A SUMMER TRAINING PROJECT REPORT
ON
“A STUDY ON INVESTOR BEHAVIOUR TOWARDS STOCK MARKET” SUBMITTED IN THE PARTIAL FULFILLMENT FOR THE AWARD OF DEGREE OF MASTER IN BUSINESS ADMINISTRATION 2015-17
UNDER THE GUIDANCE OF:
Dr. Anil goyal Assistant Professor, RDIAS SUBMITTED BY: DEEPAK JINDAL .
02280303915 2015-17
RUKMINI DEVI INSTITUTE OF ADVANCED STUDIES An ISO 9001:2008 Certified Institute NAAC Accrediated :A ,Category A+ Institute (Approved by AICTE, HRD Ministry, Govt. of India) Highest Category ‘A’ by Joint Assessment Committee, Member of AMDISA, AIMA, CSI, CII, DELNET, NHRD Affiliated to Guru Gobind Singh Indraprastha University, Delhi
2A & 2B, Madhuban Chowk, Outer Ring Road, Phase-1, Delhi-11008
Table of Contents Student Declaration……………………………………………………………………
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Certificate from Company.…………………...…………………………………....…..............ii Certificate from Guide…….………………...…………………………………....…...............iii Acknowledgement............................................................................................................iv Executive Summary………………………………………………………………..……………..v
A summary statement designed to provide a quick overview of the full length report on which it is based.
List of Tables………………………………………………………………………………….vi List of Graphs…………………………………………………………………………………vii List of Charts………………………………………………………………………………viii List of Abbreviations, if any………………………………………………ix Page no.
CHAPTER- 1: INTRODUCTION 1.1 About the Industry 1.2 About Organization/ Company Profile………………………………
CHAPTER – 2: LITERATURE REVIEW 2.1 Literature Review and Research Gap…………………………….. 2. 2 About The Topic…………………………………………………
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CHAPTER – 3: RESEARCH METHODOLOGY 3.1
Purpose of the study………………………………………
3.2
Research Objectives of the study……………………………
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3.3
Research Methodology of the study…………………………
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3. 3.1 Research Design……………
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3.3.2Method of data collection ………………………………
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3.3.2.1 Drafting of a questionnaire
3.3.3 Sample design…………………………………………………… …………...
3.3.3.1 Population…………………………………………………... 3.3.3.2 Sample size………………………………………………..
3.3.3.3 Sampling method…………………………….
3.3.4 Method of data analysis ………………………………….. 3.3.5 Limitations…………………………………………………………………………
CHAPTER – 4: ANALYSIS& INTERPRETATION 4.1 Analysis & Interpretation ………………………………………………….
CHAPTER- 5: FINDINGS & SUGGESTIONS 5.1 Findings ………………………………………………………………………….. 5.2 Suggestions…………………..…………………..…………………..………………
CHAPTER- 6 : CONCLUSION 6.1 Conclusion …………………………………………………………………………..
BIBLIOGRAPHY Bibliography……..………………..…………………..………………….. ……………
ANNEXURES (if any) Annexures 1 Annexure 2
STUDENT’s DECLARATION This to certify that I have completed the project titled “A STUDY ON INVESTOR BEHAVIOUR TOWARDS STOCK MARKET “ under the guidance of “Dr. Anil goyal“ in the partial fulfillment of the requirement for the award of the degree of “Master in Business Administration” from “Rukmini Devi Institute of Advanced Studies, New Delhi.” This is an original work and I have not submitted it earlier elsewhere.
Name : DEEPAK JINDAL Enrollment No. 02280303915
CERTIFICATE (From the Guide) This is to certify that the summer training project titled “” is an academic work done by “DEEPAK JINDAL” submitted in the partial fulfillment of therequirement for the award of the degree of “Masters in BusinessAdministration” from “Rukmini Devi Institute of Advanced Studies, New Delhi” under my guidance and direction. To the best of my knowledge and belief the data and information presented by him in the project has not been submitted earlier elsewhere.
