EXECUTIVE SUMMARY

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EXECUTIVE SUMMARY

There is a huge competition between brokerage firms in post reform India. For investors always very difficult to decide which brokerage firm to choose in which they can invest their funds.

Research was carried out to find which brokerage house people prefer while investing in stock market.

This study suggest that people are not interested while investing in stock and commodity market due to lack of proper knowledge they have.

The main purpose of any investment is get a good return and liquidity out of it, due to lack of knowledge and awareness commodity market is less prefer by investors. The major findings of this study are that people are interested to invest in stock market but they don’t have proper knowledge about the stock market.

Through this report we are also able to understand, what are the positive and strong point of company (Sharekhan Limited) by which they are able of pitching to a potential clients.

I was also asked to give a suggestion to the company, so that they can improve their product list.

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INTRODUCTION

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ROLE OF STOCK EXCHANGE IN CAPITAL MARKET OF INDIA

Stock exchange play a crucial role in the consolidation of a national economy in general and in the development of industrial sector in particular. It is the most dynamic and organized component of capital market. Especially, in developing country like India, the stock exchanges play a cardinal role in promoting the level of capital formation through effective mobilization of saving and ensuring investment safety.

1. Effective Mobilization of Savings

Stock exchanges provide organized market for individual as well as institutional investors. They regulate the trading transactions with proper rules and regulation in order to insure investor’s protection. This helps to consolidate the confidence of investors and small savers. Thus, stock exchange attract small savings especially of large number of investors in the capital market.

2. Promoting Capital Formation

The fund mobilized through capital market are provided to the industries engaged in the production of various goods and services useful for the society. This leads to capital formation and development of national assets. The saving mobilized are channelized in to appropriate avenues of investment.

3. Wider Avenues of Investment

Stock exchange provide a wider avenue for the investment to the people and organizations with investable surplus. Companies from diverse industries like Information Technology, Steel, Chemicals, Fuels and Petroleum, Cement, Fertilizers, etc. offers various kinds of equity and debt securities to investors. Online trading facility has brought the stock exchange at the doorsteps of investors through computer network. Diverse type of securities is made available in the stock

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exchanges to suit the varying objectives and notions of different classes of investors. Necessary information from stock exchanges available from different sources guides the investors in the effective management of their investment portfolios.

4. Liquidity of Investment

Stock exchanges provide liquidity of investment to the investors. Investors can sell out any of their investment in securities at the time during trading days and trading hours on stock exchanges. Thus, stock exchanges provide liquidity of investment. The online trading and online settlement of demat securities facilitates the investor to sell out their investment and realize the proceeds within a day or two. Even investors can switch over their investment from one security to another according to the changing scenario of capital market.

5. Investment Priorities

Stock exchange facilitates the investors to decide his investment priorities by providing him the basket of different kinds of securities of different industries and company. He can sell stock of one company and buy a stock of another company through stock exchange whenever he wants. He can manage his investment portfolio to maximize his wealth.

6. Investment Safety

Stock exchanges through their by-law, securities and exchange board of India (SEBI) guidelines, transparent procedures try to provide safety to the investment in industrial securities. Government has established the National Stock Exchange (NSE) and Over the Counter Exchange of India (OTCEI) for investor’s safety. Exchange authority tries to curb speculative practices and minimize the risk for common investor to preserve his confidence.

7. Wide Marketability to Securities

Online price quoting system and online buying and selling facility have changed the nature and working of stock exchanges. Formerly, the dealing on stock exchanges was restricted to its headquarters. The investors across the country were

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absolutely in dark about the price fluctuations on stock exchanges due to the lack of information. But today due to internet, online quoting facilities are available at the computers of the investors. As a result, they can keep track of price fluctuations taking place on stock exchange every second during the working hours. Certain T.V. channels like CNBC are fully devoted to stock market information and corporate news. Even other channel displays the online quoting of stock. Thus, modern stock exchanges backed up by internet and information technology provide wide marketability to securities of the industries. Demat facilities has revolutionized the procedure of transfer of securities and facilitated marketing.

8. Financial Resources for Public and Private Sectors

Stock exchanges make available the financial resources available to the industries in public and private sector through various kinds of securities. Due to the assurance of liquidity, marketing support, investment safety assured through stock exchange, the public issues of securities by these industries receive strong public response (resulting in oversubscription of issue).

9. Fund for Development Purpose

Stock exchange enable the government to mobilize the funds for public utilities and public undertaking which take up the developmental activities like power project, shipping railways, telecommunication, dams & roads contraction, etc. Stock exchange provide liquidity, marketability, price continuity and constant evaluation of government securities.

10. Indicator of Industrial Development

Stock exchanges are the symbolic indicators of industrial development of a nation productivity, efficiency, economic status, prospectus of each industry and every unit in an industry is reflected through the price fluctuation of securities of various companies tell the entire story of changes in the industrial sector.

11. Barometer of National Economy

Stock exchange is taken as a barometer of the economy of a country. Each economy is economically symbolized (indicators) by its most significant stock

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exchange. New York Stock Exchange, London Stock Exchange, Tokyo Stock Exchange and Bombay Stock Exchange are considered as barometer of U.S.A, United Kingdom, Japan and India respectively. At both national and international level these stock exchanges represent the progress and condition of their economies.

Thus, stock exchange serves the nation in several ways through its diversified economic services which include imparting liquidity to investment, providing marketability, enabling evaluation and ensuring price continuity of securities.

Capital market is divided into two categories:

1. Primary Market

2. Secondary Market

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ROLES AND FUNCTION OF SEBI IN CAPITAL MARKET OF INDIA

The Securities and Exchange Board of India (frequently abbreviated SEBI) is the regulator for the securities market in India.

