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To whom so ever may it concern i

Declaration ii
Acknowledgement iii
Executive summary iv
Content 1
Chapter 1. Introduction 2-6
Chapter 2. Company profile 7-11
Chapter 3. Review of existing literature 12-14
Chapter 4. Objective of the study 15-16
Chapter 5. Research methodology 17-18
Chapter 6. Analysis of instrument 19-28
Types of instrument 20
6.1 Bond 21-22
6.2 Mutual Fund 23
6.3 Equity 24
6.4 Insurance 25
6.5 Gold 26
6.6 Fixed deposits 26-27
6.7 Various factors which affects investment 27-28
Chapter 7. Analysis and interpretation 29-48
7.1 Personal Information 30-33
7.2 Analysis of the response 34-48
Chapter 8. Recommendation and suggestions 49-50
Chapter 9. Conclusion 51-52
Chapter 10. Annexure 53-59
10.1 Questionnaire
10.2 Bibliography
1.1 Introduction to Financial Planning

Financial Planning is the process of meeting life goals through the proper management of finances. Financial
planning is a process that a person goes through to find out where they are now (financially), determine where
they want to be in the future, and what they are going to do to get there. Financial Planning provides direction
and meaning to persons financial decisions. It allows understanding of how each financial decision a person
makes affects other areas of their finances. For example, buying a particular investment product might help to
pay off mortgage faster or it might delay the retirement significantly. By viewing each financial decision as
part of the whole, one can consider its short and long term effects on their life goals. Person can also adapt
more easily to life changes and feel more secure that their goals are on track.

In simple Financial Planning is what a person does with their money. Individuals have been practicing financial
planning for centuries. Every individual who received money had to make a decision about the best way to
use it. Typically, the decision was either spends it now or save it to spend later. Everyone have to make the
same decision every time they receive money. Does it need should be spend now or to save it to spend it later?

Today in India financial planning means only investing money in the tax saving instruments. Thanks to the
plethora of tax exemptions and incentives available under various sections and subsections of the Income Tax
Act. This has led to a situation where people invest money without really understanding the logic or the
rationale behind the investments made. Further the guiding force in investment seems to be the ‘rebate’ they
receive from the individual agents and advisors. The more the rebate an agent gives, the more smug person
are in the belief that they have made an intelligent decision of choosing the right agent who has offered them
more rebate. In the process what is not being realized is the fact that the financial future is getting
As per the Consumer Behavior Matrix developed by Antony Beckett in his paper Strategic & Marketing
Implications of Consumer Behavior, there are two factors which effect consumer behavior- Uncertainty &
No Purchase Relational-Dependent


Repeat-Passive Rational-Active

Low High
Figure 1: Consumer Behavior Matrix; Source:
Antony Beckett (2000)
Uncertainty is defined as the person’s perception of risk, which in turn is dependent upon the complexity of
the product and outcome of that product in the form of returns. On the other hand, involvement is the interest
a consumer displays towards the financial product. Involvement is again dependent upon the perception that a
particular financial product is able to satisfy the need of the customer.
Traditionally speaking, equity products are uncertain in nature with no fixed rate of return. The understanding
of these equity products is also quite low. Most of the people still look out for the ‘hot tips’ from their broker
friends to make some easy money. It is difficult for a layman to understand the complexities of the equity
markets. It is not easy for him to read and understand the various financial reports and analysis available in
the media. Thus equity as a long-term investment asset still has to gain acceptance in India. Therefore, with
high uncertainty and low involvement, most of the customers are in the first quadrant of ‘No Purchase’ in the
CB Matrix.

The challenge for the Financial Institutions is either to decrease the uncertainty associated with equity as an
investment instrument or to increase the involvement of the customer so that the customers can move to the
profitable quadrants of CB Matrix. The uncertainty can be reduced by making the working of equity markets
as transparent as possible, making tough laws and making sure that the guilty would be bring to book as soon
as possible. The complaint redressal system has to be very tough. The internal systems of the Financial
Institutions need to be strong enough so that the practice of duping the gullible customers or mis-selling can
be curbed in the very beginning. The various watchdogs like RBI, SEBI, AMFI& IRDA are working towards
this endeavor but still there is a long way to go before the layman would feel confident to invest in the equity
market. It is probably better if we can have one strong autonomous body which can look after the grievances
of the customers in the financial sector.

The involvement of the customer could be increased by providing the adequate platforms to educate them.
Basically, to tell them the long term benefits of investments in equities, to consider it as an investment class
through which their long term needs can be met. The customers need to consider the post-tax and post-inflation
returns. Many of the financial institutions are quite active in providing the platforms to their customers where
their queries can be addressed. But their target is still urban customers or High Net worth Individuals (HNIs).
They still have not directed their efforts to the rural areas where there is an actual need to educate the
The other financial instruments can be plotted in CB behavior Matrix as follows:

High Equities/Mutual Complex Investment

Funds Products offered by
Financial Institutions
Uncertainty LIC Traditional Bank Deposits, Post
Schemes Office Schemes, Gold

Low High
Figure 2: Consumer Behavior Matrix in Indian Context authors)
There are certain complex structured products which are offered by financial institutions to their HNI clients.
The returns of these products are highly uncertain but the clients would invest in these products because of
their relationships with the financial institution. They would be dependent upon the advice of their
relationship managers for making investments in these products. That’s why these products are kept in the
second quadrant of ‘Relational-Dependent’.

Traditional LIC schemes, like endowment plans or children plans are in the third quadrant of ‘Repeat-
Passive’. The investors are basically investing in these plans for saving taxes. There are low uncertainty and
low involvement in these products as consumers are more or less aware about the features of these plans and
the returns of these products are also somewhat assured.

