A Project Study Report On

Study Of Security Market And Consumer Behaviour of Moti Share Broker Ltd.

Submitted In Partial Fulfillment For The Award Of degree of

MASTER OF BUSINESS ADMINISTRATION

Submitted By:Jyoti Rani Mittal MBA IInd Year 2007-2009

SubmittedTo:Mr. Vikas shrotriya MBA(HOD)

Swami Keshwanand Institute Of Technology Management & Gramothan

Preface
Any Kind of learning is incomplete till it is practically applied in the concerned of field. Only then does a person understand and get hold of even the minutest details of what he/she learnt in his stay at institute doing his/her MBA . So, to practically apply what I had gained in the pas year in the MBA program,I underwent 25 days training at Moti Share Broker Ltd,jaipur.it has been wonderful learning experience, which has given me an insight into management of modern business which require some appreciation of multi disciplinary concept and in depth knowledge of specific analytical tools, geared to the solution of real life problems. The training is essential for the fulfillment of MBA curriculum. It provide an opportunity to the student to understand the industry with special on the development of skills in analyzing interpreting practical problems through application of management

ACKNOWLEDGEMENT

I express my sincere thanks to my project guide,Mr.Ajay Saxena,for guiding me right for inception till the successful completion of the project. I sincerely acknowledge him for extending their valuable guidance, support for leteratur, critical reviews of project and report and above all the moral support, he had provided to me with all stages of this project.

I would also like to thank the supporting staffing sales department, for their help & cooperation through my project.

JYOTI RANI MITTAL

Executive summary

Securities are an amaging vehicle for disseminating opportunities & mitigating economic deprivation. The Indian security market is in transition. There have been revolutionary change over the period of time. Almost all the operational & systematic risk management parameters,settlement ,disclosures,accounting standards,the indiam security market is at par with the global standards.Indeed ,it is ahead of the global benchmarks. Assessing the significance of securities market,this study starts with the company profile & its main part comprises of study about the consumer behaviour,sales promotin & its effect on consumer behaviour. The study aims at measuring the consumer perception about the Moti Share Broker Ltd. In the following parameters. IPO Demat Accounts Commodity & derivatives Consumer behaviour & comparative analysis with its competitiors

Initially I had to do survey with the help of questionnaire & then the required data is collected,& analyzed to present the findings in an effective manner. This project is helpful for Moti Share Broker Ltd, in the improving their sales pattern.Above all this project helps to fill the gap between my theoretical & practical knowledge & also presents the clear picture of the market.

INDEX

1) CHAPTER-ONE. 2) Executive summary of the project. Company profile Objectives of the study Relationship with Economy Scope of the Study Significance of the Study

CHAPTER-TWO . Review of literature related to study

3)

CHAPTER- THREE. Primary sampling Questionnaire Selection Secondary Sources

4)

CHAPTER-FOUR. Results and Discussions

5)

CHAPTER-FIVE. Recommendations and Bibliography

Contents: Executive summary of the project. Company profile Objectives of the study Relationship with Economy Scope of the Study Significance of the Study

COMPANY PROFILE
Moti Share Broker Ltd. is an equities focused organization, a veteran equities solutions company with over 1 decades of experience in the Indian stock markets. Their experience, language, presentation style, content or for that matter the trading facility, possess a common thread; one that helps you make informed decisions and simplifies investing in stocks. The common thread of empowerment is what Moti Share Broker Ltd. all about! Moti Share Broker Ltd. is also about focus.

Moti Share Broker Ltd. does not claim expertise in too many things. Moti Share Broker Ltd. expertise lies in stocks and that's what he talks about with authority. Investing in stocks should not be confused with trading in stocks . Portfolio-based strategy is better than betting on a single horse, it is something that is spoken with years of focused learning and experience in the stock markets. And these beliefs are reflected in everything Moti Share Broker Ltd does for its customers.

ONLINE TRADING

motisharebrokers.com is India's one of the most popular online trading site. At moti share brokers, online trading is made easy with the help of jargon-free investment advice, nifty trading tools and SUPER-DUPER trading products. What's more, the online trading website has now been completely revamped to make trading faster and safer with the help of facilities like instant cash transfer, after-market orders, limit against shares and four times exposure on margin. With a moti share brokers online trading account you can buy and sell shares in an instant. Anytime you like, from anywhere you like.

It comes with a depository participant account where shares are kept, in safe custody with National Securities Depository.

BENEFITS OF INVESTING WITH MOTI SHARE BROKER LTD.

ACCESSIBILITY Moti share brokers provides ADVICE, EDUCATION, TOOLS AND

EXECUTION services for investors. These services are accessible through our centers across the country (Over 250 locations in 123 cities), over the internet (through the website www.sharekhan.com) as well as over the Voice Tool. CONVENIENCE You can call our Dial-n-Trade number (1-600-22-7050) to get investment advice and execute your transactions. We have a dedicated call-center to provide this service via a toll-free number from anywhere in India.

ADVANTAGES: Secure Order by Voice Tool Dial-n-Trade. 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 Cell Phone & E-mail address. Special Personal Inbox for order and trade confirmations. On-line Customer Service via Web Chat. Anytime Ordering.

Product Profile of Moti Share Broker Ltd.

There are two types of account that is

1. Classic account Online trading account for investing in equities and derivatives Free trading through phone (Dial-n-Trade) Automatic funds transfer with phone banking (for Citibank and HDFC bank customers) Integration of : online trading+Bank+Demat account Instant cash transfer facility against purchase and sale of shares IPO investments Instant order and trade confirmations by e-mail

2. Speed Trade Account This accounts for active traders who trade frequently during the day's trading session. Following are few popular features of Speed Trade account Speed Trade account was launched April 2002 Single Screen interface for cash and derivatives Real-time Streaming quotes with instant order Execution and confirmation Hot keys similar to a traditional broker terminal Alerts and reminders phone lines

DOCUMENTS REQUIRED FOR OPENING DEMAT ACCOUNT:-

As per KYC guide lines there needs to be Photo Identity and Address proof of the customer. The required documents are mentioned below:-

Identity Proof

Residence/Address Proof

Passport Pan Card Driving License Voter's ID MAPIN UIN Card

Passport(valid) Voter's ID Driving License(valid) Bank Statement(latest) Telephone Bill(latest) Electricity Bill(latest) Ration Card Flat Maintenance Bill(latest) Insurance Policy(latest) Leave-License/Purchase Agreement(latest)

2 Photographs 1 Cheque of Rs.500 In Favor of Moti Share Broker Ltd. ( For Classic Account ), Or 1 Cheque of Rs.1000/=In Favor of Moti share Broker Ltd. (For Speed Trade Account).

Organization chart
This Chart tells us about the various hierarchy levels in the organization of moti share broker Ltd.

CEO Regional Sales Manager

Branch sales manager

Team manager

Assistant manager

Sales Executive

OBJECTIVES OF STUDY

The objective of the study is to assess and analyze the consumer behavior and sales promotion along with market share of Moti Share Broker Ltd. It is generally seen that the selling strategies determines the pattern of the market and affect the sale of the product, market share of the product sales promotion strategies and the distribution pattern. The main objectives of the present study are as following:1) - To study the consumer behavior regarding Share Market. 2) - To study about sales promotion technique regarding demat account. 3) - To conduct a survey regarding share trading with the help of questionnaire. 4) - To attract new customers for Moti Share Broker Ltd.

However the main objective of this study is to fill the gap between different aspect of theoretical and practical knowledge of marketing management and to develop the required skill to take decision on sight for the best use of my theoretical knowledge.

RELATIONSHIP WITH ECONOMY

In the current environment, where increasing integration of the financial markets with capital market reform measures is taking place, the activities in the stock markets and their relationships with the macro economy have assumed significant importance. Any news about the inflation rate, the rate of economic growth, employment, consumer spending and other economic variables has significant impact on share prices in general. A given piece of economic news also impacts different sectors within the overall market. There is a short note in an attempt to examine the relationship between share prices and the status of the economy by looking at their performance in India the modern enlightened investors' ultimate destination? What is the relationship between the health of the real economy and the health of the stock market? Does a rally in share prices reflect better health of the economy or is it the pink economic health that causes share prices to rise? A causal relationship between the share price index and industrial production can be easily established. However, it may require time and effort to study and establish interdisciplinary relationships with crucial macroeconomic variables like money supply, credit to the private sector, exchange rate, wholesale price index, and money market rate. Between 1995 and 2004, the real GDP in India experienced positive growth every year, ranging from a low of 4.0 per cent to 8.5 per cent. The Bombay Sensex, on the other hand, has experienced great volatility during this period, ranging from a negative 27.9 per cent to a positive 83.4 per cent.

If one were to look at the real GDP growth and BSE Sensex over the entire time horizon, 1995 and 2004, one can clearly see their co-relation. The real GDP growth was 6.1per cent and the Sensex posted a 6.2 per cent growth, both using CAGR (compounded annual growth rate reckoned). However, a closer and deeper year-on-year examination reveals a different picture. We find that while the real GDP growth has been at a steady rate on an annual basis during this period, the BSE Sensex has had a very volatile trend. On a year-on-year basis, there seems to be no sync at all between these two factors. However, the growth in nominal GDP matches that of the corporate performance year after year and hence there is a fair degree of co-relation. This may be due to the fact that the GDP of the economy is the collective output of the agriculture, industrial, and services sectors. It can, therefore, be asserted that corporate performance tends to trace GDP growth over the long-term (very important assumption), and it is assumed that the stock market follows suit. In the long-run, the economy goes through cycles of recovery, peak, slowdown, and depression. Stock markets also exhibit similar cycles. Hence, if India's GDP grows at 10 per cent in one year, the Sensex may not gain a similar percentage during that year. However, the relationship may hold true over the longer-term. It may be stated that the state of the economy has a bearing on the share prices but the health of the stock market in the sense of a rising share price index is not reflective of an improvement in the health of the economy.

SCOPE OF THE STUDY

The main scope of this study is to ascertain the various aspect of the consumer behavior and to create the brand image of Moti Share Broker Ltd. in the market (by informing clients about the information available). Another important aspect of this exercise is to study and increase the market segment of Moti Share Broker Ltd.. This study would provide useful information on the selling pattern as well it is a modest approach to evaluate the effectiveness of strategy involved to increase the network and sales of demat accounts. The analysis of market share will give a glimpse to improve the strategy effectiveness, market share e.t.c. It also aims toward increase of the consumer information.

SIGNIFICANCE OF STUDY
In an organization managers have generally different function to perform, example- planning, organizing, staffing etc. For efficient implementation of these functions various skills are required. These skills are technical, human, conceptual, adaptable etc The significance of the study on the CONSUMER BEHAVIOUR AND SALES PROMOTION, AND MARKET SHARE lies in the fact that the process involved shows the regular interaction and maintenance of different component of the chain. This whole pattern depends upon the demand of the different brands under Moti Share Broker Ltd. in the market which is highly influenced by the consumer behavior. The relevance of the study also lies in the fact about the popularity of its few selected brands and how the demand, promotion and market share are integrated to each other. The study is also significant for Moti Share Broker Ltd. as it provides relevant information about the market share, popularity, as well as its nation of being number one trading house in the market.