It was formed officially by the government of India in 1972 with SEBI Act 1992 being passed by the Indian parliament. SEBI headquartered in the business district of Bandra Kurla Complex in Mumbai, and has Northern, Eastern, Southern, and Western regional offices in New Delhi, Kolkata, Chennai and Ahmedabad.

Controller of capital issues was the regulatory authority before SEBI came into existence; it derived authority from the capital issue (control) Act, 1947.

Initially SEBI was a non-statutory body without any statutory power. However in 1995, the SEBI was given additional statutory power by the Government of India through an amendment to the Securities and Exchange Board of India Act 1992. In April, 1998 the SEBI was constituted as the regulator of capital markets in India under a resolution of the government of India.

The SEBI is managed by six members, i.e. by the chairman who is nominated by central government & two members, i.e. officers of central ministry, one member from RBI & the remaining two are nominated by the central government. The office of SEBI is situated at Mumbai with its regional offices at Kolkata, Delhi and Chennai.

Functions and Responsibilities

SEBI has to be responsive to the needs of three groups, which constitute the market:

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The issuers of securities The investors The market intermediaries

SEBI has three function rolled in to one body: quasi-legislative, quasi-judicial, and quasi-executive. It drafts regulations in its legislative capacity; it conducts investigation and enforcement action and its passes rulings and orders in its judicial capacity. Though this makes it very powerful, there is an appeals process to create accountability. There is a securities appellate tribunal which is a three-member tribunal and is presently headed by a former chief justice of a high court - Justice Mr. N.K. Sodhi. A second appeal lies directly to the Supreme Court.

SEBI has enjoyed success as a regulator by pushing systemic reforms aggressively and successively (e.g. the quick movement towards making the markets electronics and paperless rolling settlement on T+2 basis). SEBI has been active in setting up the regulation as required under law.

SEBI has also been instrumental in taking quick and effective steps in light of the global meltdown and the Satyam fiasco. It had increased the extent and quantity of disclosures to be made by Indian corporate promoters. More recently, in light of the global meltdown, it liberalized the takeover code to facilitate investment by removing regulatory structures. In one such move, SEBI has increased the application limit for retail investors to Rs. 2 lakh, from Rs. 1 lakh at present.

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COMPANY PROFILE

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COMPANY PROFILE OF SHAREKHAN LIMITED

Sharekhan limited is one of the retail brokerage firms in India. It is the retail broking firm of the Mumbai based SSKI Group, which has over eight decades of experience in the stock broking business. Sharekhan offers its customers a wide range of equity related services including trade execution on BSE, NSE, Derivatives, depository services, online trading, and investment advice etc.

The firms online trading and investment site – www.sharekhan.com was launched on 8th February 2000. The site gives access to superior content and transaction facility to retail customers across the country. Known for its jargon-free, investor friendly language and high quality research, the site has a registered base of over two lakh customers. The number of trading member currently stands at over 14 lakh. While online trading currently accounts for just over 3 daily trading in stock in India.

The content rich and research oriented portal has stood out among its contemporaries because of its steadfast dedication to offering customers best-of-breed technology and superior market information. The objective has been to let customers make informed decision and to simplify the process of investing in stocks.

On April 17, 2002 Sharekhan launched aped trade, a net-based executable application that emulate the broker terminals along with host of other information relevant to the traders. This was the first time that a net based trading station of its caliber was offered to the traders. In the six month speed trade has become a de facto standard for the day trading community over the net.

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Sharekhan’s ground network includes over 1450 branches in 450 cities in India and 2 branches in Dubai.

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Reason to choose sharekhan limited

Expert

SSKI has more than eight decades of trust and credibility in the Indian stock market. In the Asia money broker’s polled held recently, SSKI won the ‘ India’s best broking house for 2004’ award. Ever since it is launched Sharekhan as it retail broking division in February 2000, it has been providing institutional level research and broking services to individual investors.

Techniques

Sharekhan Ltd provides online trading account through which you can buy and sell shares in an instant from any PC with an Internet connection. You will get access to our powerful online trading tools that will help you take complete control over your investment in shares.

Accessibility

Sharekhan Ltd provides Advice, Education, Tools and Execution services for investors. These services are accessible through our centers across the country (Over 1005 locations in 410 cities) over the internet (through the website www.sharekhan.com) as well as over the Voice Tool.

Knowledge

In a business where the right information at the right time can translate into direct profits, you get access to a wide range of information on our content-rich portal, Sharekhan. You will also get a useful set of knowledge-based tools that will empower you to take informed decisions.

Convenience

An individual can call to Dial-N-Trade number to get investment advice and execute your transactions. We have a dedicated call-center to provide this service via a Toll Free Number 1800-22-7500, 1800-22-7050 from anywhere in India.

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Customer Service

Our customer service team will assist you for any help that you need relating to transactions, billing, demat and other queries. Our customer service can be contracted via a toll-free number, email or live chat on www.sharekhan.com.

Investment Advice

Share khan has dedicated research teams of more than 30 people for fundamental and technical researches. Our analysts constantly track the pulse of the market and provide timely investment advice to you in the form of daily research emails, online chat, printed reports and SMS on your mobile phone.

Benefits

1. Secure Order by Voice Tool Dial-n-Trade.

2. Automated Portfolio to keep track of the value of your actual purchases.

3. 24x7 Voice Tool access to your trading account.

4. Personalized Price and Account Alerts delivered instantly to your cell phone

& email address.

