Hpd Annova

8/12/2019 Hpd Annova

1/89

CHAPTER-I

INTRODUCTION

1.1. INTRODUCTION TO THE STUDY

The main idea behind the study conducted was to find out the investors preference of

commodity market with reference to Share khan Financial Services Pvt. Ltd, Gobi.

This study should deal with the investors preference from commodity market. To

identify the investors preference means, it should find out the characteristics of investors who

invest under the uidance of different share brokers. !t also should concentrate on whether they

are satisfied with the services and earnins from the commodity market to provided by theinvestment an also by the brokers service.

They will be e"pectin different types of commodities from their investment uide.

Some of them may not be satisfied with their service and the information they ive. #y aim is

to find out the investors preference from commodity market of the investors from their share

brokers. $ow is investors satisfaction from commodity market satisfaction level can be

improved by providin better services. %eepin all these thins in mind the primary and

secondary ob&ectives of the study are set.

MEANING OF INVESTOR:

'n investoris any party that makes an investment.The term has taken on a specific

meanin in financeto describe the particular types of people and companies that reularly

purchase e(uityor debt securitiesfor financial ain in e"chane for fundinan e"pandin

company.

Less fre(uently, the term is applied to parties who purchase real estate, currency, commodity

derivatives, personal property,or other assets. The term implies that a party purchases and

holds assets in hopes of achievin capital ainor cash flow,not as a professionor for short)

term income.

1
http://en.wikipedia.org/wiki/Investmenthttp://en.wikipedia.org/wiki/Financehttp://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Bond_(finance)http://en.wikipedia.org/wiki/Fundinghttp://en.wikipedia.org/wiki/Real_estatehttp://en.wikipedia.org/wiki/Commodityhttp://en.wikipedia.org/wiki/Commodityhttp://en.wikipedia.org/wiki/Assetshttp://en.wikipedia.org/wiki/Capital_gainhttp://en.wikipedia.org/wiki/Cash_flowhttp://en.wikipedia.org/wiki/Cash_flowhttp://en.wikipedia.org/wiki/Professionhttp://en.wikipedia.org/wiki/Incomehttp://en.wikipedia.org/wiki/Incomehttp://en.wikipedia.org/wiki/Financehttp://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Bond_(finance)http://en.wikipedia.org/wiki/Fundinghttp://en.wikipedia.org/wiki/Real_estatehttp://en.wikipedia.org/wiki/Commodityhttp://en.wikipedia.org/wiki/Commodityhttp://en.wikipedia.org/wiki/Assetshttp://en.wikipedia.org/wiki/Capital_gainhttp://en.wikipedia.org/wiki/Cash_flowhttp://en.wikipedia.org/wiki/Professionhttp://en.wikipedia.org/wiki/Incomehttp://en.wikipedia.org/wiki/Investment


2/89

T!es o" investors:

$ere is an overlappin, non)e"clusive list of investor types*

!ndividual investors +includin trusts on behalf of individuals, and umbrella companiesformed for two or more to pool investment funds.

-ollectors of art, anti(ues,and other thins of value.

'nel investors,either individually or in roups.

enture capital funds, which serve as investment collectives on behalf of individuals,

companies, pension plans, insurance reserves, or other funds.

!nvestment banks.

/usinessesthat make investments, either directly or via a captive fund

!nvestment trusts, includin real estate investment trusts

#utual funds, hede funds,and other funds, ownership of which may or may not be

publicly traded +these funds typically pool money raised from their owner)subscribers to

invest in securities

Soverein wealth funds

Co##o$it M%r&et is an orani0ed traders1 e"chane in which standardi0ed, raded products

are bouht and sold. 2orldwide, there are 34 ma&or commodity e"chanes that trade over 56

commodities, ranin from wheat and cotton to silver and oil. #ost tradin is done in futures

contracts, that is, areements to deliver oods at a set time in the future for a price established

at the time of the areement.

Tradin of S7P 899 and other financial futures has broken down some of the

barriers that once separated stock, bond, and commodity markets and made it easier for

2
http://en.wikipedia.org/wiki/Trust_(property)http://en.wikipedia.org/wiki/Collectinghttp://en.wikipedia.org/wiki/Arthttp://en.wikipedia.org/wiki/Angel_investorshttp://en.wikipedia.org/wiki/Investment_bankshttp://en.wikipedia.org/wiki/Businesseshttp://en.wikipedia.org/wiki/Investment_trusthttp://en.wikipedia.org/wiki/Real_estate_investment_trusthttp://en.wikipedia.org/wiki/Mutual_fundshttp://en.wikipedia.org/wiki/Publicly_tradedhttp://en.wikipedia.org/wiki/Sovereign_wealth_fundhttp://en.wikipedia.org/wiki/Trust_(property)http://en.wikipedia.org/wiki/Collectinghttp://en.wikipedia.org/wiki/Arthttp://en.wikipedia.org/wiki/Angel_investorshttp://en.wikipedia.org/wiki/Investment_bankshttp://en.wikipedia.org/wiki/Businesseshttp://en.wikipedia.org/wiki/Investment_trusthttp://en.wikipedia.org/wiki/Real_estate_investment_trusthttp://en.wikipedia.org/wiki/Mutual_fundshttp://en.wikipedia.org/wiki/Publicly_tradedhttp://en.wikipedia.org/wiki/Publicly_tradedhttp://en.wikipedia.org/wiki/Sovereign_wealth_fund


3/89

investors to hede their stock investments. -ritics chare that the futures tradin at the

commodity markets in -hicao have made stock prices more volatile.

The -hicao /oard of Trade is the larest futures and options e"chane in the

:nited States, the larest in the world is ;ure", an electronic ;uropean e"chane.

T!es o" tr%$ers in % $eriv%tives #%r&et:

He$'ers:

$eders are those who protect themselves from the risk associated with the price of

an asset by usin derivatives. ' person keeps a close watch upon the prices discovered in

tradin and when the comfortable price is reflected accordin to his wants, he sells futurescontracts. !n this way he ets an assured fi"ed price of his produce.

!n eneral, heders use futures for protection aainst adverse future price movements

in the underlyin cash commodity. $eders are often businesses, or individuals, who at one

point or another deal in the underlyin cash commodity. Take an e"ample* ' $eder pay more

to the farmer or dealer of a produce if its prices o up. For protection aainst hiher prices of

the produce, he hedes the risk e"posure by buyin enouh future contracts of the produce to

cover the amount of produce he e"pects to buy. Since cash and futures prices do tend to move

in tandem, the futures position will profit if the price of the produce raise enouh to offset cash

loss on the produce.

S!e()*%tors:

Speculators are some what like a middle man. They are never interested in actualowin the commodity. They will &ust buy from one end and sell it to the other in anticipation of

future price movements. They actually bet on the future movement in the price of an asset.

They are the second ma&or roup of futures players. These participants include independent

floor traders and investors. They handle trades for their personal clients or brokerae firms.

/uyin a futures contract in anticipation of price increases is known as


4/89

futures contract in anticipation of a price decrease is known as


5/89

'n individual or a firm who anticipates the need for a certain commodity in the future or a

person who plans to ac(uire a certain commodity later also has a position in that commodity. !n

many cases, the heder has a certain hedin hori0on = the future date when the hede will

terminate. The hede can be a lon hede or a short hede. !f the heder buys futures contract

to hede, it will be a *on' +e$'e.

For e"ample, a roller flourmill owner may like to lock)in the price of the wheat that

he wants to purchase three months later by purchasin wheat futures. !f three months later the

wheat prices rise, carryin futures prices alon with them, the flourmill owner will purchase

wheat from the spot market at a hiher price. The loss that he may suffer in the cash market

will be compensated by sale of futures at a hiher price. Similarly, a farmer can sell three)

month futures at the prevailin price and lock)in his profits at that level. !f the prices fall, theloss suffered by the farmer in the cash market will be compensated by the profit that the farmer

will earn by s(uarin the transaction in the futures market.

!n practice, hedin solutions are not as neat as the ones described above. !n the

above e"ample, the oods in (uestion were e"actly the same both in the cash and the futures

market, the amounts purchased > sold in the cash market matched the futures contract amounts,

and the hedin hori0ons of the farmer and the mill owner matched the delivery dates of the

futures contracts. !t will be rare for all factors to match perfectly? they will differ in time span

covered, the amount of commodity or the physical characteristics of the commodity that are

traded in the cash and the futures markets. Such hedes are known as (ross-+e$'es. !n such

cases, the heder must trade the riht number and kind of futures contract to control the risk in

heded positions as much as possible. There can be situations where the heder does not have

any definite hedin hori0on and may enter into what is known as ris&-#ini#iin' +e$'e.

The heder has many incentives. Ta" is a ma&or incentive. !n an un)heded situation,

the profits fluctuate widely and the person > firm may have to pay ta"es in the hih profit years

while he is not able to utili0e the ta" credits when he runs into losses. $edin also serves to

minimi0e the cost of financial distress. 2idely fluctuatin profits may drive many persons >

firms to bankruptcy. !n an ideali0ed world with no transaction costs, which is inhabited by

5


6/89


7/89


8/89

This article focuses on the history and current debates reardin lobal commoditymarkets. !t

covers physical product +food, metals, and electricity markets but not the ways that services,

includin those of overnments, nor investment, nor debt, can be seen as a commodity. 'rticles

onreinsurance markets,stock markets,bond marketsandcurrency marketscover those

concerns separately and in more depth. Dne focus of this article is the relationship between

simplecommodity moneyand the more comple" instruments offered in the commodity

markets.

1. Histor

The modern commodity markets have their roots in the tradin of aricultural

products. 2hile wheat and corn, cattle and pis, were widely traded usin standard instruments

in the E5th century in the :nited States, other basic foodstuffs such as soybeans were only

added (uite recently in most markets. For a commodity market to be established there must be

very broad consensus on the variations in the product that make it acceptable for one purpose or

another.

The economic impact of the development of commodity markets is hard to

overestimate. Throuh the E5th century the e"chanes became effective spokesmen for, and

innovators of, improvements in transportation, warehousin, and financin, which paved theway to e"panded interstate and international trade.

E%r* +istor o" (o##o$it #%r&ets

$istorically, datin from ancient Sumerianuse of sheep or oats, other peoples usin

pis, rare seashells, or other items as commodity money, people have souht ways to

standardi0e and trade contracts in the delivery of such items, to render trade itself more smooth

and predictable.

