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ACKNOWLEDGEMENT
I believe an ocean is filled by drops and each and every drop should count. No great
endeavor is successful and accomplished without some helping hands. The task needs some
guidance, encouragement and assistance for its completion and fulfilment. I would like to take this
opportunity to thank all who contributed directly or indirectly in preparation of this project.
I hereby take this opportunity to sincerely thank the authorities of ICICI Securities
Limited for taking me as an intern under the kind mentorship of Mr. Bhumish Patel and for
providing a very conducive work environment.
I would like to thank Mr. Ujjaval Dubey whose valuable inputs helped me to go about
this project. I would like to extend my sincere gratitude towards the entire team of ICICI securities
chandkheda branch who directly or indirectly played a significant role in my learning associated
with the Summer Internship.
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DECLARATION
I hereby declare that this project report MUTUAL FUNDS SIMPLIFIED is the result of two
month summer internship done by Mr. Divyang Patel at ICICI securities Limited under the
guidance of Mr. Ujjval Dubey ,Branch Manager at ICICI securities, chandkheda branch. This is
to further declare that this project report is authentic and not submitted by any other student
previously. I also confirm that the contents of the report and the views contained therein have been
discussed and deliberated with the Guide.
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EXECUTIVE SUMMARY
A mutual fund is a scheme in which several people invest their money for a common financial
cause. The collected money invests in the capital market and the money, which they earned, is
divided based on the number of units, which they hold. The mutual fund industry started in India
in a small way with the UTI Act creating what was effectively a small savings division within the
RBI. Public sector banks and financial institutions were allowed to float mutual funds and their
success emboldened the government to allow the private sector to foray into this area.
Mutual funds have emerged as a strong financial intermediary and are the fastest growing segment
of the financial services sector in India. Mutual funds play a very significant role in channelizing
the savings of millions of individuals. A mutual fund is the most suitable investment for the
common person as it offers an opportunity to invest in a diversified, professionally managed
portfolio at a relatively low cost. Mutual Fund has not only contributed to Indias growth story but
has also helped families tap into success of Indian industry. As information and awareness is rising
more & more people are enjoying the benefits of investing in Mutual Funds.
This project is regarding the mutual funds awareness program undertaken by the ICICI Securities
Ltd. ICICI Securities Ltd is an integrated securities firm offering a wide range of services including
investment banking, institutional broking, retail broking, private wealth management, and financial
product distribution. The company has undertaken the mutual funds awareness program called
Mutual Funds Simplified
Duration of the project was two months. During this period, the researcher went on to meet the
existing customers in their respective places as they mentioned in phone or customers who were
coming at ICICI direct branch of the ICICI Securities and took their feedback based on the
awareness video and demonstration regarding mutual funds and its online investment through
ICICIDirect.com shown to them during the meeting. Also, at the time of induction program
conducted by ICICI Securities, researcher learnt more about the mutual funds. During the
internship program the researcher came to know that there are many people using the online
mode of investing into different securities. But, at the same time, not many people are aware
about the online investment in mutual funds.
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Table of Contents
Acknowledgements 2
Declaration 3
Executive summery 4
Page No.
Chapter-1 Introduction 6
1.1 Objective of the study 6
1.2 Scope of the study 6
1.3 Limitation of study 6
1.4 Introduction to the topic 7
Chapter-2 Industry Profile and Analysis: 13
2.1 Introduction to the industry 13
2.2 Types of brokerage Firm 14
2.3 Recent advancements in the industry 15
2.4 Top 10 companies 16
Chapter-3 Company Profile and Functional Areas of Company 17
3.1 About ICICI securities 17
3.2 Stock Exchanges 18
3.3 ICICI Direct 18
3.4 SWOT analysis 22
3.5 Taxation aspect of company 23
3.6 Achievements of the company 24
Chapter-4 Research Methodology 28
4.1 Research Objective 28
4.2 Data sources 28
4.3 Sampling 28
4.4 Limitation 29
4.5 Research design 29
Chapter-5 Learning, Findings and Suggestion 30
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Conclusion 46
Bibliography 47
Chapter-1 INTRODUCTION
To study about Mutual fund and different investment options like equity, debt fund and
gold ETF
To analysis of investment pattern of investor.
Understand needs and goal of investor.
To get a general feedback from the customers about ICICI Mutual Fund investment and
the online portal.
Study of portfolio management primary objective is interacting with customers and
give them knowledge about new features of Mutual fund.
To make the customers understand that it is always better to invest or purchase Mutual
Funds online than offline.
To make customer user friendly with the website of ICICI Direct.com
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1.4 INTRODUCTION TO THE TOPIC
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The need to possibly sell 'poor' stocks/bonds and buy 'good' stocks/bonds demands constant
tracking of news and performance of each company they have invested in. Mutual funds are able
to maintain and track a diversified portfolio on a constant basis with lesser costs. This is because
of the pecuniary economies that they enjoy when it comes to trading and other transaction costs;
thirdly, funds also provide good liquidity. An investor can sell her/his mutual fund investments
and 17 receive payment on the same day with minimal transaction costs as compared to dealing
with individual securities, this totals to superior portfolio returns with minimal cost and better
liquidity.
