AWARENESS REGARDING EQUITY

PRODUCTS AMONGST CORPORATE

EMPLOYEES

Presented by Ashvin Koladara (107680592065)

RESEARCH METHODOLOGY

Objectives of the study

To find out the awareness level for equity products amongst corporate employees in satellite. To study the preference of the corporate employees for the investment tools. To know how many people are investing in equity market. To know the purpose of investing in equity products of corporate employees.

Research Design: descriptive design. Sampling Design

Population: corporate employees Sampling Method: convenience sampling Sample size: 300 Sample unit: corporate employee Sources of data: primary and secondary

RESEARCH METHODOLOGY

Literature Review

Share Market Knowledge, The NSE Of India, And BSE Of India (Nirmal kumar Soni, (2009), Author of stock market analyst) The Investment Pattern in Ahmedabad and Gandhinagar (Roney Josheph and Lalit barasiya, (2009) from NRIBM)

Statistical Technique

Chi-Square test

Limitations of the study

The investors may be bias in giving the require data. The scope and analysis of the project is limited to 300 corporate employees in satellite area, Ahmadabad. Time Constraint

COMPANY PROFILE

(MOSL) was founded in 1987 as a small sub-broking unit a well diversified financial services firm offering a range of financial products and services Companies Products and Services:

equity, derivatives, insurance, commodities, MFs, depository services, PMS

SWOT Analysis:

Strengths
Large and diverse distribution network Strong research and sales teams Experienced top management MOFSL operate on leased premises. MOFSL have entered into a number of related party transactions.

Weaknesses

CONT
Opportunities Good Customer Base Rising consumer incomes will translate into disproportionately higher allocation of these funds into equities Can make use of sustained growth in retail segment of financial Product. Threats Existing Competitors and new local players can affect company. Market has been uncertain for the last 3 and more months. Political instability Downturns or disruptions in the securities markets could reduce transaction volumes, and could cause a decline in the business and impact profitability.

INTRODUCTON OF EQUITY

Equity
Two words Equality & Ownership Equity means equal ownership of the company

Equity Investment

Compare to most other forms of investments, investing in equity shares or equity based mutual funds offers the highest rate of return, if invested over a longer duration. Equity products: two routes through which one can participate in equity Direct equity: Equity /Share,IPOs One of the best investment avenues available but it is one of the riskiest. best example of a "High Risk High Return" kind of investment. This kind of Investment Avenue is not meant for everybody because of the amount of expertise, skillets, time and energy that it demands. Indirect equity: MFs A common pool of money into which investors place their contribution This money is invested according to the pre-stated objectives of the fund Ownership of the fund is joint or mutual amongst all the investors equivalent to the contribution made

DATA ANALYSIS AND INTERPRETATION

How much are you aware about equity products?

Awareness Level of Equity Products

71, 24% 100, 33% Fully Aware Little Aware Not Aware

129, 43%

CONT...

Relationship between Gender & Awareness

Male & Awareness

Female & Awareness

4, 11%

59, 22% 96, 37% 12, 33% Fully Aware Fully Aware Little Aware Not Aware 109, 41% 20, 56% Little Aware Not Aware

264

CONT...

Relationship between Age & Awareness

25 - 35 Age group & Awareness level

> 35 Age group & Awareness level

60, 23% 82, 32%

11, 26% 18, 42% Fully Aware Little Aware Not Aware

Fully Aware

Little Aware
Not Aware

115, 45%

14, 32%

CONT...

Rate the following investment tools according to your preference?

Most Preferable Investment Tool
70 64 66

No.of Respondents

60 49 50 40 30 20 10 21% 0 Mutual Funds Govt. Securities & Bonds Insurance Equity Real Estate market & IPOs Bullions Fixed deposits 13% 12% 10% 16% 6% 22% 18 37 35 31 Respondents Percentage

Investment Tools

CONT...

Least Preferable Investment Tool

Least Preferable Investment tool
80
80 70

No.of Respondents

60 50 39 40 30 34 32

52 43

Respondents 20 Percentage

20 10 11% 0 Mutual Funds Govt. Securities & Bonds Insurance Equity market & IPOs Real Estate Bullions Fixed deposits 11% 13% 17% 14% 27% 7%

Investment tool

CONT...

Do you invest in Equity market?

Invest in Equity Market
No. of Respondents
160 140 120 100 80 60 40 20 0 Yes 49% 51% Respondents Percentage 148 152

Invest

No

CONT...

Relationship between Awareness & Investment decision

Awareness and Investment decision
100 91 90

No.of Respondents

80 70 60 50 40 30 56

73

70

Yes

No

20
10 0 Fully aware Little aware Not aware 9 1

Awareness

CONT...

Relationship between Gender & Investment Decision

Male & Investment decision

Female & Investment decision

11, 31% 127, 48% 137, 52% Yes No 25, 69% Yes No

CONT...

Route of Investment in equity

Route of transaction

38, 26% Direct Equity 74, 50% Mutual Funds Both

36, 24%

CONT...