Dr ANIL GOYAL Asstt. Prof./Associate Prof./Professor RDIAS
ACKNOWLEDGEMENT I offer my sincere thanks and humble regards to Rukmini Devi Institute Of Advanced Studies, GGSIP University, New Delhi for imparting me valuable professional training in MBA. I pay my gratitude and sincere regards to Dr. Anil goyal, my project Guide for giving me the cream of his knowledge. I am thankful to him/her as he/she has been a constant source of advice, motivation and inspiration. I am also thankful to him/her for giving his/her suggestions and encouragement throughout the project work. I take the opportunity to express my gratitude and thanks to our computer Lab staff and library staff for providing me opportunity to utilize their resources for the completion of the project. I am also thankful to my family and friends for constantly motivating me to complete the project and providing me an environment which enhanced my knowledge
EXECUTIVE SUMMARY
This project gives us a detailed idea of investor . behavior towards stock market. By looking at the starting of the project you will find
Functions of SEBI
Market participants
NSE
BSE
Wealth management solutions
Cash management solutions
This project also defines the objective of the study which includes,
To study about investor behavior Factors affecting investment decision Income group level matters while taking decision Time period for investment
The solution to above objectives is provided through a detailed research. After the theoretical part I have included the research part. My research work includes Research Methodology, which defines the following
Meaning of research Types of research Research methodologies Data collection techniques
STUDY ON INVESTOR BEHAVIOUR
CHAPTER 1
INTRODUCTION 1.1 ABOUT THE INDUSTRY 1.2 ABOUT THE COMPANY
ABOUT INDUSTRY
In the 12th-century France, the courretiers de change were concerned with managing and regulating the debts of agricultural communities on behalf of the banks. Because these men also traded with debts, they could be called the first brokers. A common misbeleif is that in late 13th century Bruges commodity traders gathered inside the house of a man called Van der Beurze, and in 1409 they became the "Brugse Beurse", institutionalizing what had been, until then, an informal meeting, but actually, the family Van der Beurze had a building in Antwerpwhere those gatherings occurred;[19] the Van der Beurze had Antwerp, as most of the merchants of that period, as their primary place for trading. The idea quickly spread around Flanders and neighboring countries and "Beurzen" soon opened in Ghent and Rotterdam. In the middle of the 13th century, Venetian bankers began to trade in government securities. In 1351 the Venetian government outlawed spreading rumors intended to lower the price of government funds. Bankers in Pisa, Verona, Genoa and Florence also began trading in government securities during the 14th century. This was only possible because these were independent city-states not ruled by a duke but a council of influential citizens. Italian companies were also the first to issue shares. Companies in England and the Low Countries followed in the 16th century. The Dutch East India Company (founded in the year of 1602) was the first joint-stock company to get a fixed capital stock and as a result, continuous trade in company stock occurred on the Amsterdam Exchange. Soon thereafter, a lively trade in various derivatives, among which options and repos, emerged on the Amsterdam market. Dutch traders also pioneered short selling – a practice which was banned by the Dutch authorities as early as 1610.
The year 1880 witnessed the emergence of many cotton mill industries in several parts of the country especially in Maharashtra and Gujarat. Because of that, regional wise stock exchanges were started and many stock brokers also entered into it. In 1920 Madras Stock Exchange was started with 100 brokers. The authorities have been encouraging corporatization of the broking industry in India. As a result of that, a number of brokers-proprietor firms and partnership firms have converted themselves into corporate. As at and December 2014, there were 44,540 subbrokers registered with SEBI out of which 19,392sub brokers registered under BSE and 24,522
under NSE and together constituted 98.59% of the total sub-brokers. Following figure shows the number of stock broker registered in SEBI. There are now stock markets in virtually every developed and most developing economies, with the world's largest markets being in the United States, United Kingdom, Japan, India, China, Canada, Germany (Frankfurt Stock Exchange), France, South Korea and the Netherlands
SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI) Securities and Exchange Board of India (SEBI) was first established in the year 1988 as a nonstatutory body for regulating the securities market. Functions of SEBI: Find below SEBI's important functions: 1. Regulates Capital Market 2. Checks Trading of securities. 3. Checks the malpractices in securities market.
