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One of the oldest stock markets in Asia, the Indian Stock Markets have a 200 years old history.
Year
Event
East India Company was the dominant institution and by end of the century, business in its loan securities gained full momentum
Business on corporate stocks and shares in Bank and Cotton presses started in Bombay. Trading list by the end of 1839 got broader Recognition from banks and merchants to about half a dozen brokers Rapid development of commercial enterprise saw brokerage business attracting more people into the business The number of brokers increased to 60 The American Civil War broke out which caused a stoppage of cotton supply from United States of America; marking the beginning of the "Share Mania" in India
1862-63 1865
The number of brokers increased to about 200 to 250 A disastrous slump began at the end of the American Civil War (as an example, Bank of Bombay Share which had touched Rs. 2850 could only be sold at Rs. 87)
Year
Event
1874
With the rapidly developing share trading business, brokers used to gather at a street (now well known as "Dalal Street") for the purpose of transacting business.
1875
"The Native Share and Stock Brokers' Association" (also known as "The Bombay Stock Exchange") was established in Bombay
1880's 1894 1880 - 90's 1908 1920 1923 1934 1936 1937
Development of cotton mills industry and set up of many others Establishment of "The Ahmedabad Share and Stock Brokers' Association" Sharp increase in share prices of jute industries in 1870's was followed by a boom in tea stocks and coal "The Calcutta Stock Exchange Association" was formed Madras witnessed boom and business at "The Madras Stock Exchange" was transacted with 100 brokers. When recession followed, number of brokers came down to 3 & the Exchange was closed down Establishment of the Lahore Stock Exchange Merger of the Lahore Stock Exchange with the Punjab Stock Exchange Re-organization and set up of the Madras Stock Exchange Limited (Pvt.) Limited led by improvement in stock market activities in South India with establishment of new textile mills and plantation companies
Uttar Pradesh Stock Exchange Ltd and Nagpur Stock Exchange Limited was established Establishment of "The Hyderabad Stock Exchange Limited" "Delhi Stock and Share Brokers' Association Limited" and "The Delhi Stocks and Shares Exchange Limited" were and later on merged into "The Delhi Stock Exchange Association Limited" established
Post-Independence Scenario
The depression witnessed after the Independence led to closure of a lot of exchanges in the country. Lahore Stock Exchange was closed down after the partition of India, and later on merged with the Delhi Stock Exchange. Bangalore Stock Exchange Limited was registered in 1957 and got recognition only by 1963. Most of the other Exchanges were in a miserable state till 1957 when they applied for recognition under Securities Contracts (Regulations) Act, 1956. The Exchanges that were recognized under the Act were: 1. Bombay 1
Many more stock exchanges were established during 1980's, namely: 1. 2. 3. 4. 5. 6. 7. 8. 9. Cochin Stock Exchange (1980) Uttar Pradesh Stock Exchange Association Limited (at Kanpur, 1982) Pune Stock Exchange Limited (1982) Ludhiana Stock Exchange Association Limited (1983) Guwahati Stock Exchange Limited (1984) Kanara Stock Exchange Limited (at Mangalore, 1985) Magadh Stock Exchange Association (at Patna, 1986) Jaipur Stock Exchange Limited (1989) Bhubaneswar Stock Exchange Association Limited (1989)
10. Saurashtra Kutch Stock Exchange Limited (at Rajkot, 1989) 11. Vadodara Stock Exchange Limited (at Baroda, 1990) 12. Coimbatore Stock Exchange 13. Meerut Stock Exchange
At present, there are twenty two recognized stock exchanges in India which does not include the Over the Counter Exchange of India Limited (OTCEI) and the National Stock Exchange of India Limited (NSEIL).
The key ingredients that underlie market quality in India s equity market are: Exchanges based on open electronic limit order book; Nationwide integrated market with a large number of informed traders and fluency of short or long positions; and no counterparty risk. Among the processes that have already started and are soon to be fully implemented are electronic settlement trade and exchange-traded derivatives.