Bank deposits, post-office schemes, investments in gold and real estate are in the fourth quadrant of
‘Rational-Active’. The confidence in these products is quite strong as the uncertainty associated with the
returns of these products is very low. The consumers feel involved in these products as they are confident
about the outcomes of these products.

1.3 Industry Overview

Indian financial services industry is the backbone of economic growth and development of a nation. Finance
industry enables creation of new business and expansion of existing ones. Ultimately this facilitates more
employment and job creation with the growth of other mainstream industries. The financial services industry
manages money for individuals and corporations. Finance sector mainly comprises of commercial banks,
insurance companies, non-banking financial companies (NBFC), co-operatives, pension funds, mutual funds
and other smaller financial entities.
 The asset management industry in India is among the fastest growing in the world. As of November
2017, 42 asset management companies were operating in the country
 At the end of March 2018, the assets under management of the mutual fund industry stood at Rs
21.36 lakh crore (US$ 331.42 billion).
 India registered a record inflow of amount of US$ 51.02 billion in mutual funds in FY 2016-17.
According to the Association of Mutual Funds in India (AMFI) data, this was the highest investment
in mutual fund schemes since the fiscal 1999-2000.
 The number of mutual fund (MF) portfolios has increased to 66.5 million as of December 2017,
backed by rising interest in MFs among investor.
 Mutual fund (MF) equity portfolios in India reached a 10-year high of 49.3 million, by end of 2017.
 The number of listed companies on NSE and BSE increased from 6,445 in FY10 to 7,501 in March
 The market capitalization of all the companies listed on the BSE reached a record Rs 150 lakh crore
(US$2.33 trillion) backed by high gains in the broader market.
 The amount raised by IPOs in India increased from US$ 318 million in FY 2008-09 to US$ 10,888
million in FY 2017-18*.
 Initial Public Offers (IPOs) by small and medium enterprises (SMEs) in India received record
funding of Rs 16.79 billion (US$ 259.35 million) in 2017 through 133 issues.
 The total amount of initial public offerings increased to Rs 84,357 crore (US$ 13,089 million) by the
end of FY18.

Government incentives for financial services industry

SEBI has allowed exchanges in India to operate in equity and commodity segments simultaneously, starting
from October 2018. The banking regulator has recently allowed inclusion of payments banks for better facility
of fund transfer.
The Government and RBI have taken various measures to facilitate easy access to finance for Micro, Small
and Medium Enterprises. They have launched Credit Guarantee Fund Scheme for Micro and Small
Enterprises. Government has also set up Micro Units Development and Refinance Agency (MUDRA) for
small scale industries.

Road ahead for Indian financial services industry

India is today one of the most vibrant global economies, on the back of robust banking and insurance sectors.
The Association of Mutual Funds in India (AMFI) is targeting nearly fivefold growth in assets under
management (AUM) to Rs 95 lakh crore (US$ 1.47 trillion) and a more than three times growth in investor
accounts to 130 million by 2025.
India’s mobile wallet industry is estimated to grow at a Compound Annual Growth Rate (CAGR) of 150 per
cent to reach US$ 4.4 billion by 2022 while mobile wallet transactions to touch Rs 32 trillion (USD $ 492.6
billion) by 2022.
Indian financial services industry outlook for 2018

It is projected that national savings in India will reach US$ 1,272 billion by 2019. Over 95 per cent of
household savings in India goes to bank deposits and only 5 per cent in other financial asset classes. But
landscape is changing rapidly at present.
The relaxation of foreign investment rules has received a positive response from the insurance sector. Many
foreign companies announcing plans to increase their stakes in joint ventures with Indian companies.
Over the coming quarters there could be a series of joint venture deals between global insurance giants
and local players. We are positive on brokerage industry, few holding companies, low cost housing
finance industry and insurance industry for 2018 and beyond. NBFC Industry is one of our favorite industry
at present where as we foresee challenges in Indian baking sector.



Stallion is a wealth advisory firm. It is India's one of few "Multi Family Office Firm" founded by members
having decade of experience in the field of financial domain. Stallion was operates out of two offices at New
Delhi & Bengaluru (Soon to start operation in pune, Lucknow and Hyderabad).
The foundation of Stallion was guided by a single minded client centric approach.
Its model has been developed keeping in mind the very needs of a client. Stallion's unique selling point is that it
brings all the investment of client under one roof and that being guided by Unique IPS (Investment Policy
Statement). In other words a Stallion treat every client as unique and provides solution based on client need,
financial position and circumstances.
Over time the acceptance of Stallion's financial planning tools by private clients at large and the goodwill that it
has generated in the Private Wealth Industry continues to be the source of energy for its growth. Today
Stallion serves the needs of Middle and Senior level professional, Entrepreneurs, Businessman / Woman,
Budding Investors.
Currently stallion is working closely with 330 HNI families and managing their portfolio of insurance. Mutual
fund and real estate. The ratio of 25 clients per adviser guarantees full focus and personalised touch to each
clients from Stallion.

It work with successful people at different stages of their lives and provide them with the expert strategic
financial advice they require to achieve, or maintain financial independence.
The clients want to take control of their financial future and we help them achieve this goal. By leveraging
company’s expertise to create and implement a strategic financial roadmap we can assist them to protect,
grow and manage their wealth.
The comprehensive wealth management services are free for their clients to pursue their dreams and
delegate the task of efficiently managing their wealth to company, which is a product of trust because
delegation is a follower of faith and trust.
Though, to many this is easier said than done, but the company’s focused intentions and understating of
the wealthy families in India and the need for reliable private advisor in India has helped them realize
their dream of building an admirable Wealth Management Practice.


 To put all the financial transactions of client at one place for easy access and planning.