What do you mean by stock market? A share market only allows trading of shares. The key factor is the stock exchange – the basic platform that provides the facilities used to trade company stocks and other securities. A stock may be bought or sold only if it is listed on an exchange. Thus, it is the meeting place of the stock buyers and sellers.
TRADE :
Trade in stock markets means the transfer for money of a stock or security from a seller to a buyer. This requires these two parties to agree on a price. Equities (stocks or shares) confer an ownership interest in a particular company. Participants in the stock market range from small individual stock investors to larger traders investors, who can be based anywhere in the world, and may include banks, insurance companies or pension funds, and hedge funds. Their buy or sell orders may be executed on their behalf by a stock exchange trader. Some exchanges are physical locations where transactions are carried out on a trading floor, by a method known as open outcry. This method is used in some stock exchanges and commodity exchanges, and involves traders entering oral bids and offers simultaneously. An example of such an exchange is the New York Stock Exchange. The other type of stock exchange is a virtual kind, composed of a network of computers where trades are made electronically by traders. An example of such an exchange is the NASDAQ. The purpose of a stock exchange is to facilitate the exchange of securities between buyers and sellers, thus providing a marketplace(virtual or real). The exchanges provide real-time trading information on the listed securities, facilitating price discovery. The New York Stock Exchange (NYSE) is a physical exchange, with a hybrid market for placing orders both electronically and manually on the trading floor. Orders executed on the trading floor enter by way of exchange members and flow down to a floor broker, who goes to the floor trading post specialist for that stock to trade the order. The specialist's job is to match buy and sell orders using open outcry. If aspread exists, no trade immediately takes place—in this case the specialist should use his/her own resources (money or stock) to close the difference after his/her judged time. Once a trade has been made the details are reported on the "tape" and sent back to the brokerage firm, which then notifies the investor who placed the order. Although there is a significant amount of human contact in this process, computers play an important role, especially for so-called "program trading".
MARKET PARTICIPANTS Market participants include individual retail investors, institutional investors such as mutual funds, banks, insurance companies and hedge funds, and also publicly traded corporations trading in their own shares. Some studies have suggested that institutional investors and corporations trading in their own shares generally receive higher risk-adjusted returns than retail investors. A few decades ago, worldwide, buyers and sellers were individual investors, such as wealthy businessmen, usually with long family histories to particular corporations. Over time, markets have become more "institutionalized"; buyers and sellers are largely institutions (e.g.,pension funds, insurance companies, mutual funds, index funds, exchange-traded funds, hedge funds, investor groups, banks and various other financial institutions). The rise of the institutional investor has brought with it some improvements in market operations. There has been a gradual tendency for "fixed" (and exorbitant) fees being reduced for all investors, partly from falling administration costs but also assisted by large institutions challenging brokers' oligopolistic approach to setting standardised fees. A current trend in stock market investments includes the decrease in fees due to computerized asset management termed Robo Advisers within the industry. The automation of investment management has decreased how much human portfolio management costs by lowering the cost associated with investing as a whole.
Trends in market participation Stock market participation refers to the number of agents who buy and sell equity backed securities either directly or indirectly in a financial exchange. Participants are generally subdivided into three distinct sectors; households, institutions, and foreign traders. Direct participation occurs when any of the above entities buys or sells securities on its own behalf on an exchange. Indirect participation occurs when an institutional investor exchanges a stock on behalf of an individual or household. Indirect investment occurs in the form of pooled investment accounts, retirement accounts, and other managed financial accounts.