This can be represented with the following flow chart:
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prospectus required an annual accounting, which investors could view if they requested. Two
subsequent funds set up in the Netherlands increased the emphasis on diversification to reduce
risk, escalating their appeal to even smaller investors with minimal capital.
Van Ketwichs fund survived until 1824 but the vehicle he created is still a hallmark of personal
investing more than two centuries later with an estimated $27.86 trillion US in global assets in
July 2013. In Canada alone, mutual funds represent $920 billion.
The early mutual funds spread were of the closed-end variety, issuing a fixed number of shares.
They spread from the Netherlands to England and France before heading to the U.S. in the 1890s.
The first modern-day mutual fund, Massachusetts Investors Trust, was created on March 21, 1924.
It was the first mutual fund with an open-end capitalization, allowing for the continuous issue and
redemption of shares by the investment company. After just one year, the fund grew to $392,000
in assets from $50,000. The fund went public in 1928 and eventually became known as MFS
Investment Management.
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SECOND PHASE 1987-1993 (ENTRY OF PUBLIC SECTOR FUNDS)
1987 marked the entry of non- UTI, public sector mutual funds set up by public sector banks and
Life Insurance Corporation of India (LIC) and General Insurance Corporation of India (GIC). SBI
Mutual Fund was the first non- UTI Mutual Fund established in June 1987 followed by Canbank
Mutual Fund (Dec 87), Punjab National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund
(Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92). LIC established its
mutual fund in June 1989 while GIC had set up its mutual fund in December 1990. 11 At the end
of 1993, the mutual fund industry had assets under management of Rs.47, 004 Crores.
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Trust of India, functioning under an administrator and under the rules framed by Government of
India and does not come under the purview of the Mutual Fund Regulations.
The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC. It is registered
with SEBI and functions under the Mutual Fund Regulations. With the bifurcation of the erstwhile
UTI which had in March 2000 more than Rs.76,000 Crores of assets under management and with
the setting up of a UTI Mutual Fund, conforming to the SEBI Mutual Fund
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CHAPTER 2 INDUSTRY OVERVIEW
FINANCIAL INSTITUTION
In financial economics, a financial institution is an institution that provides financial
services for its clients or members. Probably the most important financial service provided
by financial institutions is acting as financial intermediaries. Most financial institutions are
regulated by the government.
Broadly speaking, there are three major types of financial institutions:
Depositary Institutions : Deposit-taking institutions that accept and manage
deposits and make loans, including banks, building societies, credit unions, trust
companies, and mortgage loan companies
Contractual Institutions: Insurance companies and pension funds; and
Investment Institutes: Investment Banks, underwriters, brokerage firms.
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BROKING FIRM
The stock broking industry is a service-oriented industry where brokers act as agents for
investors when a security is bought or sold and are compensated with a commission.
Investors would not hesitate to switch to alternative brokerage houses if they do not obtain
satisfaction. Providing quality service and hence customer satisfaction should thus be
recognized as a key strategy and a crucial element of long-run success and profitability for
stock broking businesses.
The Securities Brokerage Industry is cyclical and comprised of two distinct types of
businesses. Brokerages, also known as financial services companies, strive to meet the
investing needs of their clients, and exchanges facilitate securities trading.
Net profits correlate to the performance of the broader equity market. In this market with
less differentiated products and many players, there exists an oligopoly, characterized by
tough competition, entry and exit barriers and many more.
Little has been done towards understanding the expectations investors hold from their
stockbrokers. Since expectations serve as benchmark to gauge the service level of brokers,
the delivery of services that exceed customer expectations is one strategy that can give
firms a competitive advantage. Therefore, it would seem beneficial for stockbrokerage
firms, in a dynamic economic environment like India, to provide service at a good scale of
quality. In addition, stockbrokers have much to gain in understanding investors
expectations of them, as this would help the stockbrokers to serve their customers better
and foster long-lasting relationship with their customers.
2.2 TYPES OF BROKERAGE FIRMS
As an investor, you should shop for a brokerage firm just as you would for any other
professional service. Brokerage firms come in all sizes, from "one-man" firms to
international corporations. Similarly, the services offered by each firm and the
commissions they charge vary significantly.
Brokerage firms may be classified into three basic types: full-service, discount and
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limited products.
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12. Slashing interest rates, lowering factory levies and more than doubling the limit on
foreign investment in corporate bonds has led to rapid growth in the financial sector. 2011-
2013 saw increased inflow in to equity with investors steadily turning positive on equity
with net investment of mutual funds in debt almost getting tripled. Indias market
capitalization has touched US$ 1.24 trillion making it the largest among in the world. The
Indian stock market has currently responded to the optimism of reforms by the new stable
government and its continuity in policies. Falling commodity price will ease input cost of
the industries. Government policies to boost the economy. Inflation is at control 9- 10%.
