“A STUDY TO CHECK THE EFFECTIVENESS OF PORTFOLIO

MANAGEMENT SERVICES”

SHAREKHAN

............
 A
MAJOR PROJECT
ON
“A STUDY TO CHECK THE EFFECTIVENESS OF

PORTFOLIO MANAGEMENT SERVICES”

Submitted in the partial fulfillment of degree of

Master of Business Administration (2017- 2019)

Under the guidance of: Submitted by:

Mr. Rahul Tripathi Deepika Bisht

Enrollment No.:43021303917

M.B.A 3rd Semester

 Student Declaration
I hereby declare that the project entitled “A STUDY TO CHECK THE EFFECTIVENESS OF PORTFOLIO
MANAGEMENT SERVICES” under the guidance of “Mr. Rahul Tripathi” submitted in the partial
fulfillment of degree of Master of Business Administration MBA (Gen) from “Tecnia institute of
advanced studies”, affiliated from GGSIPU New Delhi”. This is my original work and this project work
has not formed the basis for the award of any Degree to the best of my Knowledge.

Name: Deepika Bisht

Enrolment No: 43021303917

Place: New Delhi

Date:
Signature of the Candidate
 ACKNOWLEDGEMENT

“If the words are symbol of undiluted feelings and token of gratitude then let the words play the

heralding role of expressing my feelings.”

Making a project is a result of meticulous efforts put in by many minds that contribute to the final

report formation. This is an honest effort towards putting forward whatever I have gained as a valuable

experience that will surely help me to move up the learning curve towards the path I have chosen.

I would like to render my sincere thanks to Mr. Varun Jha ) SHAREKHAN LIMITED for his

immense encouragement, guidance and invaluable lecture sessions throughout my training. He has been an

inspirational mentor guiding me through every step of my project, thus making the entire Project a complete

learning process.

Never the last, I would take the opportunity to thank to all the Rohini branch employees of

“SHAREKHAN LTD.” who gave their precious time in providing me with valuable information

whenever needed.

(3RD SEMESTER)
 CERTIFICATE

This is to certify that project titled ““A STUDY TO CHECK THE EFFECTIVENESS OF
PORTFOLIO MANAGEMENT SERVICES” is a bonafide work done by Ms. DEEPIKA BISHT,
enrolment NO: 43021303917, Batch in partial fulfillment of the requirements for the award of the
degree MBA and submitted to SHAREKHAN LTD.
This work was not submitted earlier at any other University or Institute for the award of the degree.
 TABLE OF CONTENTS

Page No.
Chapter 1 1-17
 Introduction of the Study
 Significance of the Study
 Conceptualization
 Focus of the Study
 Objectives of the Study
 Research Methodology
 Plan of Study

Chapter 2 18
 Review of Existing Literature

Chapter 3 19-34
 Industry Profile
 Company Profile

Chapter 4 35-45
 Analysis and Interpretation
 Finding

Chapter 5 45-49
 Recommendations
 Conclusion
 Limitation of the study
Bibliography 50
Annexure /Appendices 51-52
CHAPTER-I
 INTRODUCTION TO STUDY

The field of investment traditionally divided into security analysis and portfolio management.
The heart of security analysis is valuation of financial assets. Value in turn is the function of risk
and return. These two concepts are in the study of investment .Investment can be defined the
commitment of funds to one or more assets that will be held over for some future time.

In today fast growing world, many opportunities are available, so in order to move with
changes and grab the best opportunities in the field of investments a professional fund manager
is necessary.

Therefore, in the present scenario the Portfolio Management Services (PMS) is fast gaining
importance as an investment alternative for the High Networth Investors.

Portfolio Management Services (PMS) is an investment portfolio in stocks, fixed income,

debt, cash, structured products and other individual securities, managed by a professional money
manager that can potentially be tailored to meet specific investment objectives.

When you invest through PMS, you own individual securities unlike a mutual fund investor,
who owns units of the entire fund. You have the freedom and flexibility to tailor your portfolio to
address personal preferences and financial goals. Although portfolio managers may oversee
hundreds of portfolio, your account may be unique.

MYTHS ABOUT PMS

There are two most common myths found about Portfolio Management Services (PMS)
which we found among most of the Investors. They are as follows.

Myth No. 1: “PMS and Mutual Fund are Similar as the investment option”
As in the Finance Basket both the PMS and Mutual Fund are used for minimizing risk and
maximize the profit of the Investors. The objectives are similar as in both the product but they
are different from each other in certain aspects. They are as follows.

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Management Side

In PMS, it is ongoing personalized access to professional money management services.

Whereas, in Mutual fund gives personalize access to money.

Customization

In PMS, Portfolio can be tailored to address each investor's specific needs. Whereas in
Mutual Fund Portfolio structured to meet the fund's stated investment objectives.

Ownership

In PMS, Investors directly own the individual securities in their portfolio, allowing for tax
management flexibility, whereas in Mutual Fund Shareholders own shares of the fund and cannot
influence buy and sell decisions or control their exposure to incurring tax liabilities.

Liquidity

In PMS, managers may hold cash; they are not required to hold cash to meet redemptions,
whereas, Mutual funds generally hold some cash to meet redemptions.

Flexibility

PMS is generally more flexible than mutual funds. The Portfolio Manager may move to 100%
cash if it required. The Portfolio Manager may take his own time in building up the portfolio.
The Portfolio Manager can also manage a portfolio with disproportionate allocation to select
compelling opportunities whereas, in Mutual Fund comparatively less flexible.

Myth No. 2: “PMS is more Risk free than other Financial Instrument”

In Financial Market Risk factor is common in all the financial products, but yes, it is true that
Risk Factor vary from each other due to its nature. All investments involve a certain amount of
risk, including the possible erosion of the principal amount invested, which varies depending on
the security selected. For example, investments in small and mid-sized companies tend to

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involve more risk than investments in larger companies.