-ommodity money and commodity markets in a crude early form are believed to

have oriinated in Sumerwhere small baked clay tokens in the shape of sheep or oats were

8
http://en.wikipedia.org/wiki/Commodityhttp://en.wikipedia.org/wiki/Reinsurance_markethttp://en.wikipedia.org/wiki/Reinsurance_markethttp://en.wikipedia.org/wiki/Reinsurance_markethttp://en.wikipedia.org/wiki/Stock_markethttp://en.wikipedia.org/wiki/Bond_markethttp://en.wikipedia.org/wiki/Bond_markethttp://en.wikipedia.org/wiki/Currency_markethttp://en.wikipedia.org/wiki/Currency_markethttp://en.wikipedia.org/wiki/Commodity_moneyhttp://en.wikipedia.org/wiki/Commodity_moneyhttp://en.wikipedia.org/wiki/Sumerhttp://en.wikipedia.org/wiki/Sumerhttp://en.wikipedia.org/wiki/Commodity_moneyhttp://en.wikipedia.org/wiki/Sumerhttp://en.wikipedia.org/wiki/Sumerhttp://en.wikipedia.org/wiki/Commodityhttp://en.wikipedia.org/wiki/Reinsurance_markethttp://en.wikipedia.org/wiki/Stock_markethttp://en.wikipedia.org/wiki/Bond_markethttp://en.wikipedia.org/wiki/Currency_markethttp://en.wikipedia.org/wiki/Commodity_moneyhttp://en.wikipedia.org/wiki/Sumerhttp://en.wikipedia.org/wiki/Commodity_moneyhttp://en.wikipedia.org/wiki/Sumer


9/89

used in trade. Sealed in clay vessels with a certain number of such tokens, with that number

written on the outside, they represented a promise to deliver that number. This made them a

form of commodity money ) more than an !.D.:.but less than a uarantee by a nation)state or

bank. $owever, they were also known to contain promises of time and date of delivery ) this

made them like a modernfutures contract. Heardless of the details, it was only possible to

verify the number of tokens inside by shakin the vessel or by breakin it, at which point the

number or terms written on the outside became sub&ect to doubt. ;ventually the tokens

disappeared, but the contracts remained on flat tablets. This represented the first system of

commodity accountin.

-lassical civili0ations built comple" lobal markets tradin old or silver for spices,

cloth, wood and weapons, most of which had standards of (uality and timeliness. -onsiderinthe many ha0ards of climate, piracy, theft and abuse of military fiatby rulers of kindoms

alon the trade routes, it was a ma&or focus of these civili0ations to keep markets open and

tradin in these scarce commodities. Heputation and clearin became central concerns, and the

states which could handle them most effectively became very powerful empires, trusted by

many peoples to manae and mediate trade and commerce.

0. Sie o" t+e #%r&et

The tradin of commodities consists of direct physical tradin and derivatives

tradin. ;"chane traded commodities have seen an upturn in the volume of tradin since the

start of the decade. This was larely a result of the rowin attraction of commodities as an

asset class and a proliferation of investment options which has made it easier to access this

market.

The lobal volume of commodities contracts traded on e"chanes increased by a

fifth in I9E9, and a half since I994, to around I.8 billion million contracts. @urin the three

years up to the end of I9E9, lobal physical e"ports of commodities fell by IJ, while the

outstandin value of DT- commodities derivatives declined by two)thirds as investors reduced

risk followin a five)fold increase in value outstandin in the previous three years. Tradin on

e"chanes in -hina and !ndia has ained in importance in recent years due to their emerence

9
http://en.wikipedia.org/wiki/IOU_(debt)http://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Military_fiathttp://en.wikipedia.org/wiki/IOU_(debt)http://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Military_fiat


10/89

as sinificant commodities consumers and producers. -hina accounted for more than 69J of

e"chane)traded commodities in I995, up on its 39J share in the previous year.

-ommodity assets under manaement more than doubled between I994 and I9E9 to

nearly K49bn. !nflows into the sector totalled over K69bn in I9E9, the second hihest year on

record, down from the record KMIbn allocated to commodities funds in the previous year. The

bulk of funds went into precious metals and enery products. The rowth in prices of many

commodities in I9E9 contributed to the increase in the value of commodities funds under

manaement.

. Co##o$it Tr%$in'

.1. S!ot tr%$in'

Spot tradin is any transaction where delivery either takes place immediately, or with

a minimum la between the trade and delivery due to technical constraints. Spot tradinnormally involves visual inspection of the commodity or a sample of the commodity, and is

carried out in markets such aswholesale markets. -ommodity markets, on the other hand,

re(uire the e"istence of areed standards so that trades can be made without visual inspection.

.0. For,%r$ (ontr%(ts

' forward contractis an areement between two parties to e"chane at some fi"ed

future date a iven (uantity of a commodity for a price defined today. The fi"ed price today isknown as the forward price.

.. F)t)res (ontr%(ts

10
http://en.wikipedia.org/wiki/Wholesale_marketinghttp://en.wikipedia.org/wiki/Wholesale_marketinghttp://en.wikipedia.org/wiki/Forward_contracthttp://en.wikipedia.org/wiki/Forward_pricehttp://en.wikipedia.org/wiki/Wholesale_marketinghttp://en.wikipedia.org/wiki/Forward_contracthttp://en.wikipedia.org/wiki/Forward_price


11/89

' futures contracthas the same eneral features as a forward contract but is

transacted throuh a futures e"chane.

-ommodity and futures contracts are based on whats termed forward contracts.

;arly on these forward contracts N areements to buy now, pay and deliver later N were used

as a way of ettin products from producer to the consumer. These typically were only for food

and aricultural products. Forward contracts have evolved and have been standardi0ed into

what we know today as futures contracts. 'lthouh more comple" today, early forward

contracts for e"ample, were used for rice in seventeenth century Oapan. #odern forward, or

futures areements bean in -hicao in the E439s, with the appearance of the railroads.

-hicao, bein centrally located, emered as the hub between #idwestern farmers and

producers and the east coast consumer population centers.

!n essence, a futures contract is a standardi0ed forward contract in which the buyer

and the seller accept the terms in reards to product, rade, (uantity and location and are only

free to neotiate the price.

.2. He$'in'

$edin, a common practice of farmin cooperatives insures aainst a poor harvest

by purchasinfutures contractsin the same commodity. !f the cooperative has sinificantly less

of its product to sell due to weather or insects, it makes up for that loss with a profit on the

markets, since the overall supply of the crop is short everywhere that suffered the same

conditions.

.3. De*iver %n$ (on$ition ')%r%ntees

!n addition, delivery day, method of settlement and delivery pointmust all be

specified. Typically, tradin must end two +or more business days prior to the delivery day, so

that the routin of the shipment can be finali0ed via ship or rail, and payment can be settled

when the contract arrives at any delivery point.

2. St%n$%r$i%tion

11
http://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Hedge_(finance)http://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Delivery_pointhttp://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Hedge_(finance)http://en.wikipedia.org/wiki/Futures_contracthttp://en.wikipedia.org/wiki/Delivery_point


12/89

:.S.soybeanfutures, for e"ample, are of standard rade if they are G#D or a

mi"ture of G#D and Aon)G#D Ao. I yellow soybeans of !ndiana, Dhio and #ichian oriin

produced in the :.S.'. +Aon)screened, stored in silo, and of deliverable rade if they are

G#D or a mi"ture of G#D and Aon)G#D Ao. I yellow soybeans of !owa, !llinois and

2isconsin oriin produced in the :.S.'. +Aon)screened, stored in silo. Aote the distinction

between states, and the need to clearly mention their status as G#D +Genetically #odified

Dranism which makes them unacceptable to most oranicfood buyers.

Similar specifications apply for cotton, orane &uice, cocoa, suar, wheat, corn,

barley,pork bellies, milk, feedstuffs, fruits, veetables, other rains, other beans, hay, other

livestock, meats, poultry, es, or any other commodity which is so traded.

3. Re')*%tion o" (o##o$it #%r&ets

!n the :nited States, the principal reulator of commodity and futures markets is

the -ommodity Futures Tradin -ommissionbut it is theAational Futures 'ssociationthat

enforces rules and reulations put forth by the -FT-.

3.1. Oi*

/uildin on the infrastructure and credit and settlement networks established for

food andprecious metals, many such markets have proliferated drastically in the late I9th

century. Dil was the first form of enery so widely traded, and the fluctuations in the oil

markets are of particular political interest.

Some commodity market speculation is directly related to the stability of certain

states, e.., durin thePersian Gulf 2ar,speculation on the survival of the reime of Saddam

$usseinin!ra(. Similar political stability concerns have from time to time driven the price

ofoil.

The oil market is an e"ception. #ost markets are not so tied to the politics of volatile

reions ) even natural as tends to be more stable, as it is not traded across oceans by tanker as

e"tensively.

12
http://en.wikipedia.org/wiki/Soybeanhttp://en.wikipedia.org/wiki/Soybeanhttp://en.wikipedia.org/wiki/Genetically_Modified_Organismhttp://en.wikipedia.org/wiki/Genetically_Modified_Organismhttp://en.wikipedia.org/wiki/Organic_farminghttp://en.wikipedia.org/wiki/Organic_farminghttp://en.wikipedia.org/wiki/Pork_bellyhttp://en.wikipedia.org/wiki/Pork_bellyhttp://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/wiki/National_Futures_Associationhttp://en.wikipedia.org/wiki/Precious_metalhttp://en.wikipedia.org/wiki/Precious_metalhttp://en.wikipedia.org/wiki/Gulf_Warhttp://en.wikipedia.org/wiki/Gulf_Warhttp://en.wikipedia.org/wiki/Gulf_Warhttp://en.wikipedia.org/wiki/Saddam_Husseinhttp://en.wikipedia.org/wiki/Saddam_Husseinhttp://en.wikipedia.org/wiki/Saddam_Husseinhttp://en.wikipedia.org/wiki/Iraqhttp://en.wikipedia.org/wiki/Iraqhttp://en.wikipedia.org/wiki/Petroleumhttp://en.wikipedia.org/wiki/Petroleumhttp://en.wikipedia.org/wiki/Petroleumhttp://en.wikipedia.org/wiki/Soybeanhttp://en.wikipedia.org/wiki/Genetically_Modified_Organismhttp://en.wikipedia.org/wiki/Genetically_Modified_Organismhttp://en.wikipedia.org/wiki/Organic_farminghttp://en.wikipedia.org/wiki/Pork_bellyhttp://en.wikipedia.org/wiki/Commodity_Futures_Trading_Commissionhttp://en.wikipedia.org/wiki/National_Futures_Associationhttp://en.wikipedia.org/wiki/Precious_metalhttp://en.wikipedia.org/wiki/Gulf_Warhttp://en.wikipedia.org/wiki/Saddam_Husseinhttp://en.wikipedia.org/wiki/Saddam_Husseinhttp://en.wikipedia.org/wiki/Iraqhttp://en.wikipedia.org/wiki/Petroleum


13/89

3.0 .Co##o$it #%r&ets %n$ !rote(tionis#

@evelopin countries+democratic or not have been moved to harden their

currencies, accept !nternational #onetary Fundrules, &oin the 2orld Trade

Drani0ation+2TD, and submit to a broad reime of reforms that amount to a hede aainst

bein isolated. -hina1s entry into the 2TD sinaled the end of truly isolated nations entirely

manain their own currency and affairs. The need for stable currency and predictable clearin

and rules)based handlin of trade disputes, has led to lobal trade heemony ) many nations

hedin on a lobal scale aainst each other1s anticipatedprotectionism, were they to fail to

&oin the 2TD.