What is the investable (investing) amount from your income in Equity market?
Investable amount from income in equity market No. of Respondents

100 80 60 40 20

95

Respondents
30 19 64% 20% 20% to 30% 13% 30% to 50% 4 Percentage

3%

0
10% to 20% > 50%

Percentage of Income

CONT..

Which modes of transaction do you prefer in Equity market?

Mode of Transaction Prefer in Equity Market
No. of Respondents
80 70 60 50 40 30 20 10 0 Online Offline both 50% 24% 26% 74

36

38 No of Respondents Percentage

Mode of Tansaction

CONT...

Time horizon for investment

Time Horizon for investment
49 50

No. of Respondents

45
40 35 30 25 20 15 10 5 0

40 36

23 No. of Respondents Percentage 27% Less than 6 months 16% 6 months to 1 year

33%
1 yearto 3 year

24% More than 3 years

Time Horizon

CONT...

Relationship between Time horizon & Expected return

Time horizon Vs. Expected return
30 27 25

Expected Return

21 20 15 15 10 6 3 1 0 Less than 6 months 6 months to 1year 1 year to 3 year more than 3 years 3 10 8 5 5 15

0-10%
11-20%

10 5 5 5

21-25% More than 25%

Time horizon

CONT...

What kind of investment you prefer (your risk appetite)?

Risk Appetite
8, 6% 15, 10% 36, 24%

High Risk High Return Medium Risk Medium Return Low Risk Low Return Do Not Like Any Risks

89, 60%

CONT...

Relationship between Gender & Risk Appetite

Male & Risk appetite

8, 6% High risk high return 34, 25% Medium risk medium return Low risk low return 82, 60% Do not like any risk

13, 9%

CONT...

Whom do you depend on financial advice?

Depend on Financial Advice
60 52 50

No. of Respondents

46

44
40

44
38 38 36 36 36 Advertisement 26 26 19 16 24 Financial Advisor Firm/Broker 22 18 20 Friends / Relatives Magazines / Newspaper Investment Website

40

30 25 22 20 11 10 21

27 24

29

0 P1 P2 P3 P4 P5

Source of Financial Advice

CONT...

What is your purpose behind investment?

Purpose behind Investment
70 63

No. of Respondents

60 50 40 30 20 20 10 43% 0 Wealth creation Tax savings others Future uncertain events Future More than obligations one purpose 13% 9% 7% 7% 13 11 10 31 No.of Respondents Percentage

21%

Purpose

CONT...

How much returns do you expect from equity market?

Expected Return from Equity Market
80 73

No. of respondents

70 60 50 40 30 20 10 0 0-10% 11-20% 21-25% More than 25% 13% 49% 24% 14% 19 35 21 NO. of Respondents Percentage

Percentage of Return

HYPOTHESIS

H0: Return on investment is independent of the % of investment. H1: Return on investment is dependent on the % of investment.

=0.05 DOF = (4-1) (4-1) =9 2 (tabulated) = 16.92 2 (calculated) = 9.7944 2 (tabulated) > 2 (calculated) Interpretation:
Here, H0 is accepted. It means that return on investment is independent of the percentage of investment.

FINDINGS

Majority of the corporate employees (43%) are little aware about the equity products. 37% male are fully aware about the equity products whereas only 11% female come under fully aware category. 49% corporate employees are investing in equity products Out of 100 fully aware corporate employees, 91 are investing in equity products. There are 71 employees who are not aware and thus they do not invest in equity products. 52% male and only 31% female are investing in equity market. Out of 300 corporate employees, 66 prefer to invest in fixed deposits and 64 prefer to invest in mutual funds for investment Half of the employees (50%) prefer direct equity as a route of investment in equity. 64 % are investing 10-20 % of their income in equity market. 50% employees prefer online mode of transaction. Irrespective of the time horizon, employees expect the return of 11-20% in equity market. 60% prefer medium risk medium return in equity market for safety purpose. 25% male are more attractive towards taking high risk-high return whereas only 18% female take high risk. Out of 148 corporate employees, 46 depend on investment advisor firm / broker and 44 depend on friends / relatives for investment advice. Wealth creation is the prime purpose behind the investment in equity amongst the corporate employees with 43%.

CONCLUSION

Over the last few years, the level of awareness is much higher than the past. Equity as a concept is well known, but the target audience still need to gain more awareness especially the female counterpart. Many people have fear of equity products. They think their money will not be secure in equity products - Need the awareness and knowledge of equity products and its related terms. The future of equity market is very bright as it offers the potential for a larger return than the fixed income investing in a long run. The equity products are right for the investors with high tolerance for risk.

RECOMMENDATIONS

The company should do more canopies to attract more people and to increase the awareness. The company should do marketing of Exchange Traded Funds (ETF) to explore opportunities in the untapped segment as it is a new way to indirectly participating in equity. The company should also give information about the tax benefits to invest into equity products for long term horizon. There is a large scope for the company to tap the salaried persons via SIP. SIP is an easy tool for salaried person as it provides the facility of doing the investment in EMI.

BIBLIOGRAPHY
www.motilaloswal.com http://EzineArticles.com/?expert=Nirmal_Kumar_Soni www.aumfinancialadvisors.com/market.html www.ncfm.com