Before 1995, markets in India used open outcry, a trading process in which traders shouted and hand signaled from within a pit. One major policy initiated by SEBI from 1993 involved the shift of all exchanges to screen-based trading, motivated primarily by the need for greater transparency. T he first exchange to be based on an open electronic limit order book was the National Stock Exchange (NSE), which started trading debt instruments in June 1994and equity in November 1994. In March 1995, BSE shifted from open outcry to a limit order book market. Currently, 17 of India s stock exchanges have adopted open electronic limit order.
Trading at NSE
1. 2. 3. 4. Fully automated screen-based trading mechanism Strictly follows the principle of an order-driven market Trading members are linked through a communication network This network allows them to execute trade from their offices
5. The prices at which the buyer and seller are willing to transact will appear on the Screen 6. When the prices match the transaction will be completed
3.
Investors can transact from any part of the country at uniform prices
Right from the beginning the stock broking industry has undergone a drastic change. Gone are the days when the individuals were acting as a stockbroker and just were serving a limited region. The industry structure has changed so much as the corporate giants entered into the stock broking industry.
Equity Price
For the past 12 years, equity prices have seen two extended periods of declining prices and two periods of rising prices. Between April 1986 and March 1988, Sensex decreased from 589 to 398, or by 32 percent. Prices also fell between March 1992, when the monthly closing level of Sensex was 4,258, and April 1993, when the level was 2,122, a decline of 50.5 percent. Prices generally rose for extended periods from March 1988 to March 1992 and from May 1993 to August 1994. The monthly closing level of Sensex climbed from 398 in March 1988 to 4,285 in March 1992, an increase of more than 10 times. In the second period of extended rising equity prices, Sensex increased 1.16 times. Since 1995, it has fluctuated around the 3,000-4,000 mark (see Figure 1). In April 1998, it hovered around 3,000. In the period of declining prices, from August 1994 to March 1998, the price-earnings (P/E) ratio fell more sharply than prices (Figure 1). In March 1998, the monthly average Sensex P/E ratio was 15.65 while the figure for October 1993 was 38.76.
speculative trading without the delivery of shares is no longer cost-free. Each broker s trading volume during a day is not allowed to exceed the intraday trading limit. This limit is 33.3 times the base minimum capital deposited with the exchange on a gross basis, i.e., purchase plus sale. In event of brokers wishing to exceed this limit, they have to deposit additional capital with exchange and this cannot be withdrawn for 6 months.
Circuit Breaker
SEBI has imposed price limits for stocks whose market prices are above Rs10 up to Rs20, a daily price change limit and weekly price change limit of 25 percent. BSE imposes price limits as a circuit breaker system to maintain the orderly trading of shares on the exchange. BSEs computerized trading system rejects buy or sell orders of a stock at prices outside the price limits. The daily price limit of a stock is measured from the stock s closing price in the previous trading session. The weekly price limit is based on its closing price of the last trading in the previous week, usually its closing price on the previous Friday.
Stock Lending
A scheme for regulating stock lending was introduced in February 1997, following changes in tax regulations. Stock lending can take place through an intermediary registered for this purpose with SEBI, and which has a minimum capital of Rs500 million. Lenders and borrowers of securities have to enter into agreements with the intermediary. Stock lending facilitates the timely settlement of transactions on the stock exchanges, especially in an environment where physical delivery of certificates is required for settlement.
Broking Insights :
The Indian broking industry is one of the oldest trading industries that have been around even before the establishment of BSE in 1875. Despite passing through a number of changes in the post liberalizations period, the industry has found its way towards sustainable growth. With the purpose of gaining a deeper understanding about the role of the Indian stock broking industry in the country s economy, we present in this section some of the industry insights gleaned from analysis of data received through primary research. Both primary and secondary market activity experienced sharp surge. Much progress was made in further strengthening and streamlining the risk management, market regulation and supervision. A few aspects of the major developments in the India s stock markets are described below. Indian securities market is fairly large as compared to the other emerging markets. There are 22 stock exchanges in the country, though the entire liquidity is shared between the countries two national level exchanges namely, The National Stock Exchange of India and the Bombay stock Exchange Ltd. The regional stock exchanges are in pursuit of business models that make them viable and vibrant. Meanwhile, these exchanges have become members of the national level exchanges through formation of subsidiaries whose business is showing continuous growth and progress.