 To be most admired wealth management firm with best components.

Services provided by stallion capital management:

i. TAX PLANNING: Tax planning is simply optimizing both the timing and strategy of your business tax
matters, to ensure that you pay as little tax possible. Those strategies should be geared to optimize and
improve business growth. Tax planning is an essential tool for any business to undertake each year in
order to effectively plan ahead towards the end of the financial year to ensure no nasty tax bills appear

ii. PROPERTY ADVISORY SERVICES: stallion offer property advisory services for all residential
and commercial properties, rendered by our expert team members having thorough market knowledge
in residential, industrial leading Prices.
We work on the following area:

 Negotiate On Property valuation / deal on behalf of clients and get better value of
 To make appropriate proposal favoring our clients.
 Projects offering assured return on investment.
 Cash flow analysis & financial Modeling.
 Legal documentation of properties in a methodical manner.

iii. MUTUAL FUNDS ADVISORY: Mutual Funds are measured on relative performance. Their
performance is compared to a relevant index such as the S&P 500 Index or to other Mutual Funds in their
same sector. Hedge funds, on the other hand, are expected to deliver absolute returns by attempting to
make profits under all circumstances, even when the relative indices are down.

iv. WEALTH MANAGEMENT: The term wealth management refers to a professional investment
and advisory service that offers financial planning, investment management and other types of
specialized financial advice. It is a process that aims to provide techniques and plans that allows an
individual or a company to attain all the possible goals in a systematic pragmatic manner.

v. RETIREMENT & ESTATE PLANNING : The goal of retirement planning is to achieve

financial independence. As people tend to live longer, a new reality about retirement savings: They have
to stretch for a longer period of time. So, we here to help you with the best advice.

vi. BUSINESS LOAN ASSISTANCE : Stallion capital management deploy technology and apply
innovation to create unique and compelling propositions that help you do what you always wanted to do.
Hereunder are a host of unique features and benefits that you enjoy with Business Loans from Bank,
Financial Institutions & FDIs.

vii. INVESTMENT & PORTFOLIO MANAGEMENT: A portfolio Management refers to the science
of analyzing the strengths, weaknesses, opportunities and threats for performing wide range of
activities related to the one's portfolio for maximizing the return at a given risk. It helps in making
selection of Debt vs. Equity, Growth VS Safety, and various other trade-offs.
viii. INSURANCE ADVISORY: Insurance is a term used to refer to the actions, systems, or business
where the financial protection (or financial compensation) to people, property, health and so forth
to get reimbursement form the events that cannot be expect.
SWOT Analysis

 Successful diversification in
other fields such as training
Strengths programs through various parts of
 Professional consultant with
experience of more than 20 years
 Good corporate tie-ups, like with
HDFC Life, ICICI, etc.
 Solution to all financial problems
under one roof.
 Multi-lingual staff.
 Low key I.T. infrastructures as
Weakness compared to big brands
 Low marketing and brand
 Lack of track record
 Fewer formal training programs

 Growing rural markets

Opportunities  Earning urban youth looking for
 Could use their customer
relationships for increasing
 Cross selling through financial
services such as banking

Threats  Competition from large

 Increasing no. of advisory firms
Various studies have been done to know Investors perception regarding various financial
opportunities available in market for investment. The different studies tell the perception of
investors i.e. where they want to invest and what they see at the time of investment.

Large costs associated with evaluating market conditions. Even Individual savers may not have
the ability to collect process and produce information on possible investments. High information
cost may prevent capital to flow to its highest value use. So Financial intermediaries undertake the
costly process of researching investment possibilities for others. Savers do not like risk; but high-
return projects are riskier; Financial systems that ease risk diversification induce a portfolio shift
towards higher return project.

- Banks, mutual funds, securities markets provide vehicles for trading, pooling and diversifying
risk – Risk diversification → savings rate → resource allocation → economic growth
The various studies done by various researchers which tells about the tendency which is
followed by investors at the time of investment are as follows:
- Gurley and shaw(1955)
- Greenwood and
Jovanovic(1990) - Saint-
- Patrick(1966)

Greenwood and Jovanovic(1990):

This study points out the effective information processing (entrepreneurs / projects) induces
higher growth. It Captures the link between risk-sharing, capital accumulation and growth that
how more risk increases capital accumulation and growth. It points out effective information
processing and Captures the dynamic interaction between finance and growth.

Growth → more individuals can afford to join intermediaries → improves efficiency of intermediaries.
Acemoglu and Zilibotti (1997): This study points out to Captures the interaction between
risk-diversification, capital accumulation and growth, it tells risk diversification like to invest in
different instruments accumulate growth in capital. Item phasizes endogenous risk generation in the
growth process. It also points out financial systems allow agents to hold a diversified portfolio of
risk like to invest in various instruments. According to that
- more investments in high-return
projects; - higher growth

Allen and Gale(1997):

Long-lived intermediaries can facilitate intergenerational risk sharing: invest with a
long-run perspective; according to this study which instruments offer returns that are relatively low
in boom times and high in lack times

Diamond and Dybvig (1983):

According to this study, the investors or savers choose between an illiquid, high-return project
and a liquid, low-return project. A fraction of savers receive shocks, access their savings before
illiquid project produces. Prohibitive information (verification) cost creates incentives for financial
markets to emerge.
The objectives of the study are

 To study the various financial opportunities available for investment.

 To study about the investors perception regarding various investment opportunities available
in the market
 To analyze the investment patterns of the investment.