5. Special Personal Inbox for order and trade confirmations.

6. On-line customer service via web chat.

7. Anytime Ordering

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FEES STRUCTURE

Charge Classic Account Tiger trade account

Account Opening Rs. 750 /- Nil

Annually maintain charges Rs.400/- Rs. 400/-

Brokerage Intra-day 0.10%

Delivery 0.50%

Intra-day 0.05%

Delivery 0.25%

Note

Minimum margin cheque – Rs. 5000with the classic account that is must

deposit in account opening time.

If margin cheque exceeds Rs. 50000, account opening free.

Minimum brokerage cheque – Rs. 6000 (adjusted towards brokerage within

one year) that is applicable for only tiger trade account.

Annual maintenance charges – Rs. 300 (chargeable in second year) that is

applicable for both account

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Swot Analysis of Sharekhan Ltd

Strengths-

Employees are highly empowered.

Strong communication network.

Management philosophy and commitment to maximize shareholders returns

Upgraded product design and development facilities to develop new products and aid diversification.

Ongoing activities to support up gradation of operational performance and rise in productivity

Good co-operation between employees.

Weakness-17

Competition from cheap imports.

Low customer base.

High employee turnover.

Opportunities-

Growth rate of mutual fund industry is 40 to 50% during last year and it expected that this rate will be maintained in future also.

Marketing at rural and semi-urban areas.

Threats, Risks and Concerns-

Increasing number of local players.

Constant pressure to be cost competitive to meet customer expectations.

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INTRODUCTION OF ALL PRODUCTS & SERVICES OF SHAREKHAN

LIMITED

INTRODUCTION OF ALL PRODUCT & SERVICES OF SHAREKHAN

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There are many products & services which are provided by Sharekhan Ltd. Sharekhan try its best to fulfill the demand of its customer & the market. The products & services which are provided by share are as follows:

1. Demat Account

2. Equity Investment

3. Derivatives/ F&O

4. Initial Public Offering (IPO)

5. Commodity Market

6. Currency

7. Portfolio Management Services

8. Fortune Finder

9. Mutual Fund

10. Insurance

1. Demat Account- The term "Demat", in India, refers to a dematerialized account for individual Indian citizens to trade in listed stocks or debentures in electronic form rather than

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paper, as required for investors by the Securities and Exchange Board of India (SEBI). In a Demat account, shares and securities are held electronically instead of the investor taking physical possession of certificates. A Demat account is opened by the investor while registering with an investment broker (or sub-broker). The Demat account number is quoted for all transactions to enable electronic settlements of trades to take place.Access to the Demat account requires an internet password and a transaction password. Transfers or purchases of securities can then be initiated. Purchases and sales of securities on the Demat account are automatically made once transactions are confirmed and completed.

Advantages of Demat Account-A Demat Account also helps avoid problems typically associated with physical share certificates, for example: delivery failures caused by signature mismatch, postal delays and loss of certificate during transit. Further, it eliminates the risks associated with forgery and loss due to damaged stock certificates. Demat Account holders also avoid stamp duty (as against 0.5 per cent payable on physical shares) and filling up of transfer deeds. Demat Account holders usually obtain quicker receipts of benefits like stock splits and bonuses.The other advantage is the ability access stocks, bonds, ETFs, IPO, Gold ETF, etc. all in one place. It’s like one centralized investment account from where you can access and maintain investment products.

Depositary Participant (DP)-A Depository (in simple terms) is a institution holding a pool of pre-verified shares held in electronic mode that offers efficient settlement of transactions. A Depository Participant (DP) is an intermediary between the investor and the depository. A DP is typically a financial organization like a bank, broker, financial institution, or custodian acting as an agent of the depository to make its services available to the investors. Each DP is assigned a unique identification number known as DP-ID. As of March 2006, there were a total of 538 DPs registered with SEBI.

Disadvantages of Demat Account-

1. Trading in securities may become uncontrolled in case of dematerialized securities.

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2. It is incumbent upon the capital market regulator to keep a close watch on the trading in dematerialized securities and see to it that trading does not act as a detriment to investors.

3. For dematerialized securities, the role of key market players such as stock-brokers needs to be supervised as they have the capability of manipulating the market.

4. Multiple regulatory frameworks have to be conformed to, including the Depositories Act, Regulations and the various By-Laws of various depositories.

5. Agreements are entered at various levels in the process of dematerialization. These may cause anxiety to the investor desirous of simplicity.

2. Equity Investment- An equity investment generally refers to the buying and holding of shares of stock on a stock market by individuals and firms in anticipation of income from dividends and capital gains, as the value of the stock rises. Typically equity holders receive voting rights, meaning that they can vote on candidates for the board of directors (shown on a proxy statement received by the investor) as well as certain major transactions, and residual rights, meaning that they share the company's profits, as well as recover some of the company's assets in the event that it folds, although they generally have the lowest priority in recovering their investment. It may also refer to the acquisition of equity (ownership) participation in a private (unlisted) company or a startup company. When the investment is in infant companies, it is referred to as venture capital investing and is generally regarded as a higher risk than investment in listed going-concern situations.

Book valueThe book value of equity will change in the case of the following events:

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1. Changes in the firm's assets relative to its liabilities. 2. Depreciation 3. Issue of new equity in which the firm obtains new capital increases the total

shareholders' equity.4. Share repurchases, in which a firm gives back money to its investors,

reducing on the asset side its financial assets, and on the liability side the shareholders' equity.

5. Dividends paid out to preferred stock owners are considered an expense to be subtracted from net income (from the point of view of the common share owners).

6. Other reasons - Assets and liabilities can change without any effect being measured in the Income Statement under certain circumstances

Market value of SharesIn the stock market, market price per share does not correspond to the equity per share calculated in the accounting statements. Stock valuations, which are often much higher, are based on other considerations related to the business' operating cash flow, profits and future prospects; some factors are derived from the accounting statements.