Review of literature related to study

Contents: a) Stock market b) Primary Market c) Secondary market d) Stock Exchange e) IPO f) Sensex g) Demat account h) Comparative assessment of Sharekhan with its competitors.

Stock market
A stock market is a market for the trading of company stock, and derivatives of same; both of these are securities listed on a stock exchange as well as those only traded privately. The term 'the stock market' is a concept for the mechanism that enables the trading of company stocks (collective shares), other securities, and derivatives. Bonds are still traditionally traded in an informal, over-the-counter market known as the bond market. Commodities are traded in commodities markets, and derivatives are traded in a variety of markets (but, like bonds, mostly 'over-thecounter'). The size of the worldwide 'bond market' is estimated at $45 trillion. The size of the 'stock market' is estimated at about $51 trillion. The world derivatives market has been estimated at about $300 trillion.[1] The major U.S. Banks alone are said to account for about $100 trillion. It must be noted though that the derivatives market, because it is stated in terms of notional outstanding amounts, cannot be directly compared to a stock or fixed income market, which refers to actual value. The stocks are listed and traded on stock exchanges which are entities (a corporation or mutual organization) specialized in the business of bringing buyers and sellers of stocks and securities together. The stock market in the United States includes the trading of all securities listed on the NYSE, the NASDAQ, the Amex, as well as on the many regional exchanges, the OTCBB, and Pink Sheets. Indian examples of stock exchanges include the National Stock Exchange (NSE), Bombay Stock Exchange (BSE).

PRIMARY MARKET
It is a Market for new issues of securities, as, where previously issued securities are bought and sold. A market is primary if the proceeds of sales go to the issuer of the securities sold. This is part of the financial market where enterprises issue their new shares and bonds. It is characterised by being the only moment when the enterprise receives money in exchange for selling its financial assets.

SECONDARY MARKET
The market where securities are traded after they are initially offered in the primary market. Most trading is done in the secondary market. To explain further, it is trading in previously issued financial instruments. An organized market for used securities. Examples are the New York Stock Exchange (NYSE), Bombay Stock Exchange (BSE), National Stock Exchange NSE, bond markets, over-the-counter markets, residential mortgage loans, governmental guaranteed loans etc.

STOCK EXCHANGE
A stock exchange, share market or bourse is a corporation or mutual organization which provides facilities for stock brokers and traders, to trade company stocks and other securities. Stock exchanges also provide facilities for the issue and redemption of securities as well as other financial instruments and capital events including the payment of income and dividends. The securities traded on a stock exchange include: shares issued by companies, unit trusts and other pooled investment products and bonds. To be able to trade a security on a certain stock exchange, it has to be listed there. Usually there is a central location at least for recordkeeping, but trade is less and less linked to such a physical place, as modern markets are electronic networks, which gives them advantages of speed and cost of transactions. Trade on an exchange is by members only. The initial offering of stocks and bonds to investors is by definition done in the primary market and subsequent trading is done in the secondary market. A stock exchange is often the most important component of a stock market. Supply and demand in stock markets is driven by various factors which, as in all free markets, affect the price of stocks (see stock valuation). There is usually no compulsion to issue stock via the stock exchange itself, nor must stock be subsequently traded on the exchange. Such trading is said to be off exchange or over-the-counter. This is the usual way that bonds are traded. Increasingly, stock exchanges are part of a global market for securities.

IPO Initial Public Offering

Public issues can be classified into Initial Public offerings and further public offerings. In a public offering, the issuer makes an offer for new investors to enter its shareholding family. The issuer company makes detailed disclosures as per the DIP guidelines in its offer document and offers it for subscription. Initial Public Offering (IPO ) is when an unlisted company makes either a fresh issue of securities or an offer for sale of its existing securities or both for the first time to the public. This paves way for listing and trading of the issuers securities.

IPO is New shares Offered to the public in the Primary Market .The first time the company is traded on the stock exchange. A prospectus is issued to read about its risk before investing. IPO is A company's first sale of stock to the public. Securities offered in an IPO are often, but not always, those of young, small companies seeking outside equity capital and a public market for their stock. Investors purchasing stock in IPOs generally must be prepared to accept very large risks for the possibility of large gains. Sometimes, Just before the IPO is launched, Existing share Holders get a very liberal bonus issues as a reward for their faith in risking money when the project was new How to apply to a public issue ? When a company floats a public issue or IPO, it prints forms for application to be filled by the investors. Public issues are open for a few days only. As per law, any public issue should be kept open for a minimum of 3days and a maximum of 21 days. For issues, which are underwritten by financial institutions, the offer should be kept open for a minimum of 3 days and a maximum of 21 days.

For issues, which are underwritten by all India financial institutions, the offer should be kept open for a maximum of 10 days. Generally, issues are kept open

for only 3 to 4 days. The duly complete application from, accompanied by cash, cheque, DD or stock invest should be deposited before the closing date as per the instruction on the form. IPO's by investment companies (closed end funds) usually contain underwriting fees which represent a load to buyers. Before applying for any IPO, one should analyze the following factors: 1. Who are the Promoters? What is their credibility and track record? 2. What is the company manufacturing or providing services - Product, its potential 3. What are the risk factors involved? 4. What has been the past performance of the Company offering the IPO?

Sensex and Nifty

The BSE Sensex or Bombay Stock Exchange Sensitive Index is a valueweighted index composed of 30 stocks with the base April 1979 = 100. It consists of the 30 largest and most actively traded stocks, representative of various sectors, on the Bombay Stock Exchange. These companies account for around one-fifth of the market capitalization of the BSE. The base value of the Sensex is 100 on April 1, 1979 and the base year of BSESENSEX is 1978-79. At irregular intervals, the Bombay Stock Exchange (BSE) authorities review and modify its composition to make sure it reflects current market conditions. The abbreviated form "Sensex" was coined by Deepak Mohoni around 1990 while writing market analysis columns for some of the business newspapers and magazines. It gained popularity over the next year or two. The index has increased by over ten times from June 1990 to today. Using information from April 1979 onwards, the long-run rate of return on the BSE Sensex can be estimated to be 0.52% per week (continuously compounded) with a standard deviation of 3.67%. This translates to 27% per annum, which translates to roughly 18% per annum after compensating for inflation.

Nifty
The S&P CNX Nifty (nicknamed Nifty 50 or simply Nifty) (Ticker NSE:^NSEI), is the leading index for large companies on the National Stock Exchange of India. S&P CNX Nifty is a well diversified 50 stock index accounting for 22 sectors of the economy. It is used for a variety of purposes such as benchmarking fund portfolios, index based derivatives and index funds Nifty was developed by the economists Ajay Shah and Susan Thomas, then at IGIDR. Later on, it came to be owned and managed by India Index Services and Products Ltd. (IISL), which is a joint venture between NSE and CRISIL. IISL is India's first specialised company focused upon the index as a core product. IISL have a consulting and licensing agreement with Standard & Poor's (S&P), who are world leaders in index services. CNX stands for CRISIL NSE Indices. CNX ensures common branding of indices, to reflect the identities of both the promoters, i.e. NSE and CRISIL. Thus, 'C' stands for CRISIL, 'N' stands for NSE and X stands for Exchange or Index. The S&P prefix belongs to the US-based Standard & Poor's Financial Information Services.

The average total traded value for the last six months of all Nifty stocks is approximately 55.15% of the traded value of all stocks on the NSE. Nifty stocks represent about 59.49% of the total market capitalization as on September 29, 2006. Impact cost of the S&P CNX Nifty for a portfolio size of Rs.5 million is 0.06% S&P CNX Nifty is professionally maintained and is ideal for derivatives trading. It is quoted using the symbol NSEI. It is calculated as a weighted average, so changes in the share price of larger companies have more effect

DEMAT ACCOUNT
Demat refers to a dematerialized account. Though the company is under obligation to offer the securities in both physical and demat mode, you have the choice to receive the securities in either mode. If you wish to have securities in demat mode, you need to indicate the name of the depository and also of the depository participant with whom you have depository account in your application. It is, however desirable that one should hold securities in demat form as physical securities carry the risk of being fake, forged or stolen. Just as you have to open an account with a bank if you want to save your money, make cheque payments etc, Nowadays, you need to open a demat account if you want to buy or sell stocks. So it is just like a bank account where actual money is replaced by shares. You have to approach the DPs (remember, they are like bank branches), to open your demat account. So you don't have to possess any physical certificates showing that you own these shares. They are all held electronically in your account. As you buy and sell the shares, they are adjusted in your account. Just like a bank passbook or statement, the DP will provide you with periodic statements of holdings and transactions.

Comparative Assessment of Moti Share Broker Ltd. with its competitors

5paise

83

14.56%

Moti Share Broker

109

19.12%

motilaloswal

20

3.51%

icicidirect

133

23.33%

hdfc

19

3.33%

indiabulls

85

14.91%

kotak

43

7.54%

any other

78

13.68%

Product comparison

Moti Share Broker Ltd.

Classic account Speed trade account Dial-n-trade Portfolio management

ICICIDIRECT
Cash trading Margin trading Spot trading Margin plus Trading

India bulls
India bulls Equity Trading Power India bulls Personal credit Equity trading

Religare

Commodities trading

Kotakstreet.com
Kotak flat Kotak super saver flat Kotak gateway Kotak freeway

Services Comparison

Moti Share Broker

Online services Share shops Mutal funds PMS pro prime PMS pro tech Demat services NFO

ICICIDIRECT.COM
IPO and bonds line Demat services Investing mutalfunds Trade in derivatives Online services

Religare securities
Equities Commodities Insurance Investment banking

India Bulls
equities commodities derivatives mutual funds

Kotak securities
Equities Commodities Derivatives

Price comparison

ICICIdirect.com
Account opening charges Rs 750 Annual maintain charges Rs300 Brokerages for Intra-day 0.02% and 0.20% Brokerages for delivery 0.02% and 0.25%

India bulls securities

Equity trading account opening charges Rs 250 Demat account opening charges Rs 200 Software charges Rs 750 Brokerages charges for intra-day 0.05% and 0.25% for delivery

Moti Share Broker Ltd.

Classic account
Opening charges Rs 750 AMC Rs 300 Brokerage-intra-day 0.05% and Delivery 0.25%

Speed Trade
Opening charges Rs 1000 AMC Rs 500

OPTIONS AVAILABLE FOR INVESTMENT

1. FIXED DEPOSITS
Fixed deposits remain the most popular instrument for financial savings in India. They are the middle path investments with adequate returns and sufficient liquidity. There are basically three avenues for parking savings in the form of fixed deposits. The most common are bank deposits. For nationalized banks, the yield is generally low with a maximum interest of 10 to 10.5% per annum for a period of three years or more. The rate of interest differs from bank to bank and is generally higher for private sector and foreign banks. This, however, does not mean that the depositor loses all his rights over the money for the duration of the tenor decided. The deposits can be withdrawn before the period is over. However, the amount of interest payable to the depositor, in such cases goes down (usually 1% to 2% less than the original rate). Moreover, as per RBI regulations there will be no interest paid for any premature withdrawals for the period 15 days to 29 or 15 to 45 days as the case may be. Post office is a very safe and secure investment avenue. The money is used in the development of the society as a whole, while it provides steady returns. The biggest advantage of investing in post office schemes is the tax benefit that they provide. Thus a lot of savings go through this channel to dual advantage - tax benefits and steady returns. Other than these, there deposits with NBFCs or Non Banking Financial Corporations and company deposits are more attractive.

