Hiren

Analysis of Investment Through Broking & Consultancy HIREN
HIREN M CHAUHAN
CHAPTER 01
INTRODUCTION
VISION
“We seek to emerge as the most credible financial services company serving the varied
needs of every kind of investor by being thought leaders, innovative solution providers and
ethical financial partners”
Month &
Activity
Year
October 1994 Acquired NSE Membership in individual name of our Promoter which was
later transformed to a Corporate Membership in the name of Niche
Brokerage Private Limited in the year 2000.
November 1999 Acquired BSE Membership in the name of Yogesh Securities Private
Limited, which was merged with Niche Brokerage Private Limited in July
2006.
January 2001 Acquired license to operate Depository from NSDL
September Acquired PMS License
2005
December 2006 Acquired AMFI certification
January 2007 Acquired MCX License
March 2007 Acquired NCDEX License
April 2007 Started online trading service
July 2007 Acquired Merchant Banking License
July 2007 Name changed from Niche Brokerage Private Limted to India Capital
Markets Private Limited.
October 2007 Acquired license to operate Depository from CDSL
September Started Currency derivatives
2008
Mumbai Institute of Management & Research 1

India Capital Markets Membership In NSE
There are no entry/exit barriers to the membership in NSE. Anybody can become member by
complying with the prescribed eligibility criteria and exit by surrendering membership
without any hidden/overt cost.
The standards for admission of members laid down by the Exchange stress on factors such as,
corporate structure, capital adequacy, track rescord, education, experience, etc. and reflect a
conscious effort on the part of NSE to ensure quality broking services so as to build and
sustain confidence among investors in the Exchange’s operations.
Benefits to the trading membership of NSE include:
1) Access to a nation-wide trading facility for equities, derivatives, debt and hybrid
instruments / products,
2) Ability to provide a fair, efficient and transparent securities market to the investors,
3) Use of state-of-the-art electronic trading systems and technology,
4) Dealing with an organization which follows strict standards for trading & settlement at par
with those available at the top international bourses,
5) A demutualised Exchange which is managed by independent and experienced

professionals, and
6) Dealing with an organization which is constantly striving to move towards a global

marketplace in the securities industry.

Membership Recommendation Committee (previously known as

Membership Approval Committee)

The Membership Recommendation Committee (MRC) consists of seven persons from

various disciplines, including the Managing Director of the Exchange. The MRC conducts
interviews with the applicants for trading membership.
The following persons have to appear for the interview:
(i) Corporates - A dominant shareholder and a Whole-time Director
(ii) Individuals – individual himself
(iii) Partnership Firms – Two partners
The purpose of the interview is to gain knowledge about the prospects as to their capability &
commitment to carry on stock broking activities, financial standing and integrity.
The MRC is only a recommendatory body about the admissibility of the prospect or
otherwise to the Board of Directors of the Exchange. It recommends the names of the
prospects it deems fit to the Board for their approval.
AsianStockWorld.com is a online venture of Asian Corporate Consultancy which began its

operations in the year 1998. Asian corporate consultancy provides total corporate
and investment consultancy. It has a panel of expert corporate and technical analysts in its
fold which provides a solid foundation for research. Asian corporate consultancy is well
known for corporate seminars, group debates and company visits.
Asian corporate consultancy provides daily updates to its clients on investments through e-
mail, sms and circulars. Asian Corporate Consultancy also provides our clients audio-visual
aids in the form of pre-recorded cassettes and DDS of Investment seminars to learn and
understand investment strategies.
Asian corporate consultancy is headed by Mr. Dilip Desai (B. Com., LLB, DLLP) who has

vast experience in corporate field. He has been instrumental in taking the Asian Group
amongst the top five consulting houses in the country. He has been serving the group since
the last 12 years.
Vision
“To become the most preferred investment adviser to the individual investor."
Mission
“We believe that information can neither be suppressed by nor held ransom to market
inefficiencies. It needs to be disseminated at greater speed to all participants, especially
small investors for a better price discovery and lesser volatility in the marketplace.
Otherwise, it makes some people more equal than others which is a basic violation of the
universal principle of equality which we believe is unfair.”
Rich Experience
Our dedicated team of professional traders and analysts has over 15 years of successful &
profitable trading experience. This experience is put together to produce trading systems and
publish several stock trading and investing newsletters for the day trader, swing trader,
position trader & the long term investor in Indian Stocks & Indices. Our goal is to help our
readers achieve above-average returns from the markets and create wealth for the client and
their families.
PROCEDURE TO BECOME
SUB-BROKERS

The trading members of the Exchange may appoint sub-brokers to act as agents of the
concerned trading member for assisting the investors in buying, selling or dealing in
securities. The sub-brokers would be affiliated to the trading members and are required to be
registered with SEBI. A sub-broker would be allowed to be associated with only one trading
member of the Exchange.
Trading members desirous of appointing sub-brokers are required to

submit,
The following documents to the Membership Department of the Exchange:
1) Copy of sub-broker - broker agreement duly certified by the trading Members.
2) Application form for registration as a sub-broker with Securities and Exchange Board
of India (Form B).
3) Recommendation letter to be given by the trading member with whom the sub-broker
is affiliated (Form C).
4) Individual client registration application form.
5) Non-individual client registration application form.
6) Sub-broker client agreement.
7) Purchase/Sale Note issued by Sub-brokers acting for constituents.


Eligibility
A sub-broker may be an individual, a partnership firm or a corporate. In case of corporate or

partnership firm, the directors or partners and in the case of an individual sub-broker
applicant, each of them shall comply with the following requirements:
(1) They shall not be less than 21 years of age.
(2) They shall not have been convicted of any offence involving fraud or dishonesty.
(3) They shall have at least passed 12th standard equivalent examination from an institution
recognized by the Government.
(4) They should not have been debarred by SEBI
(5) The corporate entities applying for sub-brokership shall have a Minimum paid up capital
of Rs. 5 Lakh and it shall identify a dominant shareholder who holds a minimum of 51%
shares either singly or with the unconditional support of his/her spouse.
Registration
No sub-broker is allowed to buy, sell or deal in securities, unless he or she holds a certificate
of registration granted by SEBI. Sub-brokers are required to obtain certificate of registration
from SEBI in accordance with SEBI (Stock Brokers & Sub-brokers) Rules and Regulations,
1992, without which they are not permitted to buy, sell or deal in securities.
CHAPTER 02
TYPES OF INVESTMENT OFFERED BY