A study on investor’s behaviour on various financial opportunities for investment in Stallion Capital

Problem Statement
The particular topic is mainly selected to analyze “Investor’s investment behavior
on various financial opportunities for investment in Stallion Capital Management. The
comprehensive statement of the problem can thus be stated as “Consumer
Investment behavior on financial opportunities for investment in Stallion Capital

This analysis was carried out to give more knowledge and broader view to the
consumer investment behavior on financial opportunities in stallion capital
management. As the Consumer’s are not well educated about the various options
in which they can invest in. Their attitudes towards investments are guided by
so many external factors and once they decide to invest, the major problem starts
with the lack of proper agency (financial advisor/ consultant) to guide the investors
according to their preference. If at all the Consumer decide to invest, they take a
risk of losing their hard earned money.
Hence it is very important that the Consumers knowledge about the investment
options available in Stallion Capital Management are broadened and thus gaining a
positive attitude towards the investment behavior.

Nature of Research:
The study is descriptive and analytical in nature. It is descriptive as it describes the existing financial
instruments available in the market. It is analytical as it analyses the perception of the investors.,

Universe and Sample Size

NCR region have been taken as universe of the study . Convenient sampling technique is
used and a sample of 75 investors has been taken for the purpose of the study. Convenience
sampling technique used for collecting the data from different investors. The investors are
selected by the convenience sampling method. The selection of units from the population based
on their easy availability and accessibility to the researcher is known as convenience sampling.
Convenience sampling is at its best in surveys dealing with an exploratory purpose for
generating ideas and hypothesis.

Data Collection and Sources

The study is based on both primary and secondary data. Following are the sources of secondary data:

Research Instruments:

Interview and questionnaire have been used to conduct the study. A structured questionnaire consisting
close-ended questions have been made, which is filled by the trainee during direct interaction with the
Interviews have been taken of Relationship managers of different NBFC's and BANKS to seek the
investor’s behavior towards investment.

Analysis Pattern:

Critical examinations of various investment instruments have been done and a comparison is made, based
on their merits and demerits.

The data collected form questionnaire is edited, tabulated and analyzed. Various graphical techniques
have been used to present the data in more meaningful way.

Types of Investments / various instruments


There are many ways to invest your money. Of course, to decide which investment vehicles are suitable
for you, you need to know their characteristics and why they may be suitable for a particular investing
• Public Provident Fund
• Fixed Deposits
• Bonds
• Mutual Funds
• Banks Deposits
• Equity Market
• Insurance
• Cash
• Gold

6.1) BONDS
It is a fixed income instrument issued for a period of more than one year with the purpose of raising
capital. The central or state government, corporations and similar institutions sell bonds. A bond is
generally a promise to repay the principal along with a fixed rate of interest on a specified date, called the
Maturity Date. The main attraction of bonds is their relative safety. If you are buying bonds from a stable
government, your investment is virtually guaranteed, or risk- free. The safety and stability, however, come
at a cost. Because there is little risk, there is little potential return. As a result, the rate of return on bonds
is generally lower than other securities.

Tax Saving Bonds

These are those bonds that have a special provision that allows the investor to save on tax. Examples of
such bonds are:
a) Infrastructure Bonds
b) Capital Gains Bonds
a. Rural Electrification Corporation (REC)Bonds
b. National Highway Authority of India(NHAI)
c. National Bank for Agriculture & Rural Development
c) RBI Tax Relief Bonds

A mutual fund is a body corporate registered with SEBI that pools money from the Individuals/corporate
investors and invests the same in a variety of different financial Instruments or securities such as Equity
Shares, Government Securities, Bonds, Debentures, etc. The income earned through these investments
and the capital appreciations realized are shared by its unit holders in proportion to the number of units
owned by them. Thus a Mutual Fund is the most suitable investment for the common man as it offers an
opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost.
Mutual fund units are issued and redeemed by the Asset Management Company (AMC) based on the
fund’s net asset value (NAV), which is determined at the end of each trading session.

Mutual funds are considered to be the best investments as on one hand it provides good Returns and on
the other hand it gives us safety in comparison to other investments avenues.
Figure: Below describes broadly the working of a mutual fund:-

Equities are often regarded as the best performing asset class vis-à-vis its peers over longer time frames.
However equity-oriented investments are also capable of exposing investors to the highest degree of
volatility and risk. There are a number of factors, which affect the performance of equities ad studying
and understanding all of them on an ongoing basis, can be challenging for most.

Stock markets have always been a draw for investors for their ability to generate wealth over the long-
term. Fear, greed and a short-term investment approach act as hurdles that frustrate the investor from
achieving his/her investment goals. You need to keep in mind the risk associated with the stocks. You
also need to diversify your equity portfolio i.e., include more stocks and sectors. This helps you diversify
your investment risk, so even if something were to go wrong with a stock/industry in your portfolio, other
stocks/industries should help you shore up your portfolio.

Two important resources that are critical to investing directly in stock markets are quality
stock research and a reliable and inexpensive stock broker. The first one – research on stocks is the most
critical input that investors need to identify before they begin investing in stock markets. This is because
even while you may have the risk appetite for equities, you still need credible, stock market related
research that can help you make the right investment decision.

The good thing about the Indian market, riding on the back of an economy that has grown by over 7% in
the last two years, is that you can’t miss being part of growth if you invest in the stock markets carefully.
The bad part is the CHOICE! Of the listed 4,758 stocks on BSE and the NSE, how do you even get close
to taking a call? Here comes the need of a financial advisor who can make your investment decisions and
monitor your funds. Clearly, as Indians earn more, save more and accumulate more, financial advisors
will play a crucial role in helping individuals create, protect and manage wealth.

Life insurance has traditionally been looked upon pre-dominantly as an avenue that offers tax benefits
while also doubling up as a saving instrument. The purpose of life insurance is to indemnify the nominees
in case of an eventuality to the insured. In other words, life insurance is intended to secure the financial
future of the nominees in the absence of the person insured.