NATIONAL STOCK EXCHANGE (NSE) The National Stock Exchange (NSE) is India's leading stock exchange covering various cities and towns across the country. NSE was set up by leading institutions to provide a modern, fully automated screen-based trading system with national reach. The Exchange has brought about unparalleled transparency, speed & efficiency, safety and market integrity. It has set up facilities that serve as a model for the securities industry in terms of systems, practices and procedures. NSE has played a catalytic role in reforming the Indian securities market in terms of microstructure, market practices and trading volumes. The market today uses state-of-art information technology to provide an efficient and transparent trading, clearing and settlement mechanism, and has witnessed several innovations in products & services viz. demutualisation of stock exchange governance, screen based trading, compression of settlement cycles, dematerialisation and electronic transfer of securities, securities lending and borrowing, professionalisation of trading members, fine-tuned risk management systems, emergence of clearing corporations to assume counterparty risks, market of debt and derivative instruments and intensive use of information technology. The National Stock Exchange of India (NSE) was incorporated in November 1992 as a taxpaying company. In November of the same year, the Capital Market (Equities) segment commenced operations and the Derivatives segment in June 2000. 1. Enabling shorter settlement cycles and book entry settlements and 2. Meeting international benchmarks and standards.
PRODUCTS IN NSE :
NSE offers trading in the following segments:
Equities
Equities
Indices
Mutual Funds
Exchange Traded Funds
Initial Public Offerings
Security Lending and Borrowing Scheme
Derivatives
Equity Derivatives (including Global Indices like CNX 500, Dow Jones and FTSE )
Currency Derivatives
Interest Rate Futures
Debt
Corporate Bond
Equity Derivatives The National Stock Exchange of India Limited (NSE) commenced trading in derivatives with the launch of index futures on 12 June 2000. The futures and options segment of NSE has made a global mark. In the Futures and Options segment, trading in NIFTY 50 Index, NIFTY IT index, NIFTY Bank Index, NIFTY Next 50 index and single stock futures are available. Trading in Mini Nifty Futures & Options and Long term Options on NIFTY 50 are also available. The average daily turnover in the F&O Segment of the Exchange during the financial year April 2013 to March 2014 stood at ₹1.52236 trillion (US$23 billion). On 29 August 2011, National Stock Exchange launched derivative contracts on the world’s most followed equity indices, the S&P 500 and the Dow Jones Industrial Average. NSE is the first Indian exchange to launch global indices. This is also the first time in the world that futures
contracts on the S&P 500 index were introduced and listed on an exchange outside of their home country, USA. The new contracts include futures on both the DJIA and the S&P 500, and options on the S&P 500. On 3 May 2012, the National Stock exchange launched derivative contracts (futures and options) on FTSE 100, the widely tracked index of the UK equity stock market. This was the first of its kind of an index of the UK equity stock market launched in India. FTSE 100 includes 100 largest UK listed blue chip companies and has given returns of 17.8 per cent on investment over three years. The index constitutes 85.6 per cent of UK’s equity market cap. On 10 January 2013, the National Stock Exchange signed a letter of intent with the Japan Exchange Group, Inc. (JPX) on preparing for the launch of NIFTY 50 Index futures, a representative stock price index of India, on the Osaka Securities Exchange Co., Ltd. (OSE), a subsidiary of JPX. Moving forward, both parties will make preparations for the listing of yen-denominated NIFTY 50 Index futures by March 2014, the integration date of the derivatives markets of OSE and Tokyo Stock Exchange, Inc. (TSE), a subsidiary of JPX. This is the first time that retail and institutional investors in Japan will be able to take a view on the Indian markets, in addition to current ETFs, in their own currency and in their own time zone. Investors will therefore not face any currency risk, because they will not have to invest in dollar denominated or rupee denominated contracts.
Currency Derivatives In August 2008, currency derivatives were introduced in India with the launch of Currency Futures in USD–INR by NSE. It also added currency futures in Euros, Pounds and Yen. The average daily turnover in the F&O Segment of the Exchange on 20 June 2013 stood at ₹419.2616 billion (US$6.2 billion) in futures and ₹273.977 billion (US$4.1 billion) in options, respectively.