ASIAN CORPORATE CONSULTANCY [ACC]
Some of the Following are the investments directed by ACC according to

the risk appetite of the Investors.
1) EQUITY
Equity market can be split into two main sectors: the primary and secondary market. The
primary market is where new issues are first offered. Any subsequent trading takes place in
the secondary market.
Equity market in which shares are issued and traded, either through exchanges or over-the-
counter markets. Also known as the stock market, it is one of the most vital areas of a market
economy because it gives companies access to capital and investors a slice of ownership in a
company with the potential to realize gains based on its future performance.
2) COMMODITIES
A basic good used in commerce that is interchangeable with other commodities of the same
type. Commodities are most often used as inputs in the production of other goods or services.
The quality of a given commodity may differ slightly, but it is essentially uniform across
producers. When they are traded on an exchange, commodities must also meet specified
minimum standards, also known as a basis grade.
The sale and purchase of commodities is usually carried out through futures contracts on
exchanges that standardize the quantity and minimum quality of the commodity being traded.
For example, the Chicago Board of Trade stipulates that one wheat contract is for 5,000
bushels and also states what grades of wheat can be used to satisfy the contract.
3) MUTUAL FUNDS
A Mutual Fund is a trust that pools the savings of a number of investors who share a common

financial goal. The money thus collected is then invested in capital market instruments such
as shares, debentures and other securities. The income earned through these investments and
the capital appreciations realized are shared by its unit holders in proportion to the number of
units owned by them. Thus a Mutual Fund is the most suitable investment for the common
man as it offers an opportunity to invest in a diversified, professionally managed basket of
securities at a relatively low cost. The flow chart below describes broadly the working of a
mutual fund:
Mutual Fund Operation Flow Chart
4) OTHER INVESTMENTS
a. BONDS
The indebted entity (issuer) issues a bond that states the interest rate (coupon) that will be
paid and when the loaned funds (bond principal) are to be returned (maturity date). Interest
on bonds is usually paid every six months (semi-annually). The main categories of bonds are
corporate bonds, municipal bonds. Treasury bonds, notes and bills, which are collectively
referred to as simply "Treasuries".
Two features of a bond - credit quality and duration - are the principal determinants of a
bond's interest rate. Bond maturities range from a 90-day Treasury bill to a 30-year
government bond. Corporate and municipals are typically in the three to 10-year range
A debt investment in which an investor loans money to an entity (corporate or governmental)

that borrows the funds for a defined period of time at a fixed interest rate. Bonds are used by
companies, municipalities and states to finance a variety of projects and activities.

Bonds are commonly referred to as fixed-income securities and are one of the three main
asset classes, along with stocks and cash equivalents
b. COMMERCIAL PAPERS
Commercial papers (CP) are unsecured money market instruments issued in the form
of a promissory note by large corporate houses in order to diversify their sources of short-
term borrowings and to provide additional investment avenues to investors. Issuing
companies are required to obtain investment-grade credit ratings from approved rating
agencies and in some cases, these papers are also backed by a bank line of credit. CPs are
also issued at a discount to their face value. In India, CPs can be issued by companies,
primary dealers (PDs), satellite dealers (SD) and other large financial institutions, for
maturities ranging from 15 days period to 1-year period from the date of issue. CP
denominations can be Rs. 500,000 or multiples thereof. Further, CPs can be issued either in
the form of a promissory note or in dematerialized form through any of the approved
depositories.
SHORT TERM:-
Short Term investments are the investments which may last for a day, for some weeks
and couple of months. It also includes day Trading stocks and futures.
MEDIUM TERM:-
Medium Term investments are the investments which may last for 6 months to 12
months.
LONG TERM:-
Long Term Investments are the investments which may last for more than 1 year.
LIFE CYCLE STAGE
LIFE FEATURES PRIORITY CHOICE OF

CYCLE INVESTMENT

STAGE
This is a period of Long term investment No immediate need.
dependency which of money received in Long term investments.
lasts till the full time the form of gift at
Childhood education finishes. various occasions.
Stage Most of the

requirement are
fulfilled by parents or
relatives.
Might still depends to They might not have Liquid plans & short
some extent on any dependents & term investments.
parents. hence might not need Investments for long
Relatively lower insurance. Main need term plans when
Young income & would not is to protect their adequate short term
be able to afford large earnings against any savings is achieved.
Unmarried
amount to financial disability or long-
planning. sickness.
More risk taking More immediate &
ability. short term needs.
Two incomes to meet To secure income loss Medium to long term

costs & save. of any partner against investments. Ability to
Sufficient surplus to any disability or long- take risks.

Young meet financial sickness. Fixed income, insurance
married planning needs. Life insurance so that & equity products.
stage: both Short & intermediate in unfortunate event
partners term Housing & of any partners death
insurance needs that part of income

earn
Consumer finance may be replaced.
need. Need for emergency

fund
Young Two or more Life assurance of Medium to long term

dependent on just one earning member is investments. Lesser

earner. must. ability to save & take
married
Less potential to save. Need to start for risk.
stage: one
pension provision at
partner earn
an early stage is
immense.
Arrival of kids Life assurance of Medium to long term
changes the scenario. earning member is investments.
The expenditure starts must. Ability to take risks.
Young rising at a faster rate Consumer finance Portfolio of products,
married with then income. needs are high. for growth & long term.
Children’s education,
children Financial planning
holidays & consumer
needs are highest as
finance.
this stage is ideal for
disciplining.
Housing Individuals Spending and saving Medium term
are in Mid-career and regularly investments with high
family has become Higher Saving ratios liquidity needs.
bigger with more recommended. Portfolio of products
children including equity, debt
Priority would shift
Improved finances and from protection needs and pension plans Major
better life style to investment needs contributions to pension
Medium term needs because of pension products.
for children’s needs. Contribution to health
education and insurance.
Because of load
Married with marriage.
repayment needs
older Need for pension, requirement for
children insurance and medical intermittent cash
cover higher. flows is higher.

Children have become Adequate income & Maximum investment in

independent. Savings pension products.
Last chance to ensure

adequate income to
maintain the standards
Post of living after

retirement.
Family/Pre-
Retirement
stage
As a thumb rule, after After Retirement the The need would
retirement individuals savings rate decline correspond to the
need2/3 rd of their substantially categories 1),2) and 3)
final years incomes. of the previous column:
In general people 1) Continue to

would fall in one of work and/or
the following three produce fixed
categories: income with no
1) Low pension risk at all.
income and low 2) Invest capital to

capital to supplement produce
it additional
Retirement income and can
2) Relatively low
Stage pension income plus take any risk
some accumulated 3) Wise People.

capital. Need to preserve
the value of
savings against
3) Sufficient Pension
inflation.
income plus
substantial assets and
capital.