As interest rate in developed economy is record low, India could attract investment.
Reducing interest rates provide fuel to the recession economy making the financial system
more secure.
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CHEPTER 3 INTRODUCTION TO ICICI SECURITIES.
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ICICI Securities - Retail
ICICI Securities empowers over 2 million Indians to seamlessly access the capital market
with ICICI Direct.com, an award winning and pioneering online broking platform.
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ICICI direct is an online trading and investment platform on ICICI Securities, the largest stock
broker firm in India providing a wide range of investment options to the retail and institutional
customers. ICICI Securities is part of ICICI Group, India's top financial service provider offering
banking and other financial services.
ICICI Securities (I-Sec) is the top equity house in India with over 20 lakh customers. ICICI
Direct.com is the most visited investment portal in India and by NRI's living across countries. It
is one website which provides options to invest in over 20 financial products including Equity,
Derivatives, Currency Futures, IPO, Mutual Funds, ETF, Fixed Deposits, Loans, Tax Services,
New Pension Systems and Insurance.
ICICI direct also provide current stock market information which includes stock prices, news,
market research reports, stocks tips, events, IPO News and company results. Its 'Centre for
Financial Learning' initiative offers number of online and classroom programs for investors. The
3-in-1 account, which includes ICICI Bank Account, ICICI Direct Trading Account and ICICI
Demat Account, is the best offering for retail investors in India as it provides easiest way to invest
in stock market and other financial instruments. The customers can visit any of the over 1500
ICICI Bank branches to get help on financial products which are sold through ICICI direct.
ICICI Direct.com is the largest equity house in the country providing end-to-end solutions
(including web-based services) through the largest non-banking distribution channel so as to fulfill
all the diverse needs of retail and corporate customers. ICICI Direct.com has a dominant position
in its core segments of its operations Corporate Finance including Equity Capital Markets
Advisory Services, Institutional Equities, Retail and Financial Product Distribution. With a full-
service portfolio, a roster of blue-chip clients and performance second to none, we have a
formidable reputation within the industry. Today ICICI Securities is among the leading Financial
Institutions both on the institutional as well as retail side .ICICI Direct.com, the step down wholly
owned US subsidiary of the company is a member of the National Association of Securities
Dealers, Inc. (NASD). As a result of this membership, ICICI Securities Inc. can engage in
permitted activities in the U.S. securities markets. These activities include Dealing in Securities
and Corporate Advisory Services in the United States and providing research and investment
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advice to US investors. ICICI Direct.com is also registered with the Financial Services Authority,
UK (FSA) and the Monetary Authority of Singapore (MAS).
Website based online Share Trading Account by ICICI Direct is primarily for buying and selling
of stocks The ICICI Direct website allows Cash Trading, Margin Trading, Margin PLUS Trading,
Spot Trading, Buy Today Sell Tomorrow, IPO Investment, Mutual Fund Investment etc.
Trade Racer is a power packed Trading platform which provides an investor with Live streaming
quotes & Research Calls, integrated fund transfer system along with multiple watch list facility.
Investor can also do technical analysis with the help advance charting tools. Single Order entry
page for Equities and Derivatives, Technical Analysis, Integrated Fund Transfer System,
Customized Interface, Intra-day and EOD Charts and Shortcut keys for faster access to markets
are some of the key features of Trade Racer Terminal.
1. 3-in-1 account integrates your banking, broking and demat accounts. All accounts are from
ICICI and very well integrated. This feature makes ICICI the most interesting player in
online trading facility. There is absolutely no manual interfere require. This is truly online
trading environment.
2. Unlike most of the online trading companies in India which require transferring money to
the broker's pool or towards deposits, at ICICI Direct you can manage your own demat and
bank accounts through ICICI Direct.com. Money from selling stock is available in ICICI
bank account as soon as the ICICI Direct receive it.
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3. Investment online in IPOs, Mutual Funds, GOI Bonds, and Postal Savings Schemes all
from one website. General Insurance is also available from ICICI Lombard.
4. Trading is available in both BSE and NSE.
5. Low bandwidth website is available for slow internet connection or for trading from mobile
devices.
6. Relation managers are always available to help client.
7. Client can reduce brokerage by prepaid brokerage plans.
BOARD OF DIRECTORS
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3.4 SWOT ANALYSIS
SWOT analysis is done by all the companies to be aware about the competitor and new changes
in the market. The SWOT analysis leads the company to take strategic decisions. Company always
highlight its strength, try to hide own weakness and in the same way try to find out strength and
weakness of the competitors.
S - Strength
Strength of the ICICI Securities is the main feature of the service. As it gives 3 in 1 account to the
customer, the ease to trade at your convenient time is the main strength of the ICICI Direct.