2. NATIONAL SAVING CERTIFICATES (NTSCs)

National Savings Certificates (NSC) is an assured return scheme, armed with powerful tax rebates under Section 88 of the Income Tax Act, 1961. Interest is payable at 8 per cent, compounded half-yearly for a duration of 6 years. NSC combines growth in money with reductions in tax liability as per the provisions of the Income Tax Act, 1961. The scheme offers a coupon of 8 per cent, compounded semi-annually. So, Rs 1,000 invested in NSCs become Rs 1,586.87 on maturity after 6 years.

3. LIFE INSURANCES
Life insurance is a contract that pledges payment of an amount to the person assured or his nominee on the happening of the event insured against. The contract also provides for the payment of premium periodically to the Corporation by the policyholder. Life insurance is universally acknowledged to be an institution, which eliminates 'risk', substituting certainty for uncertainty and comes to the timely aid of the family in the unfortunate event of death of the breadwinner. By and large, life insurance is civilizations partial solution to the problems caused by death. Life insurance, in short, is concerned with two hazards that stand across the life-path of every personDying prematurely leaving a dependent family and living the old age without much of support.

1. That of dying prematurely leaves a dependent family to fend for itself. 2. That of living till old age without visible le means of support

The Insurance sector in India governed by Insurance Act, 1938, the Life Insurance Corporation Act, 1956 and General Insurance Business (Nationalization) Act, 1972, Insurance Regulatory and Development Authority (IRDA) Act, 1999 and other related Acts. Life Insurance Corporation India (LIC) is the undisputed leader in this area and provides.

4. PUBLIC PROVIDENT FUND (PPF)

The Public Provident Fund (PPF) is probably the most popular of all the taxsaving schemes. PPF is a savings cum tax saving instrument. It also serves as a retirement planning tool for many of those who do not have any structured pension plan covering them. Under Section 88 of the Income Tax Act, you can invest up to Rs 70,000 of your income to claim a rebate of upto 30 per cent depending upon the rate of rebate applicable in your case. The PPF account may be opened at any branch of the State Bank of India (SBI) and its subsidiaries, a few branches of the other nationalized banks, and all head post offices. The minimum deposit is Rs 500.Minimum deposit required in a PPF account is Rs. 500 in a financial year. Maximum deposit limit is Rs. 70,000 in a financial year. Maximum number of deposits is twelve in a financial year. The account matures for closure after 15 years. Account can be continued with or without subscriptions after maturity for block periods of five years. Premature withdrawal is permissible every year after completion of 5 years from the end of the year of opening the account. Loans from the amount at credit in PPF amount can be taken after completion of one year from the end of the financial year of opening the account and before completion of the 5th year. Interest at the rate notified by the Central Government from time to time, is calculated and credited to the accounts at the end of each financial year. Presently, the rate of interest is 8% per annum. Income Tax rebate is available "on the deposits made", under Section 88 of Income Tax Act, as amended from time to time. Interest credited every year is tax-free.

5. REAL ESTATES
Real estate is a legal term (in some jurisdictions) that encompasses land along with anything permanently affixed to the land, such as buildings. Fixtures include buildings, fences, and things attached to buildings, such as plumbing, heating, and light fixtures. Property that is not affixed is regarded as personal property. For example, furniture and draperies are items of personal property. Within the real estate sector, foreign investment is now permitted in construction and project development related to both residential and commercial development in (i) Housing Townships; (ii) Commercial Office Space; (iii) Hotels and Resorts; (iv) Hospitals; (v) Educational Institutions; (vi) Recreational facilities; and (vii) City and State level Infrastructure.Real Estate investment is one of the easiest ways to make money.

6. SHARE MARKET
The capital of the company is divided into the number of equal parts known as shares and holders of these shares are called shareholders or owners of the company and company provide part of profit to shareholders out of net profit is known as dividend and at the time of loss the shareholders have to bear the loss also TYPES OF SHARES:-

EQUITY SHARES: --PREFERENCE SHARES: --EQUITY SHARES:

Equity Shares is the owners capital in the company. The holders of these shares are the real owners of the company. They have control over the working of the company. Equity Shareholders are paid dividend after paying it to the preference shareholders. PREFERENCE SHARES: These Shares have certain preferences as compared to other types of shares. These shares are given two preferences. First is for payment of dividend and second is for repayment of capital at the time of liquidation of company. DEBENTURES Debenture is a document under the companys seal which provides for the payment of principal sum and interest thereon at regular intervals. A debenture holder is a creditor of the company. A fixed rate of interest is paid on debentures irrespective of profit or loss. Debentures are payable in priority over share capital. Debenture holders have no right over the management of company. Debenture holders are merely the creditors of company not the owner of the company.

DERIVATIVES
Derivatives are the instrument and Derivative contract is a financial instrument whose payoff structure is derived from the value of the underlying asset. There are 3 types of Derivative contracts Option Contract Future Contract Forward Contract FORWARD CONTRACT:

It is an agreement entered today under which one party agrees to buy and the other agrees to sell on a specified future date at an agreed price. FUTURE CONTRACT: It is a standardized contract between two parties where one party commits to sell and the other commits to buy, a specified quantity of a specified asset at an agreed price on a given date in the future. OPTION CONTRACT: It is a contract between two parties under which the buyer of the option buys the right and not the obligation to buy or sell, a standardized quantity of a financial instrument at or before a pre determined date at a price, which is decided in advance.

COMMODITIES MARKET
Commodity markets are markets where raw or primary products are exchanged. These raw commodities are traded on regulated exchanges, in which they are bought and sold in standardized Contracts. A commodity has value, which represents a quantity of human labor. The fact that it has value implies straightaway that people try to economies its use. A commodity also has a use value, an exchange value and a price. In the world of business, a commodity is an undifferentiated product whose value arises from the owner's right to sell rather than the right to use. Example: commodities from the financial world include oil (sold by the barrel), electricity, wheat, bulk chemicals such as sulfuric acid, base and other metals, and even pork-bellies and orange juice. More modern commodities include bandwidth,

RAM chips and (experimentally) computer processor cycles, and negative commodity units like emissions credits. In the original and simplified sense, commodities were things of value, of uniform quality, that were produced in large quantities by many different producers; the items from each different producer are considered equivalent.

INITIAL PUBLIC OFFER (IPO)

An initial public offering (IPO) is the first sale of a corporation's common shares to public investors. The main purpose of an IPO is to raise capital for the corporation. The first sale of stock by a private company to the public, IPOs are often issued by smaller, younger companies seeking capital to expand, but can also be done by large privatelyowned companies looking to become publicly traded. On an average IPO to give decent returns as this helps companies to build up trust and later raise huge amounts from public.

MUTUAL FUNDS
A mutual fund is a basket of investment brought from the money of investors and managed by a set of experts. It raises money from the investors regularly by coming out with new schemes which carry a particular name depending upon their investment portfolio. For e.g. DSP FMCG fund will only invest in the shares and debt of the FMCG companies. The return received by the scheme is highlighted in the form of a higher NAV.

NAV= initial issue price + profit net of expenses

NAV goes up or down based on the performance of the scheme, which in term is related to the performance of the market.

INTRODUCTION OF SECURITY MARKET IN INDIA

The securities market essentially has three categories of participants, namely, the issuers of securities, investors in securities and the intermediaries, such as merchant bankers, brokers etc. While the corporate and government raise resources from the securities market to meet their obligations, it is households that invest their savings in the Securities Market. It is advisable to conduct transactions through an intermediary. For example you need to transact through a trading member of a stock exchange if you intend to buy or sell any security on stock exchanges. You need to maintain an account with a depository if you intend to hold securities in demat form. You need to deposit money with a banker to an issue if you are subscribing to public issues. You get guidance if you are transacting through an intermediary. Chose a SEBI registered intermediary, as he is accountable for its activities. The list of registered intermediaries is available with exchanges, industry associations etc. The securities market has two interdependent segments: the primary (new issues) market and the secondary market. The primary market provides the channel for sale of new securities while the secondary market deals in securities previously issued.

SECURITIES
Meaning of Securities The definition of Securities as per the Securities Contracts Regulation Act (SCRA), 1956, includes instruments such as shares, bonds, scrip, stocks or other marketable securities of similar nature in or of any incorporate company or body

corporate, government securities, derivatives of securities, units of collective investment scheme, interest and rights in securities, security receipt or any other instruments so declared by the Central Government. A security is a type of transferable interest representing financial value. Traditionally securities have been categorized between debt and equity securities, and between bearer and registered securities. Representing the full range of investment opportunities, a security can refer to an instrument which allows the holder to claim an ownership position in a corporation (a stock); a creditor relationship with a corporation, a government or its agency (a bond); or other rights to ownership as stipulated in specific contract (a futures contract). Types of securities

Share Debentures Bonds

Government Securities

Derivative products
Units of Mutual Funds etc.

SECURITIES MARKET

A place or places where securities are bought and sold, the facilities and people engaged in such transactions, the demand for and availability of securities to be traded, and the willingness of buyers and sellers to reach agreement on sales. Securities markets include over-the-counter markets, the New York Stock

Exchange, the Chicago Board of Trade and the American Stock Exchange. Functions of Securities Market Securities Markets is a place where buyers and sellers of securities can enter into transactions to purchase and sell shares, bonds, debentures etc. Further, it performs an important role of enabling corporates, entrepreneurs to raise resources for their companies and business ventures through public issues. Transfer of resources from those having idle resources (investors) to others who have a need for them (corporates) is most efficiently achieved through the securities market. Stated formally, securities markets provide channels for reallocation of savings to investments and entrepreneurship. Savings are linked to investments by a variety of intermediaries, through a range of financial products, called Securities.

TYPES OF SECURITIES MARKET 1. Primary Market 2. Secondary Market

1. PRIMARY MARKET The primary market is the financial market for the initial issue and placement of securities. Unlike in the secondary market, no organized stock exchanges are necessary. An organization that need funds contacts their investment banker who typically assembles a syndicate of securities dealers that will sell the new stock issue. It is the initial market for any item or service. It also signifies an initial market for a new stock issue. The jargon also means a firm, trading market held in a security by a trader who performs the activities of a specialist by being ready to execute orders in that stock.

Primary markets bring together buyers and sellers - either directly or through intermediaries - by providing an arena in which sellers investment propositions can be priced, brought to the marketplace, and sold to buyers. In this context, the seller is called the issuer and the price of whats sold is called the issue price.

Role of the Primary Market

The primary market provides the channel for sale of new securities. Primary market provides opportunity to issuers of securities; Government as well as corporates, to raise resources to meet their requirements of investment and/or discharge some obligation. They may issue the securities at face value, or at a discount/premium and these securities may take a variety of forms such as equity, debt etc. They may issue the securities in domestic market and/or international market.