Interest Rate Futures
In December 2013, exchanges in India received approval from market regulator SEBI for launching interest rate futures (IRFs) on a single GOI bond or a basket of bonds that will be cash settled. Market participants have been in favour of the product being cash settled and being available on a single bond. NSE will launch the NSE Bond Futures on 21 January on highly liquid 7.16 percent and 8.83 percent 10-year GOI bonds. Interest Rate Futures were introduced for the first time in India by NSE on 31 August 2009, exactly one year after the launch of Currency Futures. NSE became the first stock exchange to get an approval for interest-rate futures, as recommended by the SEBI-RBI committee.
Debt Market On 13 May 2013, NSE launched India's first dedicated debt platform to provide a liquid and transparent trading platform for debt related products. The Debt segment provides an opportunity to retail investors to invest in corporate bonds on a liquid and transparent exchange platform. It also helps institutions who are holders of corporate bonds. It is an ideal platform to buy and sell at optimum prices and help Corporates to get adequate demand, when they are issuing the bonds.
BOMBAY STOCK EXCHANGE (BSE) The Bombay Stock Exchange (BSE) is an Indian stock exchange located at Dalal Street, Kala Ghoda, Mumbai, Maharashtra, India. Established in 1875, the BSE is Asia’s first stock exchange. It claims to be the world's fastest stock exchange, with a median trade speed of 6 microseconds. The BSE is the world's 11th largest stock exchange with an overall market
capitalization of $1.7 trillion as of January 23, 2015. More than 5500 companies are publicly listed on the BSE. The Bombay is the oldest exchange in Asia. Its history dates back to 1855, when five stockbrokers would gather under banyan trees in front of Mumbai's Town Hall. The location of these meetings changed many times to accommodate an increasing number of brokers. The group eventually moved to Dalal Street in 1874 and in became an official organization known as "The Native Share & Stock Brokers Association" in 1875. On August 31, 1957, the BSE became the first stock exchange to be recognized by the Indian Government under the Securities Contracts Regulation Act. In 1980, the exchange moved to the Phiroze Jeejeebhoy Towers at Dalal Street, Fort area. In 1986, it developed the BSE SENSEX index, giving the BSE a means to measure the overall performance of the exchange. In 2000, the BSE used this index to open its derivatives market, trading SENSEX futures contracts. The development of SENSEX options along with equity derivatives followed in 2001 and 2002, expanding the BSE's trading platform. Historically an open outcry floor trading exchange, the Bombay Stock Exchange switched to an electronic trading system developed by CMC Ltd. in 1995. It took the exchange only 50 days to make this transition. This automated, screen-based trading platform called BSE On-Line Trading (BOLT) had a capacity of 8 million orders per day. The BSE has also introduced a centralized exchange-based internet trading system, BSEWEBx.co.in to enable investors anywhere in the world to trade on the BSE platform. BSE also provides a host of other services to capital market participants including risk management, clearing, settlement, market data services and education. It has a global reach with customers around the world and a nation-wide presence. BSE systems and processes are designed to safeguard market integrity, drive the growth of the Indian capital market and stimulate innovation and competition across all market segments. BSE is the first exchange in India and second in the world to obtain an ISO 9001:2000 certification. It is also the first Exchange in the country and second in the world to receive Information Security Management System Standard BS 7799-2-2002 certification for its On-Line trading System (BOLT). It
operates one of the most respected capital market educational institutes in the country (the BSE Institute Ltd.). BSE also provides depository services through its Central Depository Services Ltd. BSE's popular equity index - the S&P BSE SENSEX - is India's most widely tracked stock market benchmark index. It is traded internationally on the EUREX as well as leading exchanges of the BRCS nations (Brazil, Russia, China and South Africa).