Under PMS we have two product lines

 ProPrime – Based on Fundamental Research

 ProTech – Based on Technical Analysis

 Nifty Thrifty

 Diversified (new launch)

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 SIGNIFICANCE OF THE STUDY

For Researcher:-
This study will help to the further researcher to know the awareness level of customers towards
Portfolio management Services & its Future Potential. It will also help them to get knowledge
about Portfolio management Services.

For Organization:-
This study will help the organization to understand the need of customers towards Portfolio
management Services, to make strategy as per customer demand. It helps the organization to
grow more and provide best services to their customers.

For Investors:-
This study will help the investors to know about the Portfolio Management Services and help
them in their future investment.

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 CONCEPTUALIZATION

PORTFOLIO MANGEMNT SERVICES (PMS)

Portfolio means a collection of investments held by an institution or a private individual.

Holding a portfolio is often part of an investment and risk-limiting strategy called diversification.
By owning several assets, certain types of risk (in particular specific risk) can be reduced. There
are also portfolios, which are aimed at taking high risks – these are called concentrated
portfolios.

Investment management is the professional management of various securities (shares, bonds

etc) and other assets (e.g. real estate), to meet specified investment goals for the benefit of the
investors. Investors may be institutions (insurance companies, pension funds, corporations etc.)
or private investors (both directly via investment contracts and more commonly via collective
investment schemes e.g. mutual funds).

The term asset management is often used to refer to the investment management of collective
investments, whilst the more generic fund management may refer to all forms of institutional
investment as well as investment management for private investors. Investment managers who
specialize in advisory or discretionary management on behalf of (normally wealthy) private
investors may often refer to their services as wealth management or portfolio management often
within the context of so-called "private banking".

The provision of 'investment management services' includes elements of financial analysis,

asset selection, stock selection, plan implementation and ongoing monitoring of investments.
Outside of the financial industry, the term "investment management" is often applied to
investments other than financial instruments. Investments are often meant to include projects,
brands, patents and many things other than stocks and bonds. Even in this case, the term implies
that rigorous financial and economic analysis methods are used.

5
 Objective of PMS

There is the following objective, which is full filled by Portfolio Management Services.

1. Safety Of Fund: -
The investment should be preserved, not be lost, and should remain in the returnable
position in cash or kind.
2. Marketability: -
The investment made in securities should be marketable that means, the securities
must be listed and traded in stock exchange so as to avoid difficulty in their encashment.
3. Liquidity: -
The portfolio must consist of such securities, which could be en-cashed without any
difficulty or involvement of time to meet urgent need for funds. Marketability ensures
liquidity to the portfolio.
4. Reasonable return: -
The investment should earn a reasonable return to upkeep the declining value of
money and be compatible with opportunity cost of the money in terms of current income
in the form of interest or dividend.
5. Appreciation in Capital: -
The money invested in portfolio should grow and result into capital gains.
6. Tax planning: -
Efficient portfolio management is concerned with composite tax planning covering
income tax, capital gain tax, wealth tax and gift tax.
7. Minimize risk: -
Risk avoidance and minimization of risk are important objective of portfolio
management. Portfolio managers achieve these objectives by effective investment
planning and periodical review of market, situation and economic environment affecting
the financial market.

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 Types of Portfolios

The different types of Portfolio which is carried by any Fund Manager to maximize profit
and minimize losses are different as per their objectives .They is as follows.

Aggressive Portfolio:
Objective: Growth. This strategy might be appropriate for investors who seek High growth
and who can tolerate wide fluctuations in market values, over the short term.

Growth Portfolio:

Objective: Growth. This strategy might be appropriate for investors who have a preference
for growth and who can withstand significant fluctuations in market value.

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 Balanced Portfolio:
Objective: Capital appreciation and income. This strategy might be appropriate for investors
who want the potential for capital appreciation and some growth, and who can withstand
moderate fluctuations in market values.

Conservative Portfolio:

Objective: Income and capital appreciation. This strategy may be appropriate for investors
who want to preserve their capital and minimize fluctuations in market value.

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 Sharekhan Portfolio Management Services

PMS

PRO PRIME
PRO TEC

Pro Prime

Product Approach

Investment will be keeping in mind 3 investment tenets.

1. Consistent, steady and sustainable returns.

2. Margin of Safety
3. Low Volatility

Product offering

Pro Prime is the ideal for investors looking at steady and superior with low and medium risk
appetite.

The portfolio consists of a blend of quality blue chip and growth stocks ensuring a balanced
portfolio with relatively medium risk profile.

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 The portfolio constitutes of relatively large capitalization stocks, based on sector and themes
which have medium to long term growth potential.

Product Characteristics

 Bottom up stock selection

 In depth ,independent fundamental research
 High quality companies with relatively large capitalization
 Disciplined valuation approach applying multiple valuation measure.
 Medium to long term vision, resulting in low portfolio turnover.

How to invest?

 Minimum Investment : 10 Lacs

 Lock in : 6 months
 Reporting: Access to website showing clients holding .Monthly reporting of portfolio
holding /transaction.
 Charges: 2.5% pa AMC (Annual Maintenances Charges) fees charged every quarter
,0.5% brokerage ,20% profit sharing after 15% hurdle is crossed chargeable at the end of
fiscal year.

Pro Tech

Protech using the knowledge of technique analysis and the power of depravities markets to
identify trading opportunities in the market .The protech line of the product is designed around
various risk /reward /volatility profiles for the different kind of investment needs.

 ProTech PMS

 Minimum Investment:

 Indian Resident Rs 5 lakhs,

 For NRI's - Rs 50 Lacs

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  Lock in: 6 months

 Fees

 AMC fees : 0%

 Brokerage : 0.05% only

 Profit Sharing :20% profit sharing on booked profits on quarterly basis

Product Approach

Better performance is possible from superior market timing and from picking stocks before
inflation points in their trading cycles .Linear return are possible from having hedged/ sell
market positions in downtrends .Absolute return are targeted by focusing on finding trading
opportunities & not out performance of an index.

Product offered

1. Nifty Thirty :
Nifty futures will be bought and sold on the basis of an automated trading system
generated calls to go long/short. The exposure will never exceed the value of portfolio i.e.
no leveraging; but allows us to be short /hedged in Nifty in falling market therefore
allowing the client to earn irrespective of the market direction.