Face Value of a share/debenture

The nominal or stated amount (in Rs.) assigned to a security by the issuer. For shares, it is the original cost of the stock shown on the certificate; for bonds, it is the amount paid to the holder at maturity. Also known as par value or simply par. For an equity share, the face value is usually a very small amount (Rs. 5, Rs. 10) and does not have much bearing on the price of the share, which may quote higher in the market, at Rs. 100 or Rs. 1000 or any other price. For a debt security, face value is the amount repaid to the investor when the bond matures (usually, Government securities and corporate bonds have a face value of Rs. 100). The price at which the security trades depends on the fluctuations in the interest rates in the economy.

Premium and Discount in a Security Market

Securities are generally issued in denominations of 5, 10 or 100. This is known as the Face Value or Par Value of the security as discussed earlier. When a

security is sold above its face value, it is said to be issued at a Premium and if it is sold at less than its face value, then it is said to be issued at a Discount.

ISSUE OF SHARES Need to issue shares to the public

Most companies are usually started privately by their promoter(s). However, the promoters capital and the borrowings from banks and financial institutions may not be sufficient for setting up or running the business over a long term. So companies invite the public to contribute towards the equity and issue shares to individual investors. The way to invite share capital from the public is through a Public Issue. Simply stated, a public issue is an offer to the public to subscribe to the share capital of a company. Once this is done, the company allots shares to the applicants as per the prescribed rules and regulations laid down by SEBI.

Kinds of issues
Primarily, issues can be classified as a Public, Rights or Preferential issues (also known as private placements). While public and rights issues involve a detailed procedure, private placements or preferential issues are relatively simpler. The classification of issues is illustrated below:

1. Initial Public Offering (IPO) is when an unlisted company makes either

a fresh issue of securities or an offer for sale of its existing securities or both for the first time to the public. This paves way for listing and trading of the issuers securities.

2. A follow on public offering (Further Issue) is when an already listed

company makes either a fresh issue of securities to the public or an offer for sale to the public, through an offer document.

3. Rights Issue is when a listed company which proposes to issue fresh

securities to its existing shareholders as on a record date. The rights are normally offered in a particular ratio to the number of securities held prior to the issue. This route is best suited for companies who would like to raise capital without diluting stake of its existing shareholders.

4 A Preferential issue is an issue of shares or of convertible securities by

listed companies to a select group of persons under Section 81 of the Companies Act, 1956 which is neither a rights issue nor a public issue. This is a faster way for a company to raise equity capital. The issuer company has to comply with the Companies Act and the requirements contained in the Chapter pertaining to preferential allotment in SEBI guidelines which interalias include pricing, disclosures in notice etc.

Issue price
The price at which a company's shares are offered initially in the primary market is called as the Issue price. When they begin to be traded, the market price may be above or below the issue price.

Market Capitalization
The market value of a quoted company, which is calculated by multiplying its current share price (market price) by the number of shares in issue is called as

market capitalization. E.g. Company A has 120 million shares in issue. The current market price is Rs. 100. The market capitalization of company A is Rs. 12000 million.

Price of an issue
Indian primary market ushered in an era of free pricing in 1992. Following this, the guidelines have provided that the issuer in consultation with Merchant Banker shall decide the price. There is no price formula stipulated by SEBI. SEBI does not play any role in price fixation. The company and merchant banker are however required to give full disclosures of the parameters, which they had considered while deciding the issue price. There are two types of issues, one where company and Lead Merchant Banker fix a price (called fixed price) and other, where the company and the Lead Manager (LM) stipulate a floor price or a price band and leave it to market forces to determine the final price (price discovery through book building process).

Cut-Off Price
In a Book building issue, the issuer is required to indicate either the price band or a floor price in the prospectus. The actual discovered issue price can be any price in the price band or any price above the floor price. This issue price is called Cut-Off Price. The issuer and lead manager decides this after considering the book and the investors appetite for the stock. Floor price is the minimum price at which bids can be made.

Price Band in a book built IPO

The prospectus may contain either the floor price for the securities or a price band within which the investors can bid. The spread between the floor and the cap of the price band shall not be more than 20%. In other words, it means that the cap should not be more than 120% of the floor price. The price band can

have a revision and such a revision in the price band shall be widely disseminated by informing the stock exchanges, by issuing a press release and also indicating the change on the relevant website and the terminals of the trading members participating in the book building process. In case the price band is revised, the bidding period shall be extended for a further period of three days, subject to the total bidding period not exceeding ten days.

The Price Band

It may be understood that the regulatory mechanism does not play a role in setting the price for issues. It is up to the company to decide on the price or the price band, in consultation with Merchant Bankers.

Allotment in an IPO/offer for sale Timeframe for getting refund if shares not allotted
As per SEBI guidelines, the Basis of Allotment should be completed with 15 days from the issue close date. As soon as the basis of allotment is completed, within 2 working days the details of credit to demat account / allotment advice and despatch of refund order needs to be completed. So an investor should know in about 15 days time from the closure of issue, whether shares are allotted to him or not. It would take around 3 weeks after the closure of the book built issue

Role of a Registrar to an issue

The Registrar finalizes the list of eligible allottees after deleting the invalid applications and ensures that the corporate action for crediting of shares to the demat accounts of the applicants is done and the dispatch of refund orders to those applicable are sent. The Lead Manager coordinates with the Registrar to ensure follow up so that that the flow of applications from collecting bank branches, processing of the applications and other matters till the basis of allotment is finalized, dispatch security certificates and refund orders completed and securities listed.

1.2 LISTING OF SECURITIES

Listing means admission of securities of an issuer to trading privileges (dealings) on a stock exchange through a formal agreement. The prime objective of admission to dealings on the exchange is to provide liquidity and marketability to securities, as also to provide a mechanism for effective control and supervision of trading.

Listing Agreement
At the time of listing securities of a company on a stock exchange, the company is required to enter into a listing agreement with the exchange. The listing agreement specifies the terms and conditions of listing and the disclosures that shall be made by a company on a continuous basis to the exchange.

Delisting of securities The term Delisting of securities means permanent removal of securities of a listed company from a stock exchange. As a consequence of delisting, the securities of that company would no longer be traded at that stock exchange.

SEBIs Role in an Issue

Any company making a public issue or a listed company making a rights issue of value of more than Rs 50 lakh is required to file a draft offer document with SEBI for its observations. The company can proceed further on the issue only after getting observations from SEBI. The validity period of SEBIs observation letter is three months only i.e. the company has to open its issue within three months period.

2. SECONDARY MARKET
Secondary market refers to a market where securities are traded after being initially offered to the public in the primary market and/or listed on the Stock

Exchange. Majority of the trading is done in the secondary market. Secondary market comprises of equity markets and the debt markets. A secondary market is an organization that buys loans from lenders, thereby providing the lender with the capital to issue new loans. Selling loans is a common practice among lenders, so the bank you make your payments to may change during the life of the loan. The terms and conditions of your loan do not change when it is sold to another holder. Sallie Mae is the nation's largest secondary market and holds approximately one third of all educational loans.

Role of the Secondary Market

For the general investor, the secondary market provides an efficient platform for trading of his securities. For the management of the company, Secondary equity markets serve as a monitoring and control conduitby facilitating valueenhancing control activities, enabling implementation of incentive-based management contracts, and aggregating information (via price discovery) that guides management decisions.

Difference between the Primary Market and the Secondary Market In the primary market, securities are offered to public for subscription for the purpose of raising capital or fund. Secondary market is an equity-trading venue in which already existing/pre-issued securities are traded among investors. Secondary market could be either auction or dealer market. While stock exchange is the part of an auction market, Over-the-Counter (OTC) is a part of the dealer market.

Products in the Secondary Markets

Following are the main financial products/instruments dealt in the Secondary market, which may be divided broadly into Shares and Bonds:

Shares:
1.Equity Shares: An equity share, commonly referred to as ordinary share, represents the form of fractional ownership in a business venture. 2. Rights Issue/ Rights Shares: The issue of new securities to existing shareholders at a ratio to those already held, at a price. For e.g. a 2:3 rights issue at Rs. 125, would entitle a shareholder to receive 2 shares for every 3 shares held at a price of Rs. 125 per share. Bonus Shares: Shares issued by the companies to their shareholders free of cost based on the number of shares the shareholder owns. 3. Preference shares: Owners of these kind of shares are entitled to a fixed dividend or dividend calculated at a fixed rate to be paid regularly before dividend can be paid in respect of equity share. They also enjoy priority over the equity shareholders in payment of surplus. But in the event of liquidation, their claims rank below the claims of the companys creditors, bondholders/debenture holders. 4. Cumulative Preference Shares: A type of preference shares on which dividend accumulates if remained unpaid. All arrears of preference dividend have to be paid out before paying dividend on equity shares. 5. Cumulative Convertible Preference Shares: A type of preference shares where the dividend payable on the same accumulates, if not paid. After a specified date, these shares will be converted into equity capital of the company.

Bond
Bond is a negotiable certificate evidencing indebtedness. It is normally unsecured. A debt security is generally issued by a company, municipality or government agency. A bond investor lends money to the issuer and in exchange, the issuer promises to repay the loan amount on a specified maturity date. The

issuer usually pays the bondholder periodic interest payments over the life of the loan. The various types of Bonds are as follows: 1. Zero Coupon Bond: Bond issued at a discount and repaid at a face value. No periodic interest is paid. The difference between the issue price and redemption price represents the return to the holder. The buyer of these bonds receives only one payment, at the maturity of the bond. of 2. Convertible Bond: A bond giving the investor the option to convert the bond into equity at a fixed conversion price. 3. Treasury Bills: Short-term (up to one year) bearer discount security issued by government as a means financing their cash requirements.

STOCK EXCHANGE
An organized marketplace for securities featured by the centralization of supply and demand for the transaction of orders by member brokers for institutional and individual investors. A stock exchange is an organization of which the members are stockbrokers. A stock exchange provides facilities for the trading of securities and other financial instruments. Usually facilities are also provided for the issue and redemption of securities as well as other capital events including the payment of income and dividends.

About BSE
Bombay Stock Exchange Limited is the oldest stock exchange in Asia with a rich heritage. Popularly known as "BSE", it was established as "The Native Share & Stock Brokers Association" in 1875. It is the first stock exchange in the country to obtain permanent recognition in 1956 from the Government of India under the Securities Contracts (Regulation) Act, 1956.The Exchange's pivotal and preeminent role in the development of the Indian capital market is widely recognized and its index, SENSEX, is tracked worldwide. Earlier an Association of Persons (AOP), the Exchange is now a demutualised and corporatised entity incorporated under the provisions of the Companies Act, 1956, pursuant to the BSE (Corporatisation and Demutualisation) Scheme, 2005 notified by the Securities and Exchange Board of India (SEBI).

With demutualisation, the trading rights and ownership rights have been delinked effectively addressing concerns regarding perceived and real conflicts of interest. The Exchange is professionally managed under the overall direction of the Board of Directors. The Board comprises eminent professionals, representatives of Trading Members and the Managing Director of the Exchange. The Board is inclusive and is designed to benefit from the participation of market intermediaries.The Exchange provides an efficient and transparent market for trading in equity, debt instruments and derivatives. The BSE's On Line Trading System (BOLT) is a proprietory system of the Exchange and is BS 7799-2-2002 certified. The surveillance and clearing & settlement functions of the Exchange are ISO 9001:2000 certified.