Infrastructure Development:
Traditionally brokers were serving the need of local public only as there was limited infrastructure development. But after the entry of corporate brokers, now they have not restricted them to local boundaries only, Brokers are going for expanding their network to the wide area. Every corporate broker is now trying to reach in each of the geographical corner of the country and providing as many services as possible to the investors.
Major Developments:
Corporate memberships:
There is a growing surge for corporate memberships(92% NSE and 75% BSE), and the scope of functioning of the brokerage firms has transformed from that of being a family run business to that of professional organized function that lays greater emphasis on observance of market principles and best practices. With proliferation of new market and products, corporate nature of the memberships is enabling broking firms to expand the realm of their operations into other exchangesas also other product offerings. Memberships range from cash market to derivatives to commodities and a few broking firms are making forays into obtaining memberships in exchanges outside the country subject to their availability and eligibility.
background of growing opportunities for investors to invest in India as also abroad, the range of products and services will widen further. In the offering will be interesting opportunities that might arise in the exchange enabled corporate bond trading, soon after its commencement and futures trading that might be introduced in the near future in the areas of interest rates and Indian currency.
Online Broking :
Several brokers are extending benefits of online trading through creation of separate windows. Some others have dedicated online broking portals. Emergence of online broking enabled reduction in transaction cost and cost of trading. Keen competition has emerged in online broking services, with some of these offering trading services at the cost of a few basis points or costs which are fixed in nature irrespective of the volume of trading conducted. A wide range of incentives are being created and offered by online brokerage firms to attract larger number of clients.
Equity shares of company that are: Dividend paying Growth oriented Has more than 20k shareholders
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Types of Transactions:
The flowchart below describes the types of transactions that can be carried out on the Indian stock exchanges:
Spot Delivery Transactions Includes transactions that require Delivery and payment within stipulated Time period at the time of entering into the contract.
Forward Transactions Transactions in which delivery and payment can be extended by further period of 14 days each
This period shall not be more than 14 Days following the date of the contract
The overall period should not exceed 90 days from the date of the contract
Indian stock exchange allows a member broker to perform following activities: 1. Act as an agent, 2. Buy and sell securities for his clients and charge commission for the same, 3. Act as a trader or dealer as a principal, 4. Buy and sell securities on his own account and risk.
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Advantages of OTCEI
1. Greater liquidity and lesser risk of intermediary charges due to widely spread trading mechanism across India 2. 3. 4. The screen-based scriptless trading ensures transparency and accuracy of prices Faster settlement and transfer process as compared to other exchanges Shorter allotment procedure (in case of a new issue) than other exchanges
Stock market transactions are carried out on computerized systems and deals are recorded for inspection at any time. Stock Brokers may independently operate for Pvt. Clients and institutional clients. Some brokers act only as dealers (client investment managers) while others are principally advisors (equity sales advisors). Some brokers provide services for portfolio management and constantly review investments in the light of trends and developments in the market. Financial services brokers specialize in the bond issues, handling institutional accounts or mutual funds. In large firms, stock brokers deal with and advise smaller
firms. Securities brokers work on behalf of firms with private clients to understand the investment plans and objectives of the client i.e. expectation for returns and interest in risk taking. They are representatives of brokerage firms and execute orders to buy and sell securities. T hey are equipped with both knowledge and experience to give advice on the sale and purchase of scrips and management of financial services. They advise for investments and carry out market transactions. The financial services in firms concerns presales, sales and after sales-services. These firms have departments to manage the sales and trading for the owner of securities, investment banking for firms and the government for the issue of securities, and capital markets form an essential arm for trading activities. As securities Analysts: Brokers may be required to advise on floatation of shares in conjunction with the merchant banks. They are expected to have knowledge of the market to be able to anticipate certain trends and make predictions. As investment analysts: The investment Analysts provide accurate information to investors and fund managers.