There are sins, however, that this reime is far from perfect. :.S. trade sanctions

aainst -anadian softwood lumber +within A'FT' and forein steel +e"cept for A'FT'

partners -anada and #e"ico in I99I sinaled a shift in policy towards a touher reime

perhaps more driven by political concerns ) &obs, industrial policy, even sustainable forestry

and loin practices.

3.. Co##o$it E4(+%n'es

' brief description of commodity e"chanes is those which trade in particular

commodities, nelectin the trade of securities, stock inde" futures and options etc.

!n the middle of E5th century in the :nited States, businessmen bean orani0in

market forums to make the buyin and sellin of commodities easier. These central

marketplaces provided a place for buyers and sellers to meet, set (uality and (uantity standards,

and establish rules of business.

'ricultural commodities were mostly traded but as lon as there are buyers and

sellers, any commodity can be traded. !n E4MI, a roup of #anhattan dairy merchants ot

toether to brin chaotic condition in Aew Bork market to a system in terms of storae, pricin,

and transfer of aricultural products.

!n E5, durin the Great @epression, the -ommodity ;"chane, !nc. was

established in Aew Bork throuh the merer of four small e"chanes = the Aational #etal

13
http://en.wikipedia.org/wiki/Developing_countrieshttp://en.wikipedia.org/wiki/International_Monetary_Fundhttp://en.wikipedia.org/wiki/World_Trade_Organizationhttp://en.wikipedia.org/wiki/World_Trade_Organizationhttp://en.wikipedia.org/wiki/World_Trade_Organizationhttp://en.wikipedia.org/wiki/Protectionismhttp://en.wikipedia.org/wiki/Industrial_policyhttp://en.wikipedia.org/wiki/Developing_countrieshttp://en.wikipedia.org/wiki/International_Monetary_Fundhttp://en.wikipedia.org/wiki/World_Trade_Organizationhttp://en.wikipedia.org/wiki/World_Trade_Organizationhttp://en.wikipedia.org/wiki/Protectionismhttp://en.wikipedia.org/wiki/Industrial_policy


14/89

;"chane, the Hubber ;"chane of Aew Bork, the Aational Haw Silk ;"chane, and the Aew

Bork $ide ;"chane.

The ma&or commodity markets are in the :nited %indom and in the :S'. !n !ndia

there are I8 reconi0ed future e"chanes, of which there are three national level multi)

commodity e"chanes. 'fter a ap of almost three decades, Government of !ndia has allowed

forward transactions in commodities throuh Dnline -ommodity ;"chanes, a modification of

traditional business known as 'dhat and ayda yapar to facilitate better risk coverae and

delivery of commodities. The three e"chanes are*

N%tion%* Co##o$it 5 Deriv%tives E4(+%n'e /i#ite$ 6NCDE78

M)*ti Co##o$it E4(+%n'e o" In$i% /i#ite$ 6MC78

N%tion%* M)*ti-Co##o$it E4(+%n'e o" In$i% /i#ite$ 6NMCEI/8

'll the e"chanes have been set up under overall control of Forward #arket -ommission

+F#- of Government of !ndia.

9.N%tion%* Co##o$it 5 Deriv%tives E4(+%n'e /i#ite$ 6NCDE78

Aational -ommodity 7 @erivatives ;"chane Limited +A-@;C located in #umbai

is a public limited company incorporated on 'pril I, I99 under the -ompanies 'ct, E586

and had commenced its operations on @ecember E8, I99.This is the only commodity

e"chane in the country promoted by national level institutions. !t is promoted by !-!-! /ank

Limited, Life !nsurance -orporation of !ndia +L!-, Aational /ank for 'riculture and Hural

@evelopment +A'/'H@ and Aational Stock ;"chane of !ndia Limited +AS;. !t is a

professionally manaed online multi commodity e"chane. A-@;C is reulated by Forward

#arket -ommission and is sub&ected to various laws of the land like the -ompanies 'ct, Stamp

'ct, -ontracts 'ct, Forward -ommission +Heulation 'ct and various other leislations.

M.M)*ti Co##o$it E4(+%n'e o" In$i% /i#ite$ 6MC78

$ead(uartered in #umbai #ulti -ommodity ;"chane of !ndia Limited +#-C, is

an independent and de) mutualised e"chane with a permanent reconition from Government

14
http://finance.indiamart.com/markets/commodity/ncdex.htmlhttp://finance.indiamart.com/markets/commodity/mcx.htmlhttp://finance.indiamart.com/markets/commodity/nmceil.htmlhttp://finance.indiamart.com/markets/commodity/ncdex.htmlhttp://finance.indiamart.com/markets/commodity/ncdex.htmlhttp://finance.indiamart.com/markets/commodity/mcx.htmlhttp://finance.indiamart.com/markets/commodity/mcx.htmlhttp://finance.indiamart.com/markets/commodity/ncdex.htmlhttp://finance.indiamart.com/markets/commodity/mcx.htmlhttp://finance.indiamart.com/markets/commodity/nmceil.htmlhttp://finance.indiamart.com/markets/commodity/ncdex.htmlhttp://finance.indiamart.com/markets/commodity/mcx.html


15/89

of !ndia. %ey shareholders of #-C are Financial Technoloies +!ndia Ltd., State /ank of

!ndia, :nion /ank of !ndia, -orporation /ank, /ank of !ndia and -anara /ank. #-C

facilitates online tradin, clearin and settlement operations for commodity futures markets

across the country.

#-C started offerin trade in Aovember I99 and has built strateic alliances with

/ombay /ullion 'ssociation, /ombay #etal ;"chane, Solvent ;"tractors 'ssociation of

!ndia, Pulses !mporters 'ssociation and Shetkari Sanhatana.

.N%tion%* M)*ti-Co##o$it E4(+%n'e o" In$i% /i#ite$ 6NMCEI/8

Aational #ulti -ommodity ;"chane of !ndia Limited +A#-;!L is the first de)

mutuali0ed, ;lectronic #ulti)-ommodity ;"chane in !ndia. Dn I8th Ouly, I99E, it was

ranted approval by the Government to orani0e tradin in the edible oil comple". !t has

operationalised from Aovember I6, I99I. !t is bein supported by -entral 2arehousin

-orporation Ltd., Gu&arat State 'ricultural #arketin /oard and Aeptune Dverseas Limited.

!t ot its reconition in Dctober I99I.

-ommodity e"chane in !ndia plays an important role where the prices of any

commodity are not fi"ed, in an orani0ed way. ;arlier only the buyer of produce and its seller

in the market &uded upon the prices. Dthers never had a say. Today, commodity e"chanes are

purely speculative in nature. /efore discoverin the price, they reach to the producers, end)

users, and even the retail investors, at a rassroots level. !t brins a price transparency and risk

manaement in the vital market. ' bi difference between a typical auction, where a sinle

auctioneer announces the bids and the ;"chane is that people are not only competin to buy

but also to sell. /y ;"chane rules and by law, no one can bid under a hiher bid, and no one

can offer to sell hiher than someone elses lower offer. That keeps the market as efficient as

possible, and keeps the traders on their toes to make sure no one ets the purchase or sale

before they do.

15
http://finance.indiamart.com/markets/commodity/nmceil.htmlhttp://finance.indiamart.com/markets/commodity/nmceil.htmlhttp://finance.indiamart.com/markets/commodity/nmceil.htmlhttp://finance.indiamart.com/markets/commodity/nmceil.html


16/89

CHAPTER-II

0.1. INTRODUCTION TO THE COMPANY PROFI/E:

S+%re &+%n "in%n(i%* servi(e Pvt. /t$.

Share khan is !ndias leadin online retail brokin house. Launched on February 4,

I999 as an online tradin portal, Share khan has today a pan)!ndia presence with over E,8I5

outlets servin 589,999 customers across 389 cities. !t also has international presence throuh

its branches in the :'; and Dman. Share khan offers services like portfolio manaement, trade

e"ecution in e(uities, futures 7 options, commodities, and distribution of mutual funds,

insurance and structured products. These services are backed by (uality investment advice from

an e"perienced research team which offers investment and tradin ideas based on fundamental

and technical research respectively, market related news, statistical information on e(uities,commodities, mutual funds, !PDs and much more. Sharekhan is a member of the /ombay

Stock ;"chane, the Aational Stock ;"chane and the countrys two leadin commodity

e"chanes, the A-@;C and #-C. Sharekhan is also reistered as a depository participant with

Aational Securities @epository and -entral @epository Services. Sharekhan has set cateory

leadership throuh pioneerin initiatives like Trade Tier, an !nternet)based e"ecutable

16


17/89

application that emulates a broker terminal besides providin information and tools relevant to

day traders. !ts second initiative, First Step, is tareted at empowerin the first)time investors.

Sharekhan has also set its lobal footprint throuh the !ndia First initiative, a series of

seminars conducted by Sharekhan to help the non)resident !ndians participate and benefit from

the hue investment opportunities in !ndia.

SHARE;HAN TIME/INE

0.0 TOP MANAGEMENT:

Mr. T%r)n S+%+

CEO< S+%re&+%n

' Science raduate from St. Caviers -ollee, #umbai, Tarun Shah started his

professional life in sales and marketin in a chemicals company. $is hands)on approach and

rich e"perience in sales led him to hiher challenes that the capital markets provided.

