SPRIERZ CONSULTANTS

THE STUDY OF INVESTMENT PATTERN

OF DIFFERENT SEGMENTS OF THE SOCIETY IN AHMEDABAD

OBJECTIVE OF THE STUDY

PRIMARY OBJECTIVE To conduct a survey and analyze different investment pattern of people of Ahmedabad. SECONDARY OBJECTIVE To study investment decisions of different segments of the society& know the individual perception about it. To find out the extent to which the investors are ready to take risk. To compare cost effectiveness of different investment options.

INVESTMENT
INVESTMENT IS THE EMPLOYMENT OF FUNDS WITH THE AIM OF ACHIEVING ADDITIONAL INCOME OR GROWTH IN VALUE.
FUNDS/FINANCE INVESTMENT

ADDITIONAL INCOME

TYPES OF INVESTMENT
CASH INVESTMENT DEBT SECURITIES STOCK MUTUAL FUND BULLION REAL ESTATE FOREX , etc.

CONCEPT OF INCOME, EXPENSES, SAVINGS & INVESTMENT

INCOM E EXPENSE S = SAVING S

SAVING S

INVESTMEN TS

TOP 10 INVESTMENTOPTIONS IN INDIA

BANK FIXED DEPOSITS INSURANCE POLICIES NATIONAL SAVINGS CERTIFICATE PUBLIC PROVIDENT FUND SHARE MARKET MUTUAL FUND GOLD DEPOSIT SCHEME REAL ESTATE EQUITY NON RESIDENT ORDINARY FUNDS

INVESTMENT PORTFOLIO
An Investment Portfolio is a mixture of investment types all held simultaneously, and is a method of limiting the risk associated with investing. PORTFOLIO PORTFOLIO A Portfolio management refers to the science of Any item that is likely MANAGEMENT to ITEMS analyzing the strengths, weakness, opportunities
retain its value wide range and threats for performingor produceof a return can be included maximizing activities related to ones portfolio for in the return ana given risk. portfolio at investment

DIVERSIFICATION
A risk management technique that mixes a wide variety of investments within a portfolio. DIVERSIFIED PORTFOLIO Diversified portfolio greatly reduces risk while smoothing investment returns by owning many securities across a wide range of industries. Diversification reduces about 70% of the total risk of investing.

THE TWO MAIN ADVANTAGES OF PORTFOLIO DIVERSIFICATION: It helps you minimize the potential of losing all your investment money if any sector or industry does poorly. It helps you maximize the potential of doing really well if any sector or industry does well.

WHY PEOPLE SAVE AND INVEST MONEY?

Manage personal finance Retirement Tax advantage

GLOBAL SCENARIO

Bullion is defined as a bulk quantity of precious metals consisting of gold, silver and others that can be assessed by weight and cast as a lump. Bullion is valued by its purity and mass rather than its face value which is applicable in the case of money.

Bullion

Types of Bullion
Bullion Rate as on 16th January 2012

Gold Silver Diamond Platinum

TYPE
Gold Silver Diamond Platinum

Price
Rs. 28000 Rs. 51800 Rs. 35000 Rs. 22000

The Foreign Exchange market, also referred to as the "FOREX" or "Forex" or "Retail Forex" or "FX" or "Spot FX" or just "Spot" is the largest financial market in the world, with a volume of over $3.2 trillion a day. All these currencies are traded against the US dollar (USD).

Forex

What is traded on the Foreign Exchange market? USD ($) EUR () The simple answer is money. J PY () GBP () Forex trading is the CHF (Fr) CAD ($) simultaneous buying of one HKD ($) SEK (kr) currency and the selling of NZD ($) another. Currencies are traded KRW () SGD ($) through a broker or dealer, NOK (kr) and are traded in pairs. MXN ($)
INR ( )

Mutual Funds
Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal .

Working of Mutual Funds

Types of Mutual Funds

Structured Short Term Plan

Nature

Open-Ended

Close-Ended

Intervals

Debt Fund

Guilt Fund

Tax Saving

Others

Index

Specific Sector

Disadvanta Advantages ges

Professional Management Costs Diversification Dilutions Economies of Scale Taxes

Stock Market
Stock Market or Share Market is one important constituent of capital market. Stock Exchange is an organized market for the purchase and sale of industrial and financial security.