The purpose of buying a life insurance is to protect your dependants from any financial difficulties in your
absence. It helps individuals in providing them with the twin benefits of insuring themselves while at the
same time acting as a compulsory savings instrument to take care of their future needs. Life insurance can
aid your family on a rainy day, at a time when help from every quarter is welcome and of course, since
some plans also double up as a savings instrument, they assist you in planning for such future needs like
children’s marriage, purchase of various household items, gold purchases or as seed capital for starting a

Traditionally, buying life insurance has always formed an integral part of an individual’s annual tax
planning exercise. While it is important for individuals to have life cover, it is equally important that they
buy insurance keeping both their long-term financial goals and their tax planning in mind. This note
explains the role of life insurance in an individual’s tax planning exercise while also evaluating the various
options available at one’s disposal.

Life is full of dangers, but with insurance, you can at least ensure that you and your dependents don’t
suffer. It’s easier to walk the tightrope if you know there is a safety net.
You should try and take cover for all insurable risks. If you are aware of the major risks and buy the right
products, you can cover quite a few bases. The major insurable risks are as follows:

 Life
 Health
 Income
 Professional Hazards
 Asset
Outliving Wealth
Debt Repayment.

6.5) GOLD
In India, gold has traditionally played a multi-faceted role. Apart from being used for adornment purpose,
it has also served as an asset of the last resort and a hedge against inflation and currency depreciation.
India has more than 13,000 tones of hoarded gold, which translates to around Rs.6, 50,000 crores. Gold
is an asset class that’s associated with safety.
However, the ups and down that the yellow metal has seen over the last few months, has
made it look similar to other market investment assets. This is due to an unprecedented demand for gold
as an investment avenue since the last couple of years.

Gold has attracted a high level of attention in last couple of years, with an image shift from a non-volatile
asset to a hot investment avenue. The future outlook for the metal looks positive given its proven linear
relationship with the crude oil and non-linear with the US dollar. The much-awaited gold exchange-traded
funds would provide a very good vehicle to the investors and a sensible alternative to the current forms
available for investment
The same as a term or time deposit. Money may be placed with a bank, merchant bank, building society
or credit union for a fixed term at a fixed rate of interest which remains unchanged during the period of
the deposit. Depositors may have to accept an interest penalty if they break the deposit, ie, ask to take the
money out before the agreed period has expired.
Few points which FD investors must consider at the time of investment,
1. Safety
FDs have conventionally been the premier choice for investors with a low risk appetite; assured returns is
the key factor which attracts investors towards deposits. Stick to FDs of the highest credit rating i.e. those
with a “AAA” rating even if their rates seem modest vis-à-vis those offered by company deposits.

2. Tenure
Short tenured fixed deposits continue to be your best bet. With interest rates on the ascent, a further hike
in rates offered by fixed deposits cannot be ruled out. Locking your investments in longer tenured
instruments may lead to an opportunity loss.

3. Liquidity
Find out how FD fares on the pre-mature encashment front i.e. how easily can your investment be
liquidated. Also enquire about the penalty clauses, e.g. do you suffer a loss of interest and/or principal
amount. Compare how various FDs rank on this parameter and pick the best deal; thereby try to minimize

the impact of illiquidity which is typically associated with FDs.
Additional benefits
Fixed deposits from reputed entities offer additional benefits, e.g. they can be used as collateral against
which loans can be raised. Select a fixed deposit scheme which scores favorably on such parameters

Any investment portfolio should comprise the right mix of safe, moderate and risky investments. While
mutual funds and stocks are the favorite contenders for moderate and risky investments, fixed deposits,
government bonds etc. are considered safe investments. Fixed deposits have been particularly popular
among a large section of investors in India as a safe investment option for a long period.

With fixed deposits or FDs as they are popularly known, a person can invest an amount for a fixed
duration. The banks provide interest rates depending on this loan amount and the tenure of deposit. Here
are the benefits, drawbacks of fixed deposits and precautions one should take while making such

6.7) Various factors which affects investment decision

1) CRR: Cash reserve Ratio (CRR) is the amount of funds that the banks have to keep with RBI. If RBI
decides to increase the percent of this, the available amount with the banks comes down. RBI is using this
method (increase of CRR rate), to drain out the excessive money from the banks.
How It Affects :
a. From a stock market perspective
Rising interest rates have several implications including -

• slowing down the overall growth in the economy; this effectively means that demand for goods and
services, and investment activity, gets adversely impacted
• apart from the fact that overall growth is impacted, companies take a hit on account of higher interest
costs that they have to bear on their outstanding loans (to the extent their cost of funds is not lockedin)
• since some investors tend to leverage and invest in the stock markets, higher interest rates increase
expectation of returns from the stock markets; this has the impact of lowering current stock prices
• an overall decline in stock prices has a cascading effect as leveraged positions are unwound (on account
of meeting margin requirements), leading to still lower stock prices
b. From a debt market perspective If you are contemplating on investing monies in the debt market,
you will benefit from higher interest rates on offer. However, existing investors in debt oriented funds

may take a onetime hit; but at the same time, since overall interest rates are higher, from here on, such
funds will yield higher return
c. From the perspective of borrower: As a prospective borrower, you are the worst hit. The cost of
money i.e. interest rates will rise post the CRR hike. You will probably need to settle in for a lower
loan amount given theEMI.
If you are an existing borrower, as long as the rate of interest on your loan is fixed, you are immune to any rise
in interest rates. However, if you have a floating rate loan, then expect either the tenure of the loan or the EMI
to jump soon
d. Inflation: Inflation is defined as an increase in the price of bunch of Goods and services that projects
the Indian economy. An increase in inflation figures occurs when there is an increase in the average
level of prices in Goods and services. Inflation happens when there are less Goods and more buyers,
this will result in increase in the price of Goods, since there is more demand and less supply of the
How it affects:
The investors have less money to invest if there is increase in prices of goods or increase in inflation rate.
So it restrict investor to invest in order to fulfill other needs.
Global factors: If there is any change in global environment then it also affects the investors decision of
investment, as present scenario there is change in crude price which is very high due to that it affects
Indian economy as increase in rates of each product which results in high inflation rate. Due to that investors
have less amount for investment.