About NSE
With the liberalization of the Indian economy, it was found inevitable to lift the Indian stock market trading system on par with the international standards. On the basis of the recommendations of high-powered Pherwani Committee, the National Stock Exchange was incorporated in 1992 by Industrial Development Bank of India, Industrial Credit and

Investment Corporation of India, Industrial Finance Corporation of India, all Insurance Corporations, selected commercial banks and others. Trading at NSE can be classified under two broad categories: (a) Wholesale debt market and (b) Capital market. Wholesale debt market operations are similar to money market operations institutions and corporate bodies enter into high value transactions in financial instruments such as government securities, treasury bills, public sector unit bonds, commercial paper, certificate of deposit, etc.

Role of a Stock Exchange in buying and selling shares

The stock exchanges in India, under the overall supervision of the regulatory authority, the Securities and Exchange Board of India (SEBI), provide a trading platform, where buyers and sellers can meet to transact in securities. The trading platform provided by NSE is an electronic one and there is no need for buyers and sellers to meet at a physical location to trade. They can trade through the computerized trading screens available with the NSE trading members or the Internet based trading facility provided by the trading members of NSE.

Demutualisation of stock exchanges

Demutualisation refers to the legal structure of an exchange whereby the ownership, the management and the trading rights at the exchange are segregated from one another.

Demutualised exchange different from a mutual exchange

In a mutual exchange, the three functions of ownership, management and trading are concentrated into a single Group. Here, the broker members of the exchange are both the owners and the traders on the exchange and they further manage

the exchange as well. This at times can lead to conflicts of interest in decisionmaking. A demutualised exchange, on the other hand, has all these three functions clearly segregated, i.e. the ownership, management and trading are in separate hands. Currently, two stock exchanges in India, the National Stock Exchange (NSE) and Over the Counter Exchange of India (OTCEI) are demutualised.

EQUITY INVESTMENT Investment in Securities

When we buy a share of a company you become a shareholder in that company. Shares are also known as Equities. Equities have the potential to increase in value over time. It also provides your portfolio with the growth necessary to reach your long-term investment goals. Research studies have proved that the equities have outperformed most other forms of investments in the long term. This may be illustrated with the help of following examples: a) Over a 15-year period between 1990 to 2005, Nifty has given an annualized return of 17%. b) Mr. Raju invests in Nifty on January 1, 2000 (index value 1592.90). The Nifty value as of end December 2005 was 2836.55. Holding this investment over this period Jan 2000 to Dec 2005 he gets a return of 78.07%. Investment in shares of ONGC Ltd for the same period gave a return of 465.86%, SBI 301.17% and Reliance 281.42%. Therefore, Equities are considered the most challenging and the rewarding, when compared to other investment options. Research studies have proved that investments in some shares with a longer tenure of investment have yielded far superior returns than any other investment.

However, this does not mean all equity investments would guarantee similar high returns. Equities are high-risk investments. One needs to study them carefully before investing.

Average return on Equities in India

Since 1990 till date, Indian stock market has returned about 17% to investors on an average in terms of increase in share prices or capital appreciation annually. Besides that on average stocks have paid 1.5% dividend annually. Dividend is a percentage of the face value of a share that a company returns to its shareholders from its annual profits. Compared to most other forms of investments, investing in equity shares offers the highest rate of return, if invested over a longer duration.

Factors, which influence the price of a stock

Broadly there are two factors: (1) stock specific and (2) market specific. The stock-specific factor is related to peoples expectations about the company, its future earnings capacity, financial health and management, level of technology and marketing skills. The market specific factor is influenced by the investors sentiment towards the stock market as a whole. This factor depends on the environment rather than the performance of any particular company. Events favorable to an economy, political or regulatory environment like high economic growth, friendly budget, stable government etc. can fuel euphoria in the investors, resulting in a boom in the market. On the other hand, unfavorable events like war, economic crisis, communal riots, minority government etc. depress the market irrespective of certain companies performing well. However, the effect of market-specific factor is generally short-term. Despite ups and downs, price of a stock in the long run gets stabilized based on the stock specific factors. Therefore, a prudent advice to all investors is to analyze and invest and not speculate in shares.

Meaning of the terms of Growth Stock and Value Stock Growth Stocks:
In the investment world we come across terms such as Growth stocks, Value stocks etc. Companies whose potential for growth in sales and earnings are excellent, are growing faster than other companies in the market or other stocks in the same industry are called the Growth Stocks. These companies usually pay little or no dividends and instead prefer to reinvest their profits in their business for further expansions.

Value Stocks:
The task here is to look for stocks that have been overlooked by other investors and which may have a hidden value. These companies may have been beaten down in price because of some bad event, or may be in an industry that's not fancied by most investors. However, even a company that has seen its stock price decline still has assets to its name - buildings, real estate, inventories, subsidiaries, and so on. Many of these assets still have value, yet that value may not be reflected in the stock's price. Value investors look to buy stocks that are undervalued, and then hold those stocks until the rest of the market realizes the real value of the company's assets. The value investors tend to purchase a company's stock usually based on relationships between the current market price of the company and certain business fundamentals. They like P/E ratio being below a certain absolute limit; dividend yields above a certain absolute limit; Total sales at a certain level relative to the company's market capitalization, or market value etc.

Bid and Ask price

The Bid is the buyers price. It is this price that you need to know when you have to sell a stock. Bid is the rate/price at which there is a ready buyer for the stock, which you intend to sell. The Ask (or offer) is what you need to know when

you're buying i.e. this is the rate/ price at which there is seller ready to sell his stock. The seller will sell his stock if he gets the quoted Ask price.

Portfolio
A Portfolio is a combination of different investment assets mixed and matched for the purpose of achieving an investor's goal(s). Items that are considered a part of your portfolio can include any asset you own-from shares, debentures, bonds, mutual fund units to items such as gold, art and even real estate etc. However, for most investors a portfolio has come to signify an investment in financial instruments like shares, debentures, fixed deposits, and mutual fund units.

Diversification in Portfolio
It is a risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Diversification is possibly the best way to reduce the risk in a portfolio.

Advantages of the diversified portfolio

A good investment portfolio is a mix of a wide range of asset class. Different securities perform differently at any point in time, so with a mix of asset types, your entire portfolio does not suffer the impact of a decline of any one security. When your stocks go down, you may still have the stability of the bonds in your portfolio. There have been all sorts of academic studies and formulas that demonstrate why diversification is important, but it's Really just the simple practice of "not putting all your eggs in one basket." If you spread your investments across various types of assets and markets, you'll reduce the risk of your entire portfolio getting affected by the adverse returns of any single asset class.

DEBT INVESTMENT
Investment in the financing of property or of some endeavor, in which the investor loaning funds does not own the property or endeavor, nor share in its profits. If property is pledged, or mortgaged, as security for the loan, the investor may claim the property to repay the debt if the borrower defaults on payments. Also see equity investment.

Debt Instruments
Debt instrument represents a contract whereby one party lends money to another on pre-determined terms with regards to rate and periodicity of interest, repayment of principal amount by the borrower to the lender. In Indian securities markets, the term bond is used for debt instruments issued by the Central and State governments and public sector organizations and the term debenture is used for instruments issued by private corporate Sector.

Features of the debt instruments

Each debt instrument has three features: Maturity, coupon and principal. 1. Maturity: Maturity of a bond refers to the date, on which the bond matures, which is the date on which the borrower has agreed to repay the principal. Term-to-Maturity refers to the number of years remaining for the bond to mature. The Term-to-Maturity changes everyday, from date of issue of the bond until its maturity. The term to maturity of a bond can be calculated on any date, as the distance between such a date and the date of maturity. It is also called the term or the tenure of the bond. 2. Coupon: Coupon refers to the periodic interest payments that are made by the borrower (who is also the issuer of the bond) to the lender (the subscriber of the bond). Coupon rate is the rate at which interest is paid, and is usually re presented as a percentage of the par value of a bond.

4. Principal: Principal is the amount that has been borrowed, and is also called the par value or face value of the bond. The coupon is the product of the principal and the coupon rate. The name of the bond itself conveys the key features of a bond. For example, a GS CG2008 11.40% bond refers to a Central Government bond maturing in the year 2008 and paying a coupon of 11.40%. Since Central Government bonds have a face value of Rs.100 and normally pay coupon semi-annually, this bond will pay Rs. 5.70 as sixmonthly coupon, until maturity.

Different Segments in the Debt Market in India

There are three main segments in the debt markets in India, viz., (1) Government Securities, (2) Public Sector Units (PSU) bonds, and (3) Corporate securities. The market for Government Securities comprises the Centre, State and Statesponsored securities. In the recent past, local bodies such as municipalities have also begun to tap the debt markets for funds. Some of the PSU bonds are tax free, while most bonds including government securities are not tax-free. Corporate bond markets comprise of commercial paper and bonds. These bonds typically are structured to suit the requirements of investors and the issuing corporate, and include a variety of tailor- made features with respect to interest payments and redemption.

Participants of the Debt Market

Given the large size of the trades, Debt market is predominantly a wholesale market, with dominant institutional investor participation. The investors in the debt markets are mainly banks, financial institutions, mutual funds, provident funds, insurance companies and corporate.We may subscribe to issues made by the government/corporates in the primary market. Alternatively, We may purchase the same from the secondary market through the stock exchanges.

DERIVATIVES
A specialized security or contract that has no intrinsic overall value, but whose value is based on an underlying security or factor as an index. A generic term that, in the energy field, may include options, futures, forwards, etc.

Types of Derivatives Forwards:

A forward contract is a customized contract between two entities, where settlement takes place on a specific date in the future at todays pre-agreed price.

Futures:
A futures contract is an agreement between two parties to buy or sell an asset at a certain time in the future at a certain price. Futures contracts are special types of forward contracts in the sense that the former are standardized exchangetraded contracts, such as futures of the Nifty index.

Options:
An Option is a contract, which gives the right, but not an obligation, to buy or sell the underlying at a stated date and at a stated price. While a buyer of an option pays the premium and buys the right to exercise his option, the writer of an option is the one who receives the option premium and therefore obliged to sell/buy the asset if the buyer exercises it on him. Options are of two types - Calls and Puts options: Calls give the buyer the right but not the obligation to buy a given quantity of the underlying asset, at a given price on or before a given future date. Puts give the buyer the right, but not the obligation to sell a given quantity of underlying asset at a given price on or before a given future date. Presently, at NSE futures and options are traded on the Nifty, CNX IT, BANK Nifty and 116 single stocks.

Warrants: Options generally have lives of up to one year. The majority of

options traded on exchanges have maximum maturity of nine months. Longer dated options are called Warrants and are generally traded over-the counter.

Option Premium
At the time of buying an option contract, the buyer has to pay premium. The premium is the price for acquiring the right to buy or sell. It is price paid by the option buyer to the option seller for acquiring the right to buy or sell. Option premiums are always paid upfront.

COMMODITY
FCRA Forward Contracts (Regulation) Act, 1952 defines goods as every kind of movable property other than actionable claims, money and securities. Futures trading is organized in such goods or commodities as are permitted by the Central Government. At present, all goods and products of agricultural (including plantation), mineral and fossil origin are allowed for futures trading under the auspices of the commodity exchanges recognized under the FCRA.