DIFFERENT PHASES OF INVESTMENT LIFE-CYCLE
FINANCIAL INVESTMENT
PHASES FEATURES
NEEDS PREFERENCES
In this phase, Investors Investing for long Growth options and long
look to build wealth for term identified term products.
their financial goals, financial goals High – risk appetite.
Accumulation
which are still sometime
Phases away. Their primary aim
is long term wealth
accumulation.
This stage is one where He needs to plan in Liquid and medium term
one or more of the goals advance by investments.
of investors are adjusting his Investor has lower risk
Transition approaching about to be investments. Short appetite
Phases approached in clear term needs for
short-term future. funds as the dates
for objectives is
coming closer.
This stage means that Need to spend Liquid and medium term
the goal for which the money on investments. Preference
investor was objectives for income and debt
Reaping accumulating wealth has Higher liquidity products.
Phases arrived, and therefore requirements
this is a stage of
spending the money of
utilizes the goal.
This is a stage where Long term Low liquidity needs.
Inter- investors start to think investment of Ability to take risk and
of ways to share their inheritance invest for the long term
generational wealth to near ones or to
transfer transfer in favor of
different beneficiary.

This stage is one where Medium to long Wealth preservation.

due to certain event term Preference for low risk
investors receives products.
sudden cash flow, which
Sudden wealth increases their wealth
surge significantly. These
events may be like
winning lottery,
inheriting estate, huge
appreciation of shares
held, etc.
RECOMMENDED MODEL PORTFOLIO



CHAPTER 03
FUNDAMENTAL & TECHNICAL ANALYSIS
Technical analysis and fundamental analysis are the two main schools of
thought in the financial markets. As we've mentioned, technical analysis looks
at the price movement of a security and uses this data to predict its future price
movements. Fundamental analysis, on the other hand, looks at economic
factors, known as fundamentals. Let's get into the details of how these two
approaches differ, and how technical and fundamental analysis can be used
together to analyze securities.
What Does Fundamental Analysis Mean?
Fundamental analysis is about using real data to evaluate a security's value. Although most
analysts use fundamental analysis to value stocks, this method of valuation can be used
for just about any type of security.
For example, an investor can perform fundamental analysis on a bond's value by looking at
economic factors, such as interest rates and the overall state of the economy, and information
about the bond issuer, such as potential changes in credit ratings. For assessing stocks, this
method uses revenues, earnings, future growth, return on equity, profit margins and other
data to determine a company's underlying value and potential for future growth. In terms of
stocks, fundamental analysis focuses on the financial statements of the company being
evaluated.
The end goal of performing fundamental analysis is to produce a value that an investor can
compare with the security's current price, with the aim of figuring out what sort of position to
take with that security (underpriced = buy, overpriced = sell or short).
This method of security analysis is considered to be the opposite of technical analysis.

The Very Basics

When talking about stocks, fundamental analysis is a technique that attempts to determine a Security’s value by
focusing on underlying factors that affect a company's actual business and its future prospects. On a broader
scope, you can perform fundamental analysis on industries or the economy as a whole. The term simply
refers to the analysis of the economic well-being of a financial entity as opposed to only its price movements
Fundamental analysis serves to answer questions, such as:
 Is the company’s revenue growing?

 Is it actually making a profit?
 Is it in a strong-enough position to beat out its competitors in the future?
 Is it able to repay its debts?
 Is management trying to "cook the books"?
Of course, these are very involved questions, and there are literally hundreds of others you might have about a
company. It all really boils down to one question: Is the company’s stock a good investment? Think of
fundamental analysis as a toolbox to help you answer this question.
The factor that suppose to go through while Analyzing

Fundamentally
A. QUALITATIVE FACTORS
 Business Model
Even before an investor looks at a company's financial statements or does any research, one of the most
important questions that should be asked is: What exactly does the company do? This is referred to as a
company's business model – it's how a company makes money. You can get a good overview of a company's
business model by checking out its website.
 Competitive Advantage

Another business consideration for investors is competitive advantage. A company's long-term success is driven
largely by its ability to maintain a competitive advantage - and keep it. Powerful competitive advantages, such as
Coca Cola's brand name and Microsoft's domination of the personal computer operating system, create a moat
around a business allowing it to keep competitors at bay and enjoy growth and profits. When a company can
achieve competitive advantage, its shareholders can be well rewarded for decades.
 Management
Just as an army needs a general to lead it to victory, a company relies upon management to steer it towards
financial success. Some believe that management is the most important aspect for investing in a company. It
makes sense - even the best business model is doomed if the leaders of the company fail to properly execute the
plan.
So how does an average investor go about evaluating the management of a company?
This is one of the areas in which individuals are truly at a disadvantage compared to professional investors. You
can't set up a meeting with management if you want to invest a few thousand Rupees. On the other hand, if you
are a fund manager interested in investing millions of Rupees, there is a good chance you can schedule a face-
to-face meeting with the upper brass of the firm.
 Market Share
Understanding a company's present market share can tell volumes about the company's business. The fact that
a company possesses an 85% market share tells you that it is the largest player in its market by far. Furthermore,
this could also suggest that the company possesses some sort of "economic moat," in other words, a
competitive barrier serving to protect its current and future earnings, along with its market share. Market share
is important because of economies of scale. When the firm is bigger than the rest of its rivals, it is in a better
position to absorb the high fixed costs of a capital-intensive industry.
 Industry Growth
One way of examining a company's growth potential is to first examine whether the amount of customers in the
overall market will grow. This is crucial because without new customers, a company has to steal market share in
order to grow.
B. QUANTITAVE FACTORS

 The Income Statement
The income statement is basically the first financial statement you will come across in an annual report or
quarterly Security & Exchange Board of India (SEBI) filing.
It also contains the numbers most often discussed when a company announces its results - numbers such as
revenue, earnings and earnings per share. Basically, the income statement shows,
a. How much money the company generated (revenue).
b. How much it spent (expenses) and
c. The difference between the two (profit) over a certain time period.
When it comes to analyzing fundamentals, the income statement lets investors know how well the
company’s business is performing - or, basically, whether or not the company is making money. Generally
speaking, companies ought to be able to bring in more money than they spend or they don’t stay in business for
long. Those companies with low expenses relative to revenue - or high profits relative to revenue - signal strong
fundamentals to investors.
 The Balance Sheet
Investors often overlook the balance sheet. Assets and liabilities aren't nearly as sexy as revenue and
earnings. While earnings are important, they don't tell the whole story
The balance sheet highlights the financial condition of a company and is an integral part of the financial
statements.
The Balance Sheet's Main Three
Assets, liability and equity are the three main components of the balance sheet. Carefully analyzed, they can tell
investors a lot about a company's fundamentals.
o Assets