1) Sample Details

75 people belonging to different fields, who do investment, were asked to fill the questionnaire, on the
basis of which an attempt is made to study the prospects of Financial Planning in the market. The sample
unit consists of those people who are trading in secondary markets, mutual funds, initial public offer,
insurance, debt instruments as they can give the accurate information about financial planning. A sampling
frame has been developed so that everyone in the target population has an equal chance of being sampled.

7.1) Personal Information:

1. Gender
2. Occupational Structure:
Samples include responses from Businessmen, Retired, Student, home maker and a good number of
service class which includes Chartered Accountant, Engineer, Banker, CEO, Software Professionals, etc
so as to include their perception and awareness Regarding financial planners.

3. Age of Investor:
The survey includes the people having different age levels from less than 20 to above 50. The age less
than 20 includes 0 investors, as it is nonearning range as respectively between 20-30 there are 57.3 %
investors, it is a highest investment class of the data. The different age levels show their perception about
investment. The mid age investor which is between 30 – 40 are likely to take risk and generally invest
in more in equity than the people who are between 40 – 50. The service man in age between 20 –30 also
plan their future planning by invests in P.P.F, insurance and gold.

4. Income Levels:
Income levels were classified into 3 levels, namely below less than 3 lac, 3- 6 lac , 6- 9 lac and more
than 9 lac
Figure : Classification of Income Levels of the Sample

7.2) Analysis of the Response
Given below are the graphical representations of the responses received on questions asked through the
questionnaire. The interpretation derived and the model adopted will be explained in detail in the later
part of the report. On asking the following questions, the replies were received accordingly:

1. What is your practice on saving money?

To determine the saving habits of the investors, the questionnaire enquired the respondents as about their
practice of savings. The greater the inclination of saving the more will be the funds available for
Around 38.7% of the respondents try to save from their income, while only 20% of the respondents always
make an effort to save some part of their income, as depicted in Figure 6.3 below. 14.7 % people response
that he don’t believe in savings, which substantiate high.
Importance of savings in Indian households. However, it was also observed that majority of the women
respondents had high inclination for savings and try to save the maximum out of their available income.
Figure: Respondents response practice on their saving:

2.What is your practice on saving money?
To determine the saving habits of the investors, the questionnaire enquired the respondents as about their
practice of savings. The greater the inclination of saving the more will be the funds available for


This figure depicts that actually how much percent the investors really invested out of the expectations,
efforts and the expenses. The above figure shows that 53.3 % people invested 10-20% of their money,
respectively 28% Invested between 20-30%, 16% invested in between 30-40% of their incomes.

Figure : Respondents response practice on their saving:

3. Type of instrument prefers for investment
On enquiring from the respondents about which instruments they prefer most for their investment.

The surveyed people give priority top to Fixed deposits, which is followed by Mutual funds.The
businessmen people generally give preference to EQUITY + MUTUAL FUNDS + INSURANCE. And
the service man generally give preference to Fixed deposit + Insurance + Bank deposits According to the
surveyed people response the Gold is also a safer and growth investment opportunity as its price is rising
fastly. Service, business, student, retired and home maker people invests in gold.

Figure : Respondents response about instrument they prefers for investment

4. Purpose for investment in Public Provident Fund

Interpretation: According to the above table 51.9% Public Proviodent fund (PPF) investors wants return
on their PPF Investments, respectively 40.7% PPF Investors invested in PPF for gaining tax benefits,
whereas 37 % PPF investors invested in it for their retirement planing for securing futureas follows
35.2 % investors seeks safety in their investments, 14.8 % wants Liquidity and for Beating
inflation respectively, 11.1 % investors have their some other reasons of investing in PPF.

5. Purpose for investment in Fixed Deposits

Interpretation: Now, its about the purpose of investments in Fixed Deposits by the investors, 39 %
Investors invested in Fixed Deposits for Safety and Returns respectively, and 33.9 % investors invested
for securing their futures by making it as a retirement plan, whereas 25.4 % invested for Tax benefits,
15.3 % for beating Inflation, 13.6 % for liquidity and 8.5 5 % for some other reasons.

6. Purpose for investment in Mutual Funds

Interpretation: Now, its about the purpose of investments in Mutual Funds by the investors, 47.2 %
Investors invested in Mutual funds for Returns respectively, and 32.1 % investors invested for their futures
by making it as a retirement plan, whereas 28.3 % invested for Tax benefits, 22.6% for beating Inflation,
15.1% for liquidity and safety and 13.2 % for some other reasons.

7. Purpose for investment in Equity Shares

Interpretation: According to the above data 48% of investor invested in Equity Shares.Its all about the
purpose of investments in Equity Shares by the investors, 50 % Investors invested in Equity shares for
Returns respectively, 22.9 % investors invested for tax benefits and others reason, 18.8% investor invested
for securing their futures by making it as a retirement plan, whereas 16.7 % invested for beating inflation
and liquidity, 10.4 % for safety.