2. Beta Portfolio :
Positional trading opportunities are identified in the future segment based on
technical analysis .Inflection points in the momentum cycles are identified to go long
/short on stock/index futures with 1-2 months time horizon .The idea is to generate the
best possible return in the medium term irrespective of the direction of the market
without really leveraging beyond the portfolio value. Risk protection is done based on
stop losses on daily closing prices.

3. Star Nifty:
Swing trading technique and Dow Theory is used to identify short –term reversal
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 levels for Nifty futures and ride with trend both on the long and short side .This return
can be earned in bull and bear market .Stop and reverse means to reverse ones position
from long to short or vice a versa at the reversal levels simultaneously .The exposure
never exceeds value of portfolio i.e. there is no leveraging.

4. Trailing Stops.
Momentum trading techniques are used to spot short –term momentum of 5-10 days
in stocks and stocks /index futures .Trailing stop loss method of risk management or
profit protection is used to lower the portfolio volatility and maximize return .Trading
opportunities are exposed both on the long side and the short side as the market demands
to get the best of both upward and downward trends.

Product Characteristics

 Using swing based index –trading systems stop and reverse .trend following and
momentum trading technique.
 Nifty based products for low impact cost and low product volatility
 Both long and short strategies to earn returns even in falling market.
 Trading in future market to allow for active risk protection using trailing stop losses.

How to invest?

 Minimum : Rs.10 Lacs

 Lock in : 6 months
 Reporting: Fortnightly reporting of portfolio Net Worth, monthly reporting of
portfolio Holding /Transaction.
 Charges: 0% AMC (Annual Maintenance Charges), 0.05% brokerage for
derivatives, 20% profit sharing on booked profit quarterly basis

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 OBJECTIVES OF THE STUDY

 To know the concept of Portfolio Management.

 To know about the awareness of consumers towards stock brokers and share market.
 To check the awareness level of consumers about PMS.
 To study about whether people are satisfied with Sharekhan portfolio Management
Services System or not.
 To check the effectiveness of portfolio management services.
 To study the various products of the company.
 To know various reason for market fluctuation.

13
 Focus of the study

The study entitled “A STUDY TO CHECK THE EFFECTIVENESS OF PORTFOLIO

MANAGEMENT SERVICES” has been designed with the definite focus to measure the
effectiveness of Portfolio Management Services at Sharekhan Limited.

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 RESEARCH METHODOLOGY

This report is based on primary as well secondary data, however primary data collection was
given more importance since it is overhearing factor in attitude studies. One of the most
important users of research methodology is that it helps in identifying the problem, collecting,
analyzing the required information data and providing an alternative solution to the problem .It
also helps in collecting the vital information that is required by the top management to assist
them for the better decision making both day to day decision and critical ones. The research
design is exploratory cum descriptive.

The study consists of analysis about Investors Perception about the Portfolio Management
Services offered by Sharekhan Limited. For the purpose of the study 40 customers were picked
up at random and their views solicited on different parameters.

The methodology adopted includes

 Questionnaire
 Random sample survey of customers
 Discussions with the concerned

SOURCES OF DATA
For this study I used use Primary as well as Secondary data.

The sources used for the collection of Primary data were:

 Questionnaires
 Tele-calling
 Personal Visits
 Clients References

15
 The sources used for the collection of Secondary data were:

 Internet
 Database provided by the Sharekhan Limited.

SAMPLING PLAN
 Sampling:

Since Sharekhan Limited has many segments, I selected Portfolio Management Services
(PMS) segment as per my profile to do market research. 100% coverage was difficult within the
limited period. Hence sampling survey method was adopted for the purpose of the study.

 Population:
(Universe) customers & non-consumers of Sharekhan limited

 Sampling size:
A sample of 40 was chosen for the purpose of the study. Sample consisted of Investor as
based on their Income and Profession as well as Educational Background.

 Sampling Methods:
Probability sampling requires complete knowledge about all sampling units in the universe.
Due to time constraint, non-probability sampling will be chosen for the study.

 Sampling procedure:
From large number of customers & non-consumers sample lot will be randomly picked up
by me.

Field Study:
Directly approached respondents by the following strategies
 Tele-calling
 Personal Visits
 Clients References
 Promotional Activities
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 PLAN OF THE STUDY

The structure of present study is as follows:

 Chapter 1 of this study covers the introduction of the study, significance of the study,

objectives of the study, focus of the problem, conceptualization and plan of the study.
The chapter also includes research methodology containing the nature of research, sample
size and analysis pattern used to conduct the research.
 Chapter 2 explores the significant literature published on the present study reflecting

understanding of the relevant theoretical and empirical background of the problem.

 Chapter 3 consists of industry & company profile, which gives a thorough study about

the company.
 Chapter 4 consists of data analysis and inferences.

 Chapter 5 of this study contains findings and conclusions providing the end result of the

study. The last part gives the limitation of the study thus providing significant scope for
further research.

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CHAPTER-II
 LITERATURE REVIEW OF PROJECT

Elton New York University, (May 2004) “The Impact of Mutual Fund Family Membership
on Investor Risk”. This paper discusses how investors who confine their mutual fund
holdings to a single fund family, tend to restrict their returns exposing their portfolio to much
higher risk. As, empirical evidence shows that degree of correlation between two similar
category funds of similar mutual fund family is much higher as compared to two funds in
same category but different fund families.

Sharpe (1994), provides an excellent review of “Theoretical aspects of portfolio

diversification and investment decisions.”

Edwin J. Elton (1996) “Modern Portfolio Theory and Investment Analysis”. This book
deals with the economics behind designing a portfolio as well as theories regarding
portfolio optimization.

Donald E.Fisher(1995), “Security Analysis and Portfolio Management”. This book

deals with art of buying and selling securities as well as security markets.

According to “Developments of Captal Market in India” at London School of

nd
Economics on 2 October, 2006 .