Features
Market for securities Transactions effected only through members Association of person Working as per rules

FUNCTIONS
Encourage capital formation Continuous and ready market for securities Regulates company management Facilitates evaluation of securities.

Life Insurance
Life Insurance is a contract between an insurance policy holder and an insurer, where the insurer promises to pay a designated beneficiary a sum of money upon the death of an insured person. The policy holder typically pays a premium, either regularly or as a lump sum.

The advantage for the policy owner is peace of mind, in knowing that the death of the insured person will not result in financial hard ship for loved ones. Life policies are legal contracts and the term of the contract describes the limitations of the insured events. Common examples are claims relating to suicides, fraud, war, riots and civil commotions. Life based contracts tend to fall into two major categories. Protection Policies: designed to provide a benefit in the event of specified event, typically a lump sum amount. Investment Policies: where the main objective is to facilitate the growth of capital by regular or single premiums.

Types of Life Insurance

Term insurance Money back life insurance policy Endowment insurance policy Whole life insurance policy Unit linked insurance policy

Post Office
Out of 155,000 post offices spread all over the country, 89% are in the rural areas. Post offices in India play a vital role in the rural areas. They connect these rural areas with the rest of the country and also provide banking facilities. The modern postal service in India is more than 150years old. In 1854, the post office in the province of Sindh made postal history, when India became the first country to issue postage stamps. After independence the Indian government broadened the vision of the postal system, to reach the entire population of the country. Today Indian Postal system has a reach that ranges from Kanyakumari to Laddakh. Indian postal service provide many facilities like general or registered mail, parcel post, speed post, express post, ePost and EMS Speed Post. They also offer a number of post office savings scheme like National Savings Certificate, Kisan Vikas Patra, Recurring Deposits and Term Deposits.

Kisan Vikas Patra Monthly Income Account National Savings Certificate Public Provident Fund Recurring Deposit Account Post Office Savings Account Time Deposit Account

The various post office schemes are:

 one of the most successful investment

phenomenon. major part of investment is done by foreign investors. investment is done in both commercial and residential sphere. shortage of 26.53 million houses during the 11th five year plan(2007-12) may result into a big investment opportunity.

Real Estate

it produces relatively consistent total return that are hybrid of income and capital growth. (income return from real estate) = (rent payments received from tenants) (cost of operating the property and outgoing mortgage.) In real estate income returns tend to be fairly stable and capital returns fluctuate more.

Types of Real Estate

Residential property

Commercial property Agricultural land

 Bank deposit means money placed into a banking institution for safekeeping. Bank deposits are made to deposit accounts such as savings accounts, checking accounts and money market accounts at a banking institution. It is a liability owed by the bank to the depositor. the total amount of fixed deposits with banks in India is rs. 35,68,435 crores as per RBI. Bank deposits give medium return with low risk which is a very safe method of

Bank Deposits

Types of Bank Deposits

Demand deposit Fixed deposit Recurring deposit Savings account Current account

Analysis & Interpretation

AGE CLASSIFICATION
AGE CLASSIFICATION INVESTORS PERCENTAGE

BELOW 25 26-35 36-45 46-55 56 AND ABOVE TOTAL

17 42 50 44 47 200

9% 21% 24% 22% 24% 100%

PERCENTAGE OF INCOME PEOPLE SAVE SAVINGS CLASSIFICATION INVESTORS %

LESS THAN 10% 10-25% 25-40% 40-55% 55% AND ABOVE TOTAL

57 91 41 6 5 200

28% 45% 21% 3% 3% 100%

PREFERRED INVESTMENT OPTIONS INVESTMENT OPTIONS PREFERENCE %

BULLION MUTUAL FUND STOCK LIFE INSURANCE POST OFFICE FOREX TRADING REAL ESTATE BANK DEPOSIT

74 37 55 114 97 5 57 135

13% 6% 10% 20% 17% 1% 10% 23% 100%

IF GIVEN RS.10 LAC, OPTIONS WHERE PEOPLE PREFER TO INVEST IN. INVESTMENT OPTIONS BULLION MUTUAL FUND STOCK LIFE INSURANCE POST OFFICE FOREX TRADING REAL ESTATE BANK DEPOSIT TOTAL PREFFERENCE 88 48 54 52 55 16 95 93 % 18% 10% 11% 10% 11% 3% 18% 19% 100%