Following are some of the strong points of the company. Convenience of time to trade Faster
transaction Paperless work 3 in 1 account facility so all work done at one place. The bank has
strength of the latest technologies and the most modern banking channels as net banking and the
schemes such as young saver accounts also. The young and energetic staff of the bank is also one
of the strengths.
W- Weaknesses
It is just like two side of the coin, if you have strength then you have weakness. The weakness of
the ICICI Direct.com can be said its high charges compared to other companies because of better
service.
O - Opportunity
Opportunity of the company is with the growth of volume of share trading and if company decides
to reduce the prices to some extent then a new market segment will come up as a customer of the
service. Ahmedabad being the big industrial city of Gujarat, company has enough of opportunities
to flourish its business here. ICICI securities can also grab the opportunity of establishing its
market in then ear by towns and villages by keeping their by updating and promoting investment
in mutual fund, equity market and other options of investment.
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T - Threat
Threat for the company can be considered as following. Growing competition Change in
government rules which is negative for stock market Low prices of local brokers Low awareness
of computer in public. The other threat of the new entrants in the market will take up the share
from them. Now a days many of the financing companies are entering the market, which is one of
the biggest threat for the company as they provide the finance service to the customers at very less
rates and also at the quickest.
In today's busy world assessing one's tax well in advance and investing in right tax saving products
with optimum returns seems to be a difficult task., with this also comes the pain of standing in
long queues for filing the tax returns timely.
You are Just 5 steps away from easing your Income Tax Worries:
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3.6 ACHEIVEMENTS OF THE COMPANY
Retail
ICICI Securities wins Global CSR Excellence & Leadership Awards 2016
"Best Performing National Financial Advisor Equity Broker' award at UTI CNBC TV 18
Financial Advisor Award 2014 - 2015
ICICIdirect.com, won the Outlook Money ' Best e- Brokerage Award' for 10th time in a row in
2014. Previously, the firm won the award in 2004, 2005, 2007, 2008, 2009, 2010, 2011, 2012
and 2013.
ICICI Securities won the Award for Outstanding Social Impacts at the Global Sustainability
Leadership Awards 2014 These awards recognize institutions for their contribution to the society
in their domain as well as businesses that deliver products and services in ways that takes full
account of their responsibility towards the communities they touch.
ICICI Securities was awared the "MOST ADMIRED SERVICE PROVIDER IN FINANCIAL
SECTOR" at the BANKING FINANCIAL SERVICES & INSURANCE AWARDS 2014
presented by ABP News.
ICICIdirect.com won the Mobbys award for the "Best Mobile application in Mobile Trading".
ICICI Securities Business Partners has been conferred the Franchise India Awards 2013, for
being the 'Franchisor of the year' in the Financial Services category.
ICICIdirect.com, won the award for Innovation at Banking Frontiers Finnoviti Awards 2013.
The award was conferred on ICICIDirect' for its `Valid Till Cancel Order' (VTC ) facility, which
was awarded amongst the top 3 innovations in BFSI industry by 'Peer Voting'.
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ICICI Securities won the Outlook Smart use Technology eRetailer of the year 2013 conferred by
FIHL in association with HomeShop18.com.
ICICIdirect.com won the 'Stock Broker of the Year' award at the Money Today FPCIL Awards
2012
ICICI Securities Business Partners (Sub Broker channel) won the 'Franchisor of the Year' at the
Franchise Awards 2012 for the fourth time in a row.
ICICI Securities won the 'BSE IPF D&B Equity Broking Awards 2012' under two categories:
ICICI Securities won the Chief Learning Officer Award from World HRD Congress for
Innovation in Learning category.
ICICI Securities won the Grand Jury Award for 'Commendable performance by National
Financial Advisor (Retail) - Online' at the CNBC TV 18 - Financial Advisor Awards 2011. The
awards recognises India's best Financial Advisors.
ICICI Securities Business Partners (Sub Broker channel) won the 'Franchisor of the Year at the
Franchise Awards 2011', third time in a row.
ICICI Securities was the winner of the'Smart use Technology eRetailer of the year' 2012 award
conferred by Franchise India in association with UTV Bloomberg for the first time.
ICICIdirect.com, won the Outlook Money ' Best e- Brokerage Award' seventh time in a row.
Previously, the firm won the award in 2004, 2005, 2007, 2008, 2009 and 2010.
ICICI Securities' Business Partners (Sub Broker channel) won the 'Franchisor of the Year
2011' for the third consecutive year.
Anup Bagchi, MD & CEO has been honoured with the Zee Business 'Industry Newsmaker
Award 2010' for his tremendous and unmatched contribution in the field of Finance
Pankaj Pandey, Head- Research - ICICIdirect has won the Zee Business Best Market Analyst
2010 award in the Equities Fundamental Category
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o 'Campaign of the Year' for the Trade Racer Campaign
o Brand Excellence in Banking and Financial Services for the store format
ICICIdirect, the neighborhood financial superstore won the prestigious Franchise India `Service
Retailer of the Year 2008 award.