Buying Of Stocks
There are various methods of buying and financing stocks. The most common means is through a stock broker. Whether they are a full service or discount broker, they arrange the transfer of stock from a seller to a buyer. Most trades are actually done through brokers listed with a stock exchange. There are many different stock brokers from which to choose, such as full service brokers or discount brokers. The full service brokers usually charge more per trade, but give investment advice or more personal service; the discount brokers offer little or no investment advice but charge less for trades. Another type of broker would be a bank or credit union that may have a deal set up with either a full service or discount broker. There are other ways of buying stock besides through a broker. One way is directly from the company itself. If at least one share is owned, most companies will allow the purchase of shares directly from the company through their investor relations departments. However, the initial share of stock in the company will have to be obtained through a regular stock broker. Another way to buy stock in companies is through Direct Public Offerings which are usually sold by the company itself. A direct public offering is an initial public offering in which the stock is purchased directly from the company, usually without the aid of brokers. When it comes to financing a purchase of stocks there are two ways: purchasing stock with money that is currently in the buyer's ownership, or by buying stock on margin. Buying stock on margin means buying stock with money borrowed against the stocks in the same account. These stocks, or collateral, guarantee that the buyer can repay the loan; otherwise, the stockbroker has the right to sell the stock (collateral) to repay the borrowed money. He can sell if the share price drops below the margin requirement, at least 50% of the value of the stocks in the account. Buying on margin works the same way as borrowing money to buy a car or a house, using a car or house as collateral. Moreover, borrowing is not free; the broker usually charges 810% interest.
Selling of Shares
Selling stock is procedurally similar to buying stock. Generally, the investor wants to buy low and sell high, if not in that order (short selling); although a number of reasons may induce an investor to sell at a loss, e.g., to avoid further loss. As with buying a stock, there is a transaction fee for the broker's efforts in arranging the transfer of stock from a seller to a buyer. This fee can be high or low depending on which type of brokerage, full service or discount, handles the transaction. After the transaction has been made, the seller is then entitled to all of the money. An important part of selling is keeping track of the earnings. Importantly, on selling the stock, in jurisdictions that have them, capital gains taxes will have to be paid on the 14
Types of Order:
Placing orders correctly is probably one of the most important aspects of trading. It is vital that you understand and use the correct order when you trade.
Market Order
This simply tells your broker to buy or sell at the current market price. This is preferable in fast market conditions or when you want to ensure that a position is taken and to protect against missing an opportunity. The broker will attempt to buy or sell the security at the current market rate.
Limit Order
This order can be used to enter or exit a trade. It specifies a price that the trader is willing to pay or accept (or better). A buy limit order is placed below the current market price and states the highest price the trader is willing to pay for a purchase. A sell limit order is placed over the current market price and is the lowest price the seller is willing to accept. If you already have a position in the market e.g. you were long the market, you could use a limit order to tell the broker at what price you wanted to sell once your price objective had been reached. You could also use the order to tell the broker at what price you want to enter the market. If ABC Company was trading at 45.50 and you wanted to buy that company at 44.00 you could use a buy limit order to take you into the market.
All Or None
This is essentially a limit order to buy or sell a security. The important point of this order is that the total order must be filled or none of it.
Day Order
This is an order that terminated automatically at the end of the day. If you have placed an order to buy or sell a security at a particular price and it is not filled the order is terminated at the end of the day.
WithDrawals
T+1 System: The decision to withdraw the profit or the total margin money is at the discretion of the client. All payments from the company are by the account payee cheques only. T he client would 16
be issued the withdrawal cheque on the next working from date of submission of the signed withdrawal slip.
LITERATURE REVIEW
Competitor-oriented objectives, such as market-share targets, are promoted by academics and are commonly used by firms. A 1996 review of the evidence, summarized in this paper, found that competitor-oriented objectives reduced profitability.. The evidence says that competitor-oriented objectives are harmful, especially when managers receive information about competitors market shares. The evidence appears to have had little effect on managers decisions and on what is taught in business schools. The pursuit of competitor-oriented objectives is consistent with the long-held belief that business is like warfare. In the late 19th century, it was popular for executives to strive for revenue maximization. To see how well they were doing, they compared themselves to their competitors in the industry. Competitor-oriented objectives, typically expressed in terms of market share, were commonly utilized by large firms well before the 1950s.
