the most?  Mutual funds  Annuities  Fixed deposit  Real estate  Shares Q.000 – 1.000  2.00.000  1.4) What would be the period of your investment?  Long term (more than 4years )  Mid-term (2-4 years)  Short term (1-2 years) 18 .00.000 and Above Q.000-50.000-4. would you withdraw your investments or wait for recovery?  YES  NO Q.2) What is the total amount that you are ready to invest?  10.00.00.00.00  4.

Q.6) What is the risk factor that you are willing to take while investing  Low  Medium  High 19 .5) Tick the following that is applicable to you  Maximise returns on investment with maximum risk  Minimise risk and investment  Balanced investments with risky and risk-free assets  Others. please mention _________________________________ Q.