ICICIdirect has also won the CNBC AWAAZ 2007 Consumer Award for the Most Preferred
Brand of Financial Advisory Services.
Institutional
ICICI Securities awarded the Asiamoney `Best Domestic Equity House' for 2012
Vikash Mantri tops The Wall Street Journal's Asia's Best Analysts survey in the media sector for
2010
ICICI Securities has awarded as the Best Investment Bank 2008 by Global Finance Magazine
The Corporate Finance group also was awarded a runner-up Best Merchant Banker by Outlook
Money in 2007.
ICICI Securities topped the Prime Database League Tables 2007 for money raised through
IPOs/FPOs.
The equities team was adjudged the 'Best Indian Brokerage House-2003' by Asiamoney.
Technology
ICICI Securities Ltd was awarded the The Indian Merchants Chamber - IT Awards 2015 for the
category "End Users of IT" by the Indian Merchants? Chamber under the BFSI domain.
ICICI Securities recently won the Innovation Award for Oracle Fusion Middleware.ICICI
Securities has consistently demonstrated the best usage of Oracle Tuxedo as an OLTP engine.
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These Asia-Pacific awards honor customers for their optimum and innovative solutions using
Oracle Fusion Middleware.
Fairfax Business Media has recognized ICICI Securities as a recipient of CIO 100 Asia award in
2013.
ICICI Securities has been awarded the NASSCOM IT Innovation Awards 2013.
CIO Masters for Collaboration and Cloud was awarded by Biztech2 (Network 18) in 2013.
IDG India has recognized ICICI Securities as a recipient of CIO 100 award in 2009, 2010, 2011
and 2012, four times in a row.
IDG India has conferred the CIO Hall of Fame award in 2012.
EMC Transformers Award was presented for best use of IT to transform business in 2012
CIO Masters for Virtualization was awarded by Biztech2 (Network 18) in 2012
ICICI Securities was the Bloomberg UTV CXO Awards Finalist for Best Utilization of IT to
Transform Business in 2011
ICICI Securities was conferred the Gold CIO award jointly by CIOL and Dataquest at the
Enterprise Awards 2010
ICICI Securities was the NASSCOM CNBC IT User Awards Finalist in 2009 and 2010
Indian Bank's Association Business Technology Awards was presented for Best Online Trading
Platform in 2006 and 2007
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CHAPTER 4 RESEARCH METHODOLOGY
This report is based on primary as well secondary data, however primary data collection was given
more importance since it is overhearing factor in attitude studies. One of the most important users
of research methodology is that it helps in identifying the problem, collecting, analyzing the
required information data and providing an alternative solution to the problem .It also helps in
collecting the vital information that is required by the top management to assist them for the better
decision making both day to day decision and critical ones.
Research is based on primary data as well as secondary data. Secondary data can be used only for
the reference. Research has been done by primary data collection, and primary data has been
collected personally. The secondary data has been collected through various journals and websites
4.3 SAMPLING
SAMPLING PROCEDURE
The sample was selected of existing investors. It was also collected through personal, by formal
and informal talks and through filling up the questionnaire prepared.
SAMPLE SIZE
SAMPLE DESIGN
Data has been presented with the help of bar graph, pie charts, line graphs etc.
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4.4 LIMITATION
Some of the persons were not so responsive. Sample size is limited to 100 people including
government employee, private employee, business man, doctors and others. The sample size may
not adequately represent the whole market. Some respondents were reluctant to divulge personal
information which can affect the validity of all responses. The research is confined to a certain part
of Delhi NCR.
A research design is the master plan or model for the conduct of formal investigation and survey.
It is a specification of methods and procedures for acquiring the information of investors like which
customers are interested in Mutual fund and needs for solving the problem. It decides the source
of information and methods for gathering the data. A questionnaire and other forms are tested to
use the collection of data. A sampling design is to be selected.
DATA COLLECTION
Primary data will be collected through feedback form filled by the customer.
Customers were the investor who mostly likely to invest in Equity or Fixed deposit or there
were customers who had stopped investing in the market.
Customers mostly prefer investing through online channels as mode of investment.
The customers were already existing customers of ICICI company weather insurance, so
this database was used for cross sealing.
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CHAPTER 5 LEARNING AND FINDINGS
LEARNING
INTERPERSONAL LEARNING:
Improved skills: i have improved my communication skills.
Convincing Power: while talking with different customer I have learned many
thing like how to convince different customer.
Interest of Customer is most important thing so give them real time example so
they can understand easily and your presentation did not get boring for them.
Different customer different examples : when you are talking with customers
who has salary of 3-4 lacs per month give them examples of sip of 50 k -70k
because if you give them small value they find you can manage only this much
amount you are not capable to handle my 30-40 lac portfolio. When you talk with
person who has salary of 30k to 50k and if you give him examples of 40k to 50k
sip then he will feel shy that you manage this much amount and I have only very
less amount so he will not show more interest in your scheme so you have to give
example bye knowing your customers.