There are two main types of assets:
1) Current Assets
2) Non-Current Assets
1. Current assets are likely to be used up or converted into cash within one business cycle usually treated
as twelve months. Three very important current asset items found on the balance sheet are: cash,
inventories and accounts receivables.
Investors normally are attracted to companies with plenty of cash on their balance sheets. After all, cash
offers protection against tough times, and it also gives companies more options for future growth.
Growing cash reserves often signal strong company performance. Indeed, it shows that cash is
accumulating so quickly that management doesn't have time to figure out how to make use of it. A
dwindling cash pile could be a sign of trouble. That said, if loads of cash are more or less a permanent
feature of the company's balance sheet, investors need to ask why the money is not being put to use.
Cash could be there because management has run out of investment opportunities or is too short-
sighted to know what to do with the money.
Inventories are finished products that haven't yet sold. As an investor, you want to know if a company
has too much money tied up in its inventory. Companies have limited funds available to invest in
inventory. To generate the cash to pay bills and return a profit, they must sell the merchandise they
have purchased from suppliers. Inventory turnover (cost of goods sold divided by average
inventory) measures how quickly the company is moving merchandise through the warehouse to
customers. If inventory grows faster than sales, it is almost always a sign of deteriorating fundamentals.
Receivables are outstanding (uncollected bills). Analyzing the speed at which a company collects
what it's owed can tell you a lot about its financial efficiency. If a company's collection period is growing
longer, it could mean problems ahead. The company may be letting customers stretch their credit in
order to recognize greater top-line sales and that can spell trouble later on, especially if customers face
a cash crunch. Getting money right away is preferable to waiting for it - since some of what is owed may
never get paid. The quicker a company gets its customers to make payments, the sooner it has cash to
pay for salaries, merchandise, equipment, loans, and best of all, dividends and growth opportunities.
2. Non-Current Assets are defined as anything not classified as a current asset. This includes items that
are fixed assets, such as property, plant and equipment (PP&E). Unless the company is in
financial distress and is liquidating assets, investors need not pay too much attention to fixed assets.
Since companies are often unable to sell their fixed assets within any reasonable amount of time they
are carried on the balance sheet at cost regardless of their actual value. As a result, it's is possible for

companies to grossly inflate this number, leaving investors with questionable and hard-to-compare
asset figures.
o LIABILITIES
There are current liabilities and non-current liabilities. Current liabilities are obligations the firm must pay
within a year, such as payments owing to suppliers. Non-current liabilities, meanwhile, represent what the
company owes in a year or more time. Typically, non-current liabilities represent bank and bondholder debt.
You usually want to see a manageable amount of debt. When debt levels are falling, that's a good sign.
Generally speaking, if a company has more assets than liabilities, then it is in decent condition. By contrast, a
company with a large amount of liabilities relative to assets ought to be examined with more diligence. Having too
much debt relative to cash flows required to pay for interest and debt repayments is one way a company can go
bankrupt.
o EQUITY
Equity represents what shareholders own, so it is often called shareholder's equity. The two important equity
items are paid-in capital and retained earnings. Paid-in capital is the amount of money shareholders paid
for their shares when the stock was first offered to the public. It basically represents how much money the firm
received when it sold its shares. In other words, retained earnings are a tally of the money the company has
chosen to reinvest in the business rather than pay to shareholders. Investors should look closely at how a
company puts retained capital to use and how a company generates a return on it.
 The Cash Flow Statement
The cash flow statement shows how much cash comes in and goes out of the company over the quarter or
the year. At first glance, that sounds a lot like the income statement in that it records financial performance
over a specified period. But there is a big difference between the two.
What distinguishes the two is accrual accounting, which is found on the income statement. Accrual
accounting requires companies to record revenues and expenses when transactions occur, not when cash is

exchanged. At the same time, the income statement, on the other hand, often includes non-cash revenues or
expenses, which the statement of cash flows does not include.
Three Sections of the Cash Flow Statement
Companies produce and consume cash in different ways, so the cash flow statement is divided into three
Sections: cash flows from operations, financing and investing. Basically, the Sections on operations and
financing show how the company gets its cash, while the investing Section shows how the company spends its
cash.
o Cash Flows from Operating Activities
This Section shows how much cash comes from sales of the company's goods and services, less the amount of
cash needed to make and sell those goods and services. Investors tend to prefer companies that produce a net
positive cash flow from operating activities. High growth companies, such as technology firms, tend to show
negative cash flow from operations in their formative years. At the same time, changes in cash flow from
operations typically offer a preview of changes in net future income. Normally it's a good sign when it goes up.
Watch out for a widening gap between a company's reported earnings and its cash flow from operating activities.
If net income is much higher than cash flow, the company may be speeding or slowing its booking of income or
costs.
o Cash Flows from Investing Activities
This Section largely reflects the amount of cash the company has spent on capital expenditures, such as new
equipment or anything else that needed to keep the business going. It also includes acquisitions of other
businesses and monetary investments such as money market funds.
You want to see a company re-invest capital in its business by at least the rate of depreciation expenses each
year. If it doesn't re-invest, it might show artificially high cash inflows in the current year which may not be
sustainable.
o Cash Flow From Financing Activities

This Section describes the goings-on of cash associated with outside financing activities. Typical sources of cash
inflow would be cash raised by selling stock and bonds or by bank borrowings. Likewise, paying back a bank loan
would show up as a use of cash flow, as would dividend payments and common stock repurchases.
 RATIO’S
The ratios are further divided into three types:-
RATIOS
Income Statement Ratio Balance Sheet Ratio Combined Ratio
a. Gross Profit Ratio a. Current Ratio a. Earnings Per Share

b. Operating Profit Ratio b. Quick Ratio b. Book Value

c. Net Profit Ratio c. Total Debt to Equity c. Dividend per Share
Ratio
d. Return on Net-worth
e. Return on Capital
Employed
I. Income Statement Ratio
a. Gross Profit Ratio:- Gross Profit x 100

Sales
Standard Ratio- Should be compared with gross profit ratio of past few years or with other
companies
This ratio shows the profitability of the company.

Higher ratio means greater profitability & lower ratio means indicates lower profitability.
b. Operating Profit Ratio:-Operating Profit x100

Sales
Operating Profit= Sales- Cost of Goods Sold- Operating Exp
Similar to net profit ratio but is a better judge of companies profitability as it excludes non-
operating exp & non-operating incomes.
c. Net Profit Ratio:- Net Profit x100

Sales
It measures overall profitability. It should be studied along with Gross Profit Ratio.
Higher ratio means greater profitability & lower ratio means indicates lower profitability.
II. Balance Sheet Ratio
a. Current Ratio:- Current Assets Standard Ratio=2:1

Current Liabilities
Current Assets = Debtors, Stock, Loose Tools, Accrued Income, B/R, Cash, Bank.
Current Liabilities = Creditors, B/P, O/S Exp, Bank O/D, Proposed Dividend.