!n E54M, #r Shah &oined SS%!, a brokerae firm with over five decades of leendary

service to its credit. The capital market at that time was underoin a sea chane in terms of

character and SS%! under the vision and uidance of Shripal #orakhia and the commitmentand hard work of #r Shah was able to chane and adopt the new business practices to achieve

a sinificant rowth in a competitive environment. Since then SS%! has achieved rowth in

each of its businesses* !nstitutional brokin, retail brokin and corporate Finance. Startin with

the retail brokin business of SS%! in /ombay and developin a sub)broker network across the

17


18/89

country, #r Shah was also instrumental in successfully settin up the !nstitutional Tradin

@esk of SS%!.

'cceptin new challenes is a way of life for #r Shah. To ensure that SS%!s foray

into retail stock brokin business throuh Sharekhan is as successful as every other venture of

SS%!, #r Shah moved in to spearhead this new effort as the -;D of Sharekhan, the retail

brokin arm of SS%!.

Mr. =%i$ee! Aror%

Dire(tor< Pro$)(t Deve*o!#ent

Oaideep 'rora, completed his /.Tech from !!T +%anpur and his PG@# from !!#,%olkata.$e worked with !-!-! for 4 years where his work spanned a amut of functions, which

included pro&ect finance, e(uity sales and brokerae, investments etc. @urin his tenure there

he set up and headed the !nstitutional ;(uity /rokerae @esk at !-!-! Securities 7 Finance -o.

Ltd.

#r 'rora &oined Sharekhan in Oune I999 as the head of the Product development

division. ' year later he took over the reins of the online business of Sharekhan. 't present #r

'roras responsibilities include spearheadin Sharekhans online foray as well as its overall

customer ac(uisition effort.

Mr. S+%n&er V%i*%%

Dire(tor< O!er%tions< Fin%n(e %n$ /e'%* F)n(tions

' raduate in -ommerce from the :niversity of #analore and an 'ssociate of The

#ember of the !nstitute of -hartered 'ccountants of !ndia, Shankar ailaya heads theoperations, finance and leal functions of Sharekhan. $e is responsible for settlements,

depository operations, risk and compliance, reulatory and other leal commitments, and

treasury.

18


19/89

#r.ailaya has manaed Sharekhans brokin operations throuh the most turbulent

times in the aftermath of the securities scam in E55I and successfully steered the company

clear of a flurry of bad papers that hit the market durin E553)58.

0. PRODUCTS 5 SERVICES:

I.FIRST STEP:

/et t+e e4!erts ')i$e o)>

'lways wanted help on what the stock market is all aboutQ /een wonderin about

how all this worksQ 2ell, you don1t need to fret any more ) the Sharekhan First Step is a brand

new proram desined especially for those who are new to investin in shares. 'll you have todo is open a Sharekhan First Step account and we1ll uide you throuh the investin process.

-lick here to learn more about the Sharekhan First Step proram.

/oo&in' "or Ans,ers?

@o you have a lot of unanswered (uestions about stocks and the stock marketQ

2e1ve created special information tools for you, to help answer any (ueries you may have. 'll

you have to do is sin up to receive all the tools you need to understand the markets and investin sharesR -lick here to et a free FirstStep !nformation %it.

@+%t $oes t+e !ro'r%# (onsist o"?

!n the comple" world of investin in shares in !ndia, interested beinners like you

didn1t have any place they could start out from. This is why we started the First Step proram )

to assist and uide new investors when they take their first steps into the world of investin in

shares. This proram is e"plicitly desined for beinners. Bou will not feel unintellient whenaskin (uestions like 2ho owns the Stock #arketQ or 2hat is a stock)splitQ since our

people are trained to assist those takin their first step in the market.

II.C/ASSIC ACCOUNT:

19


20/89

H%ss*e Free Investin'< On*ine< Anti#e An,+ere

Presentin the easiest way to control your investments with a click of a button. 2ith

live stock prices, online cash transfer and instant order e"ecution you et complete freedom

from borin paper)work. Dur friendly customer service representatives are accessible via toll)

free phone, email and live online chat

Proven Rese%r(+< Ti#e* A$vi(e.

Get live analysis before, durin 7 after market hours. From daily intra)day calls to

lon)term stock recommendations, you will et timely advice with well)defined profit tarets.

!n addition, you can invest in the companies that form part of our Top Picks research basket

III.U/TIMATE ON/INE TRADING P/ATFORM-TRADE TIGER:

A$v%nt%'es:

#ultiple ;"chane

!nternatinational #arket 2atch

I3 $our #arket 'ccess

Dne -lick Filter

:nlimited -harts

-reate your own technical rules for tradin

' sinle Tradin Screen for all sements

Live Streamin uotes

'ccess all Tradin -alls

'dvanced -hartin features

Fe%t)res:20


21/89

E. ' sinle platform for multiple e"chane /S; 7 AS; +-ash 7 F7D, #-C, A-@;C,

#utual Funds, !PDs.

I. #ultiple #arket 2atch available on Sinle Screen.

. #ultiple -harts with Tick by Tick !ntraday and ;nd of @ay -hartin powered withvarious Studies.

3. Graph Studies include 'verae, /and) /olliner, %now Sure Thin, #'-@, HS!, etc.

8. 'pply studies such as ertical, $ori0ontal, Trend, Hetracement 7 Free lines.

6. :ser can save his own defined screen as well as raph template that is, savin the layout

for future use.

M. :ser)defined alert settins on an input Stock Price trier.

4. Tools available to aue market such as Tick uery, Ticker, #arket Summary, 'ction2atch, Dption Premium -alculator, Span -alculator.

5. Shortcut key for F'ST access to order placements 7 reports.

E9. Dnline fund transfer activated with EI /anks.

IV.MUTUA/ FUND INVESTMENT:

M)t)%* F)n$s On*ine Free$o# 5 F*e4ii*it:

!nvest in #utual Funds online with your Sharekhan 'ccount. Get access to a number

of e"clusive mutual fund research reports and ability to invest in Fle"ible Systematic

!nvestment Plans. Dr &ust download the P@F of the application form and send it to the nearest

Sharekhan ShareShop in your city. 'lternatively, &ust call up our toll)free customer care

number, and we will dispatch the application form.

ene"it "ro# tr%$in' in M)t)%* F)n$s On*ine

Freedom from fillin forms

Set up S!Ps and Fle"i)S!Ps

Get access to the latest, free research reports with analysis of #utual Fund schemes.

21


22/89

V.PORTFO/IO MANAGEMENT SERVICES

Post s%*es servi(es:

@etailed portfolio reports are available at timely basis like.

!nvestment Summary

Portfolio $oldin

Transaction Statement

/ank /ook

Heali0ed>:nreali0ed Gain Loss @etails

Fees -hared Statement +@ebit Aote

-orporate /enefit +/onus > @ividend > Hiht issues declared, etc.

Fund #anaer1s Heport

@edicated -lient Servicin Team to address your (ueries.

@+ PMS?

1. /e%ve it to t+e E4!erts

@+oBs o)r Mone E4!ert?

22


23/89

Bour health, your accounts, your leal matters = you have professionals to manae

the entire thin that are most important to you. @o you have an e"pert to manae your hard)

earned moneyQ

Share khan Portfolio #anaement Services +P#S use the e"pert manaement skills

of our independent Fund #anaers, backed by the e"pertise of 8 Financial Hesearch 'nalysts,

to et the best possible returns for you.

0. Dis(i!*ine$ A!!ro%(+

2e are investin the funds and not &ust allocatin to the sectors to achieve decent

rowth of the corpus.

2e diversify the portfolio to reduce the risk.

2e would like to be in stocks with fewer burdens on /alance sheet and ood earnin

visibility.

. Ti#e is Mone

Few Bears ao you never imained that you would have so much money. 'nd never

imained that you would have so little Time. Success has e"torted a fee from you* Time Leavin you very few hours for all the

thins you think are important. 2hich is why at Sharekhan Portfolio #anaement

Services, we do not e"pect you to invest your precious time.

2. Co#!*ete Tr%ns!%ren(

The third advantae of P#S is the transparent fee structure. 2ith transparent fees and '#-

chares there are no hidden costs.

3. Str)(t)r%** etter

23


24/89

Portfolio manaement services reistered with S;/! are permitted to e"it or enter E99J at

any time as lon as they dont leverae and dont do intraday tradin.

The second bi advantae of P#S services is that they can hold fewer stocks and be more

aressive in their stance towards stocks or sectors.

The third advantae of P#S is the transparent fee structure. 2ith flat fees and '#- chares

there are no hidden costs.

9. Ris& Dis(*os)re Do()#ent

S+%re&+%n /i#ite$

PORTFO/IO MANAGEMENT SERVICES DISC/OSURE DOCUMENT

i. This @ocument has been updated up to 1st M%r(+< 011 and has been filed with

the Securities and ;"chane /oard of !ndia +S;/! alon with the certificate in

the prescribed format in terms of Heulation E3 of the S;/! +Portfolio #anaers

Heulations, E55.

ii. The purpose of this @ocument is to provide essential information about the portfolio

services in a manner to assist and enable you in makin informed decision for enain

us as a Portfolio #anaer.

iii. This document ives necessary information about us as


25/89

Convenience Redefined with Online Commodities Trading

2ith a Share khan online tradin account, you can buy and sell commodities in an

instantR 'nytime you like and from anywhere you likeR 'lso, Get access to cuttin ede

analysis, latest research reports and the most relevant news on -ommodities riht in your

tradin terminal.

ene"it "ro# On*ine Tr%$in' in Co##o$ities

Freedom from Paperwork

Dnline orders on the phone

!nstant credit and money Transfer

Timely advice and research reports

Trade from any net enabled P-

!nformation and Price alerts

'fter hour orders

VII./EARN TO TRADE:

Share khan, your own uide to the financial &unle, in a step to boost trader

education has partnered with Dnline Tradin 'cademy to provide (uality trader education.

's our educational partner, Dnline Tradin 'cademy will provide professional

education to traders who want to succeed in any market, and any asset class. 2ith 3 centers

across the lobe and rowin, Dnline Tradin 'cademy is the world1s most trusted name inprofessional trader education.