Learning about people: when you meet different people they have very
different prospective you can observe that person is in good mood or angry mood
you have to talk with them accordingly. If person has some issue then listen them
carefully and let them complete because if you talk in between he will let you
remind their problem in between your presentation and your presentation can not
become as much interesting as much it should have been.
An internship is an opportunity to test out a career field of interest, when I
join my internship I am little bit confused about my interest of working in
financial service firm but after joining I came to know that it is very interesting
job to meet diversified customers and meet them and there is lots of knowledge
one can get from this career like about share market, how different scheme works
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, how to help client in taxation , indexation, prepaid brokerage schemes. Now I
am very much clear that I want to join financial service firm and this job can give
me satisfaction.
Relationship building: Building a good relationship with your manager or
supervisor and other employee should be a top priority.
Knowledge of the fileld: Obviously you learn a lot in your classes, but classes
can only teach you fundamentals . Hands-on experience is essential. Youll learn
whats actually happening in the field and can see if its what you really want to
do.
Leadership: A leader is one who knows the way, goes the way, and shows
the way, I have shown many excellent leader in my life, our branch manager
Mr. Ujjaval Dubey is one of them. The way he lead the entire branch is excellent.
He is very friendly with every employee so work environment is very good for
this particular branch and when it comes to work, his dedication is
recommendable like he arrange meeting every week take data from employee and
analyses their data and always remind them that if you want to complete this work
you have to do these things. I can only say captain leading from the front. I have
learned many things from him.
A greater sense of professionalism: Working in an office environment (or any
kind of professional setting) can be difficult to get used to - and the best (perhaps
only) way to learn how to navigate the working world is through real life, hands-
on experience. After your internship, you should have a better idea of the
appropriate way to behave as a professional.
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LEARNING OF DIFFERENT FUNDAS:
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While computing tax, CII is multiplied with the purchase price to arrive at the
indexed cost of acquisition. This is the actual cost of the asset.
Therefore, the indexed cost of acquisition = 20,00,000 X 1.49 = Rs.29,92,288
The long term capital gain= sale value of the asset- indexed cost of acquisition
i.e., 35,00,00- 29,92,288 = Rs.5,07,712
The tax liability if you use the indexation method is charged at 20 percent. The
tax liability will be 20% X 5,07,712 = Rs.1,01,542
If you do not use the indexation method, the tax is liable at 10% on the capital
gain. The capital in this case is sale price of the apartment cost of acquisition =
35,00,000 20,00,000 = Rs.15,00,000. The capital gains tax is 10% X 15,00,000
= Rs.1,50,000.
When you index, it helps you save taxes. It helps you adjust the purchasing price
of the apartment with the current market prices.
NAV
The Net Asset Value (NAV) of a mutual fund is the price at which units of a mutual
fund are bought or sold. It is the market value of the fund after deducting its
liabilities. The value of all units of a mutual fund portfolio are calculated on a daily
basis, from this all expenses are then subtracted. The result is then divided by the
total number of units the resultant value is the NAV. NAV is also sometimes
referred to as Net Book Value or book Value.
Calculation of NAV:
Mutual fund assets usually fall under two categories securities & cash.
Securities, here, include both bonds and stocks. Therefore, the total asset value of a
fund will include its stocks, cash and bonds at market value. Dividends and interest
accrued and liquid assets are also included in total assets.
Also, liabilities like money owed to creditors, and other expenses accrued are also
included. Now the formula is:
Net Asset Value (NAV) = (Assets Debts) / (Number of Outstanding units)
Here:
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Assets = Market value of mutual fund investments + Receivables + Accrued
Income
Debts = Liabilities + Expenses (accrued)
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ADVANTAGES AND DISADVANTAGES OF INVESTING ONLINE OVER
AMC
Advantages:
Convenient and Paperless transactions: You can centralize your mutual fund
and stock investments at one place and/or have multiple schemes spread across
fund houses. Also, there would be no tiresome process of form filling or giving
documents every time you buy MF.
Simplifies the nomination requirements for your investments: This is true in
case of a single nominee for all your investments.
Convenient in case of change in contact information: This consolidated
platform Demat Account helps if the investor changes his address or mobile
number. Instead of multiple applications to different Fund Houses requesting for
change of address, you need to give just one application for the multiple
investments you hold.
Disadvantages:
Higher charges: Trading and holding mutual funds schemes through Demat
Account is a bit expensive compared to the same done through independent online
mutual fund platforms such as FundsIndia and FundsSuperMart. Most Brokerage
houses charge a flat fee for both lump sum and SIP investment in mutual fund
schemes unlike the online mutual fund platforms who offer the same service for
zero fees.
Advantageous if you are a Stock Investor: Investment in mutual fund schemes
through Demat Accounts is useful and cost effective for those who also
invest/trade in direct stocks.