3. Derivatives/ F&O- A Derivative instrument is a contract between two parties that specifies conditions (especially the dates, resulting values of the underlying variables, and notional amounts) under which payments, or payoffs, are to be made between the parties. Derivatives can be used for speculating purposes ("bets") or to hedge ("insurance"). For example, a speculator may sell deep in-the-money naked calls on a stock, expecting the stock price to plummet, but exposing him to potentially unlimited losses. Very commonly, companies buy currency forwards in order to limit losses due to fluctuations in the exchange rate of two currencies.Third parties can use publicly available derivative prices as educated predictions of uncertain future outcomes, for example, the likelihood that a corporation will default on its debts.

Usage-Derivatives are used by investors for the following:

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1. Provide leverage (or gearing), such that a small movement in the underlying value can cause a large difference in the value of the derivative;

2. speculate and make a profit if the value of the underlying asset moves the way they expect (e.g., moves in a given direction, stays in or out of a specified range, reaches a certain level);

3. Hedge  or mitigate risk in the underlying, by entering into a derivative contract whose value moves in the opposite direction to their underlying position and cancels part or all of it out;

4. Obtain exposure to the underlying where it is not possible to trade in the underlying (e.g., weather derivatives);

5. Create option ability where the value of the derivative is linked to a specific condition or event (e.g. the underlying reaching a specific price level).

Types of Derivatives-There are mainly 2 types of Derivatives in which an investor invest his/her money. They are as follows:

1. Over-the counter2. Exchange-Traded Derivative Contracts

4. Initial Public Offering (IPO)- An initial public offering (IPO) or stock market launch is the first sale of stock by a company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises. Many companies that undertake an IPO also request the assistance of an investment banking firm acting in the capacity of an underwriter to help them correctly assess the value of their shares, that is, the share price (IPO Initial Public Offerings, 2011).

Reasons for listingWhen a company lists its securities on a public exchange, the money paid by investors for the newly issued shares goes directly to the company (in contrast to a later trade of shares on the exchange, where the money passes between investors). An IPO, therefore, allows a company to tap a wide pool of investors to provide itself with capital for future growth, repayment of debt or working capital. A company selling common shares is never required to repay the capital to investors.Once a company is listed, it is able to issue additional common shares via a secondary offering, thereby again providing itself with capital for expansion

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without incurring any debt. This ability to quickly raise large amounts of capital from the market is a key reason many companies seek to go public.

Disadvantages of an IPOThere are several disadvantages to completing an initial public offering, namely:

1. Significant legal, accounting and marketing costs2. Ongoing requirement to disclose financial and business information3. Meaningful time, effort and attention required of senior management4. Risk that required funding will not be raised5. Public dissemination of information which may be useful to competitors,

suppliers and customers.

Issue PriceA company that is planning an IPO appoints lead managers to help it decide on an appropriate price at which the shares should be issued. There are two ways in which the price of an IPO can be determined: either the company, with the help of its lead managers, fixes a price (fixed price method) or the price is arrived at through the process of book building.

5. Commodity Market- Commodity markets are markets where raw or primary products are exchanged. These raw commodities are traded on regulated commodities exchanges, in which they are bought and sold in standardized contracts.This article focuses on the history and current debates regarding global commodity markets. It covers physical product (food, metals, and electricity) markets but not the ways that services, including those of governments, nor investment, nor debt, can be seen as a commodity. Articles on reinsurance markets, stock markets, bond markets and currency markets cover those concerns separately and in more depth. One focus of this article is the relationship between simple commodity money and the more complex instruments offered in the commodity markets.

Spot trading-

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Spot trading is any transaction where delivery either takes place immediately, or with a minimum lag between the trade and delivery due to technical constraints. Spot trading normally involves visual inspection of the commodity or a sample of the commodity, and is carried out in markets such as wholesale markets. Commodity markets, on the other hand, require the existence of agreed standards so that trades can be made without visual inspection.

Forward contracts-A forward contract is an agreement between two parties to exchange at some fixed future date a given quantity of a commodity for a price defined today. The fixed price today is known as the forward price.

Futures contracts-A futures contract has the same general features as a forward contract but is transacted through a futures exchange. Commodity and futures contracts are based on what’s termed forward contracts. Early on these forward contracts — agreements to buy now, pay and deliver later — were used as a way of getting products from producer to the consumer. These typically were only for food and agricultural products. Forward contracts have evolved and have been standardized into what we know today as futures contracts. Although more complex today, early forward contracts for example, were used for rice in seventeenth century Japan. Modern forward, or futures agreements began in Chicago in the 1840s, with the appearance of the railroads. Chicago, being centrally located, emerged as the hub between Midwestern farmers and producers and the east coast consumer population centers.

Hedging - Hedging, a common practice of farming cooperatives insures against a poor harvest by purchasing futures contracts in the same commodity. If the cooperative has significantly 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.

Delivery and condition guarantees-In addition, delivery day, method of settlement and delivery point must all be specified. Typically, trading must end two (or more) business days prior to the

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delivery day, so that the routing of the shipment can be finalized via ship or rail, and payment can be settled when the contract arrives at any delivery point.

6. Currency- In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply. The other part of a nation's money supply consists of bank deposits (sometimes called deposit money), ownership of which can be transferred by means of cheques, debit cards, or other forms of money transfer. Deposit money and currency are money in the sense that both are acceptable as a means of paymentDirect exchange of commodities such as precious metals, furs, grain, etc. in early human societies lead to the first money proper in early civilizations. Until modern times, precious metals such as gold or silver typically were used to retain the commodity nature of the store of value function of money. However, nearly all contemporary monetary systems are based on fiat money. Usually, a government declares its currency (including notes and coins issued by the central bank) to be legal tender, making it unlawful to not accept it as a means of repayment for all debts, public and private. In major modern economies such as those of the United States or the Euro Zone, most money is electronic, but the "currency" of these policies may, depending on context, include all money or just specie.