Stockbroker : An application by a stockbroker shall be made in Form A and submitted to the stock exchange in which he is admitted as a member. Before issuing the certificate of Registration, the Board shall take into account all matters relating to buying, selling or dealing in securities and in particular verify that the stockbroker – A. Is eligible to be admitted as a member of a stock exchange, B. Has the necessary infrastructure like adequate office space, equipments and manpower to effectively discharge his activities,
Registration of brokers The following procedure is followed by the Securities Exchange Board of India for registration as broker: 1. An application by a sub-broker for the granting of a certificate shall be made in Form B. The application for registration shall be accompanied by a recommendation letter from a stockbroker of a recognized stock exchange with whom he is to be affiliated along with two references including one from his banker. The application form duly filled shall be submitted to the stock exchange of which the stockbroker with whom he is to be affiliated is a member. 2. The stock exchange on receipt of an application under sub regulation shall verify the information contained therein and shall also certify that the applicant is eligible for registration as per criteria specified in sub-regulation. The eligibility criteria for Registration as a sub-broker shall be as follows: a. The applicant is not less than 21 years of age,
Special area:
Commission brokers are members who execute buy and sell orders received from their individual and institutional clients on the floor of the exchange. They charge commission or brokerage at rates not exceeding the ceiling, which is presently 2.5% of the value of the contract. Odd-lot dealers are those members who specialize in buying and selling odd lots. They either buy odd lots and convert them into marketable lots that can be sold or sell odd lots by buying and splitting marketable lots. The marketable lot is 100 shares where the face value of the share is Rs.10 and 10 shares where the face value is Rs.100. Now with increasing number of dematerialized stocks, the scope for odd-lot business is limited. Dealers in non-cleared securities are a kin to taravniwallas in their role but they specialize in buying and selling securities, which are not on the active list. FUNCTIONS A stock broker or share broker is a regulated professional broker who buys or sells shares and other securities through market makers or agencies on behalf of investor. A broker may be employed by a brokerage firm. The functions of stock broker are as follows. Paid on commission: Individual brokers are paid on commission usually as a percentage of the value of the trade. Commissions and fees vary. Advice: Most of the individual broker charges a certain percentage of the transaction of buying and selling of stock. There are two types of brokers, one is discount and another one is full service broker. Discount broker mostly is individual broker who won’t give advice and simply does the transaction. On the other hand, full service broker actually help the investors to choose the stock for investment by giving advice, and charges some additional amount along with their regular commission. Products: Brokers offer many different types of products besides stock. Often, packaged products such as mutual funds and annuities are important parts of the recommendation. Problems: Lower Retail Investor Participation. The traditional investment preference of Indians in real assets like gold or real estate has not helped the industry as a whole. After a number of investor
awareness sessions are held by brokers/NSE, people are gradually warming up to the idea of equity investing. However, the pace of people adopting financial assets is still low. The past scams, lack of understanding of volatility, and the cultural obsession with gold+land has not helped fellow Indians in taking a meaningful pie of shares. Finally, the unfortunate reality is that due to lack of Indian retail participants, foreign investors are eating the cake of India’s growth story (and rising stock market). Increasing Costs and Additional Investments. Stock markets are always evolving. They add newer products, technologies, and provide newer opportunities to trade. Brokerages need to invest in newer technologies trading platforms and algorithms continuously or risk-losing trading clients. For example, addition of commodity or currency segments involves additional expenses for brokers to enable the trading and settlement infrastructure for the new products. Likewise adoption of mobile technologies involves investment in applications and portfolio management systems which further increase costs. Besides, brokers need to pay their staff exchange memberships and other infrastructure in order to make a profit, finally.
ABOUT THE COMPANY
ADITYA BIRLA MONEY Aditya Birla Money Ltd, a part of Aditya Birla financial Services Group was incorporated in the year 1995 as Apollo Sindhoori Capital Investment Ltd. Earlier, the company was promoted by Prathap C Reddy,Chairman of Apollo Hospitals Group. In March 2009, the company became a part of Aditya Birla Group, when the group acquired 76% of the company. The company commenced their operations in Chennai in the year 1996. They spent their initial time in establishing and consolidating their presence throughout South India. Until 2001, they established their presence in 13 locations throughout the South India. Within four years, they established their presence in over 350 locations all over the country. Aditya Birla Money Mart Limited is a wealth management and distribution player, offering third party products like company deposits, mutual funds, insurance, structured products, alternate investments, property services and has a premier wealth management service arm to cater to HNI customers. The services of MyUniverse are provided through Aditya Birla Customer Services Limited. These offerings are delivered through a strong pan India distribution network of about 1000 self owned and franchisee branches, a robust online and offline model with a strong technology backbone to a large customer base, in excess of 4 lakh.