't Dnline Tradin 'cademy, our constant endeavor is to provide trader education for

every need and e"perience level. 2e provide traders with*)

25


26/89

2orld)class learnin e"perience

$ihly skilled professional traders as mentors

Live Tradin = in our Professional Trader = !ndia course

Free retakes

-ourses that pay for themselves

0.2 SHARE;HAN RESEARCH:

1. FUNDAMENTA/:

Sto(& I$e%s:'imed at investors. Presents our stock pick and discusses reasons for the same. !tcomes with a price taret and a time frame over which ains can be materiali0ed

InvestorsB Ee:' daily fundamental newsletter to help you take riht decisions.

-ontents iews on most important news reports of the day

Hecos usin the bottom)up approach

Stock :pdate reports

Special reports

Dther reports

S+%re &+%n To! Pi(&s:' model portfolio comprisin of EI stocks for investors with a hori0on

of more than a year. Portfolio is updated with new stocks replacin e"istin stocks as and when

re(uired to optimi0e performance.

Vie, Point:iews on companies we don1t track. iews on economy, policy chanes and

overnment initiatives

S!e(i%* Re!orts: Speciali0ed reports on uni(ue market opportunities.

26


27/89

Heports like ) Selectivity pays monetary policy review, $urricane ains, @ividend yield stocks,

etc.

IPO F*%s+: Heport on forthcomin !PDs ) only those !PDs which are covered by our research

team

Se(tor Re!orts: iew on various sectors and its constituents +;. suar and /alrampur -hini,

%-P Suar !ndustries, :pper Ganes

M%r&et O)t*oo&: /i)monthly Fundamental view on the market.

0. TECHNICA/:

P)nter C%**:' daily view on how the market and ma&or indices are e"pected to

trade for the day the closest support and resistance levels are provided to help traders take

decisions.

-alls created for tomorrow* These calls are for a one)day period and are created

today to buy in cash or futures. For sellin tomorrow at the taret price. /uy with a stop loss or

s(uare off by .9pm the day after.

Smart -harts* !t presents the best positional tradin calls in the market. ;ach call is

introduced alon with a Heco +Go Lon>Go Short, a price taret, a stop loss and a chart

depictin the trend in the stock.

Deriv%tive C%**s:Toolkit for derivative traders.

. MUTUA/ FUND:

M)t)%* F)n$ In$)str U!$%te:This report provides all the latest news in the industry like

fund flows, investment trends, performance of various cateories of e(uity funds, performance

in sector funds etc.

To! SIP F)n$ Pi(&s:This report provides details on the S!P performances of various funds

across different cateories for various time periods. Top S!P fund picks are provided in Lare)

27


28/89

cap funds, #ulti)cap funds, #id)cap funds and ;LSS funds cateories, after analy0in risk

return parameters.

To! E)it F)n$ Pi(&s: This report provides details of the Top Funds in Lare)cap funds,

#id)cap Funds, #ulti)cap funds, balanced funds, thematic funds, ;LSS funds etc. Take an

informed decision, dependin on your risk takin appetite, and stay ahead of the ups and downs

of the market.

To! Det F)n$ Pi(&s: This report provides details of the Top Funds in #onthly income plans,

!ncome funds, Short)term debt funds, :ltra short term funds, Floatin rate funds, Li(uid funds,

Gilt funds etc.

2. COMMODITY:

Co##o$ities ):@aily newsletter on commodities fundamentals

Rivetin' Met%*s:@aily newsletter with Technical calls on metals

E%'*e Ee 6Co##o$ities8:@aily newsletter with technical calls on commodities

CHAPTER III

REVIE@ OF /ITERATURE

.1 A((or$in' to S%+%$ev%n


29/89

(o##o$it )estion: ne, t+in&in' on o*$ !ro*e#s - This paper reviews more and less

mainstream policy options in relation to the Ucommodity (uestionin the liht both of its

classical definition and of the emerin concern about oliopoly. !t beins by updatin the

evidence concernin commodity price decline and volatility, and e"aminin the implications of

these phenomena for macro)economic performance and livelihoods in producin countries.

. A((or$in' to Ste!+en Cr%i'


30/89

.9 A((or$in' to N.S%t+is+ ;)#%r


31/89

. A((or$in' to $e Roon< Fr%ns A.< T+eo E. NiJ#%n< %n$ C+ris Ve*$ 608. He$'in'

Press)re E""e(ts in F)t)res M%r&ets"Oournal of Finance, 2e present a simple model implyin

that futures risk premium depend on both own)market and cross)market hedin pressures.

;mpirical evidence from I9 futures markets, divided into four roups +financial, aricultural,

mineral, and currency indicate that, after controllin for systematic risk, both the futures own

hedin pressure and cross)hedin pressures from within the roup sinificantly affect futures

returns. These effects remain sinificant after controllin for a measure of price pressure. Finally, we

show that hedin pressure also contains e"planatory power for returns on the underlyin asset, as

predicted by the model. +p. E3M.

3.9 A((or$in' to D)s%&< ;%t+erine 618. F)t)res Tr%$in' %n$ Investor Ret)rns: An

Investi'%tion o" Co##o$it M%r&et Ris& Pre#i)#s."Oournal of Political ;conomy, ol. 4E,Ao. 6 +Aovember>@ecember* E4M)E396. The lon)standin controversy over whether speculators

in a futures market earn a risk premium is analy0ed within the conte"t of the capital asset pricin

model recently developed by Sharpe, Linter, and others. :nder that approach the risk premium

re(uired on a futures contract should depend not on the variability of prices but on the e"tent to

which the variations in prices are systematically related to variations in the return on total wealth.

The systematic risk was estimated for a sample of wheat, corn, and soybean futures contracts over

the period E58I to E56M and found to be close to 0ero in all three cases. 'verae reali0ed holdin

period returns on the contracts over the same period were close to 0ero. +p. E4M

.1. A((or$in' to E$,%r$s< Fr%n&*in R.< %n$ =i## /ie, 618. M%n%'e$ Co##o$it

F)t)res =o)rn%* o" F)t)res M%r&ets< Vo*. 1< No. 2 6=)ne8: -211.The authors e"amine the

performance of manaed commodity futures as represented by public commodity funds, commodity

pool operators, and commodity tradin advisers. The authors indicate that the costs associated with

investin in -PDs and -T's may be (uite lare because the funds may incur sinificant transaction

costs, which are added to a number of fees chared to investors, includin manaement fees, profit)

based incentive fees, and loads. @espite these relatively hih costs, the authors find that the net

return to commodity fund investments is fre(uently relatively attractive. ;ach individual fund,

however, has relatively volatile returns, so the stand)alone performance of manaed commodity

futures is poor relative to traditional investments. The authors find that, in eneral, addin a portfolio

of -PDs or -T's to a traditional investment portfolio enhances portfolio performance. !n addition,

31


32/89

the authors compare the returns to -T's and -PDs with the returns to the passive Heuters>Oefferies

-H/ !nde" and the #L#. The #L# is a dynamic inde" based on momentum in commodity prices,

which is consistent with the stratey followed by many manaed futures funds. The authors find a

sinificant positive relationship between the returns to manaed futures and the #L# but no

sinificant relationship between manaed funds and the -H/. This findin is consistent with the

contention that the #L# provides a eneral indicator of the performance of manaed futures. The

authors also find, however, that neither the #L# nor the -H/ supplants manaed futures in their

derived efficient portfolios.

CHAPTER IV

RESEARCH METHODO/OGY

The methodoloy of research indicates the eneral pattern of orani0in the procedure of

atherin valid and reliable data for the problem under investiations (Kothari, 1996). The

methodoloy of this study includes the choice of the research approach, samplin techni(ue,

development of the tool, data collection procedure and method of analysis based on the statement

and ob&ectives of the study.

Rese%r(+ %!!ro%(+

32


33/89

The selection of the research approach is the basic procedure for the conduct of research.

' research approach tells the investiator as to what data to collect and how to analy0e it. !t also

suests possible conclusion to be drawn from the data.

The research approach refers to the investiator overall plan for obtainin answers to the

research (uestion and for testin the research hypothesis. !t spells out the strateies that the

investiator adopts to develop information that is accurate, ob&ective and interpretable. !t is set of

fle"ible uide spots desined to keep the investiator in the riht direction. + Polit and Hungler,

1999).

2.1 O=ECTIVES OF THE STUDY

To study about the investors preferences towards commodity market in Share khan

Financial Services Pvt. Ltd, Gobi.

To find out very hih preference of commodity market.

To analy0e the various factors influencin investors preference on commodity market.

To find out the investors awareness reardin commodity market.

To study about the investors acceptance level of rumors in commodity market.

To find some suested measures to improve the present level.

2.0 SCOPE OF THE STUDY

!t assesses the preference of choosin the market by the respondents.

The study helps us to know about the !nvestors preferences towards commodity market.

!t helped to brin out various investment opportunities and preference in commoditymarket.

The specific reason to why people preference commodity market one mode of investment

and earnin hih return

33


34/89

2. RESEARCH DESIGN

Hesearch desin constitutes the blue print for the collection and analysis of the data.

Hesearch desin is essential as it facilitates the smooth sailin of various research operations so

as to make the research as efficient as possible yieldin ma"imum information with minimum of

effort, time, and money.

@ecisions reardin what, when, how, how much by what means concernin a

research constitutes the research desin. ))-.H. %othari

DESCRIPTIVE RESEARCH:

Des(ri!tive Rese%r(+ includes surveys and fact ) findin en(uiries of different

kinds of the ma&or purpose of descriptive research is description of the state of affairs as it e"ists

at present. !n social science and business research we (uite often use the term e" post facto

research for description research studies.

SAMP/ING UNIT

/usiness #en, Professionals, ;mployed personnel, others like $ouse wife etc.

SAMP/E SIKE

' sample si0e of EI9 investors was selected for the study in the Gobi Heion.

METHOD OF DATA CO//ECTION

$ere the researcher mainly used primary data.

A. PRIMARY DATA

@ata are collected for the first time for a specific purpose in mind usin the(uestionnaire method and interview method.

. SECONDARY DATA

The secondary data was collected from the company Oournals, Heports, #aa0ines,

34


35/89

!nternet and #aterials obtained from the commodity product in the reional Dffice.

2.2 SAMP/ING TECHNILUE

This samplin method involves purposive or deliberate selection of particular unitsof the universe for consultin a sample, which represents the universe.