This ratio measures the short term solvency of the business by comparing current assets with
current liabilities. It is expressed in the form of a pure ratio. This ratio shows whether
company is able to meet its short term obligations.
b. Quick Ratio:- Quick Assets Standard Ratio=1:1

Quick Liabilities
Quick Assets = Current Assets-Stock-Prepaid Exp

Quick Liabilities = Current Liabilities-Bank O/D-Advance Income
This ratio takes into account only those current assets, which can be very quickly converted
into cash & only those liabilities, which have to be paid immediately.
Higher ratio indicates sound financial position. But too high ratio may also indicate idle
investment in quick assets.
Lower ratio indicates dangerous financial position.
c. Debt Equity Ratio:- Debt Standard Ratio=2:1

Equity
This ratio indicates the long term solvency of the company. It compares the loan funds i.e.
debt with the proprietor’s i.e. equity. It indicates that for every rupee of proprietor’s fund
there is a particular amount of borrowed funds.
III. Combined Ratio
a. Earning per Share:- Profit After Tax-Preference Dividend

No. of Equity Shares
This ratio measures the earnings per equity share i.e. it measures the profitability of the firm
on a per share basis.
EPS is one of the most commonly quoted & widely publicized ratio.
It has been made mandatory in nature by the ICAI.
b. Book Value:- Equity (+) Reserve & Surplus

No. of Equity

If the book value per shares is 150% of the face value then it is good for investment & if it is
more than that its consider to be best for investment.
c. Return on Net-Worth:- Net Profit After Tax

Proprietor’s fund
Standard ratio – Should be compared with similar ratio of other companies.

It shows earning power of proprietors fund. This ratio is helpful to future investor.
Higher ratio means growing & prosperous company. Lower is unfavorable.
d. Return on Capital Employed:- Net Profit Before Interest & Tax x100
Capital Employed
Standard ratio – Should be compared with similar ratio of other companies.

This ratio shows the profitability & productivity of the company. It is the broadest measure
of performance. It combines the effect of Net Profit Ratio & Capital Turnover Ratio.
Turnover ratio measures productivity & Net Profit Ratio measures profitability.
What Does Technical Analysis Mean?
A method of evaluating securities by analyzing statistics generated by market activity, such

as past prices and volume. Technical analysts do not attempt to measure a security's intrinsic
value, but instead use charts and other tools to identify patterns that can suggest future
activity.
Technical analysts believe that the historical performance of stocks and markets are
indications of future performance.
For example, In a shopping mall, a fundamental analyst would go to each store, study the
product that was being sold, and then decide whether to buy it or not. By contrast, a technical
analyst would sit on a bench in the mall and watch people go into the stores. Disregarding the
intrinsic value of the products in the store, the technical analyst's decision would be based on
the patterns or activity of people going into each store.

The Use Of Trend
One of the most important concepts in technical analysis is that of trend. The meaning in
finance isn't all that different from the general definition of the term - a trend is really nothing
more than the general direction in which a security or market is headed. Take the look at the
chart below:
Types of Trend
There are three types of trend:
1• Uptrends
2• Downtrends
3• Sideways/Horizontal Trends
As the names imply, when each successive peak and trough is higher, it's referred to as an
upward trend. If the peaks and troughs are getting lower, it's a downtrend. When there is little
movement up or down in the peaks and troughs, it's a sideways or horizontal trend. If you
want to get really technical, you might even say that a sideways trend is actually not a trend
on its own, but a lack of a well-defined trend in either direction. In any case, the market can
really only trend in these three ways: up, down or nowhere.

Trend Lengths
Along with these three trend directions, there are three trend classifications. A trend of any
direction can be classified as a long-term trend, intermediate trend or a short-term trend. In
terms of the stock market, a major trend is generally categorized as one lasting longer than a
year. An intermediate trend is considered to last between one and three months and a near-
term trend is anything less than a month. A long-term trend is composed of several
intermediate trends, which often move against the direction of the major trend. If the major
trend is upward and there is a downward correction in price movement followed by a
continuation of the uptrend, the correction is considered to be an intermediate trend. The
short-term trends are components of both major and intermediate trends.
When analyzing trends, it is important that the chart is constructed to best reflect the type of
trend being analyzed. To help identify long-term trends, weekly charts or daily charts
spanning a five-year period are used by chartists to get a better idea of the long-term trend.
Daily data charts are best used when analyzing both intermediate and short-term trends. It is
also important to remember that the longer the trend, the more important it is; for example, a
one-month trend is not as significant as a five-year trend.
Trend Lines
A trendline is a simple charting technique that adds

a line to a chart to represent the trend in the market
or a stock. Drawing a trendline is as simple as
drawing a straight line that follows a general trend.
These lines are used to clearly show the trend and
are also used in the identification of trend reversals.
As you can see in Figure 5, an upward trendline is drawn at the lows of an upward trend. This
line represents the support the stock has every time it moves from a high to a low. Notice
how the price is propped up by this support. This type of trendline helps traders to anticipate
the point at which a stock's price will begin moving upwards again. Similarly, a downward
trendline is drawn at the highs of the downward trend. This line represents the resistance level
that a stock faces every time the price moves from a low to a high.

Channels
A channel, or channel lines, is the addition of two parallel trendlines that act as strong areas
of support and resistance. The upper trendline connects a series of highs, while the lower
trendline connects a series of lows. A channel can slope upward, downward or sideways but,
regardless of the direction, the interpretation remains the same. Traders will expect a given
security to trade between the two levels of support and resistance until it breaks beyond one
of the levels, in which case traders can expect a
sharp move in the direction of the break. Along with
clearly displaying the trend, channels are mainly
used to illustrate important areas of support and
resistance.
The Importance of Trend

It is important to be able to understand and identify
trends so that you can trade with rather than against
them. Two important sayings in technical analysis are "the trend is your friend" and "don't
buck the trend," illustrating how important trend analysis is for technical traders.
Support And Resistance

Once you understand the concept of a trend, the
next major concept is that of support and
resistance. You'll often hear technical analysts
talk about the ongoing battle between the bulls
and the bears, or the struggle between buyers
(demand) and sellers (supply). This is revealed
by the prices a security seldom moves above (resistance) or below (support).

support is the price level through which a

stock or market seldom falls (illustrated by
the blue arrows). Resistance, on the other
hand, is the price level that a stock or market
seldom surpasses (illustrated by the red
arrows).
Role Reversal
Once a resistance or support level is broken,

its role is reversed. If the price falls below a support level, that level will become resistance.
If the price rises above a resistance level, it will often become support. As the price moves
past a level of support or resistance, it is thought that supply and demand has shifted, causing
the breached level to reverse its role. For a true reversal to occur, however, it is important that
the price make a strong move through either the support or resistance.
In almost every case, a stock will have both a level of support and a level of resistance and
will trade in this range as it bounces between these levels. This is most often seen when a
stock is trading in a generally sideways manner as the price moves through successive peaks
and troughs, testing resistance and support.
The Importance of Support and Resistance