Not all schemes offered under Demat Account: You can purchase and hold
units of mutual fund schemes of only those AMCs with which your Brokerage
House has tie-up with. If you wish to invest in schemes of other AMCs, you may
have to consider other channels (as listed above).
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IMPORTANCE OF FUNDMANAGER IN MUTUAL FUND
People turn to funds because they want growth. Fund managers can only deliver it
by putting clients' money to work, so they have to decide where to invest. Their
choices are shaped not only by the rules and regulations applicable to the fund, but
also by clients' expectations. Fund managers are judged by how well their fund
performs.
Fund managers have a responsibility to protect investors' money. Prudent investors
are aware that funds must take some risks to deliver growth but they do not expect
reckless behavior. Therefore, fund managers' choices to buy or sell assets are
preceded by a lot of research and due diligence, which can involve investigating
companies or assets, attending industry events and employing risk management
techniques to assess investments. Fund managers also address risk by ensuring asset
portfolios are sufficiently diversified.
EXPENCE RATIO
The expense ratio is a measure of what it costs an investment company to operate
a mutual fund. An expense ratio is determined through an annual calculation,
where a fund's operating expenses are divided by the average dollar value of its
assets under management (AUM).
EVALUATION OF RISK PROFILE
Before giving any advice to any client we have to completely analyze their profile
because if you dont measure then you can not give them best advise. for example
retired person always want to take less risk , they are ok with little bit less return
but they want assurance of return because at that stage they can not take more risk
because they dont have now regular income so we have to advice them less risky
funds. Best funds are those which covers most of requirement of client. One can
be best for one client and not suitable for another client based on their risk
profiles. Thats why risk before investment risk profile evolution is critical.
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VIRTUAL TRADING
I have open 3 in 1 account with ICICI. there is one option of virtual trading on
ICICI direct website. in this virtual trading you will given some fixed virtual
amount and you can trade any stock from NSE and BSE virtually. From this you
can get knowledge of how actual share market works without investing any
money. you can not use every function in virtual trading but you can learn basics
of trading.
INTRADAY TRADING
Intraday trading as the name suggests refers to the trading system where you have
to square-off your trade on the same day. Squaring off the trade means that you
have to do the buy and sell or sell and buy transaction on the same day before the
market close. Intraday Trading is also referred to as Day trading by many traders
Why many traders find Intraday Trading attractive ?
Brokerage charges for the stocks traded under the day trading segment are very less
than Delivery segment.
High Margin is available for Day trading (eg.If you have Rs.5000 in your account,
you will be allowed to do transactions worth multiple times of this value. This ratio
varies as per the policy of the Brokerage firms. Some of the brokerage firms even
allow upto 10 times margin)
They do not want to carry their positions overnight as the stock price might be
impacted due to some other event and open with a gap up or gap down the next day.
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Be your own boss: The day trader works alone, independent from the whims of
corporate bigwigs. He can have a flexible working schedule, take time off whenever
needed, and work at his own pace, unlike someone on the corporate treadmill.
Never a dull moment: Long-time day traders love the thrill of pitting their wits against
the market and other professionals day in and day out. The adrenaline rush from rapid-
fire trading is something that not many traders will admit to, but is a big factor in their
decision to make a living from trading, compared with spending their days selling
widgets or poring over numbers in an office cubicle.
CONS:
Risk of substantial losses: In an investor publication titled "Day Trading: Your Dollars
at Risk," the U.S. Securities and Exchange Commission points out that "days traders
typically suffer financial losses in their first months of trading, and many never
graduate to profit-making status." While the SEC cautions that day traders should only
risk money they can afford to lose, the reality is that many day traders incur huge losses
on borrowed monies, either through margined trades or capital borrowed from family
or other sources. These losses may not only curtail their day trading career, but also put
them in substantial debt.
Be your own boss: To really make a go at it, a trader must quit his day job and give up
his steady monthly paycheck. From then on, the day trader must depend entirely on his
own skill and efforts to generate enough profit to pay the bills and enjoy a decent
lifestyle.
High stress and risk of burnout: Day trading is stressful because of the need to watch
multiple screens to spot trading opportunities, and then act quickly to exploit them.
This has to be done day after day, and the requirement for such a high degree of focus
and concentration can often lead to burnout.
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BROKERAGE CALCULATION:
I - Secure Plan
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ICICIDirect Future & Future Plus Brokerage
Above Rs 20 0.030 Rs 15 Rs 10
Crores
Rs 10 Crores to 0.035 Rs 15 Rs 10
20 Crores
Rs 5 Crores to 10 0.040 Rs 15 Rs 10
Crores
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ICICI Direct Options Brokerage
Above 600 65 Rs 15
301-600 70 Rs 15
151-300 75 Rs 15
61-150 85 Rs 15
0-60 95 Rs 15
An Option gives the buyer the right but not the obligation. As a buyer, you may
choose to let the option to buy call or put option lapse. The seller has an obligation
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to comply with the contract. In the case of a futures contract, there is an obligation
on the part of both the buyer and the seller.