The capital market is a place where the suppliers and users of capital meet to share one
another's views. The Indian capital markets dates back to the 18th century when the securities of
the East India Company were traded in Mumbai and Kolkata. However, the orderly growth of
the capital market began with the setting up of The Stock Exchange, Bombay in July 1875
and Ahmadabad Stock Exchange in 1894.

18
CHAPTER-III
 COMPANY PROFILE

Sharekhan is one of the leading retail brokerage of Citi Venture which is running
successfully since 1922 in the country. Earlier it was the retail broking arm of the Mumbai-based
SSKI Group, which has over eight decades of experience in the stock broking business.
Sharekhan offers its customers a wide range of equity related services including trade execution
on BSE, NSE, Derivatives, depository services, online trading, investment advice etc.

Earlier with a legacy of more than 80 years in the stock markets, the SSKI group ventured
into institutional broking and corporate finance 18 years ago. SSKI is one of the leading players
in institutional broking and corporate finance activities. SSKI holds a sizeable portion of the
market in each of these segments. SSKI’s institutional broking arm accounts for 7% of the
market for Foreign Institutional portfolio investment and 5% of all Domestic Institutional
portfolio investment in the country.

It has 60 institutional clients spread over India, Far East, UK and US. Foreign Institutional
Investors generate about 65% of the organization’s revenue, with a daily turnover of over US$ 2
million. The content-rich and research oriented portal has stood out among its contemporaries
because of its steadfast dedication to offering customers best-of-breed technology and superior
market information. The objective has been to let customers make informed decisions and to
simplify the process of investing in stocks

Mission of the Sharekhan is

“To educate and empower the individual investor to make better investment decisions
through
 QUALITY ADVICE
 INNOVATIVE PRODUCTS and
 SUPERIOR SERVICE.”
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 WORK STRUCUTRE OF SHAREKHAN

Sharekhan has always believed in investing in technology to build its business. The company
has used some of the best-known names in the IT industry, like Sun Microsystems, Oracle,
Microsoft, Cambridge Technologies, Nexgenix, Vignette, Verisign Financial Technologies India
Ltd, Spider Software Pvt. Ltd. to build its trading engine and content. The Citi Venture holds a
majority stake in the company. HSBC, Intel & Carlyle are the other investors.

On April 17, 2002 Sharekhan launched Speed Trade and Trade Tiger, are net-based
executable application that emulates the broker terminals along with host of other information
relevant to the Day Traders. This was for the first time that a net-based trading station of this
caliber was offered to the traders. In the last six months SpeedTrade has become a de facto
standard for the Day Trading community over the net. Sharekhan’s ground network includes
over 700+ Shareshops in 130+ cities in India.

The firm’s online trading and investment site www.sharekhan.com - was launched on Feb 8,
2000. The site gives access to superior content and transaction facility to retail customers across
the country. Known for its jargon-free, investor friendly language and high quality research, the
site has a registered base of over 3 Lacs customers. The number of trading members currently
stands at over 7 Lacs. While online trading currently accounts for just over 5 per cent of the daily
trading in stocks in India, Sharekhan alone accounts for 27 per cent of the volumes traded online.

The Corporate Finance section has a list of very prestigious clients and has many ‘firsts’ to
its credit, in terms of the size of deal, sector tapped etc. The group has placed over US$ 5 billion
in private equity deals. Some of the clients include BPL Cellular Holding, Gujarat Pipavav,
Essar, Hutchison, Planetasia, and Shopper’s Stop. Finally, Sharekhan shifted hands and Citi
venture get holds on it.

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PRODUCT AND SERVICES OFFERD BY SHAREKHAN

1- Equity Trading Platform (Online/Offline).

2- Commodities Trading Platform (Online/Offline).

3- Portfolio Management Service.

4- Mutual Fund.

5- Insurance.

6- IPOs.

7- Demat.

8- Derivatives.

9- Currency.

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 6. Forex.

REASON TO CHOOSE SAHREKHAN LIMITED

Experience
SSKI has more than eight decades of trust and credibility in the Indian stock market. In the
Asia Money broker's poll held recently, SSKI won the 'India's best broking house for 2004'
award. Ever since it launched Sharekhan as its retail broking division in February 2000, it has
been providing institutional-level research and broking services to individual investors.
Technology
With their online trading account one can buy and sell shares in an instant from any PC with
an internet connection. Customers get access to the powerful online trading tools that will help
them to take complete control over their investment in shares.

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 Accessibility
Sharekhan provides ADVICE, EDUCATION, TOOLS AND EXECUTION services for
investors. These services are accessible through many centers across the country (Over 650
locations in 150 cities), over the Internet (through the website www.sharekhan.com) as well as
over the Voice Tool.

Knowledge
In a business where the right information at the right time can translate into direct profits,
investors get access to a wide range of information on the content-rich portal,
www.sharekhan.com. Investors will also get a useful set of knowledge-based tools that will
empower them to take informed decisions.

Convenience
One can call Sharekhan’s Dial-N-Trade number to get investment advice and execute his/her
transactions. They have a dedicated call-center to provide this service via a Toll Free Number
1800 22-7500 & 39707500 from anywhere in India.

Customer Service
Its customer service team assist their customer for any help that they need relating to
transactions, billing, demat and other queries. Their customer service can be contacted via a toll-
free number, email or live chat on www.sharekhan.com.

Investment Advice
Sharekhan has dedicated research teams of more than 30 people for fundamental and
technical research. Their analysts constantly track the pulse of the market and provide timely
investment advice to customer in the form of daily research emails, online chat, printed reports
etc.
Benefits
 Free Depository A/c
 Instant Cash Transfer
 Multiple Bank Option.
 Secure Order by Voice Tool Dial-n-Trade.
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  Automated Portfolio to keep track of the value of your actual purchases.
 24x7 Voice Tool access to your trading account.
 Personalized Price and Account Alerts delivered instantly to your Mobile Phone & E-
mail address.
 Live Chat facility with Relationship Manager on Yahoo Messenger
 Special Personal Inbox for order and trade confirmations.
 On-line Customer Service via Web Chat.
 Enjoy Automated Portfolio.
 Buy or sell even single share
 Anytime Ordering.