8. Purpose for investment in Post Office Schemes

Interpretation: According to the data 49 investor invested in Post Office Schemes Its about the matter
of investments in Equity Shares by the investors, 36.7 % Investors invested in Post office schemes for
Returns and 32.7 % investors invested for safety, 28.6% investor invested for securing their futures by
making it as a retirement plan, whereas 20.4 % invested for beating inflation and liquidity, 16.3 % for tax
benefits and other reasons respectively and 14.3 % for liquidity.

9. Purpose for investment in Government Bonds

Interpretation: Its about the purpose of investments in government bond by the investors, 29.2 %
Investors invested in Equity shares for safety and 27.1 % investors invested for tax benefits Returns and
liquidity , 18.8% investor invested for securing their futures by making it as a retirement plan, whereas
14.6 % invested for beating inflation and other reasons.

10.Purpose for investment in Gold

Interpretation: According to the above graph only 53 investor invest in Gold. Purpose of investments in
Gold by the investors are as follows, 39.6 % Investors invested in Gold for Returns respectively, 34 %
investor invested in gold for liquidity, 28.3 % investors invested for safety, 13.2% investor invested for
securing their futures by making it as a retirement plan, whereas 17 % invested for beating inflation and
15.1 % for other reasons .

11.Purpose for investment in Insurance

Interpretation: From 75 responses 56 investor invested in Insurance. And the purpose of their
investments in Equity Shares are as follows, 48.2% Investors invested in Insurance for safety respectively,
and 41.1 % investors invested for Returns , 32.1% investor invested for tax benefits, 26.8% investor
invested for securing their futures by making it as a retirement plan, whereas 10.7 % invested for beating
inflation and liquidity and other reasons.

12.Purpose for investment in Bank deposits

Interpretation: According to the data 54 investor prefer Bank deposits as a good means for investing
their money into Bank, they have a mind set that the Bank Deposits are safer than other available options.
As the graph shows 48.1% of Investors invested in Bank deposits for Safety and 29.6 % investors invested
for Returns, 22.2 % for beating inflation, 20.4% investor invested for securing their futures by making it
as a retirement plan, whereas 16.7 % invested for tax benefits and other reaosns, 9.3 % for liquidity.

13.How do you take financial decisions?
An individual’s decision has a vital role to play in achieving investment objectives and thereby making
investments in a systematic manner. Decisions can make or break investment avenues as wrong decisions
would merely lead to wrong investments resulting in major loss.

On enquiring from the respondents about how they take their financial decisions, majority of the
respondents take their financial decisions Advise from friends / Relatives which depicts they are
dependent on advisor. On analyzing the response 26.7% of the respondents take their financial decisions
independently while only 13.3% of the respondents take investment decisions from financial advisors, as
also disclosed in Figure 6.6. This opens up the door for various financial advisors who can target these
investors and can give advisoryservices.

Figure : Reader’s response regarding taking financial decisions

14. If they take Decisions "Independently":

To know how they take financial decisions if independently then what they see at time of investment.

Analyzing the response of investors every investor keep in mind the future growth of investment
instrument, is that instrument can give the good growth or returns on their invested money. Generally they
make assumption of future growth on the basis of history of instrument and invest accordingly. 20%
investors also keep Risk Factor at time of investment in their mind, as they want to invest in safer
instrument as they said no one wants to lose their money. They also accepts investment in equity is more
risky but it adds higher returns.
24% investors doesn’t want to take risk of volatility they think of fixed returns by investing in fixed
deposits also they invests in insurance and P.P.F and gold.

Figure : Reader’s response if they take Decisions Independently

15. Reader’s Response towards Tendency they prefer:
Respondent’s response to wards which tendency they prefer at time of investment shown in fig

Respondents response shows 22.7% people like the tendency high risk high return , as they believe unless
and until we would not take risk how can we earn or get return more. That tendency is generally prefer by
business and servicemen whose income level is more than 9 lac.
The income level of 3 to 6 lac generally prefer moderate risk or low risk to invest in insurance, mutual
fund, gold .

The age level also influence the tendency the age level between 20–30 likes to take risks but above 40
they prefer low risk low return.

Figure : Reader’s Response towards Tendency they prefer:



On studying the peculiarities of the wealth management industry and analysing the responses of the
investors on their perception, the following points are recommended which a general financial advisor
should consider while approaching the people.

India is seeing as a maturing financial environment. Options to attract savings exist through a spate of
financial products and services that have differing risk/growth and asset accretion propositions. It is
becoming increasingly obvious to people that their money, in real terms, would fall in value if they were
to keep their money in the bank. And hence the keenness to find out the right avenue that would help
grows their savings or assets.

While this is becoming a universally undeniable desire, the fact is that some people don’t have the
knowledge and inclination to understand the financial markets and others don’t have the time to follow
them. This then leads to financial decisions being taken by individuals based on either relationship
hearsay or the sales call of a vendor

Unbiased Advisory
Investment Advisory Services are in this business of managing the assets of individuals and corporations.
However, the distinct model of services should enable the advisors to offer unbiased advice on the entire
spectrum of personal finance, keeping the clients interest foremost while doing so. The investment
strategies developed across perpetuity should outline a detailed financial plan with frequent reviews of
investment decisions made to ensure that portfolios are in line with what was planned. I’d like to add
here that the financial advisory should not only be unbiased with respect to an asset class but it should
also be independent of biases across manufacturers within an asset class.
Investment in Foreign Markets
A recent pioneering initiative is to facilitate for the clients investment in foreign markets, adding to the
advisory capability that spreads across the widest range of asset classes in the country. One needs to be
cautious while investing and it is now important to hire a financial planner to plan your wealth better.
Financial Planning Should Be Encouraged
‘Financial planning’ is the process of charting out the money course of your life. It’s like having a
financial roadmap that guides your every step till you pass on the baton to the next generation. In other
words, it is a process in which an individual sets long-term financial goals through investments, tax
planning, asset allocation, risk management, retirement planning and estate planning. Most of us

approach our financial lives like the disorganized traveller who gets to his destination eventually and
perhaps even enjoys the rough ride. We think we have a clear roadmap in mind, but our financial lives
are marked by ad-hoc decisions and capitulation to the temptations of the flavors of the financial season.