Currency Convertibility-Convertibility of a currency determines the ability of an individual, corporate or government to convert its local currency to another currency or vice versa with or without central bank/government intervention. Based on the above restrictions or free and readily conversion features currencies are classified as:

1. Fully Convertible - When there are no restrictions or limitations on the amount of currency that can be traded on the international market, and the government does not artificially impose a fixed value or minimum value on the currency in international trade. The US dollar is an example of a fully convertible currency and for this reason, US dollars are one of the major currencies traded in the FOREX market.

2. Partially Convertible - Central Banks control over international investments flowing in and out of the country, while most domestic trade transactions are handled without any special requirements, there are significant restrictions on international investing and special approval is often required in order to

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convert into other currencies. The Indian Rupee is an example of a partially convertible currency.

3. Nonconvertible - Neither participates in the international FOREX market nor allows conversion of these currencies by individuals or companies. As a result, these currencies are known as blocked currencies. e.g.: North Korean Won and the Cuban Peso.

7. Portfolio Management Services-

A Portfolio Management refers to the science of analyzing the strengths, weaknesses, opportunities and threats for performing wide range of activities related to the one’s portfolio for maximizing the return at a given risk. It helps in making selection of Debt Vs Equity, Growth Vs Safety, and various other tradeoffs.

Major tasks involved with Portfolio Management are as follows.

1. Taking decisions about investment mix and policy

2. Matching investments to objectives

3. Asset allocation for individuals and institution

4. Balancing risk against performance

There are basically two types of portfolio management in case of mutual and exchange-traded funds including passive and active.

1. Passive management involves tracking of the market index or index investing.

2. Active management involves active management of a fund’s portfolio by manager or team of managers who take research based investment decisions and decisions on individual holdings.

Portfolio-In terms of mutual fund industry, a portfolio is built by buying additional bonds, mutual funds, stocks, or other investments. If a person owns more than one security, he has an investment portfolio. The main target of the portfolio owner is to increase value of portfolio by selecting investments that yield good returns. As per the modern portfolio theory, a diversified portfolio that includes different types

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or classes of securities; reduces the investment risk. It is because any one of the security may yield strong returns in any economic climate.

Facts about Portfolio-1. There are many investment vehicles in a portfolio.

2. Building a portfolio involves making wide range of decisions regarding buying or selling of stocks, bonds, or other financial instruments. Also, one needs to make decision regarding the quantity and timing of the buy and sell.

3. Portfolio Management is goal-driven and target oriented.

4. There are inherent risks involved in the managing a portfolio.

5. The basics and ideas of Investment Portfolio Management are also applied to portfolio management in other industry sectors.

8. Fortune Finder-

Spot the best trading opportunities using Fortune Finder for 500 stocks inDay Trading and over 3000 stocks for Delivery. 

It's a scientific system powered by a trend evolution algorithm which captures the changing trend pattern for each stock. This helps investors /traders to get a clear and simple "call to action" for profitable trades.

It's a simple decision making system to generate high probability calls with only 3 action cues: 

BUY SELL HOLD

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No jargons, No indecision 

Here's how you can find your Fortune:Your Stock, Any Stock - Get the Buy, Sell, Hold on any stock with an easy to understand explanation

Daily Picks - The system also provides daily picks for you to choose from for day trading or delivery

9. Mutual Fund-

A Mutual Fund is a type of professionally-managed collective investment scheme that pools money from many investors to purchase securities. While there is no legal definition of mutual fund, the term is most commonly applied only to those collective investment schemes that are regulated, available to the general public and open-ended in nature. Hedge funds are not considered a type of mutual fund.The term Mutual Fund is less widely used outside of the United States. For collective investment schemes outside of the United States, see articles on specific types of funds including open-ended investment companies, SICAVs, unitized insurance funds, unit trusts and Undertakings for Collective Investment in Transferable Securities.

History of Mutual Fund in IndiaThe Mutual Fund Industry in India started in 1963 with the formation of Unit Trust of India, at the initiative of the Government of India and Reserve Bank. The history of mutual funds in India can be broadly divided into four distinct phases.

1. First Phase- 1964-19872. Second Phase- 1987-1993 (Entry of Public Sector)3. Third Phase- 1993-2003 (Entry of Private Sector)4. Forth Phase- since February 2003

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Types of Mutual FundThere are mainly 2 types of Mutual Fund in which an investor invest his/her money. They are as follows:1. Open-ended Funds2. Close-ended Funds

10. Insurance-Insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the insurance; the insured, or policyholder, is the person or entity buying the insurance policy. The amount to be charged for a certain amount of insurance coverage is called the premium. Risk management, the practice of appraising and controlling risk, has evolved as a discrete field of study and practice.

LegalWhen a company insures an individual entity, there are basic legal requirements. Several commonly cited legal principles of insurance include:

1. Indemnity 2. Insurable interest  3. Utmost good faith  .4. Contribution Subrogation

Types of InsurancesThere are many types of insurances which insurance company give to its customer according to their needs.

1. Auto insurance2. Gap insurance3. Home insurance4. Health insurance5. Accident, sickness and unemployment insurance6. Others

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MAJOR COMPETITORS OF SHAREKHAN LTD.

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ICICI DIRECT

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ICICI Web Trade Ltd (IWTL) maintains www.icicidirect.com whereas IWTL is an affiliate of ICICI Bank Ltd and the Website is owned by ICICI Bank Ltd. IWTL has launched and established an online trading service on the Website.