Support and resistance analysis is an important part of trends because it can be used to make
trading decisions and identify when a trend is reversing. For example, if a trader identifies an
important level of resistance that has been tested several times but never broken, he or she
may decide to take profits as the security moves toward this point because it is unlikely that it
will move past this level.
Support and resistance levels both test and confirm trends and need to be monitored by
anyone who uses technical analysis. As long as the price of the share remains between these
levels of support and resistance, the trend is likely to continue. It is important to note,
however, that a break beyond a level of support or resistance does not always have to be a

reversal. For example, if prices moved above the resistance levels of an upward trending
channel, the trend has accelerated, not reversed. This means that the price appreciation is
expected to be faster than it was in the channel.
What is Volume?
Volume is simply the number of shares or

contracts that trade over a given period of time,
usually a day. The higher the volume, the more
active the security. To determine the movement of
the volume (up or down), chartists look at the
volume bars that can usually be found at the
bottom of any chart. Volume bars illustrate how
many shares have traded per period and show
trends in the same way that prices do.
Why Volume is Important
Volume is an important aspect of technical analysis because it is used to confirm trends and
chart patterns. Any price movement up or down with relatively high volume is seen as a
stronger, more relevant move than a similar move with weak volume. Therefore, if you are
looking at a large price movement, you should also examine the volume to see whether it tells
the same story.
Volume should move with the trend. If prices are moving in an upward trend, volume should
increase (and vice versa). If the previous relationship between volume and price movements
starts to deteriorate, it is usually a sign of weakness in the trend. For example, if the stock is

in an uptrend but the up trading days are marked with lower volume, it is a sign that the trend
is starting to lose its legs and may soon end.
Chart Types
There are Three main types of charts that are used by
investors and traders depending on the information that
they are seeking and their individual skill levels. The
chart types are:
i. The Line Chart
ii. The Bar Chart
iii. The Candlestick Chart
Line Chart:-
The most basic of the four charts is the line chart because it represents only the closing prices
over a set period of time. The line is formed by connecting the closing prices over the time
frame. Line charts do not provide visual information of the trading range for the individual
points such as the high, low and opening prices. However, the closing price is often
considered to be the most important price in stock data compared to the high and low for the
day and this is why it is the only value used in line charts.
Bar Charts:-

The bar chart expands on the line chart by adding several more key pieces of information to
each data point. The chart is made up of a series of vertical lines that represent each data
point. This vertical line represents the high and low for the trading period, along with the
closing price. The close and open are represented on the vertical line by a horizontal dash.
The opening price on a bar chart is illustrated by the dash that is located on the left side of the
vertical bar. Conversely, the close is represented by the dash on the right. Generally, if the
left dash (open) is lower than the right dash (close) then the bar will be shaded black,
representing an up period for the stock, which means it has gained value. A bar that is colored
red signals that the stock has gone down in value over that period. When this is the case, the
dash on the right (close) is lower than the dash on the left (open).
Candlestick Charts:-
The candlestick chart is similar to a bar chart,

but it differs in the way that it is visually constructed. Similar to the bar chart, the candlestick
also has a thin vertical line showing the period's trading range. The difference comes in the
formation of a wide bar on the vertical line, which illustrates the difference between the open
and close. And, like bar charts, candlesticks
also rely heavily on the use of colors to explain
what has happened during the trading period. A
major problem with the candlestick color
configuration, however, is that different sites
use different standards; therefore, it is
important to understand the candlestick
configuration used at the chart site you are
working with. There are two color constructs for days up and one for days that the price falls.
When the price of the stock is up and closes above the opening trade, the candlestick will
usually be white or clear. If the stock has traded down for the period, then the candlestick will
usually be red or black, depending on the site. If the stock's price has closed above the
previous day’s close but below the day's open, the candlestick will be black or filled with the
color that is used to indicate an up day.

Conclusion
Charts are one of the most fundamental aspects of technical analysis. It is important that you
clearly understand what is being shown on a chart and the information that it provides. Now
that we have an idea of how charts are constructed, we can move on to the different types of
chart patterns.
Chart Patterns
A chart pattern is a distinct formation on a stock chart that creates a trading signal, or a sign
of future price movements. Chartists use these patterns to identify current trends and trend
reversals and to trigger buy and sell signals
The theory behind chart patters is based on this assumption. The idea is that certain patterns
are seen many times, and that these patterns signal a certain high probability move in a stock.
While there are general ideas and components to every chart pattern, there is no chart pattern
that will tell you with 100% certainty where a security is headed.
There are two types of patterns within this area of technical analysis, reversal and
continuation. A reversal pattern signals that a prior trend will reverse upon completion of the
pattern. A continuation pattern, on the other hand, signals that a trend will continue once the
pattern is complete.
Head and Shoulders

This is one of the most popular and reliable chart patterns in technical analysis. Head and
shoulders is a reversal chart pattern that when formed, signals that the security is likely to
move against the previous trend. there are two versions of the head and shoulders chart
pattern. Head and shoulders top (shown on the left) is a chart pattern that is formed at the
high of an upward movement and signals that the upward trend is about to end. Head and
shoulders bottom, also known as inverse head and shoulders (shown on the right) is the lesser
known of the two, but is used to signal a reversal in a downtrendBoth of these head and
shoulders patterns are similar in that there are four main parts: two shoulders, a head and a
neckline. Also, each individual head and shoulder is comprised of a high and a low. For
example, in the head and shoulders top image shown on the left side, the left shoulder is
made up of a high followed by a low. In this pattern, the neckline is a level of support or
resistance. Remember that an upward trend is a period of successive rising highs and rising
lows.
Double Tops and Bottoms

This chart pattern is another well-known pattern that signals a trend reversal - it is considered
to be one of the most reliable and is commonly used. These patterns are formed after a
sustained trend and signal to chartists that the trend is about to reverse. The pattern is created
when a price movement tests support or resistance levels twice and is unable to break
through. This pattern is often used to signal intermediate and long-term trend reversals.