One of the myths regarding financial planning is that only rich individuals and HNIs can undertake this.
This perception exists because most players in the market target these people, as they are very profitable
customers. However, anyone can use financial planning. In fact, individuals should use effective
financial planning to build their wealth over the years.

Awareness of the Benefits of Planning Early for Retirement

Anyone who will retire needs to plan for it. There is more than one reason to save for retirement. The
all-important reason is the rising cost of living. It’s called inflation. If you start planning for retirement
early on, you can bridge the gap between what you have in your hand today and what you would like to
have when you retire. If you begin saving for retirement early on in your life, you can set aside smaller
amounts. You can also take on more risk by investing larger amounts in equities i.e., stocks and equity
funds. If you delay saving for retirement, you will have to invest larger sums of money to save for the
same amount; also the share of equity investments as a portion of your retirement savings will have to
be lower. The older you are when you start, the more risk averse you will have to be. Your retirement
portfolio will actually be a mix of stocks, debt securities, index funds and other money market
instruments. This mix will change as you do, moving increasingly toward low-risk guaranteed
investments as you age. Unless planned well, retirement phase will be a downhill ride.

People should come out of the concept of just keeping their money in banks & should concentrate on
doing financial planning to maximize their returns by taking proper guidance from financial planner.



The successful completion of this internship indicates that as I was engaged in studying the behavior of
customer towards the financial institutions. I have come to the following facts that most of the investors
aren’t aware of the various investment avenues available in the country. Of which most of the older investors
mostly invested in various kind of Retirement plans which are available in the market and they want to
have an average growth rate of their investment and the main concern of their investment is tax-saving and
they majorly have an apprehension of the loss of their principal amount as this is one of the major factors
that they think about before investing is that of safeguarding of the principal amount, so in order to save
money in order to meet their and family’s future expenses and to be prepared for the retirement. In short,
they aren’t quite interested in doing investment and somewhat interested in debt market instruments to get
a risk- free return out of their investment when needed.
On the contrary, the new investors i.e. the ones who are in the age group of 20-30 years are showing immense
interest in doing investment in various securities that can not only benefitted them for tax saving purposes
but can also proves to be a measure of wealth creation, can provide for their future expenses and also
facilitate long and short term goals which can vary individual to individual.
These new investors also keep them aware about the various investment avenues in order to generate wealth
and attain high return by investing in these in these securities.

10.1 Questionnaire
1. NAME ………………..
2. Gender
a. Male
b. Female
3. Occupation
a. Business Man
b. Service
c. Student
d. Retired
e. Home maker
4. Age
a. Less than 20
b. 20-30
c. 30-40
d. 40-50
e. 50 or above
5. Annual Income
a. Less than 3 lakh
b. 3-6 lakh
c. 6- 9 lakh
d. More than 9 lakh
6. What is your opinion on saving money ?
a. I don’t believe in saving
b. I’d like to save, but my expenses & financial commitments do not permit me.
c. I try to save whenever & wherever possible
d. I always save some percentage of my take- home salary without exception.

e. Others
7. Annual saving of the investor?
a. 10% to 20%
b. 20% to 30 %
c. 30% to 40%
d. More than 40%
8. Type of instrument you prefer for your investment
a. Public provident fund
b. Fixed deposits
c. Equity shares
d. Post office schemes
e. Government bonds
f. Gold
g. Insurance
h. Bank deposits
i. Other
9. Purpose for investment in Public provident fund
a. Safety
b. Returns
c. Retirement planning
d. Tax benefits
e. Beating inflation
f. Liquidity
g. Others

10. Purpose for investment in Fixed deposits

a. Safety

b. Returns
c. Retirement planning
d. Tax benefits
e. Beating inflation
f. Liquidity
g. Others
11. Purpose for investment in Mutual Funds
a. Safety
b. Returns
c. Retirement planning
d. Tax benefits
e. Beating inflation
f. Liquidity
g. Others
12. Purpose for investment in equity shares
a. Safety
b. Returns
c. Retirement planning
d. Tax benefits
e. Beating inflation
f. Liquidity
g. Others
13. Purpose for investment in Post office schemes
a. Safety
b. Returns
c. Retirement planning
d. Tax benefits

e. Beating inflation
f. Liquidity
g. Others
14. Purpose for investment in government bonds
a. Safety
b. Returns
c. Retirement planning
d. Tax benefits
e. Beating inflation
f. Liquidity
g. Others
15. Purpose for investment in Gold
a. Safety
b. Returns
c. Retirement planning
d. Tax benefits
e. Beating inflation
f. Liquidity
g. Others

16. Purpose for investment in Insurance

a. Safety
b. Returns
c. Retirement planning
d. Tax benefits
e. Beating inflation
f. Liquidity

g. Others
17. Purpose for investment in bank Deposits
a. Safety
b. Returns
c. Retirement planning
d. Tax benefits
e. Beating inflation
f. Liquidity
g. Others
18. How do you take financial decisions?
a. Independently
b. Advise from friends/ Relatives
c. Advise from banks
d. NBFC’s Adviser
e. Financial advisor
f. Others
19. If independently, then what do you see while investing?
a. Risk factor
b. Fixed returns
c. History of instrument
d. Future growth
e. Trend of other investors
20. Which tendency do you prefer the most?
a. Low risk, low return
b. Moderate risk, moderate return
c. High risk, high return



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