Commodity Exchange
A Commodity Exchange is an association, or a company of any other body corporate organizing futures trading in commodities. In a wider sense, it is taken to include any organized market place where trade is routed through one mechanism, allowing effective competition among buyers and among sellers this would include auction-type exchanges, but not wholesale markets, where trade is localized, but effectively takes place through many non-related individual transactions between different permutations of buyers and sellers.

Commodity derivatives market

Commodity derivatives market trade contracts for which the underlying asset is commodity. It can be an agricultural commodity like wheat, soybeans, rapeseed, cotton, etc or precious metals like gold, silver, etc.

Difference between Commodity and Financial derivatives

The basic concept of a derivative contract remains the same whether the underlying happens to be a commodity or a financial asset. However there are some features, which are very peculiar to commodity derivative markets. In the case of financial derivatives, most of these contracts are cash settled. Even in the case of physical settlement, financial assets are not bulky and do not need special facility for storage. Due to the bulky nature of the underlying assets, physical settlement in commodity derivatives creates the need for warehousing. Similarly, the concept of varying quality of asset does not really exist as far as financial underlings are concerned. However in the case of commodities, the quality of the asset underlying a contract can vary at times.

DEPOSITORY
A place where something of value is left for safekeeping. A depository similar to a bank A Discussion A Depository can be compared with a bank, which holds the funds for depositors. An analogy between a bank and a depository may be drawn as follows:

Bank Depository Holds 1. Holds funds in an account Hold securities in an account 2. Transfers funds between accounts on the instruction of the account holder Transfers securities between accounts on the instruction of the account holder. 3. Facilitates transfers without having to handle money facilitates transfers of ownership without having to handle securities. 4. Facilitates safekeeping of money Facilitates safekeeping of shares.

Depositories in India

There are two depositories in India which provide dematerialization of securities. The National Securities Depository Limited (NSDL) and Central Securities Depository Limited (CSDL).

Benefits of participation in a depository

The benefits of participation in a depository are: Immediate transfer of securities No stamp duty on transfer of securities Elimination of risks associated with physical certificates such as bad delivery, fake securities, etc. Reduction in paperwork involved in transfer of securities Reduction in transaction cost Ease of nomination facility Change in address recorded with DP gets registered electronically with all companies in which investor holds securities eliminating the need to correspond with each of them separately Transmission of securities is done directly by the DP eliminating correspondence with companies Convenient method of consolidation of folios/accounts Holding investments in equity, debt instruments and Government securities in a single account; automatic credit into demat account, of shares, arising out of split/consolidation/merger etc.

Meaning of Depository Participant (DP)

The Depository provides its services to investors through its agents called depository participants (DPs). These agents are appointed by the depository with the approval of SEBI. According to SEBI regulations, amongst others, three categories of entities, i.e. Banks, Financial Institutions and SEBI registered trading members can become DPs.

Meaning of Custodian
A Custodian is basically an organisation, which helps register and safeguard the securities of its clients. Besides safeguarding securities, a custodian also keeps track of corporate actions on behalf of its clients: Maintaining a clients securities account Collecting the benefits or rights accruing to the client in respect of securities Keeping the client informed of the actions taken or to be taken by the issue of securities, having a bearing on the benefits or rights accruing to the client.

Dematerialization of physical securities In order to dematerialize physical securities one has to fill in a Demat Request Form (DRF) which is available with the DP and submit the same along with physical certificates one wishes to dematerialize. Separate DRF has to be filled for each ISIN number.

MUTUAL FUNDS
A fund operated by an investment company that raises money from shareholders and invests it in stocks, bonds, options, commodities, or money market securities. These funds offer investors the advantages of diversification and professional management also known as an open-end investment company, to differentiate it from a closed-end investment company. Mutual funds invest pooled cash of many investors to meet the fund's stated investment objective. Mutual funds stand ready to sell and redeem their shares at any time at the fund's current net asset value: total fund assets divided by shares outstanding.

Regulatory Body of Mutual Funds

Securities Exchange Board of India (SEBI) is the regulatory body for all the mutual funds. All the mutual funds must get registered with SEBI.

Benefits of investing in Mutual Funds

There are several benefits from investing in a Mutual Fund:

1. Small investments: Mutual funds help you to reap the benefit of returns
by a portfolio spread across a wide spectrum of companies with small investments.

2. Professional Fund Management: Professionals having considerable

expertise, experience and resources manage the pool of money collected by a mutual fund. They thoroughly analyze the markets and economy to pick good investment opportunities.

3. Spreading Risk: An investor with limited funds might be able to invest in

only one or two stocks/bonds, thus increasing his or her risk. However, a mutual fund will spread its risk by investing a number of sound stocks or bonds. A fund normally invests in companies across a wide range of industries, so the risk is diversified.

4. Transparency: Mutual Funds regularly provide investors with information

on the value of their investments. Mutual Funds also provide complete portfolio disclosure of the investments made by various schemes and also the proportion invested in each asset type.

5. Choice: The large amount of Mutual Funds offer the investor a wide variety
to choose from. An investor can pick up a scheme depending upon his risk/ return profile.

6. Regulations: All the mutual funds are registered with SEBI and they
function within the provisions of strict regulation designed to protect the interests of the investor.

Meaning of NAV
NAV or Net Asset Value of the fund is the cumulative market value of the assets of the fund net of its liabilities. NAV per unit is simply the net value of assets divided by the number of units outstanding. Buying and selling into funds is done on the basis of NAV-related prices. The NAV of a mutual fund are required to be published in newspapers. The NAV of an open-end scheme should be disclosed on a daily basis and the NAV of a close end scheme should be disclosed at least on a weekly basis.

Entry and Exit Load

A Load is a charge, which the mutual fund may collect on entry and/or exit from a fund. A load is levied to cover the up-front cost incurred by the mutual fund for selling the fund. It also covers one time processing costs. Some funds do not charge any entry or exit load. These funds are referred to as No Load Fund. Funds usually charge an entry load ranging between 1.00% and 2.00%. Exit loads vary between 0.25% and 2.00%. For e.g. Let us assume an investor invests Rs. 10,000/- and the current NAV is Rs.13/-. If the entry load levied is 1.00%, the price at which the investor invests is Rs.13.13 per unit. The investor receives 10000/13.13 = 761.6146 units. (Note that units are allotted to an

investor based on the amount invested and not on the basis of no. of units purchased). Let us now assume that the same investor decides to redeem his 761.6146 units. Let us also assume that the NAV is Rs 15/- and the exit load is 0.50%. Therefore the redemption price per unit works out to Rs. 14.925. The investor therefore receives 761.6146 x 14.925 = Rs.11367.10.

Risks involvement in investing in Mutual Funds

Mutual Funds do not provide assured returns. Their returns are linked to their performance. They invest in shares, debentures, bonds etc. All these investments involve an element of risk. The unit value may vary depending upon the performance of the company and if a company defaults in payment of interest/principal on their debentures/bonds the performance of the fund may get affected. Besides incase there is a sudden downturn in an industry or the government comes up with new a regulation which affects a particular industry or company the fund can again be adversely affected. All these factors influence the performance of Mutual Funds. Some of the Risk to which Mutual Funds are exposed to is given below:

Market risk
If the overall stock or bond markets fall on account of overall economic factors, the value of stock or bond holdings in the fund's portfolio can drop, thereby impacting the fund performance.

Non-market risk
Bad news about an individual company can pull down its stock price, which can negatively affect fund holdings. This risk can be reduced by having a diversified portfolio that consists of a wide variety of stocks drawn from different industries.

Interest rate risk

Bond prices and interest rates move in opposite directions. When interest rates rise, bond prices fall and this decline in underlying securities affects the fund negatively.

Credit risk
Bonds are debt obligations. So when the funds invest in corporate bonds, they run the risk of the corporate defaulting on their interest and principal payment obligations and when that risk crystallizes, it leads to a fall in the value of the bond causing the NAV of the fund to take a beating.

Types of Mutual funds

Mutual funds are classified in the following manner:

(a) On the basis of Objective

Equity Funds or Growth Funds Funds that invest in equity shares are called equity funds. They carry the principal objective of capital appreciation of the investment over the medium to long-term. They are best suited for investors who are seeking capital appreciation. There are different types of equity funds such as Diversified funds, Sector specific funds and Index based funds.

Diversified funds
These funds invest in companies spread across sectors. These funds are generally meant for risk-averse investors who want a diversified portfolio across sectors.

Sector funds
These funds invest primarily in equity shares of companies in a particular business sector or industry. These funds are targeted at investors who are bullish or fancy the prospects of a particular sector.

Index funds
These funds invest in the same pattern as popular market indices like S&P CNX Nifty or CNX Midcap 200. The money collected from the investors is invested only in the stocks, which represent the index. For e.g. a Nifty index fund will invest only in the Nifty 50 stocks. The objective of such funds is not to beat the market but to give a return equivalent to the market returns.

Tax Saving Funds

These funds offer tax benefits to investors under the Income Tax Act. Opportunities provided under this scheme are in the form of tax rebates under the Income Tax act.

Debt/Income Funds
These funds invest predominantly in high-rated fixed-income-bearing instruments like bonds, debentures, government securities, commercial paper and other money market instruments. They are best suited for the medium to long-term investors who are averse to risk and seek capital preservation. They provide a regular income to the investor.

Liquid Funds/Money Market Funds

These funds invest in highly liquid money market instruments. The period of investment could be as short as a day. They provide easy liquidity. They have emerged as an alternative for savings and short term fixed deposit accounts with comparatively higher returns. These funds are ideal for corporates, institutional investors and business houses that invest their funds for very short periods.

Gilt Funds
These funds invest in Central and State Government securities. Since they are Government backed bonds they give a secured return and also ensure safety of

the principal amount. They are best suited for the medium to long-term investors who are averse to risk.

Balanced Funds
These funds invest both in equity shares and fixed-income-bearing instruments (debt) in some proportion. They provide a steady return and reduce the volatility of the fund while providing some upside for capital appreciation. They are ideal for medium to long-term investors who are willing to take moderate risks.

b) On the basis of Flexibility Open-ended Funds

These funds do not have a fixed date of redemption. Generally they are open for subscription and redemption throughout the year. Their prices are linked to the daily net asset value (NAV). From the investors' perspective, they are much more liquid than closed-ended funds.

Close-ended Funds
These funds are open initially for entry during the Initial Public Offering (IPO) and thereafter closed for entry as well as exit. These funds have a fixed date of redemption. One of the characteristics of the close-ended schemes is that they are generally traded at a discount to NAV; but the discount narrows as maturity nears. These funds are open for subscription only once and can be redeemed only on the fixed date of redemption. The units of these funds are listed on stock exchanges (with certain exceptions), are tradable and the subscribers to the fund would be able to exit from the fund at any time through the secondary market.

Different rights that are available to a Mutual Fund holder in India

As per SEBI Regulations on Mutual Funds, an investor is entitled to:

1. Receive Unit certificates or statements of accounts confirming your title within 6 weeks from the date your request for a unit certificate is received by the Mutual Fund. 2. Receive information about the investment policies, investment objectives, financial position and general affairs of the scheme. 3. Receive dividend within 42 days of their declaration and receive the redemption or repurchase proceeds within 10 days from the date of redemption or repurchase. 4. The trustees shall be bound to make such disclosures to the unit holders as are essential in order to keep them informed about any information, which may have an adverse bearing on their investments. 5. 75% of the unit holders with the prior approval of SEBI can terminate the AMC of the fund. 6. 75% of the unit holders can pass a resolution to wind-up the scheme. 7. An investor can send complaints to SEBI, who will take up the matter with the concerned Mutual Funds and follow up with them till they are resolved.