Options are of two types - Calls and Puts options:
'Calls' give the buyer the right, but not the obligation to buy a given quantity of the
underlying asset, at a given price on or before a given future date.
'Puts' give the buyer the right, but not the obligation to sell a given quantity of
underlying asset at a given price on or before a given future date.
If the buyer of options chooses to exercise the option to buy, the counter-party
(seller) must comply. A futures contract, on the other hand, is binding on both
counter-parties as both parties have to settle on or before the expiry date.
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ADVANTAGES AND DISADVANTAGES OF INVESTMENT IN EQUITY
ADVANTAGES:
CAPITAL GAIN: The other source of return on investment apart from dividend is
the capital gains. Gains which arise due to rise in market price of the share.
CLAIM OVER ASSETS AND INCOME: An investor of equity share is the owner
of the company and so is the owner of the assets of that company. He enjoys a share
of the incomes of the company. He will receive some part of that income in cash in
the form of dividend and remaining capital is reinvested in the company.
RIGHTS SHARES: Whenever companies require further capital for expansion etc,
they tend to issue rights shares. By issuing such shares, ownership and control of
existing shareholders are preserved and the investor receives investment priority over
other general investors.
LIQUIDITY: The shares of the company which is listed on stock exchanges have the
benefit of any time liquidity. The shares can very easily transfer ownership.
DISADVANTAGES
HIGH RISK: Equity share investment is a risky share compared to any other
investment like debts etc. The money is invested based on the faith an investor has in
the company. There is no collateral security attached with it.
FLUCTUATION IN MARKET PRICE: The market price of any equity share has a
wide variation. It is always very difficult to book profits from the market. On the
contrary, there are equal chances of losses.
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LIMITED CONTROL: An equity investor is a small investor in the company,
therefore, it is hardly possible to impact the decision of the company using the voting
rights.
RESIDUAL CLAIM: An equity shareholder has a residual claim over both the
assets and the income. Income which is available to equity shareholders is after the
payment of all other stakeholders viz. debenture holders etc.
FINDINGS
Most of the clients are not aware with concept of mutual fund and its advantages.
Clients who know about mutual fund are not investing their money into it because
of lack of knowledge about mutual fund.
Customers problems are solved as soon as possible in ICICI direct.
Mostly customers want to invest in fixed deposit only because they dont want to
take risk of their money.
In Occupation group most of the Investors were Govt. employees, the second most
Investors were Private employees and doctors.
Most of customers who switch from ICICI direct to another broker gives reason of
high brokerage.
Most of customers know something about mutual fund but they dont have deep
knowledge about Mutual fund.
Most of client prefer investment their money in equity.
People with the age of 45 to 65 years are more potential customers.
Most of the female clients accounts has been handled by their husbands or son.
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SUGGESTION
After seeing the whole Data analysis and findings, the Recommendations for the company are
shown as below.
The company should give the knowledge regarding Mutual Fund through various sources
like more advertisement, TV programmes etc. about what it is? How it works? What is its
benefit for us with its advertisement or in programmes ? Because many people have heard
about it but dont know what it is?
The company should also attract the low Income people by showing them the benefits of
the liquidity funds for the short Term to attract them.
The company should also attract the customer through different schemes who having
knowledge about the Mutual Funds but not investing in Mutual Funds.
The company should give information regarding Tax benefit to Invest into Mutual Fund.
The company should organize Free seminars to give information about Mutual Fund and
should distribute brochures having detail of schemes of Mutual Fund
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CONCLUSION:
After a thorough study and analysis of the questionnaires, Feedback given by clients some
important and useful findings can be stated. These findings have helped in a great way to come to
the conclusion part of the project work. The project was quite successful at the end of the internship
period of the researcher. The researcher had a great experience working with ICICI Securities Ltd.
Meetings with customers were useful to understand their queries about mutual funds and
investment in the same with the use of ICICIDirect.com.
There was a lot of confusion about mutual funds in the minds of customers. Because of the
awareness program undertaken by ICICI Securities Ltd many of the respondents now have clear
idea about mutual funds and are willing to invest in the same.
Though many of the customers were aware about online investment in MFs through
ICICIDirect.com, only few were investing. But after showing the demo of the same, many of them
impressed with it and gave positive response about the awareness program.
Also, the researcher got ample of knowledge about the mutual funds. The researcher also learnt
about comparison of various schemes based on different parameters.
As many of the customers are now aware about the mutual funds and online investment through
ICICIDirect.com, the project has been successfully completed by the researcher.
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BIBLIOGRAPHY:
http://icicisecurities.com/
http://content.icicidirect.com/idirectcontent/Home/Home.aspx
www.amfiindia.com
www.ific.ca/en/articles/who-we-are-history-of-mutual-funds/
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