Products and Services of ICICI DIRECT- Investing in Mutual Funds Personal Finance Customer Service Features IPO’s Margin Trading Margin PLUS Trading Call Trade Trading on NSE/BSE

HDFC SECURITY

HDFC Security is the subsidiary of HDFC (Housing Development Financial Corporation). www.hdfcsec.com would have an exclusive discretion to decide the customers who would be entitled to its online investing services.

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www.hdfcsec.com also reserves the right to decide on the criteria based on which customers would be chosen to participate in these services. The present web site (www.hdfcsec.com) contains features of services that they offer/propose to offer in due course. The launch of new services is subject to the clearance of the regulators.ie. SEBI, NSE and BSE.

Products and Services of HDFC SECURITIES- Online trading for Resident & Non Resident Indians. Cash-n-Carry on both NSE and BSE. Day trading on both NSE and BSE. Trades on Futures & Options on the NSE. Online IPO’s.

ACCOUNT ACTIVATION AND OTHER CHARGES

COMPAN

Y

A/C

OPENIN

G

CHARGE

BROKE-

RAGE

(INTRADA

Y

AM

C

TRADING

EXPOSUR

E

INTERES

T

RATE

DEBIT

PERIO

D

MODE

OF

TRADIN

G

MARGI

N

SOFTWAR

E USED

35

DELIVERY)

Sharekhan NIL 5p, 25p1st yr

free4-6 times 19% T+ 2

Online/

OfllineRs 5000 Trade Tiger

Karvy Nil 5p, 50p1st yr

free5-7 times 18% T + 4

Online/

OfflineRs 5000

ICICI Direct Rs 750 50p, 75p

Rs

500

pa

3-4 times 18% T + 2Online/

OfflineNIL

Accesed

through net

Indiabulls Rs900 3-4p, 30-40p NIL 4-5 times 17% T + 2Online/

OfflineNIL

Power India

Bulls

HDFC Rs 750 30p,60p

Rs

400

pa

4-6 times 19% T + 3Online/

OfflineRs 5000

IndiaInfolin

eRs 900 45p, 65p

Rs

5003-5 times 20% T + 3

Online/

OfflineRs 5000

OBJECTIVES

1. To know about the different Broking Housing Firms which are the big competitors of Sharekhan Ltd.

36

2. To know the different Companies Account Activation and Other Charges like Brokerage, Annual Maintenance Cost (AMC), and Interest Rate etc.

3. To know about the Awareness of the Investors towards Stock Brokers and Share Market.

4. To study the Market share of Sharekhan Ltd in the Share Market and identify the areas of competitive advantages over other players present in the market.

5. To study about consumer Awareness and Satisfaction, about Operational Services and Procedures of Sharekhan Ltd.

37

RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

1. Research Design-My research is based on Descriptive, Qualitative and Quantitative research.

38

1. Descriptive Research-Descriptive research includes surveys and facts findings enquire of different kinds. The major purpose of descriptive research is description of the state of affairs as it exists at present. Researcher has no control over the variables of this type of research.

2. Qualitative Research-

In our research we need comparison between different stock brokers. So this based on all qualitative data. In short, Qualitative research is especially important in the behavioral sciences where the aim is to discover the underline motives of human behavior. Through such research we can analyses various factors which motivate to people to behave in a particular manner or which make people like or dislike a particular thing.

3. Quantitative Research-

Quantitative research is based on the measurement of quantity or amount. It is applicable to phenomena that can be expressed in terms of quantity. So we can use it in our research for collection of all the numerical data.

2. Sample Design-

“A sample design is a definite plan for obtaining a sample from a given population. It refers to the technique or the procedure the researcher would adopt in selecting item for the sample.”

1. Sample Size-

“This refers to the number of items to be selected from the universe to constitute a sample.”

The Sample Size in this project is 100.

39

But I have also study the 5 other Stock Broker Companies in comparison to Sharekhan ltd, related to security and commodity market like, ICICI Direct, HDFC Securities and Indiabulls for the appropriate collection of the information. The Sampling Area is Delhi.

3. Data Collection-

The data for any topic or content can be collected by 2 types:

Primary Data-

The Primary Data is collected using Sampling Method and by Survey using Questionnaire.

Secondary Data-

Secondary Data includes information regarding present market scenario, information regarding mutual funds and competitors, this data is collected by internet, magazines, newspapers and books.

Research is totally based on Primary Data, but in some place Secondary Data is also taken to make this report more appropriate.

40

DATA ANALYSIS & FINDINGS

41

AGE

N Valid 100

Missing 0

Mean 2.46

Std. Deviation .858

AGE

Frequency Percent Valid Percent

Cumulative

Percent

Valid 15-20 4 4.0 4.0 4.0

20-25 63 63.0 63.0 67.0

25-30 19 19.0 19.0 86.0

30-40 11 11.0 11.0 97.0

40 AND ABOVE 3 3.0 3.0 100.0

Total 100 100.0 100.0

42

43

Interpretation :- The data here shows age of 20-25 with 53% followed by 25-30 with 19% followed by 30-40 with 11% followed by 15-20 with 4% followed by 40 and above with 3%.

GENDER

N Valid 100

Missing 0

Mean 1.43

Std. Deviation .498

GENDER

Frequency Percent Valid Percent

Cumulative

Percent

Valid MALE 57 57.0 57.0 57.0

FEMALE 43 43.0 43.0 100.0

Total 100 100.0 100.0

44

Interpretation:- Here the data shows that in the sample 57% are male and 43% are female.