A double top pattern is shown on the left, while a double bottom pattern is shown on the
right. In the case of the double top pattern in Figure 3, the price movement has twice tried to
move above a certain price level. After two unsuccessful attempts at pushing the price higher,
the trend reverses and the price heads lower. In the case of a double bottom (shown on the
right), the price movement has tried to go lower twice, but has found support each time. After
the second bounce off of the support, the security enters a new trend and heads upward.
Triple Tops and Bottoms
Triple tops and triple bottoms are another type of reversal chart pattern in chart analysis.
These are not as prevalent in charts as head and shoulders and double tops and bottoms, but
they act in a similar fashion. These two chart patterns are formed when the price movement
tests a level of support or resistance three times and is unable to break through; this signals a
reversal of the prior trend Confusion can form with triple tops and bottoms during the
formation of the pattern because they can look similar to other chart patterns. After the first
two support/resistance tests are formed in the price movement, the pattern will look like a
double top or bottom, which could lead a chartist to enter a reversal position too soon

Moving Averages
Most chart patterns show a lot of variation in price movement. This can make it difficult for
traders to get an idea of a security's overall trend. One simple method traders use to combat
this is to apply moving averages . A moving average is the average price of a security over a
set amount of time. By plotting security's average price, the price movement is smoothed out.
Once the day-to-day fluctuations are removed, traders are better able to identify the true trend
and increase the probability that it will work in their favor.
Types of Moving Averages
There are a number of different types of moving averages that vary in the way they are
calculated, but how each average is interpreted remains the same. The calculations only differ
in regards to the weighting that they place on the price data, shifting from equal weighting of

each price point to more weight being placed on recent data. The three most common types of
moving averages are simple , linear and exponential.
Simple Moving Average (SMA)
This is the most common method used to calculate the moving average of prices. It simply
takes the sum of all of the past closing prices over the time period and divides the result by
the number of prices used in the calculation. For example, in a 10-day moving average, the
last 10 closing prices are added together and then divided by 10. As you can see in Figure
below a trader is able to make the average less responsive to changing prices by increasing
the number of periods used in the calculation.
Many individuals argue that the usefulness of this type of average is limited because each
point in the data series has the same impact on the result regardless of where it occurs in the
sequence. The critics argue that the most recent data is more important and, therefore, it
should also have a higher weighting. This type of criticism has been one of the main factors
leading to the invention of other forms of moving averages.
Linear Weighted Average

This moving average indicator is the least common out of the three and is used to address the
problem of the equal weighting. The
linear weighted moving average is
calculated by taking the sum of all the
closing prices over a certain time period
and multiplying them by the position of
the data point and then dividing by the
sum of the number of periods. For
example, in a five-day linear weighted
average, today's closing price is
multiplied by five, yesterday's by four
and so on until the first day in the period range is reached. These numbers are then added
together and divided by the sum of the multipliers.

Exponential Moving Average (EMA)
This moving average calculation uses a smoothing factor to place a higher weight on
recent data points and is regarded as much more efficient than the linear weighted
average. Having an understanding of the
calculation is not generally required for most
traders because most charting packages do the
calculation for you. The most important thing
to remember about the exponential moving
average is that it is more responsive to new
information relative to the simple moving
average. This responsiveness is one of the key
factors of why this is the moving average of choice among many technical traders. As you
can see in side, a 15-period EMA rises and falls faster than a 15-period SMA. This slight
difference doesn’t seem like much, but it is an important factor to be aware of since it can
affect returns.
Major Uses of Moving Averages
Moving averages are used to identify current trends and trend reversals as well as to set up
support and resistance levels. Moving averages can be used to quickly identify whether a
security is moving in an uptrend or a downtrend depending on the direction of the moving
average. As you can see in Figure below, when a moving average is heading upward and the
price is above it, the security is in an uptrend. Conversely, a downward sloping moving
average with the price below can be used to signal a downtrend.
Another method of determining momentum is to look at the order of a pair of moving

averages. When a short-term average is above a longer-term average, the trend is up. On the
other hand, a long-term average above a shorter-term average signals a downward movement
in the trend

Relative Strength Index – RSI
The relative strength index (RSI) is another one of the most frequently used and well known
momentum indicators in technical analysis. It is
used to signal overbought and oversold
conditions in a security.
The indicator is plotted between a range of zero

to 100 where 100 is the highest overbought
condition and zero is the highest oversold
condition. The RSI helps to measure the strength
of a security's recent up moves compared to the
strength of its recent down moves. This helps to indicate whether a security has seen more
buying or selling pressure over the trading period.
The standard calculation uses 14 trading periods as the basis for the calculation which can be
adjusted to meet the needs of the user. If the trading periods used is lowered then the RSI will
be more volatile and is used for shorter term trades.
The technique is to use overbought and sold lines to generate buy-and-sell signals. In the RSI,
the overbought line is typically set at 70 and when the RSI is above this level the security is
considered to be overbought. The security is seen as oversold when the RSI is below 30.
These values can be adjusted to either increase or decrease the amount of signals that are
formed by the RSI.
A buy signal is generated when the RSI breaks the oversold line in an upward direction,
which means that it goes from below the oversold line to moving above it. A sell signal is
formed when the RSI breaks the overbought line in a downward direction crossing from
above the line to below the line. A more conservative approach can be used by setting the
overbought and oversold levels at 80 and 20, respectively.
Conclusion
The RSI is a standard component on any basic technical chart. The relative strength indicator
focuses on the momentum underlying the security and is a great secondary measure to be

used by traders. It is important to note that the RSI is often not used as the sole generation of
buy-and-sell signals but used in conjunction with other indicators and chart patterns.
CHAPTER 04
Fundamental & Technical Analysis of INFOSYS & TECH

MAHINDRA &its comparison.
Fundamentals of IT companies INFOSYS with TECH MAHINDRA
Current Price (BSE): h 2867

Market cap: h 164,459.51 cr

INFOSYS Technologies Ltd.

Current Price (BSE) h 2867
Market cap h 1,64,459.51 cr
Industry Computer –
Software Tech Mahindra Ltd.
CEO Mr. S
Gopalakrishna Current Price (BSE) h 725.05
Face Value 5
Market cap h 8,891.45 cr
Industry Computer – Software
CEO Mr. Vineet Nayyar
Face Value 10
Financials (g in crores) Financials (f in crores)
Operating Income 21,140.00 Operating Income 4,483.80
Net Profit 5,803.00 Net Profit 742.80
Net Worth 21,982.00 Net Worth 2,673.00
No. of Shares(f in 57.28 No. of Shares(f in crs) 12.23

crs)
Adjusted EPS (g) 100.47 Adjusted EPS (f) 56.90
Book value Per 384.69 Book value Per Shares (f) 234.34
Shares (f)
Dividend Per 25.00 Dividend Per Share(f) 3.50
Share(f)
Net Profit Margin 26.31 Net Profit Margin (%) 16.43
(%)
Current Ratio 4.28 Current Ratio 2.17
Lt Debt Equity 0.00 Lt Debt Equity 0.61