A US $ 40 billion MNC Anchored by 133,000 employees belonging to 42 different nationalities Ranked No. 4 in the Global “Top Companies for Leaders” survey and ranked No. 1 in Asia Pacific for 2011 (Aon Hewett, Fortune Magazine and RBL)
Aditya Birla Financial Services Group (ABFSG) ranks among the top 5 fund managers in India (excluding LIC) with an AUM of USD 20.4 billion. Having a strong presence across the life insurance, asset management, NBFC, private equity, retail broking, distribution & wealth management, and general insurance broking businesses, ABFSG is committed to serve the endto-end financial services needs of its retail and corporate customers. The companies representing Aditya Birla Financial Services Group are:
Birla Sun Life Insurance Company Ltd. Aditya Birla Money Ltd. (ABM) Aditya Birla Insurance Brokers Ltd. (ABIB) ADITYA BIRLA BUSINESS 1. WEALTH MANAGEMENT At Aditya Birla Money Wealth Management, our teammates are akin to these Indian craftsmen that ensure your portfolio is as distinct as you and your investment goals. We craft a sublime creation that is just the perfect fit for you. Our experts adept at offering personalized solutions will partner you at every step of the way on the road to financial wellbeing. Reach out to us and realize shining financial landmarks. PRODUCTS Our Product
Product Benefits
Alternative Investments
Invest in opportunities beyond the landscape of markets
Goal-Based Mutual Fund Advisory
We give your life goals as much importance as you do and ensure that they are met at all times
2. CASH MANAGEMENT SOLUTIONS Cash Management Solutions assist any SME, MME or company in identifying the avenues for temporary
funds
deployment
as
also
plan
the
cash
flows
appropriately.
A great symphonic arrangement will always end on a high note. Just like our robust Cash Management Solutions. They are designed to enrich cash inflows and restrict outflows so that you always end up cash positive. Transactional Support: A zero-error back office with well trained executives that supports the corporate at all times with the transactions they undertake.
MIS & Information Support: We have a good set of MIS and informational reports suitable for investors to take a look at periodic intervals and gauge portfolio performance FINANCING SUPPORT SOLUTION Business assets are not just a barometer of the organization’s financial health, they can also help chart the course to future wellbeing. Our ace team armed with smart insights can demonstrate the best means to use valuable assets for future funding. It could be to fuel business growth, expand horizons or diversify into other verticals. Financing Options Loan against Securities In the real estate arena, chances of finding a piece of property that shows potential of quick capital appreciation are tough and rather slim. Yet, property investments act as booster doses to pep the health of your portfolio. And even if you have zeroed in on the perfect property, it’s back breaking to land a good bargain for it. With dedicated Relationship Managers at your service expect nothing but the best end-to-end property solutions for all property transactions.
ACHIEVEMENT 1. Women Leadership Achievement Award-2016 Aditya Birla Money adds another feather to its shining cap of success! 2. ING Private Banking-March 2010 Aditya Birla Money has been awarded the ING Private Banking Financial Advisor Award March 2010.