Use Market Developments and Money Managing Techniques for Share Trading (from: investopedia.com)
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Money management with stock market trading and investment is a dynamic prospect. The possibility of high gains and fast income is the biggest pull for anyone looking to enhance their existing pot of money by funneling it into a more resourceful process such as stock trading and investment. However, these benefits come with a fine print. Short term trading or long term investment in stock markets is highly susceptible to risk failure. If one gets into the process unaware, unprepared and without a calculated risk assessment, the likelihood of incurring heavy losses is very strong. Particularly when one decides to trade beyond ones financial limits, there is a chance that with a drop in the market, losses will axe ones capital investment altogether, leaving them financially and security-wise broke. One way to avert this drastic turn of events is by trading market trends. The concept of trend trading considers that a definite market trend is likely to culminate and continue for a certain period of time before another similar trend emerges. And it is within the parameters of such trends that stock trading and investments are carried out so as to avert risk damage as far as possible.
crisis. Confidence was not restored until after 1933, and the effects of the panic were felt throughout the Great Depression of the 1930s. Since 1929, central banks have been quick to provide liquidity to falling markets in order to prevent panics. For example, when the New York Stock Exchange dropped over 508 points (22.6%) on Oct. 19, 1987, the Federal Reserve released a large sum of money overnight to meet demands on brokers. In Sept.Oct., 2008, the Federal Reserve and U.S. Treasury took more drastic and wide-ranging measures to ensure liquidity and stability in a financial system reeling from the effects of a collapsing housing bubble and the resulting credit crunch and accelerating stock market decline.
OBJECTIVES
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I carried out my internship in Kaynet Finance Ltd. for a period of 7 weeks from 5th June 2012 to 21st July 2012 . I carried out my internship in the company, under the supervision of Mr. Sumit Malik . The purpose of my Corporate Internship for 7 weeks was to connect theory and practice, obtain knowledge & awareness of the functioning of various departments of the corporate and its environment which is utmost necessary for the success of the budding managers.
The basic objectives of my Corporate Internship were: 1. 2. 3. 4. 5. To understand the business and competitive environment in which the organization is operating. To analyze and understand the financial position of the organization viz. a viz. competitors. To study at least one management department and its practices. To test what I had learnt in the foundation courses in the first year. To get a feel of corporate life and its functioning & understand various interaction styles.
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COMPANYS PROFILE
Kaynet was established in 1994 with a view to provide diversified investment solutions to its customers. With a blend of a dedicated team, accurate research results and high customer focus, they are all set to expand. Servicing 30,000+ customer accounts, they provide a diverse range of investment options and continuously strive to introduce innovative investment solutions based on the demands of their customers. Their current businesses include Equities, Commodities, Currency, IPO's, Mutual Funds Trading, DP Services, Fixed Deposits/ Bonds, Structure Product, Insurance, securities and commodity broking and investment management. Operating from over 21 locations across India, they specialize in providing efficient financial solutions to its clients, having branches in Mumbai, Delhi, Kolkata, Pune, Jodhpur, Jaipur and other major cities with operations starting soon at Chennai, Bangalore and Hyderabad. They are members of National Stock Exchange (NSE), Bombay Stock Exchange (BSE), Multi Commodity Exchange of India Limited (MCX), National Commodity & Derivatives Exchange (NCDEX), Currency Exchange, Central Depository Services Limited (CDSL) and Association of Mutual fund in India (AMFI). Their services cater to a wide range of clients like corporations, institutional investors, retail clients and high net-worth individuals. They adopt a success mantra of due diligence. Over the years, Kaynet has accumulated rich experience and a strong foundation to grow.
Mission:
To be ahead of the market always.
Vision:
To become a preferred and cordial partner for retail and institutional investors by offering comprehensive and research-based financial solutions.
Core Values :
Trust comes before all transactions. Both protection and growth are of paramount importance. Knowledge will keep us as well as our clients ahead. Their management comprises a diverse talent pool that brings together rich experience from across the 22
industry.
DIRECTORS
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STRENGTHS:
Online Trading Facility 18 years of Experience in securities market Dedicated and responsive workforce/staff Research Centre Membership of NSE & BSE Trading option like Future & Option and Commodities Volume based differentiated product.