REGULATOR
Need of Regulators in Securities Market
The absence of conditions of perfect competition in the securities market makes the role of the Regulator extremely important. The regulator ensures that the market participants behave in a desired manner so that securities market continues to be a major source of finance for corporate and government and the interest of investors are protected.

Regulation of the Securities Market

The responsibility for regulating the securities market is shared by Department of Economic Affairs (DEA), Department of Company Affairs (DCA), Reserve Bank of India (RBI) and Securities and Exchange Board of India (SEBI).

SEBI (Securities and Exchange Board of India)

The Securities and Exchange Board of India (SEBI) is the regulatory authority in India established under Section 3 of SEBI Act, 1992. SEBI Act, 1992 provides for establishment of Securities and Exchange Board of India (SEBI) with statutory powers for (a) protecting the interests of investors in securities (b) promoting the development of the securities market and (c) regulating the securities market. Its regulatory jurisdiction extends over corporate in the issuance of capital and transfer of securities, in addition to all intermediaries and persons associated with securities market. SEBI has been obligated to perform the aforesaid functions by such measures as it thinks fit. In particular, it has powers for: Regulating the business in stock exchanges and any other securities markets Registering and regulating the working of stock brokers, subbrokers etc. Promoting and regulating self-regulatory organizations Prohibiting fraudulent and unfair trade practices Calling for information from, undertaking inspection, conducting inquiries and audits of the stock exchanges, intermediaries, self regulatory organizations, mutual funds and other persons associated with the securities market.

DATABASE AND METHODOLOGY

Database
1) Primary sampling 2) Questionnaire Selection 3) Secondary Sources

PRIMARY SAMPLING

WHAT IS MARKETING RESEARCH?

Marketing research is a set of technique and principle for systematically collecting, recording, analyzing and interpreting data that can aid decision makers involved in marketing goods, services and ideas. Marketing research is the functions which links the consumers, customers and public to marketer through information (information use to identify and define marketing opportunities and problems, generates refine and evaluates marketing problems, monitoring performance sand improve understanding of marketing as a process.

Marketing research involves:-

Gathering data from the market. Conducting customer surveys. Determining the needs of the customers. Evaluating customer responses. Gathering sales and market share data. Testing the product and policies.

MAJOR STEPS IN MARKETING RESEARCH PROCESS.

The major steps in the marketing research process are as following

Step 1- Justify the need of marketing research. Step 2- Define the research objective. Step 3- Identify the data need. Step 4- Identify the data source. Step 5- Choose an appropriate research design and data collection method. Step 6- Design the research instrument. Step 7- Identify the sample. Step 8- Collect data from relevant source. Step 9- Analyze and interpreter the data. Step 10- Presentation of research findings.

TYPES OF MARKETING RESEARCH

Research may be classified under following

1) EXPLORATORY RESEARCH Exploratory research aims to develop initial hunches and provide directions for any future research needed. The primary purpose is to through light on nature of a situation and identifies any specific objectives through additional research. It is most useful when a decision maker wishes to better understand the situation or to identify decision alternatives. Exploratory research technique includes the following Focus Group Interview. Observation

2) CONCLUSIVE RESEARCHConclusive research is intended to verify insight and aid decision maker in selecting a specific course of action. Its primary purpose is to help decision maker to choose the best course of action in a situation.

.TYPES

OF CONCLUSIVE RESEARCH

Conclusive research is further divided into following categories

1) Descriptive research Descriptive research aims at describing something. Data collected through descriptive research provides valuable information about the unit under study. Descriptive research is further classified into

Cross sectional research-

It is one time study involving data collection at a single period of time. Here the sample is not repeated for again and again for the data collection.

Longitudinal research-

the data collection over a Longitudinal research involves the repetition of the same sample for period of time.

2) Experimental research Experimental research is also known as causal research and it allows one to make causal inferences about relationships among variables.

TYPES OF DATA
Data can be classified as below Primary data Secondary data

1) Primary data: Primary data are to be collected by the researcher , they are not present in reports or journals e.t.c and can be collected through a number of method which can be classified as follow

Personal interview of sample. Telephonic interview. E- Mails. Observations. Questionnaires. Interviews.

2) Secondary data: -

Secondary data are the data collected for some purpose other than the research situation; such data are available from the sources such as books, company reports, journals, rating organization, census department e.t.c . The

secondary data are readily available and therefore they are less costly and less time consuming. Sources of secondary data are

Internets. Book and Journals. Company reports. Census department. Research work of others.

METHODOLOGY USED FOR THE STUDY

The methodology used in the study is analytical. A survey was done in different parts of DELHI to ascertain the facts about share trading and its sale process, and promotion in the market. This project is mainly based on the primary data and information beside this secondary data is also used.

Sampling method adopted

Sampling method adopted for the study was Non Probability sampling. Non Probability sampling is a subjective procedure in which the probability of selection for the population units cannot be determined Both convenience and judgment sampling is used for the study purpose.

Convenience sampling: -

Here the researcher convenience forms the basis for selecting a sample unit. During my project I had collected data from different type of respondents.

Judgment sampling: -

Judgment sampling is a procedure in which a researcher exerts some efforts in selecting a sample that he or she believes is most appropriate for the study. During the project study the required data is also collected from the officials of Moti Share Broker Ltd. , which may provide a clear picture

SAMPLE SIZE- 100 RESPONDENTS

The main methodology used in this study is as follow
1) MARKET SURVEY (FIELD OBSERVATION):-

The information regarding market share, consumer behavior and availability of different product of Moti Share Broker Ltd. have been collected with the use of questionnaire and by interviewing different customer, business honchos, and officials directly.

QuestionnaireTo know about the consumer perception about share trading with respect to the facilities and effectiveness, e.t.c a questionnaire was framed out. After proper approval from the project guide and concerned authority it was taken in market for study. The questionnaire includes both open ended and closed ended question to get proper response from the consumer. It was an attempt to give and take information about share trading and to further promotes the sale and to collect the data about what changes a consumer wants.

2) DOCUMENTARY OBSERVATION: The information has been collected from secondary sources also, which include magazine, journals, company reports and other published sources. The secondary data are taken from the following sources Websites Business magazine Books

Note- All the data are properly discussed with staff and officials of Moti Share Broker Ltd. and with my Project guide along with the fellow trainees.

LIMITATIONS OF STUDY

The authorities of the marketing department of Moti Share Broker Ltd. provided me with the necessary information about the CONSUMER BEHAVIOUR AND SALE PROMOTION, ALONG WITH MARKET SHARE AND DISTRIBUTION PATTERN of the company. However there were some basic problems which could not be avoided. A few limitations are listed below.

1) The time factor was the most important limitation; the lack of availability of time on the part of authorities of the company and other concerned person as well as customers was one of the important limitations. 2) There were few people who were not prepared to give true facts. This had posed a problem. 3) In order to maintain the policy of secrecy the authority of company had not provided some data and information. 4) In order to maintain the policy of secrecy the authority of company had not provided data about financial gain from a particular promotion schemes.

This study was carried out within the geographical limits of JAIPUR. Despite having above limitation, I had tried my best to come nearest to the fact in preparing the report.

.CONSUMER BEHAVIOUR
Consumer behavior is the behavior that consumer displays in searching for purchasing, using, evaluating, and disposing of the product and service that they expect will satisfy their needs. It focuses on how individual make decision to spend their available resources (time, effort and money) on consumption related items, which it includes

Why they buy. Where they buy.

What they buy.

When they buy.

How often they buy. How often they use

. As customers are the king and they are the factor around whom sales of a product revolve and hence the market share is affected so it is very important that product of a company should be able to fulfill the customer expectations that it should be able to balance the experience and expectation. Therefore the main concentration is to maintain the size of existing customer and to raise the satisfaction level of defectors so that the number of loyalist of the company would increase and hence the market share shows a positive change and which finally increase the profitability. A loyal consumer is very important as

Loyal customer buys more products. They pay less attention to competitors advertisement Servicing existing customers who are companies offering and process is cheaper familiar with the

Loyal customer spread positive word of mouth.

SALES PROMOTION
Any action or decision which helps to promote the sale is sales promotion. The basic aim of the activities which come under this section is to attract customer. All the effort made by the officials of sharekhan ltd to increase the sale forms the part of sales promotion Thus in ordinary terms sales promotion includes personal selling, advertisement, public relation and supplementary selling activity e.t.c.

OBJECTIVES OF SALES PROMOTION AT Moti Share Broker Ltd.

Following are the important objectives of sales promotion at Sharekhan Ltd Providing Information to Customers or already existing clients. To increase sales volume regarding demat accounts. To face competition offered by other trading houses. To attract new customers for the company. To induce present customer to invest more in shares.

IMPORTANCE OF PROMOTIONAL ACTIVITIES

The importance of promotional activities is as following

For facing the imperfect and uneven market tactfully. For shortening the distance between the sharekhan and customer

Contents:-

QUESTIONNAIRE SELECTION HOW TO ANALYZE

FINDINGS AND ANALYSIS

1) What is your most preferred investment mode? a) Insurance Plans c) Stock market and mutual funds b) Bank fixed and current deposited d) Real estate

Ins. Plans= 25% Bank deposit= 40% Stock market= 20% Real estate= 10%

2) Are you aware about investment in share market? a) Yes b) No

yes=80% no=20%

3) Are you risk averse? a) Yes b) No

Yes= 20% No= 80%

4)

In case you do not invest in shares what is your perceived problem? a) Risk factor c) Lack of knowledge b) Previous bad experience d) Time constraints

Rf= 20% Bad. Exp.= 10% Lack of know.=40% Time const= 30%

5) What type of trading you are involved into? a) On line b) Off line

On line= 60% Off line= 40%

6) Are you satisfied with your broker? a) Yes b) No

Yes= 70% No= 30%

7) How frequently do you trade? a) Daily c) 2-3 times a month b) 2-3 times a week d) No set pattern of trading

Daily= 5% 2-3 times a week=20% 2-3 times a month= 15% No pattern= 60%

8) What is your preferred trading mode? a) Delivery b) Intra day

Delivery= 70% Intraday= 30%

9) Are you interested in opening an account which offers you facility of online trading, online fund transfer, online IPO and demat account at low brokerage? a) Yes b) No

Yes= 90% No= 10%

EXPLANATION OF THE FINDINGS

The survey was done among 100 respondents and these respondents involve persons from various categories. Respondents were business official, government official, layman and businessmen.

Very simple, lucid language has been used in the preparation of questionnaire so that even a layman will find it easy to understand.

After the completion of survey an analysis of each question has been done so as to find the basic reason behind investors perception to invest in shares. This analysis will help Sharekhan Ltd. to understand the liking and disliking of investors about various schemes. This will also help Sharekhan Ltd to target more market share with the help of effective policies and strategies.