45

OCCUPATION

N Valid 100

Missing 0

Mean 1.54

Std. Deviation .717

OCCUPATION

Frequency Percent Valid Percent

Cumulative

Percent

Valid STUDENT 59 59.0 59.0 59.0

SERVICE 28 28.0 28.0 87.0

SELF EMPLOYED 13 13.0 13.0 100.0

Total 100 100.0 100.0

46

Interpretation:- Here the data shows that in sample 59% are student, 28% service man, and 13% are self employed.

47

INTRESTED IN SHARE TRADING

N Valid 100

Missing 0

Mean 1.14

Std. Deviation .349

INTRESTED IN SHARE TRADING

Frequency Percent Valid Percent

Cumulative

Percent

Valid YES 86 86.0 86.0 86.0

NO 14 14.0 14.0 100.0

Total 100 100.0 100.0

48

Interpretation:- Here the data shows that 86% are interested in trading and 14% are not interested in trading.

49

TRADING YEAR

N Valid 100

Missing 0

Mean 1.73

Std. Deviation .815

TRADING YEAR

Frequency Percent Valid Percent

Cumulative

Percent

Valid BELLOW 1 YEAR 48 48.0 48.0 48.0

1 TO 2 YEAR 33 33.0 33.0 81.0

2 TO 5 YEARS 17 17.0 17.0 98.0

MORE THAN 5 YEARS 2 2.0 2.0 100.0

Total 100 100.0 100.0

50

51

Interpretation:- Here the data show that 48% do the trading bellow 1 year, 33% are 1 to 2 year,17% are 2 to 5 years, and 2% are more than 5 years.

TRADINGTYPE

N Valid 100

Missing 0

Mean 1.10

Std. Deviation .302

TRADING TYPE

Frequency Percent Valid Percent Cumulative Percent

Valid ONLINE 90 90.0 90.0 90.0

OFFLINE 10 10.0 10.0 100.0

Total 100 100.0 100.0

52

INVESTMENT SECTOR

N Valid 100

Missing 0

Mean 2.17

Std. Deviation 1.256

53

INVESTMENT SECTOR

Frequency Percent Valid Percent

Cumulative

Percent

Valid EQUITY 41 41.0 41.0 41.0

COMMODITY 25 25.0 25.0 66.0

CURRENCY 16 16.0 16.0 82.0

MUTUAL FUND 12 12.0 12.0 94.0

IPO 6 6.0 6.0 100.0

Total 100 100.0 100.0

54

Interpretation:- Here the data shows that 41% invested in equity, 25% invested in commodity, 16% invested in currency, 12% invested in mutual fund, and 6% invested in IPO.

BROKING FIRM PREFERENCE

N Valid 100

Missing 0

Mean 1.31

Std. Deviation .465

BROKINGFIRMPREFERENCE

Frequency Percent Valid Percent

Cumulative

Percent

Valid SHAREKHAN LIMITED 69 69.0 69.0 69.0

OTHER BROKING FIRMS 31 31.0 31.0 100.0

Total 100 100.0 100.0

55

Interpretation:- Here the study shows that 69% people wants to go with the Sharekhan Limited and 31% wants to go with Other Broking Firms.

56

AWERNESS OF SHAREKHAN

N Valid 100

Missing 0

Mean 2.99

Std. Deviation 1.133

AWERNESS OF SHAREKHAN

Frequency Percent Valid Percent

Cumulative

Percent

Valid NEWSPAPER 14 14.0 14.0 14.0

JOURNALS 15 15.0 15.0 29.0

FRIENDS 36 36.0 36.0 65.0

INTERNET 28 28.0 28.0 93.0

TV Ads 7 7.0 7.0 100.0

Total 100 100.0 100.0

57

Interpretation:- Here the study shows that the 36% people know about the Sharekhan Limited due to his friends, 28% know due to the internet, 15% know due to the journals, 14% know due to the newspaper, and 7% know due to the TV Ads.

58

Factor   Analysis

Correlation Matrix

LOWBROKE

RAGE

BETTERCUS

TOMERSER

VICE

BRANDLOY

ALTY

MARGINMO

NEY

GOODTRADI

NGTIPS

TIMELYRE

SEARCHR

EPORT

Correlation LOW BROKERAGE 1.000 .598 .535 .470 .387 .418

BETTER

CUSTOMER

SERVICE

.598 1.000 .452 .548 .364 .477

BRAND LOYALTY .535 .452 1.000 .371 .369 .250

MARGIN MONEY .470 .548 .371 1.000 .316 .479

GOOD TRADING

TIPS.387 .364 .369 .316 1.000 .477

TIMELY

RESEARCH

REPORT

.418 .477 .250 .479 .477 1.000

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .824

Bartlett's Test of Sphericity Approx. Chi-Square 188.879

Df 15

Sig. .000

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Interpretation:- Here the KMO value is 0.824>0.60 this shows that the factors in the questionnaire is adequate.

Communalities

Initial Extraction

LOWBROKERAGE 1.000 .628

BETTERCUSTOMERSERVICE 1.000 .644

BRANDLOYALTY 1.000 .456

MARGINMONEY 1.000 .540

GOODTRADINGTIPS 1.000 .420

TIMELYRESEARCHREPORT 1.000 .499

Extraction Method: Principal Component Analysis.

60

Total Variance Explained

Compon

ent

Initial Eigenvalues Extraction Sums of Squared Loadings

Total % of Variance Cumulative % Total % of Variance Cumulative %

1 3.187 53.109 53.109 3.187 53.109 53.109

2 .821 13.685 66.794

3 .728 12.135 78.929

4 .482 8.025 86.954

5 .407 6.787 93.741

6 .376 6.259 100.000

Extraction Method: Principal Component Analysis.