Ratios: -
Infosys Technologies Ltd. Tech Mahindra Ltd. (2010)

(2010)
Adjusted EPS (f) 100.47 56.9
Cash EPS (f) 114.55 67.52
Book value (f) 384.69 234.34
Dividend Per Share (f) 25 3.5
Return On Networth (%) 26.33 25.91
Return On Capital Employed 33.9 21.57
(%)
Operating Profit Margin (%) 34.85 24.38
Gross Profit Margin (%) 31.04 21.49
Net Profit Margin (%) 26.31 16.43
Current Ratio 4.28 2.17
Quick Ratio 4.2 2.14
Assets Turnover Ratio 5.59 4.06
Bonus Component 93.26 86.13
Profit & Loss Account

(2010)
Operating Income 21140.00 4483.80
Manufacturing Expenses 2317.00 1176.00
Personal Expenses 10,356.00 1598.70
Selling Expenses 215.00 9.80
Administrative Expenses 883.00 605.80
Cost of Sales 13771.00 3390.30
PBDIT 7369.00 1093.00
Other Recurring Income 910.00 35.60
Adjusted PBDIT 8279.00 1129.10
Depreciation 807.00 129.90
Adjusted PBIT 7472.00 999.20
Adjusted Profit before Tax 7472.00 827.40
Tax Charges 1717.00 131.40
Adjusted PAT 5755.00 696.00
Non Recurring Item 48.00 22.90
Net Profit 5803.00 742.00

Equity Dividend 1434.00 42.80
Balance Sheet

(2010)
Equity Share Capital 287.00 122.30
Reserved & Surplus 21749.00 2744.20
Secured Loans 0.00 1517.70
Unsecured Loans 0.00 617.20
TOTAL 22036.00 5002.60
Gross Block 3779.00 1112.80
Accumulated Depreciation 0.00 518.80
Net Block 3779.00 594.00
Capital Work in Progress 409.00 320.00
Investments 4636.00 3113.00
Current Assets, Loans, 17242.00 1807.00
Advances
Less-Current Liabilities & 4030.00 824.90
Provision
Total Net Current Assets 13212.00 972.90
TOTAL 22036.00 5001.60
Number Of Equity Shares 57.28 12.23
Outstanding
Bonus Component In Equity 267.66 105.35
Capital
Book Value Of Unquoted 4636.00 3113.90
Investment
Contingent Liabilities 295.00 335.50
TECHNICAL ANALYSIS comparison of INFOSYS & TECH

MAHINDRA
Introduction of INFOSYS & TECH MAHINDRA with the help of TREND

Analysis

“The trend technical analysis is the movement of the highs and lows that
constitutes a trend. UPTREND is classified as a higher highs & higher lows, while
DOWNTREND is one of lower lows and lower highs.”
The above chart shows the technical analysis LINE CHART of INFOSYS
As mention in the chart GREEN line shows the uptrend in the script.

The above chart shows the technical analysis LINE CHART of TECH MAHINDRA
As mention in the chart RED line shows the downtrend in the script but in this case in short
run it is showing the uptrend.
TECHNICAL ANALYSIS comparison of INFOSYS & TECH

MAHINDRA
With the help of RSI Indicator

Above chart shows the RSI indicators when this particular script reached over bought & over
sold level. The white line in this chart shows the time when there were over bought situation & at
the same time it is visible enough that price of script fell down after the indication.

Above chart shows the RSI indicators when this particular script reached over bought & over
sold level. The white line in this chart shows the time when there were over bought situation & at
the same time it is visible enough that price of script fell down after the indication but again at the
end of MAY it is showing the oversold situation & currently it is in uptrend as mentioned in the
trend analysis

Moving averages of INFOSYS

Moving Averages of TECH MAHIDRA

Following chart shows the comparison of two scripts together & clearly specifies the
performance of the scripts where Infosys completely outperforms and tech Mahindra is slowly
recovering from its downtrend.



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Analysis of Investment Through Broking & Consultancy HIREN

Mumbai Institute of Management & Research 1

India Capital Markets Membership In NSE

Benefits to the trading membership of NSE include:

3) Use of state-of-the-art electronic trading systems and technology,

5) A demutualised Exchange which is managed by independent and experienced

6) Dealing with an organization which is constantly striving to move towards a global

Mumbai Institute of Management & Research 2

Membership Recommendation Committee (previously known as

Mumbai Institute of Management & Research 3

The Membership Recommendation Committee (MRC) consists of seven persons from

The following persons have to appear for the interview:

(i) Corporates - A dominant shareholder and a Whole-time Director

(ii) Individuals – individual himself

(iii) Partnership Firms – Two partners

AsianStockWorld.com is a online venture of Asian Corporate Consultancy which began its

Mumbai Institute of Management & Research 4

Mumbai Institute of Management & Research 5

Trading members desirous of appointing sub-brokers are required to

1) Copy of sub-broker - broker agreement duly certified by the trading Members.

4) Individual client registration application form.

5) Non-individual client registration application form.

6) Sub-broker client agreement.

7) Purchase/Sale Note issued by Sub-brokers acting for constituents.

Mumbai Institute of Management & Research 6

Mumbai Institute of Management & Research 7

A sub-broker may be an individual, a partnership firm or a corporate. In case of corporate or

(1) They shall not be less than 21 years of age.

(4) They should not have been debarred by SEBI

TYPES OF INVESTMENT OFFERED BY

Mumbai Institute of Management & Research 8

ASIAN CORPORATE CONSULTANCY [ACC]

Some of the Following are the investments directed by ACC according to

Mumbai Institute of Management & Research 9

Mutual Fund Operation Flow Chart

A debt investment in which an investor loans money to an entity (corporate or governmental)

Mumbai Institute of Management & Research 10

LIFE CYCLE STAGE

LIFE FEATURES PRIORITY CHOICE OF

Mumbai Institute of Management & Research 11

Stage Most of the

More risk taking More immediate &

ability. short term needs.

Two incomes to meet To secure income loss Medium to long term

Sufficient surplus to any disability or long- take risks.

partners term Housing & of any partners death

insurance needs that part of income

need. Need for emergency

Mumbai Institute of Management & Research 12

dependent on just one earning member is investments. Lesser

Mumbai Institute of Management & Research 13

Children have become Adequate income & Maximum investment in

Last chance to ensure

Post of living after

In general people 1) Continue to

1) Low pension risk at all.

income and low 2) Invest capital to

some accumulated 3) Wise People.

Mumbai Institute of Management & Research 14

DIFFERENT PHASES OF INVESTMENT LIFE-CYCLE

Mumbai Institute of Management & Research 15

This stage is one where Medium to long Wealth preservation.

RECOMMENDED MODEL PORTFOLIO