INVESTMENT PREFERENCE AMONG VARIOUS OCCUPATIONS INVESTMENT OPTIONS\ BUSINES SERVIC RETIRED HOUSEWIF SELF OCCUPATIONS: S E E EMPLOYE D BULLION 22 11 10 18 12 MUTUAL FUND STOCK LIFE INSURANCE POST OFFICE FOREX TRADING REAL ESTATE BANK DEPOSIT 9 16 28 18 2 24 31 10 5 22 20 0 10 27 9 16 22 23 0 7 30 6 6 19 20 0 5 31 4 12 21 17 2 10 26

DO PEOPLE WANT TO CHANGE THEIR INVESTMENT IN FUTURE?

CHANGE IN PRESENT INVESTMEN T

PREFFERENCE

YES

70

36%

NO

124

62%

DEPENDS

2%

TOTAL

200

100 %

RESEARCH METHODOLOGY

Primary Data Secondary Data Period of Study Type of research Sampling Technique Sample Size Tools used for data analysis

LIMITATIONS

 The investment pattern analysis has been limited to only 200 investors. This study is conducted to analyze their pattern not all those factors that really matter while investing. It is conducted in Ahmedabad city. An interpretation of this study is based on the assumption that the respondents have given correct information. The economy and industry are so wide and comprehensive that it is difficult to encompass all the likely factors influencing the investors investment pattern in the given period of time. As the study has been limited to only 200, so there may be different perception level of respondent to invest. Besides the study has the limitation of time, place and resources.

FINDINGS

The common thing we found out through our research that investors of all age group of Ahmedabad mainly invest in bank deposit and life insurance. The main purpose behind the investment of investors of Ahmedabad is safety and returns. We also have found that majority of investors of Ahmedabad save up to 10-25% of their income. Majority of investors invest for period of 1 to 5 years only. Mainly investor of Ahmedabad prefers advice of family and friends in investment decision and also some seeks advice of consultants and local brokers. We have observed that investors of Ahmedabad prefer low and moderate risk in investment. People of Ahmedabad are aware of the benefits of diversification of investment and so they tend to play safe. Investors of Ahmedabad are satisfied with their present investors and are not ready to change but only some prefer to change in future while some stays neutral and change as per the situation in future Mostly Bullion is preferred by house wifes and business class people. Stock is more preferred by retired and business class investors. Forex is yet not been preferred by all, only business and self-employed class opt for that. From the study we have observed that, business class investors tend to invest more than the otherclass followed by retired class than by service and house wife and last rank goes to service class in Ahmedabad.

OBSERVATIONS

Our grand project gave us an experience to work in a group of 10 people and also gain real life knowledge about investment through survey. Investment is part of our day to day life, and the experience gained in the sudy of investment pattern of different segments of society will surely help each one of us in future. Through the survey we got a chance to interact with people of various occupation and know their experience. The communication was easy with service class people and the people between age of 25-35years and retired class people. Some people were co-operative while some were quite uncomfortable filling up the questionnaire. We found it difficult to explain most of the housewifes the purpose behind our survey and also explaining our topic to them. We observed that most of the people were not ready to disclose all the facts related to investment. From our survey we observed that people of Ahmedabad are clearly aware of different investment options and almost all have diversified investment pattern. We all finally got a platform to show our creativity and knowledge that we used in preparing this grand project be it for using Ms excel or Ms word.

SUGGESTIONS
S - Straight Return I - Investment Risks M- Manageable Investment P - Persistent L - Learning Process E- Expanding The Investment

Conclusion
General Conclusion - Diversification Specific Conclusion Age wise Investment: o All age group o Above 50 o Young Investors