Non Pro%i*it- Convenien(e S%#!*in':

2hen population elements are selected for inclusion in the sample based on the ease

of access it can be called convenience samplin

2.3 TOO/S FOR ANA/YSIS

E. Simple Ao. of Hespondents in +J analysis

I. -hi)S(uare Test

. -orrelation 'nalysis

3. 2eihted 'verae

8. 'AD'

1. SIMP/E NO.OF RESPONDENTS IN 68 ANA/YSIS

Ao. of Hespondents in +J analysis is a simple and effective method used for

analy0in collect data. !t provides clear distribution of respondents responses. :sin this

method we can et clear view of how customer respondents to a specific (uery distributed

amon different options.

No. o" Res!on$ents in 68 6N)#er o" Res!on$ent Tot%* Res!on$ents8 7 1

0.CHI-SLUARE TEST

The chi)s(uare test is an important test amonst the several tests of sinificant1. -hi)

S(uare, symbolically written as VW+Pronounced as %i ) S(uare, is a statistical measure used in

the conte"t of samplin analysis for comparin a variance to a theoretical variance.

35


36/89

!t can also be used to make comparisons between theoretical populations and actual

data when cateories are used. Thus, the chi)s(uare test is applicable in lare number of

problems. The tests is, in fact, a techni(ue throuh the use of which it is possible for all

researchers to

+i Test the oodness of fit?

+iiTest the sinificant of association between two attributes, and

+iii Test the homoeneity or the sinificance of population variance.

Q 6OiJ- EiJ8Q/EiJ

2here,

Di&X Dbserved fre(uency of the cell in ithrow and &thcolumn.

;i&X ;"pected fre(uency of the cell in ithrow and &thcolumn.

. CORRE/ATION ANA/YSIS:

!t is helps to determine the strenth of linear between the two variables C 7B. !n

other words as to how stronly are these two variables correlated. %arl Pearson, in E546

developed and inde" or co)efficient of these association in case where the relationship is a

linear one. i.e. where the trend of the relationship can be described by a straiht line.

N $4 $ 6 $48 6 $8

r ------------------------------------------

N$4Q - 6 $48 Q N $Q - 6 $8 Q

2. @EIGHTED AVERAGE:

2eihted averae may be defined as the averae obtained multiplyin the various

item in serious by certain values know as weihted and the total of products so obtained is

dividend by the total of weihted.

36


37/89

@ei'+te$ Aver%'e X6 7@@8

2here,

2) Ao. of Hespondents favorin in the opinion

C) alue of the score to the option.

3. ANOVA*

'nalysis of variance +'bbreviated as 'AD' is an e"tremely useful techni(ue

concernin researches in the field of economics, bioloy, education, psycholoy, socioloy,

business>industry in researches of several other disciplines. This techni(ue is used here since

multiple sample cases are involved.

The sinificance of the difference between the means of two samples can be &uded

throuh either Y)test or T) Test but the difficulties arise when we happen to e"amine the

sinificance of the difference amonst more than two sample means at the same time.

The 'AD' techni(ues enable us to perform this simultaneous test and as such are

considered to be an important tool of analysis in the hands of a researcher. :sin this techni(ue,

one can draw inferences about whether the samples have been drawn from populations havin the

same mean.

The essence of 'AD' is that the total amount of variation in set of data is broken

down into two types, that amount which can be attributed to chance and that amount which can be

attributed to specific causes.

T+e te(+ni)e invo*ves t+e "o**o,in' ste!s:

E. The -orrelation factor +-.F X +T W > A

@+ere ;i& E3.9II4

Ste!2 :Therefore, the @eree of freedom in this case

X +r)E +c)E

64


65/89

10

Ste!3 :Con(*)sion:

The table value of VW for EI deree of freedom at 8J level of sinificance is IE.999.The calculated value VW is much less than the tabulated value and hence the result of the

e"periment supports the hypothesis. 2e can, thus, conclude that there is no influencin of

income to prefer the pulses. +Aull $ypothesis 'ccepted

T%*e No.3.0: T+e t%*e s+o,in' Re*%tions+i! et,een Ann)%* In(o#e %n$ Fires

65


66/89

In(o#e Fiers Cross t%)*%tion

FibresTotal

E I 3 8

!ncome

/elow two lakhs

-ount 4 8 4 E9 5 39

;"pected

-ount4.M 3.9 5.9 E9.9 4. 39.9

Two Lakhs ) Four

Lakhs

-ount E9 3 6 8 I4

;"pected

-ount6.E I.4 6. M.9 8.4 I4.9

Four Lakhs ) Si"

Lakhs

-ount 6 6 8 I

;"pected

-ount8.9 I. 8.I 8.4 3.4 I.9

'bove Si" Lakhs

-ount 8 E 5 4 6 I5

;"pected

-ount6. I.5 6.8 M.I 6.9 I5.9

Total

-ount I6 EI IM 9 I8 EI9

;"pected

-ountI6.9 EI.9 IM.9 9.9 I8.9 EI9.9

Ste!1 * Aull $ypothesis +$9* There is no sinificant relationship between 'nnual !ncome

and Fibers.

Ste!0 * 'lternate $ypothesis +$E* There is sinificant relationship between 'nnual Fibers.

Ste! :calculation of chi)s(uare VW X[ +Di&) ;i&W/;i&

T%*e No.3.02:(%*()*%tion o" (+i-s)%re

S.No OiJ EiJ OiJ-EiJ 6OiJ-EiJ8Q 6OiJ-EiJ8QEiJ

66


67/89

E 4 4.M )9.M 9.35 9.986

I 8 3 E E 9.I8

4 5 )E E 9.EEEE

3 E9 E9 9 9 9

8 5 4. 9.M 9.35 9.98596 E9 6.E .5 E8.IE I.353

M I.4 9.I 9.93 9.9E3I

4 3 6. )I. 8.I5 9.456

5 6 M )E E 9.E3I4

E9 8 8.4 )9.4 9.63 9.EE9

EE 8 )I 3 9.4

EI I. 9.M 9.35 9.IE9

E 6 8.I 9.4 9.63 9.EI9

E3 6 8.4 9.I 9.93 9.9964

E8 8 3.4 9.I 9.93 9.994

E6 8 6. )E. E.65 9.I64I

EM E I.5 )E.5 .6E E.I334

E4 5 6.8 I.8 6.I8 9.56E8

E5 4 M.I 9.4 9.63 9.9444

I9 6 6 9 9 9

-hi s(uare+VW X[ +Di&) ;i& W > ;i& M.M5E5

Ste!2 * Therefore, the @eree of freedom in this case X +r)E +c)E X 10

Ste!3 * Con(*)sion:

The table value of VW for EI deree of freedom at 8J level of sinificance is IE.999.

The calculated value VW is much less than the tabulated value and hence the result of the


income to prefer the fibers. +Aull $ypothesis 'ccepted.

67


68/89

T%*e No.3.03: T+e t%*e s+o,in' Re*%tions+i! et,een Ann)%* In(o#e %n$ Ener'

68


69/89

O(()!%tion Ener' Cross t%)*%tion

;neryTotal

E I 3 8

Dccupation

/usiness-ount E 3 4 8

;"pected

-ountE3. 8.8 3.E 8.8 .6 .9

Profession

-ount II E9 6 8 36

;"pected

-ountE5.5 M.M 8.4 M.M 8.9 36.9

;mployed

-ount E8 3 I IM

;"pected

-ount

EE.M 3.8 .3 3.8 I.5 IM.9

Dthers

-ount I 3 I 8 E E3

;"pected

-ount6.E I. E.4 I. E.8 E3.9

Total

-ount 8I I9 E8 I9 E EI9

;"pected

-ount8I.9 I9.9 E8.9 I9.9 E.9 EI9.9

Ste!1 * Aull $ypothesis +$9* There is no sinificant relationship between 'nnual

!ncome and ;nery.

Ste!0 * 'lternate $ypothesis +$E* There is sinificant relationship between 'nnual

;nery.

Ste! : calculation of chi)s(uare VW X[ +Di&) ;i&W/;i&

T%*e No.3.09: (%*()*%tion o" (+i-s)%re

S.No OiJ EiJ OiJ-EiJ 6OiJ-EiJ8Q 6OiJ-EiJ8QEiJ

E E E3. )E. E.65 9.EE4E

I 8.8 )I.8 6.I8 E.E6

69


70/89

3 3.EI8 )9.EI8 9.9E86 9.99M

3 4 8.8 I.8 6.I8 E.E6

8 8 .8M8 E.3I8 I.996 9.8649

6 II E5.5 I.966M 3.IMEI 9.IE3I

M E9 M.66M I.3 8.333M8 9.ME9E

4 6 8.M8 9.I8 9.96I8 9.9E94

5 M.66M )3.6666 IE.MMME I.4398

E9 8 3.54 9.9E6M 9.999I 8.8563

EE E8 EE.M . E9.45 9.59M

EI 3.8 )E.8 I.I8 9.8

E .M8 )9.M8 9.E396 9.93E6

E3 3 3.8 )9.8 9.I8 9.9888

E8 I I.5I8 )9.5I8 9.4886 9.I5I8

E6 I 6.96M )3.9666 E6.8MI I.MI85

EM 3 I. E.666M I.MMM4 E.E598

E4 I E.M8 9.I8 9.96I8 9.98M

E5 8 I. I.666M M.EEEI .93MM

I9 E E.8EM )9.8E66 9.I664 9.EM85

-hi s(uare+VW X[ +Di&) ;i& W > ;i& E8.M83

Ste!2 :Therefore, the @eree of freedom in this case

X +r)E +c)E X +3)E +8)E X EI

Ste!3 :Con(*)sion:

The table value of VW for EI deree of freedom at 8J level of sinificance is IE.999.

The calculated value VW is much less than the tabulated value and hence the result of the

70


71/89


Dccupation to prefer the ;nery. +Aull $ypothesis 'ccepted.

. ANNOVA

T%*e No.3.0: T+e t%*e s+o,in' Re*%tions+i! et,een O(()!%tion %n$ Met%*s

71


72/89

O(()!%tion Met%*s Cross t%)*%tion

#etalsTotal

E I 3 8

Dccupation

/usiness E M 8 6 I

Profession IE E6 I I 8 36

;mployed E 8 E 3 3 IM

Dthers 3 3 9 E3

Total 89 I EE E6 EE EI9

Ste! 1 : N)** H!ot+esis 6Ho8:There is no sinificant relationship between occupation and

Preference of the #etal -ommodity.