61

Component Matrix

Component

1

BETTERCUSTOMERSERVICE .803

LOWBROKERAGE .792

MARGINMONEY .735

TIMELYRESEARCHREPORT .706

BRANDLOYALTY .675

GOODTRADINGTIPS .648

Extraction Method: Principal Component Analysis.

a. 1 components extracted.

62

Component Score Coefficient Matrix

Component

1

LOWBROKERAGE .249

BETTERCUSTOMERSERVICE .252

BRANDLOYALTY .212

MARGINMONEY .231

GOODTRADINGTIPS .203

TIMELYRESEARCHREPORT .222

.

Crosstabs

Case Processing Summary

Cases

Valid Missing Total

N Percent N Percent N Percent

GENDER * TRADINGTYPE 100 100.0% 0 .0% 100 100.0%

63

GENDER * TRADINGTYPE Crosstabulation

TRADINGTYPE

TotalONLINE OFFLINE 4

GENDER MALE Count 52 5 0 57

% within GENDER 91.2% 8.8% .0% 100.0%

% within TRADINGTYPE 57.8% 55.6% .0% 57.0%

% of Total 52.0% 5.0% .0% 57.0%

FEMALE Count 38 4 1 43

% within GENDER 88.4% 9.3% 2.3% 100.0%

% within TRADINGTYPE 42.2% 44.4% 100.0% 43.0%

% of Total 38.0% 4.0% 1.0% 43.0%

Total Count 90 9 1 100

% within GENDER 90.0% 9.0% 1.0% 100.0%

% within TRADINGTYPE 100.0% 100.0% 100.0% 100.0%

% of Total 90.0% 9.0% 1.0% 100.0%

Hypothesis

H0: Trading type is not dependent upon gender.

H1: Trading type is dependent upon gender.

64

Chi-Square Tests

Value Df

Asymp. Sig. (2-

sided)

Pearson Chi-Square 1.355a 2 .508

Likelihood Ratio 1.718 2 .424

Linear-by-Linear Association .826 1 .363

N of Valid Cases 100

a. 3 cells (50.0%) have expected count less than 5. The minimum expected

count is .43.

Interpretation:- H0 accepted since 0.508>0.05, this means trading type is not dependent upon gender.

Reliability Statistics

Cronbach's Alpha

Cronbach's Alpha

Based on

Standardized

Items N of Items

.823 .822 6

Interpretation:- This study show that the cronbach’s alpha 0.822>0.50 so the use of the data in this study is reliable.

65

FINDINGS

1. According to the data that have been collected all the people who were surveyed are aware of the Share Market & Trading.

2. Survey Shows that the nearly 86% people are interested in Share Trading and rest others are not interested.

3. The Survey also shows that 90% people prefer the online trading rather than that of offline trading through brokers.

4. People like to invest more in Equity rather than other investment sectors.

5. The best preferred broking firm among the people is Sharekhan Limited.

6. Friends, Internet & Journals are the most preferred mode for awareness of the Broking Firms & Share Trading.

66

CONCLUSION

67

CONCLUSION

Our findings during the training with Sharekhan Ltd, was good on the following ground.

1. Sharekhan Ltd is a top ranked company listed with NSDL & CDSL; provide trading through both NSE & BSE.

2. Sharekhan Ltd is providing software to their prospective Sub broker & Remises.

3. Online transferring of funds from trading account to Bank account & vice-versa.

4. Give credit limit up to 10 times on intraday trading and 5 times on Delivery.

5. Give Bunch of services like:1. Product Support2. Back Office Support3. Set Up Support4. Sales Support5. Business Development

68

LIMITATIONS

69

LIMITATIONS

1. Lot of efforts have been undergone to improve the prediction techniques, like earlier there was only fundamental analysis being used but now analysis has come into existence.

2. Once the people who are involved in it, they play it like gambling.

3. It’s difficult to make people aware about the market knowledge it is very vast.

4. Time limitations.

5. Research has been done only at Delhi.

6. Some of the persons were not so responsive.

7. Possibility of error in data collection.

8. Possibility of error in analysis of data due to small sample size.

70

BIBLIOGRAPHY

71

BIBLIOGRAPHY

Websites:

www.wikipedia.com

www.moneycontrol.com

www.mutualfundsindia.com

www.bseindia.com

www.nseindia.com

www.investopedia.com

www.sharekhan.com

www.rediffmoney.com

Journals & Other References:

The Economic Times

Business Standards

Business India

The Telegraph

72

ANNEXURE

ANNEXURE

73

Comparative Study of Products and Services of Broking House in Delhi

1. Age……………………………………………………………………….

2. Gender………………………………………………………………….

3. Occupation……………………………………………………………

4. Are you interested in share trading?1. Yes2. No

5. Since how many years you trade?1. Bellow 1 year2. 1 to 2 year3. 2 to 5 years4. More than 5 years

6. What type of trading you prefer?1. Online2. Offline

7. In which sector you invest the most?1. Equity2. Commodity3. Currency4. Mutual Fund5. IPO

8. If you trade in future, which broking firm would you prefer?

74

1. Sharekhan Limited2. Other broking firms

9. How did you come to know about the Sharekhan Limited?(if 1 selected in Q8)

1. Newspaper2. Journals3. Friends4. Internet5. TV Ads

10. How important do you think these factors influence in choosing a broking firm? (Select one)

(Not Very Important) 1 2 3 4 5 (Extremely Important)

FACTORS 1 2 3 4 5

I. Low Brokerage

II. Better Customer Service

III. Brand Loyalty

IV. Margin Money

V. Good Trading Tips

VI. Timely Research Report

75