Sharekhan offers the following products:-

CLASSIC ACCOUNT
This is a User Friendly Product which allows the client to trade through website
www.sharekhan.com and is suitable for the retail investors who is risk-averse and hence prefers
to invest in stocks or who does not trade too frequently.
Features
 Online trading account for investing in Equity and Derivatives via www.sharekhan.com
 Live Terminal and Single terminal for NSE Cash, NSE F&O & BSE.
 Integration of On-line trading, Saving Bank and Demat Account.
 Instant cash transfer facility against purchase & sale of shares.
 Competitive transaction charges.
 Instant order and trade confirmation by E-mail.
 Streaming Quotes (Cash & Derivatives).
 Personalized market watch.
 Single screen interface for Cash and derivatives and more.
 Provision to enter price trigger and view the same online in market watch.

DIAL-N-TRADE
Along with enabling access for trade online, the CLASSIC and SPEEDTRADE ACCOUNT

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also gives Dial-n-trade services. With this service, one can dial Sharekhan’s dedicated phone
lines 1800-22-7500, 3970-7500. Beside this, Relationship Managers are always available on
Office Phone and Mobile to resolve customer queries.

SHARE MOBILE
Sharekhan had introduced Share Mobile, mobile based software where one can watch Stock
Prices, Intra Day Charts, Research & Advice and Trading Calls live on the Mobile. (As per SEBI
regulations, buying-selling shares through a mobile phone are not yet permitted.)

PREPAID ACCOUNT
Customers pay Advance Brokerage on trading Account and enjoy uninterrupted trading in
their Account. Beside this, great discount are also available (up to 50%) on brokerage.
Prepaid Classic Account: - Rs. 2000
Prepaid Speed trade Account: - Rs. 6000

IPO ON-LINE
Customers can apply to all the forthcoming IPOs online. This is quite hassle-free, paperless
and time saving. Simply allocate fund to IPO Account, Apply for the IPO and Sit Back & Relax.

Mutual Fund Online

Investors can apply to Mutual Funds of Reliance, Franklin Templeton Investments, ICICI
Prudential, SBI, Birla, Sundaram, HDFC, DSP Merrill Lynch, PRINCIPAL and TATA with
Sharekhan.

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 INDUSTRY PROFILE
Stock Market is a market where the trading of company Stock, both listed securities and
unlisted takes place. It is different from Stock Exchanges because it includes all the national
Stock exchanges of the country. For example, we use the term, "the Stock market was up today"
or "the Stock market bubble."

- Bombay Stock Exchanges

- National Stock Exchanges

- Regional Stock Exchanges

INDIAN STOCK MARKET OVERVIEW

The Bombay stock exchanges (BES) and the National Stock Exchange of India Ltd (NSE) is
the two primary exchanges in India. In addition, there are 28 Regional Stock Exchanges
However, the BSE and NSE have established themselves as the two leading exchanges and
account for about 80% of the equity volume traded in India.

The average daily turnover at the exchanges has increased from Rs. 851 crore in 1997-98 to
Rs. 1,284 crore in 1998-99 and further to Re. 2273 crore in 1999-2000 (April- August 1999).
NSE has around 1500 shares listed with a total market capitalization of around Rs. 921500 crore
(Rs. 9215 Bln). The BSE has over 6000 stocks listed and has a market capitalization of around
Rs. 968000 crore (9680 Bln). Most key stocks are traded on both the exchanges and hence the
investor could buy them on either exchange. Both exchanges have a different settlement cycle,
which allows investors to shift their positions on the bourse. The primary index of BSE is BSE
Sensex comprising 30 stocks. NSE has the S&P NSE 50 index (Nifty) which consists of fifty
stocks.

The BSE Sensex is the older and more widely followed index. Both these indices are
calculated on the basis of market capitalization and contain the heavily traded shares from key
sectors. The markets are closed on Saturdays and Sundays. Both the exchanges have switched
over from the open outcry trading system to a fully automated computerized mode of trading

26
known as BOLT (BSE on Line Trading) and NEAT (National Exchange Automated
Trading)System. It facilitates more efficient processing, automatic order matching, faster
execution of trades and transparency.

The Scripts traded on the BSE have been classified into ‘A’, ‘B1’, ‘B2’, ‘C’, ‘F’ and ‘Z’
groups. The ‘A’ group shares represent those, which are in the carry forward system (Badla). The
‘F’ group represents the debt market (fixed income securities) segment. The ‘Z’ group scripts are
the blacklisted companies. The ‘C’ group covers the odd lot securities in ‘A’, ‘B1’& ‘B2’ groups
and Rights renunciations. The key regulator governing Stock Exchanges, Brokers, Depositories,
Depository participants, Mutual Funds, FIIs and other participants in Indian secondary and
primary market is the Securities and Exchange Board of India (SEBI) Ltd.

ABOUT NSE

The National Stock Exchange of India Limited has genesis in the report of the High Powered
Study Group on Establishment of New Stock Exchanges, which recommended promotion of a
National Stock Exchange by financial institutions (FIs) to provide access to investors from all
across the country on an equal footing. Based on the recommendations, NSE was promoted by
leading Financial Institutions at the behest of the Government of India and was incorporated in
November 1992 as a tax-paying company unlike other stock exchanges in the country.

On its recognition as a stock exchange under the Securities Contracts (Regulation) Act, 1956 in
April 1993, NSE commenced operations in the Wholesale Debt Market (WDM) segment in June
1994. The Capital Market (Equities) segment commenced operations in November 1994 and
operations in Derivatives segment commenced in June 2000.

NSE Group

 NSCCL
 IISL
 NSE.IT
 NSDL
 DotExIntl.Ltd
27
ABOUT BSE

The Stock Exchange, Mumbai, popularly known as "BSE" was established in 1875 as "The
Native Share and Stock Brokers Association". It is the oldest one in Asia, even older than the
Tokyo Stock Exchange, which was established in 1878. It is a voluntary non-profit making
Association of Persons (AOP) and is currently engaged in the process of converting itself into
demutualised and corporate entity. It has evolved over the years into its present status as the
premier Stock Exchange in the country. It is the first Stock Exchange in the Country to have
obtained permanent recognition in 1956 from the Govt. of India under the Securities Contracts
(Regulation).