Ste! 0 : A*tern%tive H!ot+esis 6H18: There is sinificant difference

between occupation and #etal -ommodity Preference.

Ste! : TXEI9, nXI9, Therefore,

Corre(tion "%(torX +T W > n X EI9W>I9 X MI9

Ste!2 : Tot%* SS E65Z35ZI8Z6Z3Z33EZI86Z3Z3ZI8ZE65ZI8ZEZE6ZE6Z5ZE6Z5Z5

X 8M9

Ste! 3 : SS et,een Co*)#ns Tre%t#ent:

X +89W>3 Z +IW>3 Z +EEW>3 Z +E6W>3 Z +EEW>3 ) MI9 +correction Factor

03.3

Ste! 9 : SS et,een Ro,s Tre%t#ent:

X +W>8 Z +36W>8 Z +IMW>8 Z +E3W>8 ) MI9 +correction Factor

72


73/89

19

Ste! : SS Resi$)%* or Error Tot%* SS 6SS , Co*)#ns SS , Ro,s8

X 8M9 = +I48.8 Z E96

1.3

Ste! : C%*()*%tion o" Anov%

T%*e No.3.0: T+e Anov% T%*e

So)r(e o"v%ri%tion SS $." MS F- r%tio

3 F-/i#it

6or t+e t%*ev%*)es8

/etween

columns

+i.e. between

occupation

I48.8

X + c)E

X + 8 = E

X 3

X I48.8 > 3

X ME.M8

X ME.M8 >

E3.4M8

X 3.M54

F + 3 , EI

X 8.5EEM

/etween

Hows

+i.e. between

#etal

Preference

level

E96

X + r = E

X + 3 = E

X

X E96 >

X 8.

X 8. >

E3.4M8

X I.M8

F + , EI

X 4.M336

Hesidual or

;rrorEM4.8

X + c = E

+ r = E

X 3 "

X EI

X EM4.8 > EI

X E3.4M8

Total 8M9+3 " = E X

EE

In"eren(e:

73


74/89

!t is noted from the above table that, the calculated 'AD' value is less than the

table value. So, there is no relationship between Dccupation and #etal preference. +Aull

hypothesis accepted.

T%*e No.3.0: T+e t%*e s+o,in' Re*%tions+i! et,een Ris& T%&in' C%!%(it %n$ A'e

Gro)!

74


75/89

Ris& T%&in' A'e Cross t%)*%tion

'eTotal

/elow I8 yrs I8)89 yrs 89)M8 yrs 'bove M8 yrs

Hisk takin

ery hih 9 E5 E 9 I9

$ih 9 E I 9 I3

#edium E5 8 I 9 I6

Low 9 6 I9 9 I6

ery low 9 E9 6 4 I3

Total E5 3E 8I 4 EI9

Ste! 1 : N)** H!ot+esis 6Ho8:

There is no sinificant relationship between Hisk Takin -apacity and ae Group for investin

in commodity market.

Ste! 0: A*tern%tive H!ot+esis 6H18:

There is sinificant difference between Hisk Takin -apacity and 'e Group for investin in

commodity market.

Ste! : TXEI9, nXI9, Therefore, Corre(tion "%(torX +T W > n X EI9W>I9 X MI9

Ste!2 :

Tot%* SS 9 Z E Z 8I5 Z 9 Z 6E Z I8 Z 3 Z 6 Z 399 Z E99 Z 6 Z 63

X E886 = MI9 +correction Factor

9

Ste! 3 : SS et,een Co*)#ns Tre%t#ent:

75


76/89

X +E5W>8 Z +3EW>8 Z +8IW>8 Z +4W>8 ) MI9 +correction Factor

X 56I = MI9 +correction Factor

020

Ste! 9 : SS et,een Ro,s Tre%t#ent:

X +I9W>3 Z +I3W>3 Z +I6W>8 Z +I6W>8 Z +I3W>8 ) MI9 +correction Factor

X MI6 = MI9 +correction Factor

X 6

Ste! : SS Resi$)%* or Error Tot%* SS 6SS , Co*)#ns SS , Ro,s8

46 = +I3I Z 6

3

Ste! : C%*()*%tion o" ANOVA

T%*e No.3.: T+e ANOVA T%*e

So)r(e o"v%ri%tion SS $." MS F- r%tio

3 F-/i#it

6or t+e t%*ev%*)es8

76


77/89

/etween

columns

+i.e. between

occupation

I3I

X + c)E ?

X + 3 = E

X

X I3I >

X 49.6666

X 49.6666> 35

X 3.M54

F + , EI

X 4.M336

/etween Hows

+i.e. between

#etal Preference

level

6

X + r = E

X + 8 = E

X 3

X 6> 3

X E.8

X E.8> 35

X 9.96E

F + 3 , EI

X 8.5EEM

Hesidual or ;rror 844

X + c = E

+ r = E

X " 3

X EI

X 844 > EI

X 35

Total 46+ " 3 = E

X EE

In"eren(e:

!t is identified from the above table that, the calculated 'AD' value is less than

the table value. So, there is no relationship between Hisk takin capacity and ae of the

respondents. $ence, the null hypothesis accepted.

2. CORRE/ATION ANA/YSIS

T%*e No.3.1: T+e t%*e s+o,in' Corre*%tion et,een S!i(es %n$ #et%*s

Spices +C EM I9 E4 I

#etal +B 89 I EE E6 EE

Ste! 1:-alculation of -orrelation

77


78/89

N $4 $ 6 $48 6 $8

r ------------------------------------------

N$4Q - 6 $48 Q N $Q - 6 $8 Q

Ste!0: T%*e No.3.0: Corre*%tion et,een S!i(es %n$ #et%*s

7 67-028 $4 $4Q Y 6Y-038 $ $Q $4 $

EM )M 35 89 I8 6I8 )EM8

I9 )3 E6 I M 35 )I4

E4 )6 6 EE )E3 E56 43

I 4 63 E6 )5 4E )MI

5 4E EE )E3 E56 )EI6

EI9 9 I36 EI9 )8 EE3M )EM

r -.3

In"eren(e:

Since the correlation value should lies between )E 7 ZE. $ere, r value is Aeative, so

there is Ao relationship between spices and metals preference of the respondents.

T%*e No.: T+e t%*e s+o,in' (orre*%tion et,een Ris& T%&in' (%!%(it %n$ !re(io)s

#et%*s

Hisk Takin capacity +C I9 I3 I6 I6 I3

precious metals +B 69 E5 EE E8 E8

Ste! 1:-alculation of -orrelation

N $4 $ 6 $48 6 $8

r ------------------------------------------

N$4Q - 6 $48 Q N $Q - 6 $8 Q

78


79/89

Ste!0: T%*e No.3.2: C%*()*%tion o" Corre*%tion

7 67-098 $4 $4Q Y 6Y-8 $ $Q $4 $

I9 )6 6 69 9 599 )E49

I3 )I 3 E5 )EE EIE II

I6 9 9 EE )E5 6E 9

I6 9 9 E8 )E8 II8 9

I3 )I 3 E8 )E8 II8 9

EI9 )E9 33 EI9 )9 E4I )EI4

r -.2221

In"eren(e:

Since the correlation value should lies between )E 7 ZE.$ere, r value is Aeative, so

there is no relationship between Hisk Takin capacity and precious metals preference of the

respondents.

3. @EIGHTED AVERAGE ANA/YSIS

T%*e No.3.3: T+e t%*e s+o,in' o!inion o" t+e res!on$entWs !re"eren(e o" (o##o$it

#%r&et r%tin' in S+%re &+%n Fin%n(i%* Servi(es Pvt. /t$< Goi

T!es o" (o##o$itiesVerHi'+

Hi'+ Me$i)# *o,ver/o,

Tot%*R%n&in

'

Plantation Products*

Hubber,EM E8 E3 3 39 EI9

5

Score 48 69 3I 64 39 I58

Spices* Pepper, Turmeric,

Oeera,chilli, corianderEM I9 E4 I EI9

M

Score 48 49 83 63 E6

Pulses* -hana E4 I9 I 33 E8 EI9 3

79


80/89

Score 59 49 65 44 E8 3I

Fibres* )M5M kapas ,

shankar kapasI6 EI IM 9 I8 EI9

Score E9 34 4E 69 I8 33

-ereals* 2heat, /arley, I E8 I8 E I6 EI98

Score EE8 69 M8 6I I6 4

Dil and Dil seeds* -astor

seeds,II E8 IE I 9 EI9

6

Score EE9 69 6 63 9 IM

Dthers* Guar Seeds, Guar

Gum,E8 E3 II 6 EI9

4

Score M8 86 66 66 6 I55

#etals* Steel, -opper,

Yinc,89 I EE E6 EE EI9

E

Score I89 EI4 I EE 383

;nery* -rude Dil,

Thermal -oal,8I I9 E8 I9 E EI9

I

Score I69 49 38 39 E 34

Precious #etals* Gold,Gold +E99 ms, Gold

!nternational, Silver, Silver

+8k, Silver !nternational,

Platinum

69 E5 EE E8 E8 EI9E

Score 99 M6 9 E8 383

Dthers* -;H, Polyvinyl

-hlorideI 9 E8 39 6 EI9

E9

Score E9 9 38 49 6 E54

In"eren(e:

From the above table by the weihted averae method, its observed that Precious

#etals* Gold, Gold +E99 ms, Gold !nternational, Silver, Silver +8k, Silver !nternational,

Platinum commodities have E rank of investors preference, ;nery* -rude Dil, Thermal -oal,

80


81/89

commodities havin the Ind Hank of the !nvestors preference. Fibres* )M5M kapas, Shankar

kapas commodities havin the rdrank of amon the investors preference. Therefore from the

weihted averae method ma&ority of the respondents very hihly prefer to invest in the

commodities like Precious #etal, ;nery and Fibres.

CHAPTER VI

FINDINGS< SUGGESTIONS 5 CONC/USION

9.1 FINDINGS OF THE STUDY

E8.4J of the respondents are belons I8yrs of ae Group, 3.IJ of the respondents are ae

roup between I8 yrs to 89 yrs.,3.J of the respondents are between 89 to M8 yrs of ae

roup, and 6.MJ of the respondents are the above M8 Brs.

IM.8 J of the respondents are business people, 36J of the respondents are professionals,

IMJ of the respondents are employed, and E3 J of the respondents are other occupations.