WEAKNESSES:
Less informative website Problems due to network crash Unawareness among Investors
OPPORTUNITY:
Collaboration with international financial institution To tap the Untapped market To capture the market lost to its Competitors. To focus on developing a superior and powerful portal To spread awareness of its Brand Name.
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THREATS:
Follow government laws Competitors develops Prolonged depression and high volatility in the market New Entrants.
RESEARCH METHODOLOGY
Research Design
This is a descriptive research as it will clarify the doubts about Stock market. It would give us a clear picture on the products and services offered by Kaynet Finance Limited and its competitors.
Data Collection
Primary Data: Personal interview, Questionnaire Secondary Data: Online reports related to Stock markets
Sample Universe
Basis of sampling: Sample should be literate Should have basic knowledge about stock market
Sampling Technique
Convenience Sampling technique and Judgemental sampling Techniques have been used.
Sampling Unit
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Sample Size
The sample size taken here is 100
Kaynet Finance Ltd. Account Opening Charge (AOC): Rs. 200 Annual Maintenance Charge (AMC): Rs. 0 Brokerage: 50p (delivery), 5p (intra-day). Enquiry: 011-30185455
Angel Broking Account Opening Charge (AOC): Rs. 491 Annual Maintenance Charge (AMC): 1 st year free. Rs. 300 2 nd year on. Brokerage: 40p (delivery ), 8p (intra-day). Browsers: IE 6.0+ Enquiry: No toll-free number
Annual Maintenance Charge (AMC): Rs. 750 (up to 10 transactions), Rs.550 (from 11-25 transactions), Rs. 300 (over 25 transactions) Brokerage: Higher of Rs. 25 or 0.5% of transaction value (delivery). Higher of Rs. 25 or 0.1% of transaction value (intra-day). Browsers: IE 5.0+, NN 8.1+ and FF 1.5+ Enquiry: 1-800-209-9700
ICICI Direct Account Opening Charge (AOC): Rs. 975 Annual Maintenance Charge (AMC): Rs. 500 (paper statements), Rs. 450 (email statements) Brokerage: 0.55% (delivery). 0.05% of transaction value (intra-day). Browsers: IE 5.5+ , NN 4.7 and FF 2.0+ Enquiry: No toll-free number
IDBI Paisa builder Account Opening Charge (AOC): Rs. 700 Annual Maintenance Charge (AMC): Rs. 350 Brokerage: 0.5% (delivery), 0.05% (intra-day). Browsers: IE 6.0+ Enquiry: 1-800-223-366
Indiabulls Account Opening Charge (AOC): Rs. 900 Annual Maintenance Charge (AMC): Nil (lifetime free) Brokerage: 0.25% (delivery). 0.03% (intra-day). Browsers: IE 4.0+ Enquiry: No toll-free number
India Infoline 28
Account Opening Charge (AOC): Rs. 750 Annual Maintenance Charge (AMC): 1 st year free. Rs. 249 2 nd year on. Brokerage: 50p (delivery). 5p (intra-day). Browsers: IE 4.0+ Enquiry: No toll-free number
Kotak Securities Account Opening Charge (AOC): Rs. 750 Annual Maintenance Charge (AMC): 1 st year free. Rs. 360 2 nd year on. Brokerage: 59p (delivery). 6p (intra-day). Browsers: IE 6.0+ Enquiry: 1-800-209-9191, 1-800-222-299
Reliance Money Account Opening Charge (AOC): Rs. 750 Annual Maintenance Charge (AMC): 1 st year free. Rs. 200 2 nd year on. Brokerage: Offline - 35p (delivery). 5p (intra-day) Browsers: IE 6.0+ Enquiry: No toll-free number
Religare Account Opening Charge (AOC): Rs. 2500 Annual Maintenance Charge (AMC): 1st year free. Rs. 360 (email statements), Rs. 480 (paper statements) Brokerage: 25p (delivery) 2.5p (intra-day) 0.06% (futures). Browsers: IE 5.5+ Enquiry: 1-860-258-8888
SBI Account Opening Charge (AOC): Rs. 500 Annual Maintenance Charge (AMC): Rs. 386 Brokerage: 50p (delivery). 15p (intra-day). Browsers: IE 6.0+ and FF 1.5+ 29
Enquiry: 1-800-223-345
Sharekhan Account Opening Charge (AOC): Rs. 750 Online, (Rs. 500 Offline, plus Rs.160 franking charge) Annual Maintenance Charge (AMC): 1 st year free. Rs. 400 2 nd year on. Brokerage: Higher of 0.5% or 10p (delivery). 0.1% or 5p (intra-day). Browsers: IE 6.0+ and Opera 7.0+ Enquiry: 1-800-227-500
QUESTIONNAIRES:
Q1.