The Exchange, while providing an efficient and transparent market for trading in securities, debt
and derivatives upholds the interests of the investors and ensures redressal of their grievances
whether against the companies or its own member-brokers. It also strives to educate and
enlighten the investors by conducting investor education programs and making available to them
necessary informative inputs.

A Governing Board having 20 directors is the apex body, which decides the policies and
regulates the affairs of the Exchange. The Governing Board consists of 9 elected directors, who
are from the broking community (one third of them retire ever year by rotation), three SEBI
nominees, six public representatives and an Executive Director & Chief Executive Officer and a
Chief Operating Officer.

The Executive Director as the Chief Executive Officer is responsible for the day-to-day
administration of the Exchange and he is assisted by the Chief Operating Officer and other
Heads of Departments.

The Exchange has inserted new Rule No.126 A in its Rules, Bye-laws & Regulations pertaining
to constitution of the Executive Committee of the Exchange. Accordingly, an Executive
Committee, consisting of three elected directors, three SEBI nominees or public representatives,
Executive Director & CEO and Chief Operating Officer has been constituted. The Committee
considers judicial & quasi matters in which the Governing Board has powers as an Appellate

27 (1)
Authority, matters regarding annulment of transactions, admission, continuance and suspension
of member-brokers, declaration of a member-broker as defaulter, norms, procedures and other
matters relating to arbitration, fees, deposits, margins and other monies payable by the member
brokers to the exchange etc.

Sensex
Milestones

Here's a timeline on the rise and rise of the Sensex through Indian stock market history.

• 1000, July 25, 1990

On July 25, 1990, the Sensex touched the magical four-digit figure for the first time and
closed at 1,001 in the wake of a good monsoon and excellent corporate results.

• 2000, January 15, 1992

On January 15, 1992, the Sensex crossed the 2,000-mark and closed at 2,020 followed by the
liberal economic policy initiatives undertaken by the then finance minister and current Prime
Minister Dr Manmohan Singh.

• 3000, February 29, 1992

On February 29, 1992, the Sensex surged past the 3000 mark in the wake of the market-

28
 friendly Budget announced by the then Finance Minister, Dr Manmohan Singh.

• 4000, March 30, 1992

On March 30, 1992, the Sensex crossed the 4,000-mark and closed at 4,091 on the
expectations of a liberal export-import policy. It was then that the Harshad Mehta scam hit the
markets and Sensex witnessed unabated selling.

• 5000, October 11, 1999

On October 8, 1999, the Sensex crossed the 5,000-mark as the BJP-led coalition won the
majority in the 13th Lok Sabha election.

• 6000, February 11, 2000

On February 11, 2000, the infotech boom helped the Sensex to cross the 6,000-mark and hit
and all time high of 6,006.

• 7000, June 21, 2005

On June 20, 2005, the news of the settlement between the Ambani brothers boosted investor
sentiments and the scrips of RIL, Reliance Energy, Reliance Capital and IPCL made huge gains.
This helped the Sensex crossed 7,000 points for the first time.

• 8000, September 8, 2005

On September 8, 2005, the Bombay Stock Exchange's benchmark 30-share index -- the
Sensex -- crossed the 8000 level following brisk buying by foreign and domestic funds in early
trading.

• 9000, December 09, 2005

The Sensex on November 28, 2005 crossed the magical figure of 9000 to touch 9000.32
points during mid-session at the Bombay Stock Exchange on the back of frantic buying spree by
foreign institutional investors and well supported by local operators as well as retail investors.

• 10,000, February 7, 2006

29
 The Sensex on February 6, 2006 touched 10,003 points during mid-session. The Sensex finally
closed above the 10K-mark on February 7, 2006.

• 11,000, March 27, 2006

The Sensex on March 21, 2006 crossed the magical figure of 11,000 and touched a life-time
peak of 11,001 points during mid-session at the Bombay Stock Exchange for the first time.
However, it was on March 27, 2006 that the Sensex first closed at over 11,000 points.

• 12,000, April 20, 2006

The Sensex on April 20, 2006 crossed the magical figure of 12,000 and touched a life-time
peak of 12,004 points during mid-session at the Bombay Stock Exchange for the first time.

Regional Stock Exchanges (RSE)

There are 23 stock exchanges in India. Among them two are national level stock exchanges
namely Bombay Stock Exchange (BSE) and National Stock Exchange of India (NSE). The rest
21 are Regional Stock Exchanges (RSE).

List of Regional Stock Exchanges in India:

Ahmedabad Stock Exchange Association Ltd.

Manek Chowk
Ahmedabad 380 001, India

Bangalore Stock Exchange

Stock Exchange Towers
No 51 1st Cross, J C Road
Bangalore 560 027, India
Phone: 91-80-299-5233/5225

Bhubaneshwar Stock Exchange Association

217 Budhraja Building
Jharpara Cuttak Road
Bhubaneshwar 751 006, India

30
Calcutta Stock Exchange
7 Lyins Range
Calcutta 700 001, India
Phone: 91-33-20-6957
Fax: 91-33-20-2514

Cochin Stock Exchnage Ltd.

Exchange House
38/1431 Kaloor Road Extension
Ernakulum, Kochi-682035, India

Coimbatore Stock Exchange

Chamber Towers
8/732 Avinashi Road
Coimbatore 641 018, India

Delhi Stock Exchange Association

3 & 4/4B Asaf Ali Road
West Plaza, I.G. Stadium
New Delhi 110 002, India
Phone: 91-11-335-2951
Fax: 91-11-332-6182

Guwahati Stock Exchange Ltd.

Saraf Building Annexe
A.T. Road
Guwahati 781 001, India

Hyberabad Stock Exchange Ltd.