M6.MJ of the respondents are male investors, and I.J of the respondents are female

investors.

E6.M J of the respondents (ualification is below schoolin, 39J of the respondents

(ualification is only under raduates, E.MJ of the respondents (ualification is post

raduates and EE.M J of the respondents (ualification is others like diplomas.

. J of the respondents annual incomes level is below than I Lakh, I.J of the

respondents annual incomes level is between I Lakh to 3Lakh, E5.IJ of the respondents

annual incomes level is in between 3 lakh to 6 lakh, and I3.IJ of the respondents annual

incomes level is above 6 lakh.

63.I J of the respondents investment ob&ectives is $ih !ncome ,I5.IJ of the respondents

investment ob&ectives is Heasonable income for safety , 6.MJ of the respondents investment

81


82/89

ob&ectives is for retirement welfare and 9J of the respondents an investment ob&ective is ta"

benefits.

9.4J of the respondents of investments portion from their income is below I8 J,8.4J of

the respondents of investments portion from their income is between I8J to 89J, I5.IJ of

the respondents of investments portion from their income is between 89J to M8J and 3.I J

of the respondents of investments portion from their income is above M8J.

E6.M J of the respondents risk takin capacity is very hih, I9J of the respondents risk

takin capacity is hih, IE.M J of the respondents risk takin capacity is medium, IE.MJ of

the respondents risk takin capacity is low, and I9J of the respondents risk takin capacity

is very low.

35.IJ of the respondents current investment is below E lakh, IM.8J of the respondents

current investment is between E lakh to I lakh, E3.IJ of the respondents current investment

is between I lakh to lakh, 5.IJ of the respondents current investment is above lakh.

35.IJ of the respondents are ettin investments advice from their friends, EM.8J of the

respondents are ettin investments advice from their family members,M.8J of the

respondents are ettin investments advice from investment consultants and I8.4J of the

respondents are ettin investments advice from others sources.

3. J of the respondents hiher preference of their investment avenues is shares, IE.MJ of

the respondents investment preference is mutual funds, I6.MJ of the respondents

investment preference is commodity markets and 4. J of the respondents investment

preference is other savins.

5. J of the respondents are well known about commodity market tradin, and 6.M J f the

respondents are not havin much aware about commodity marketin.

35.IJ of the respondents are know about commodity market tradin throuh their friends ,

3.IJ of the respondents are know about commodity market tradin throuh their investment

traders, I9.4J of the respondents are know about commodity market tradin throuh mass

82


83/89

media, E5.IJ of the respondents are know about commodity market tradin throuh the

official investment orani0ations.

E99J of the respondents are involved in commodity tradin.

E8J of the respondents are havin e"perience in commodity tradin below E yr. 8J of the

respondents are havin e"perience in commodity tradin between E to I yrs, E5.IJ of the

respondents are havin e"perience in commodity tradin between I to yrs, and 9.4J of

the respondents are havin e"perience in commodity tradin more than yrs.

48.4 J of the respondents are daily traders, 8.4J of the respondents are weekly traders,

I.8J of the respondents are monthly traders, E.MJ of the respondents are season traders,

I.8J of the respondents are occasionally trade, and E.MJ of the respondents are trade rarely.

84.J of the respondents are very hih aware of the commodity markets circular and its

reulations , I8J of the respondents are hih level awareness of the commodity markets

circular and its reulations, 4.J of the respondents are medium level of awareness about

the commodity markets circular and its reulations, 8.4J of the respondents are havin low

level of awareness about their commodity markets circular and its reulations, and I.8J of

the respondents are havin very low level of awareness about their commodity markets

circular and its reulations,

64.J of the respondents are choosin commodity trade for hih return. .J of the

respondents are choosin commodity trade for moderate return, .J of the respondents are

choosin commodity trade for safely return, and I8J of the respondents are choosin

commodity tradin because its re(uired only low marin.

E3.IJ of the respondents are very hihly prefer the plantation products like rubber, EI.8J

of the respondents are hihly prefer the plantation products like rubber, EE.MJ of the

respondents are prefer medium level of preference of the plantation products like rubber,

and I4.J of the respondents are prefer low ..J of the respondents are very low to

prefer the plantation products like rubber

83


84/89

E3.IJ of the respondents are very hihly prefer the spices products like

pepper,turmeric,&eera,chilli,coriander, E6.MJ of the respondents are hihly prefer the spices

products like pepper,turmeric,&eera,chilli,coriander, E8J of the respondents are moderate

level of preference of spices products like pepper, turmeric, &eera, chilli, coriander, I6.M J

of the respondents are prefer low level of preference of the spices products like pepper,

turmeric, &eera, chilli, coriander, and IM.8J of the respondents are very low to prefer the

spices products like pepper,turmeric,&eera,chilli,coriander.

E8J of the respondents are very hihly prefer the pulses products like -hana, E6.MJ of the

respondents are hihly prefer the pulses products like -hana, E5.IJ of the respondents are

moderate level of preference in pulses products like -hana, 6.M J of the respondents are

prefer low level of preference of the pulses products like -hana, and EI.8J of the

respondents are very low to prefer the pulses products like -hana.

IE.MJ of the respondents are very hihly prefer the Fibers products like )M5M %apas,

Shankar %apas, E9J of the respondents are hihly prefer the Fibers products like )M5M

%apas, Shankar %apas, II.8J of the respondents are moderate level of preference in Fibers

products like )M5M %apas, Shankar %apas, I8 J of the respondents are prefer low level of

preference of the Fibers products like )M5M %apas, Shankar %apas, and I9.4J of the

respondents are very low to prefer the Fibers products like )M5M %apas, Shankar %apas.

E5.IJ of the respondents are very hihly prefer the -ereals products like wheat, barley,

mai0e)feed>industrial Grade, EI.8J of the respondents are hihly prefer the -ereals products

like wheat, barley, mai0e)feed>industrial Grade, I9.4J of the respondents are moderate level

of preference in -ereals products like wheat, barley, mai0e)feed>industrial Grade, I8.4 J of

the respondents are prefer low level of preference of the -ereals products like wheat, barley,

mai0e)feed>industrial Grade, and IE.MJ of the respondents are very low to prefer the -ereals

products like wheat, barley, mai0e)feed>industrial Grade.

E4.J of the respondents are very hih to prefer the oil and oil seeds, EI.8J of the

respondents are hihly to prefer the oil and oil seeds, EM.8J of the respondents are prefer it

only the moderate level, I6.MJ of the respondents are prefer only low level and I8J of the

respondents are very low to prefer the oil and oil seeds.

84


85/89

EI.8J of the respondents are very hih to prefer the other products like Guar Seeds, potato .

EE.M J of the respondents are prefer hih level, E4. Jof the respondents are prefer these

products only moderate level, IM.8 J of the respondents are prefer it low level and 9 J of

the respondents are not to prefer the other products.

3E.MJ of the respondents are very hihly prefer metal products like steel, copper and nickel,

I6.MJ of the respondents are hihly prefer metal products like steel, copper and nicke.5.Il

J of the respondents are prefer it only moderate levels, E.J of the respondents are prefer

only low level and 5.I J of the respondents are not to prefer the metals to invest.

3.J of respondents are very hih to prefer the enery products, E6.M J of the respondents

are hihly prefer it, EI.8 J of the respondents are only moderate level of preference, and

E6.MJ of the respondents are very low to prefer it. and E9.4EJ of the respondents are not

ready to prefer it

89J of respondents are very hih to prefer the Precious metals products, E8.4J of the

respondents are hihly prefer it, 5.IJ of the respondents are only moderate level of

preference, EI.8J of the respondents are very low to prefer, and EI.8 J of the respondents

are not prefer it.

E.MJ of the respondents are very hihly prefer other products like Polyvinyl, EI.8 J of therespondents are moderate level of preference , . J of the respondents are very low to

prefer it ,8I.8 J of the respondents are not to prefer its.

3I.8 J of the respondents are sayin about commodity market is price hedin, I.8J of

the respondents are sayin about commodity market is reulated marketin, E6.MJ of the

respondents are sayin about commodity market is low risk, and 4. J of the respondents

are sayin about commodity market is (uality products.

6M.8J of the respondents are very hihly accepted the commodity market advertisement and

its rumors. I9.4J of the respondents are hihly accept the commodity market advertisement

and its rumors, E9J of the respondents are moderate level of acceptance of the commodity

market advertisement and its rumors, 9.4J of the respondents are very low acceptin the

85


86/89

commodity market advertisement and its rumors and 9.4J of the respondents are not to

accept the commodity market advertisement and its rumors.

6I.8J of the respondents are sayin definitely recommend commodity tradin to others,

IM.8 J of the respondents are probably others to trade in commodity market, EIJ of the

respondents are not ready to recommend others to do in commodity tradin.

From the chi s(uare analysis between the income and pulses calculation, the table value of VW

for EI deree of freedom at 8J level of sinificance is IE.999. The calculated value VW is

much less than the tabulated value and hence the result of the e"periment supports the

hypothesis. 2e can conclude that there is no influencin of income to prefer the pulses.

+Aull $ypothesis 'ccepted

From the chi s(uare analysis between the income and fibers calculation, the table value of VW

for EI deree of freedom at 8J level of sinificance is IE.999. The calculated value VW is

much less than the tabulated value and hence the result of the e"periment supports the

hypothesis. 2e can, conclude that there is no influencin of income to prefer the fibers.

+Aull $ypothesis 'ccepted

From the chi s(uare analysis between the occupation and enery calculation the table value

of VW for EI deree of freedom at 8J level of sinificance is IE.999. The calculated value VW

is much less than the tabulated value and hence the result of the e"periment supports the

hypothesis. 2e can, thus, conclude that there is no influencin of Dccupation to prefer the

;nery. +Aull $ypothesis 'ccepted

!t is noted from the 'AD' calculation between occupation and precious metal, the

calculated 'AD' value is less than the table value. So, there is no relationship between

Dccupation and #etal. +Aull hypothesis accepted.

!t is noted from the 'AD' calculation between risk takin capacity and ae of the

respondents, the calculated 'AD' value is less than the table value. So, there is no

relationship between Hisk takin capacity and ae of the respondents. +Aull hypothesis

accepted.

86


87/89

The correlation calculation between spices and metal, the correlation value i.e. r value is

Aeative, so there is Ao relations

Documents

Hpd Annova