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Interpretation:
According to the above chart we can see that: 68%of investors (119) are investing in Equity Market. While 36% of investors (56) are not investing in Equity Market.
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Q2.
If you want to invest, which investment option will provide the best returns?
[ ] Equity Share [ ] IPO [ ] Mutual Funds [ ] Bonds [ ] Fixed Deposits [ ] If any other _________
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Investment option Equity Share IPO Mutual Funds Bonds Fixed Deposits Other
18%
Interpretation:
According to the previous chart: As we can see that according to 53% of investors, Equity market will provide the best returns in comparison to other investment option. 18% of investors believe that IPO (Primary Market)will provide the best returns. 8% of investors think that Mutual Fundswill provide the best returns. 7% of investors believe that Bonds Market will provide the best returns. 4% of investors trust that Fixed Deposits will provide the best returns. According to 10% of investors, other investment option will provide the best returns.
Q3.
[ ] Other _____________
Interpretation:
According to the Previous Figure: 49% of investors are motivated by Return to invest in Equity market. 35
26%of investors are motivated by Liquidity to invest in Equity market. 6%of investors are motivated by Safety to invest in Equity market. 16%of investors are motivated by Capital Appreciation to invest in Equity market. While 5%of investors are motivated by other factors like-Investment, Profit etc. to invest in Equity market.
Q4.
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[ ] Less than 5% [ ] 5%-10% [ ] 10%-15% [ ] 15%-20% [ ] 20%- 25% [ ] More than 25%
Percentage of Income Less than 5% 5%-10% 10%-15% 15%-20% 20%- 25% More than 25%
17%
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Interpretation:
According to the Previous Figure: 23% of the investors are investing Less than 5% of theirincome in Equity Market. 45%of the investors are investing5%-10% of theirincome in Equity Market. 17% of the investors are investing10%-15% of theirincome in Equity Market. 7% of the investors are investing15%- 20%of theirincome in Equity Market. 5% of the investors are investing20%-25% of theirincome in Equity Market. While 3% of the investors are investing More than25% of their income in Equity Market.
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Q5.
Interpretation:
According to the Previous Figure: 13% of the investors are doing Intraday trading in Equity Market. Intraday Trading is trading for that one day only. Means any securities are purchase & sell within the day. 31% of the investors are investing in Equity Market as a Delivery based Trading. Delivery based trading is normally considered as a safer approach for trading in shares when compared to day trading. Delivery based trading involves buying shares on a market day and selling them only after receiving the delivery of those shares in demat account. 26% of the investors are trading in Equity Market as a Speculator. Speculators are those classes of investors who willingly take higher-than-average risk in return for a higherthan-average profit potential in future. Speculators aim primarily at quick profit from a short-term acquisition of assets. 17% of the investors are Arbitragers in Equity Market. Arbitrager means who purchases securities in one market for immediate resale in another in the hope of profiting from the price differential 11% of the investors are trading in Equity Market as Hedgers. Hedging means reducing or controlling risk. Hedgers wish to eliminate or reduce the price risk to which they are already exposed.
While 2% of the investors are trade in Equity Market for Other Purpose.
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Q6.
Time Horizon Less than 1 Months 1 to 3 Months 3 to 6 Months 6 to 12 Months More than 12 Months
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Interpretation:
According to the Previous Figure: 14%of investors invest in Equity market for Less than 1 Months. 28% of investors invest in Equity market for the period of 1 to 3 Months. 15% of investors time horizon for in Equity market is 3 to 6 Months. 18% of investors time horizon for in Equity market is 6 to 12 Months. 25%of investors invest in Equity market for more than12 Months.