Bank Street
Hyderabad 500 001, India

31
Kanara Stock Exchange Ltd
4th Floor, Rambhavan Complex
Kodialbail
Mangalore 575 003, India

Ludhiana Stock Exchange Association Ltd

Lajpat Rai Market, Clock Tower
Ludhiana 141 008, India

Madras Stock Exchange

11 Second Line Beach
Exchange Building
Madras 600 004, India
Phone: 91-44-512-237
Fax: 91-44-514-897

Madhya Pradesh Stock Exchange Ltd.

67, Bada Sarafa
Indore 452 002, India

Mangalore Stock Exchange Limited

4th Floor, Rambhavan Complex

Mangalore 575 003, Karnataka, India
Phone: 91-824-440813/440851
Fax: 91-824-21491

Meerut Stock Exchange Ltd.

Kingsway Building
345 Bombay Bazar
Meerut Cantonment 250 001, India

32
Mumbai Stock Exchange

Phiroze Jeejeebhoy Towers

Dalal Street
Mumbai 400 001, India
Phone: 91-22-265-5860
Fax: 91-22-265-8121

National Stock Exchange of India

Mahendra Towers, "A" Wing

1st Floor, RBC, Worli
Bombay 400 018, India
Phone: 91-22-493-2555
Fax: 91-22-493-5631

OTC Exchange of India

92/93 Market Tower "F"

Cuffe Parade
Bombay 400 005, India
Phone: 91-22-218-8164
Fax: 91-22-218-8511

Pune Stock Exchange Ltd.

1177, Budhwar Peth
Bank of Maharashtra Building, 2nd Floor
Bajirao Road
Pune 411 002, India

Saurashtra Kutch Stock Exchange Ltd.

4, Swaminarayan Gurukul Building
Dhebarbhai Road
33
]ajkot 380 002, India

Uttar Pradesh Stock Exchange Association Ltd.

Padam Towers
14/113 Civil Lines
Kanpur 208 001, India

Vadodara Stock Exchange Ltd.

101 Paradise Complex
Tilak Road, Sayaji Gunj
Vadodara 390 005, India

34
CHAPTER-IV
 1. Do you know about all the Investment Option available?

Interpretation

As the above table shows the knowledge of Investor out of 40 respondent carried
throughout the delhi Area is only 85%. The remaining 15% take his/her residential property as an
investment. According to law purpose this is not an investment because of it is not create any
profit for the owner.

35
 2. What is the basic purpose of your Investments?

Interpretation

As with the above analysis, it is found 75% people are interested in liquidity, returns and tax
benefits. And remaining 25% are interested in capital appreciations, risk covering, and others. In
the entire respondent it is common that this time everyone is looking for minimizing the risk and
maximizing their profit with the short time of period.

As explaining them About the Portfolio Management Services of Sharekhan, they were quite
interested in Protech Services.

36
 3. What is the most important factor you consider at the time of Investment?

Interpretation

As the above analysis gives the clear idea that most of the Investors considered the market
factor as around 12% for Risk and 23% Return, but most important common things in all are that
they are even ready for taking both Risk and Return in around 65% investor.

Moreover, the Market is fluctuating now days, so as it also getting improvement. So, Investor
are looking for Investment in long term and Short-term.

37
 4. From which option you will get the best return.

Interpretation

Most of the respondents say they will get more returns in Share Market. Since Share Market
is said to be the best place to invest to get more returns. The risk in the investment is also high.

Similarly, the Investor are more Interested in Investing their money in Mutual Fund
Schemes as that is also very important financial product due to its nature of minimizing risk and
maximizing the profit. As the commodities market is doing well from last few months so
Investor also prefer to invest their money in Commodities Market basically in GOLD nowadays.

Moreover, even who don’t want to take Risk they are looking for investing in Fixed Deposit
for long period of time.

38
 5. How much you carry the expectation in Rise of your Income from Investments?

Interpretation

The optimism is shown in the attitude of the respondents. The confidence was appreciable with
which they are looking forward to a rise in their investments. Major part of the sample feels that
the rise would be of around 15%. Only 8% of the respondents were confident enough to expect a
rise of upto 35%.

As all the respondents were considering the Risk factor also before filling the questionnaire
and they were asking about the performance report of all the PMS services offered by Sharekhan
limited.

39
 6. How do you manage your Portfolio?

Interpretation

About 57% of the respondents say they themselves manage their portfolio and 43% of the
respondents say they depend on the security company for portfolio Management. 43% of the
respondents prefer PMS of the company because they don’t have to keep a close eye on their
investment; they get all the information time to time from their Fund Manager.

Moreover, talking about the Sharekhan PMS services they are far satisfied with the Protech
and Prop rime Performance during last year. They are satisfied with the quick and active services
of Sharekhan customer services where, they get the updated knowledge about the scrip detail
everyday from their Fund Manager.

40
 7. If you trade with Sharekhan limited then why?

Interpretation

As the above research shows, the reasons and the parameters on which investor lie on
Sharekhan and they do the trade.

Among 40 respondents 35% respondents do the trade with the company due to its research
Report, 28% based on Brokerage Rate whereas 22 % are happy with its Services.

Last but not the least, 15% respondents are depends upon the tips of Sharekhan which gives
them idea where to invest and when to invest.

At the time of research, what I found is that still Sharekhan need to make the clients more
knowledge about their PMS product.

41
 8. Are you using Portfolio Management services (PMS) of Sharekhan?

Interpretation

As talking about the Investment option, in most of clients it was common that they know
about the Option but as the PMS of Sharekhan have different Product offering, Product
Characteristics and the Investment amount is very much, this makes the clients to think
differently.

It is found that 15% of Sharekhan client where using PMS services as for their Investment
Option.

42
 9. How was your experience about Portfolio Management services (PMS) of Sharekhan
Limited?

Interpretation

In the above analysis it is clear that the Investor have the good and the bad experience both
with the Sharekhan PMS services.

In this current scenario 52% of the Investor earned, whereas around 18% have to suffer
losses in the market. Similarly 30% of the Respondents are there in Breakeven Point (BEP),
where no loss and no profit.