Analysis -- Question no 1
The most preferred answer given by the investors was bank fixed and recurring deposits. This is mainly because these banks fixed and recurring deposits are the safest mode of investment. Even if they are not getting high returns through this mode of investment but they preferred it as it involves no risk in it.

Second most preferred option is insurance plans as every person wants to ensure his future or want to involve in any form of tax saving schemes. Every fourth person of 100 respondents chose insurance plans as his second investment mode.

Now when it comes to stock market, investments in this mode are very popular only because of high returns. It involves both type of risks, high and low. Thats why this mode of investment varies from different category of investors. Adequate knowledge about securities and non-devotion of proper time is another reason that it is ranked third in the investors opinion. An investment in real estates is the least preferred option among investors as it involves very huge investments. Returns are very high but risk is not as compared to stock markets. Other involves national savings scheme, corporate bonds, post offices schemes etc are the least preferred option.

Analysis --Question no 2

80% of the total 100 respondents are aware of investing in share market. Here word "awareness" can also be divided into different categories. 1) First category belongs to those persons who are having very basic knowledge about stock market.

2) Second category of awareness belongs to those persons who get their trading done through brokers. These category of investors do not have complete knowledge about securities but want to involve in huge investment and high returns.

3) Investors from third category of awareness are those who trade on their own and have very high level of knowledge about shares and stock market. Chartered accountants, doctors, and business honchos fall under this category.

Analysis --Question no 3

Out of the 40 investors only 20% of the investors were risk averse. These risk averse players want to deal in intraday mode as well as in derivatives. These investors do not hesitate to invest a huge amount. There returns are very much affected by the movements of sensex, nifty and other stock indices.

Rest of the 80% that is 32 investors want to play safe. They usually play in delivery mode. Whenever the value of sensex or nifty moves down ,they hold the shares and wait to sell them until the value of indices increases. But the returns are not so good as compare in intraday trading.

Analysis -- question no 4
Only 80% I found that only 40 respondents who do not want to invest in shares reveals lack of knowledge as the most perceived problem. From rest of the 40 respondents were involved with different different trading houses . Another set of respondents were not inclined in share trading because of the high risk associated with it.

Some investors have faced huge losses or they have invested for the shorter period but did not get equal rewards. Numbers of investors who do not want to invest in shares due to various reasons are as follows----Due to risk factor-----20% of the total non investors=20% of 40=8 Due to Bad Experience------10% of non investors=10% of 40 = 4 Due to lack of knowledge------40% of 40 =1 6 Due to time constraints---------30% of 40 = 12

Analysis -- question no 5

The analysis to this question can be linked with the previous question. out of 40 respondents,24 respondents were involved into online trading and 16 into offline trading. Here offline trading refers to dial and trade facility given by their trading houses and their brokers.

Lack of knowledge and constraints of time were the main cause of chosing offline trading by the investors. Offline trading is time saving but it does not rewards big and handsome returns. Where as in online trading we can invest in intraday mode which offers high returns as well as high risk and as well as in delivery mode.

Analysis -- question no 6
Satisfaction with the brokerage house or brokers includes various aspects. These parameters are as follows Brokerage given to the investors Exposure limits Information given to the investors.

Weekly and monthly reports about capital markets. Sms facilities Live terminal Dial and trade facility. Net banking

70% of the responses were positive that means 28 respondents were satisfied with their brokerage house. But 15 still seems to be unhappy. If proper guidance and facilities is given to these respondents it would be easy to attract these clients to Sharekhan Ltd.

Analysis -- question no 7
Every trading house seeks that category of investors who trade frequently or in a daily basis. Only 5% of the 40 respondents that is 2 customers were involved in daily trading. as this number is very low so trading houses should frame their policies and

facilities in such a way so that every investor would feel comfortable in trading on daily basis. Rest of th calculations has been done in the following mannerNo of investors who trade on daily basis---5% of 40 = 2 No of investors who trade 2-3 times a week------20%of 40=8 No of investors who trade 2-3 times a month-----15% of 40=6 No of investors who do not have a proper pattern of trading=60% of 40=24

Analysis -- question no 8
Investments in shares are done in two mode .These two modes are as follows 1) Delivery 2) Intraday

This question will again help to categorize investors. Investors who are engaged with intraday trading are usually offered less brokerage than delivery by their trading houses.intraday trading involves very high returns. Brokerage offered in intraday trading lies between 0 paise to 10 paise. As low risk is involved in delivery trading brokerage lies between 20 paise to 50 paise in delivery. So optimum level of brokerage that brokerage house should offered lie between 0 paise to 5 paise in intraday and 10 paise to 20 paise in delivery to attract investors in trading. Here 12 respondents were involved in intraday and 28 investors were involved in delivery trading.

Analysis -- question no 9
Ninety percent of the respondents answered in positive where as only ten percent respondents replied negative as they want savings accounts as an extra facility.

Now a days ICICI, ABN Amro , Kotak bank are the leading banks who offers three in one saving account.

RESULTS AND DISCUSSIONS

Result:After the proper collection, analysis and tabulation of data following Conclusion has been drawn-

Moti Share Broker Ltd. leads by large margin. The probable reason behind this result are Effective communication between sharekhan and its investors. Freedom of paperwork- maximum part of paperwork is done by Moti Share Broker officials. Integrated trading bank and Demat account (auto paying and payout of securities) with digital contracts removes all paperwork. Exposure-attractive exposures which are up to 8 times are being given to investors. Instant credit And Transfer-instant transfer of funds from bank accounts. (Moti Sharen Broker Ltd. has tie up with 8 banks) to trading account. Dial and Trade -Two toll free number are given to place order through Moti Share Broker Ltd. telebrokers which saves investors time and it is also a troubleshooter to non-accessibility of investors access to internet. Timely advice-make informed decisions with expert advice, investment calls and live market commentary. Real time portfolio tracking-benefit from real-tim information of your investment and current portfolio value. After our orders-place orders after market hours, which get executed as son as the markets open.

DISCUSSION
I strongly believe that a well functioning securities market is conducive to sustained economic growth. There have a number of studies, starting from World Bank and IMF to various scholars, which have established robust relationship not only one way, but also the both ways, between the development in the securities market and the economic growth. An important study by Ross Levine and Sara Zervos (1996) finds that the stock market development is highly significant statistically in forecasting future growth of per capita GDP. Their regressions forecast that if Mexico or Brazil were to obtain stock markets as advanced as Malaysia, then they might obtain an additional per capita GDP growth per year of 1.6%. This happens, as market gets disciplined / developed/ efficient, it avoids the allocation of scarce savings to low yielding enterprises and forces the enterprises to focus on their performance which is being continuously evaluated through share prices in the market and which faces the threat of takeover. Thus securities market converts a given stock of investible resources to a larger flow of goods and services. The securities market fosters economic growth to the extent that it(a) Augments the quantities of real savings and capital formation from any given level of national income, (b) Increases net capital inflow from abroad, (C) Raises the productivity of investment by improving allocation of investible Funds. (d) Reduces the cost of capital. The securities market provides a bridge between ultimate savers and ultimate investors and creates the opportunity to put the savings of the cautious at the

disposal of the enterprising, thus promising to raise the total level of investment and hence of growth. The indivisibility or lumpiness of many potentially profitable but large investments reinforces this argument. These are commonly beyond the financing capacity of any single economic unit but may be supported if the investor can gather and combine the savings of many. Moreover, the availability of yield bearing securities makes present consumption more expensive relative to future consumption and, therefore, people might be induced to consume less today. The composition of savings may also change with fewer saving being held in the form of idle money or unproductive durable assets, simply because more divisible and liquid assets are available. The securities market facilitates the internationalization of an economy by linking it with the rest of the world. This linkage assists through the inflow of capital in the form of portfolio investment. Moreover, a strong domestic stock market performance forms the basis for well performing domestic corporate to raise capital in the international market. This implies that the domestic economy is opened up to international competitive pressures, which help to raise efficiency. It is also very likely that existence of a domestic securities market will deter capital outflow by providing attractive investment opportunities within domestic economy. Any financial development that causes investment alternatives to be compared with one another produces allocation improvement over a system of segregated investment opportunities. They provide a convenient market place to which investors and issuers of securities go and thereby avoid the need to search a suitable counterpart. The market provides standardized products and thereby cuts the information costs associated with individual instruments. The market institutions specialize and operate on large scale, which cuts costs through the use of tested procedures and routines. There are also other developmental benefits associated with the existence of a securities market. First, the securities market provides a fast-rate breeding ground for the skills and judgment needed for entrepreneurship, risk bearing, portfolio selection and management. Second, an active securities market serves as an engine of general financial development and may, in particular, accelerate the integration

of informal financial systems with the institutional financial sector. Securities directly displace traditional assets such as gold and stocks of produce or, indirectly, may provide portfolio assets for unit trusts, pension funds and similar FIs that raise savings from the traditional sector. Third, the existence of securities market enhances the scope, and provides institutional mechanisms, for the operation of monetary and financial policy.

IMPLICATION OF THE STUDY This study can help the investors who are new in the market. This study also helps in finding how to invest in capital market whether to trade offline or online. This study give us right direction to invest in the market Give us scope in equity market as well as commodity market Provide us best research Provide the scope for investments Give us suitable opinion according to the customer And most, this study emphasize on :-

RECOMMENDATIONS

On the basis of the study undertaken I would like to recommend the following points.

Displays like hoardings, posters banners should increase so that the investor come to know about the different schemes of investments in shares. This will ultimately result in increase in sale.

Equal facilities should be given to big and small investors to maintain equality between them.

Daily and weekly feedback of investors should be taken in order to know about their actual problems

Attractive prices and emoluments should be offered to sharekhan officials to motivate them hence resulting in increase in sales.

Healthy working environment should be maintained to motivate employees towards their goal accomplishment.

A balanced team should be formed to meet the daily and weekly targets.

CONCLUSION
Indian economy globalizes and the capital market has been linked to the international financial market. Foreign individuals and institutional investors are now encouraged to participate into it. So, there is a need for raising the Indian Capital market in to the international standards in terms of efficiency and

transparency. One such measure is the passing out of the Depository Act in the year 1996. Dematerialization of securities is one of the major steps aimed at improving and modernizing the capital market and enhancing the levels of investors protection measures which aims at eliminating the bad deliveries and forgery of shares and expediting the transfer of shares. This study is giving the clear picture about the security market. It gives the meaning of primary and secondary market. The study is helpful to understand the different type of securities available in the market. It made clear the meaning of stock exchange where the companies are listed and issue the security for buying and selling like shares, debenture, bonds, and government securities etc. how one can invest in these securities. There are two procedures are available. One is old procedure and second is new procedure. In old procedure one can purchase securities in physical form. Issue of securities is along term process on the other hand new procedure or modern procedures one can purchase securities in demat form through DPs. DPs and stock exchange follow some rules and regulations, which made by regulatory body known as SEBI (Security and Exchange Board of India). It is a governing body to regulate the working of security market and function DPs. It also protects the right of the investors.

ANNEXURE

Bibilography

www.wikipedia.org www.Motisharebroker.com www.shareinfoline.com www.google.com search.yahoo.com Securities Market (Basic) Module: NCFM Economic Times.

MBA-IIYear(IV Sem)