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Q7.
Are you satisfied with the current performance of the Equity Market in terms of expected return?
[ ] Fully Satisfied [ ] Satisfied [ ] Neutral [ ] Unsatisfied [ ] Fully Unsatisfied
No. of Investors 30 73
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49 18 5 175
Interpretation:
According to the Previous Figure: 30 investors are Fully Satisfied from current performance of Equity market. 73 investors are Satisfied from Equity market. 49 investors are Neutral with current performance of Equity market. 44
18 investors are Unsatisfied from Equity market. While 5 investors are Fully Unsatisfied from Equity market.
Q9.
Interpretation:
46
According to the Above Figure: Friends motivate 28% of the investors to enter into the equity market. Relatives motivate 12%of the investors to enter into the equity market. 25% of investors enter in Equity market by the Advise of Financial Advisor. Media motivate 17% of the investors to enter into the equity market. Magazines motivate 10% of the investors to enter into the equity market. 5% of investors are motivated by Reading Magazines to enter in Equity market. While other factors like self-Study, their own View etc. motivate 3%of the investors to enter into the equity market.
Out of the 100 respondents 77(77%) of them chose to invest in the equity market and 33(33%) of the remaining were interested in the commodities market.
The main reason for this trend is the lack of awareness or knowledge with the investors. Most of the investors are unaware about the functioning of the commodities market. The functioning of the equity market is easily understandable to them, hence majority of the people prefer to invest in the equity market instead of the commodities market. Also, due to the high volatility of the commodities market, say for eg: silver, the investors hesitate to invest in the commodities market. Hence equity market is more preferred.
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It was found that only 41(41%) clients preferred intraday out of the total 100. The remaining 59(59%) preferred to invest in Delivery. The reason being, if the price of a stock falls, then in intraday the investor is sure to lose out the money invested and incur a loss. But, in delivery he has the choice to wait for the stock to gain back position to prevent the loss and try to gain some profit out of it.
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Findings:
Most of the respondents invest in the security market. Investors feel secure in investing in the security market. In todays market, still most of the investors are doing the trading through offline medium Market survey provided me knowledge that 72% investors are aware with online trading. Though the awareness level about the offline trading is very high, still there is feeling of reluctance among the respondents and they prefer to trade offline. Consumption level is high comparatively the income of the customers related to the Indian perspective because only 10% is being invested in the savings by the customers. The consumers are more speculative in behavior in the Indian economy. They have no high risk-taking attitude that means they do not want to take high risk. A large number of respondents have taken their loans from investment agencies. The reason of this is: 1. Easy Documentation and Quick disbursal 2. Good Ambience 3. Prompt Action 4. Easy monthly repayment and installment(EMI) The awareness level about Kaynet is satisfactory. Still most of the respondents are not aware of the product and services of Kaynet. There are major player in online trading are giving good competition to Kaynet.
Suggestions
There is a rigid and complex organizational structure so complete transparency must be required within the employees. Customers do not have enough idea about the products, services and brokerage offerings of Kaynet, so it must be full with crystal clear view. Awareness about the product such as personal loans, insurance should be created. Most of the customers 51
don t know about the brand so, promotional activity is required. Most of the customers also don t have clear view that in which segment Kaynet is actually dealing with, so consistent and clear messages regarding the products must be provided to the customer. Customer s grievances should be attempted in clear and prompt way.
REFERENCE
WEBLIOGRAPHY:
http://www.indiabulls.com http://www.sharekhan.com http://www.icicidirect.com http://www.sebi.com http://www.nseindia.com http://www.bseindia.com http://www.hdfcsec.com http://www.kotakstreet.com http://www.5paisa.com http://www.religare.com http://www.moneycontrol.com http://www.investopedia.com http://www.adb.org/documents/books/rising_to_the_challenge/india/india-cap.pdf http://www.tracenotes.com/reports/brokers-india.html http://www.chittorgarh.com/newportal/online-stock-brokers-detail.asp?a=3
BIBLIOGRAPHY:
Financial Management by P.K Jain and M.Y. Khan Dealers (Derivatives) Module provided by NSE
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