43
10. Does Sharekhan Limited keep it PMS process Transparent?

Interpretation

The above analysis is talking about the Sharekhan Transparency of their PMS services. In 40
respondents 63% said that they get all the information about their scrip buying and selling
information day by day, where as 37% of respondents are not satisfied with the PMS information
and Transparency because they don’t get any type of extra services in PMS as they were saying.

44
 11. Do you recommend Sharekhan PMS to others?

Interpretation

The above analysis shows the Investor perception toward the Sharekhan PMS as on the basis
of their good and bad experience with Sharekhan limited. Among 40 respondents 86%
respondents were agree to recommend the PMS of Sharekhan to their peers, relatives etc.

45
CHAPTER-V
 OBSERVATION AND FINDING

 About 85% Respondents knows about the Investment Option, because remaining 15%
take his /her residential property as Investment, but in actual it not an investment
philosophy carries that all the Investment does not create any profit for the owner.

 More than 75% Investors are investing their money for Liquidity, Return and Tax
benefits.
 At the time of Investment, the Investors considered the both Risk and Return in more
percentageage around 65%.

 As among all Investment Option for Investor, the most important area to get more return
is share around 22%after that Mutual Fund and other comes into existence.

 As expected return from the Market more than 48% respondents expect the rise in
Income more than 15%, 32% respondents are expecting between 15-25% return.

 Around 57% residents manage their Portfolio through the different company whereas
43%Investor manage their portfolio themselves.

 The most important reasons for doing trade with Sharekhan limited are Sharekhan
Research Department than its Brokerage rate Structure.

 Out of respondents 15%, respondents are using Sharekhan PMs services.

 About 52% Respondents earned through Sharekhan PMS product, whereas 18% investor
faced loses also.

 As based on the good and bad experience with Sharekhan limited around 86% are ready
to recommended the PMS of Sharekhan to their peers, relatives etc.

46
 LIMITATION OF THE PROJECT

 As only Delhi1 was dealt in the survey, so it does not represent the view of the total
Indian market.

 The sample size was restricted with 40 respondents.

 There was lack of time on the part of respondents.

 The survey was carried through questionnaire and the questions were based on
perception.

 There may be biasness in information by market participant.

 Complete data was not available due to company privacy and secrecy.

 Some people were not willing to disclose the investment profile.

47
 CONCLUSION AND SUGGESTIONS

Based on the study it is found that Sharekhan Ltd is better services provider than the other
stockbrokers because of their timely research and personalized advice on what stocks to buy and
sell. Sharekhan Ltd. provides the facility of Trade tiger as well as relationship manager facility
for encouragement and protects the interest of the investors. It also provides the information
through the internet and mobile alerts that what IPO’s are coming in the market and it also
provides its research on the future prospect of the IPO. We can conclude the following with
above analysis.

 Sharekhan Ltd has better Portfolio Management services than Other Companies

 It keeps its process more transparent.

 It gives more returns to its investors.

 It charges are less than other portfolio Management Services

 It provides daily updates about the stocks information.

 Investors are looking for those investment options where they get maximum returns with
less returns.

 Market is becoming complex & it means that the individual investor will not have the
time to play stock game on his own.

 People are not so much aware about the Investment option available in the Market.

48
 SUGGESTIONS

 The company should also organize seminars and similar activities to enhance the
knowledge of prospective and existing customers, so that they feel more comfortable
while investing in the stock market.
 Investors must feel safe about their money invested.

 Investor’s accounts must be more transparent as compared to other companies.

 Sharekhan limited must try to promote more its Portfolio Management Services through
Advertisements.
 Sharekhan needs to improve more it’s Customer Services.

 There is need to change in lock in period in all PMS i.e. Protech, Proprime.

49
 BIBLIOGRAPHY

 BOOKS

 Edwin J. Elton, (1996) “Modern Portfolio Theory and Investment Analysis.”

 E.Fisher Donald, (1995) “Security Analysis and Portfolio Management.”
 Elton (May 2004) “The Impact of Mutual Fund Family Membership on Investor
Risk New York University”.
 Kothari C. R., (2004) “Research Methodology” Vishwa Prakshan, New Delhi.
 Sharpe (1994), “Theoretical aspects of portfolio diversification and investment
decisions.”

 JOURNALS

 International Business & Economics Research Journal (March 2008 Volume 7), Number
361
 International Journal of Banking (November 3 / 2009), Accounting and Finance- Volume
1, Number 285 – 309.


 Web Sites

 www.bseindia.com
 www.karvy.com
 www.moneycontrol.com
 www.nseindia.com
 www.sebi.gov.inwww.sharekha.com
 www.theeconomist.com
 www.valueresarchonline.com
 www.yahoofinance.com

50
 ANNEXURE

QUESTIONNAIRE

NAME………………………………….
AGE…………………………………………
OCCUPATION……………………………... PHONE NO..................................

1. Do you know about the Investments Option available?

A) YES B) NO

2. What is the basic purpose of your Investments?

A) Liquidity B) Return C) Tax Benefits D) Risk Covering

E) Capital Appreciation F) Others

3. What is the most important factor you consider at the time of Investment?

A) Risk B) Return C) Both

4. From which option you will get the best returns?

A) Mutual Funds B) Shares C) Commodities Market D) Bonds

E) Fixed Deposits F) Property G) Others

5. How much you carry the expectation in Rise of your Income from Investments?

A) Upto 15% B) 15-25% C) 25-35% D) More than 35%

6. How do you manage your Portfolio?

A) Self B) Depends on the company for portfolio

51
 7. If, you trade with Sharekhan limited then why?

A) Research B) Brokerage C) Services D) Investments Tips

8. Are you using Portfolio Management services (PMS) of Sharekhan?

A) Yes B) No

9. How was your experience about Portfolio Management services (PMS) of Sharekhan
Limited?

A) Earned B) Faced Loss C) No profit No loss

10. Does Sharekhan Limited keep it PMS process Transparent?

A) Yes B) No

11. Do you recommend Sharekhan PMS to others?

A) Yes B) No

52