CHAPTER - 2 LITERATURE REVIEW
Sikidar and Singh (1996) carried out a survey with an objective to understand the behavioral aspects of the investors of the north eastern region towards mutual funds investment portfolio.The survey revealed that the salaried and self-employed formed the major investors in mutualfund primarily due to tax concessions. Kumar Singh (2006)analyze the investment pattern of people in Bangalore city and Bhubaneswar analysis of the study was undertaken with the help of survey conducted. It is concluded that in Bangalore investors are more aware about various investment avenues and therisk associated with that. And in Bhubaneswar, investors are more conservative in nature andthey prefer to invest in those avenues where risk is less like bank deposits, small savings, postoffice savings etc. Chandra collected the data from survey to know the factors influencing Indian individual investorbehavior in stock market. Using univariate and multivariate analysis and found five major factors that affect the investment behavior of individual investor in stock market namelyprudence, and precautions attitude, conservatism, under confidence, informational asymmetryand financial addition . Finally he concluded that these are the major psychological componentsseem to be influencing individual investor’s trading behavior in Indian stock market. AjmiJy.A. (2008) used a questionnaire to know determinants of risk tolerance of individual Investors and collected responses from 1500 respondents. He concluded that the men are less riskaverse than women, less educated investors are less likely to take risk and age factor is alsoimportant in risk tolerance and also investors are more risk tolerance than the less wealthyinvestors. Tamimi, H. A. H.indentified the factors influencing the UAE investor Behavior. Using questionnaire found six factors were most influencing factors on the UAE investor behaviour namely expected corporate earnings, get rich quick, stock marketability past performance of thefirm’s stock , government holdings and the creation of the organized financial markets
Paul Slovic (1972) discussed in his research that most of the investors whoinvested on equity shares have a tendency of looking on the returns generated byequity shares of well established companies or stock market indices returns beforemaking their investment decision. Though the past returns on equity shares do notgive guarantee for any future returns, investors perceive that equity shares aregiving better returns to beat the inflation rate and hence they are committing onequity shares. Similarly, Diacon, S. (2002) found in his research that most of the investorsperceive equity investment is suitable to achieve their long term objective andhence those investors whose needs are arising in less than three years ofinvestment prefer to invest on fixed income securities
Lakshmi C. (2005) has stated that the reason for not investing onequity shares and equity oriented securities by Indian investors is the perceptionthat equity investments are risky. She added that though the investors are aware ofsuccess stories of equity investment, as they perceive that they do not understandvarious risk minimisation techniques, they feel it is better to stay away from equityinvestment.
Koundinya. C (2010) concluded in hisresearch that, the perception of risk associated with equity investment made someof the Indian investors believe that equity investment is not suitable to themespecially after Indian stock market crash due to the global economic recession of2007-08. Elankumaran and AAAnanth. A study on behavioral finance has been done presuming information structure and characteristics of capital market. Participants influence their own decisions and also on market outcomes. The above studies have been conducted by using surveymethod. The questionnaire with 5 Point Likert Scale designed with 15 components for
measuringbehavior and respondents were selected from Trichy District and the total number respondentswere 525. The influence of resulting factor analysis and descriptive statistics has concluded thatmultiple factors have greater influence on behavior of commodity market investors in India. Themain factor was information asymmetry, objective knowledge, high sector and low risk Dr. K Ravichandran. The research study was intended tofind preference level of investors on various capital market instruments and type of riskconsidered by investors. The sample was collected from 100 investors in derivative markets fromChennai from a structured questionnaire. Descriptive research type is used and conveniencesampling method was adopted to gather data. Various parametric and non-parametric techniqueshave been used for analyzing data. The findings reveal that friends and relatives followed bybrokers who pull the investors into capital market. Respondents preferred short term investments.It has been suggested by the author to develop more number of products which it can attract more number of investors Society for Capital Market Research and Development, (2008)conducted a survey on, “Indian Household Investors Survey-2004”, to identify the investors preferences, problems andpolicy issues. The study was based on direct interviewing of avery large sample of 5,908 household heads over 90 citiesacross 24 states. The study states that price volatility, price manipulation and corporate mismanagement/fraud havepersistently been the household investors’ top three worries inIndia.
CHAPTER – 3 RESEARCH METHODOLOGY
Purpose of the Study It takes into account the investor’s point of view. This study analysis What Makes Investors optimistic and afraid. It study the Investor sentiment .
Research Objectives Of the Study
impact of investors behaviour on stock selection decision. factors influencing investor’s behaviour while selecting stock.
Research Methodology of the Study
Research Design Descriptive statistics tell what is, while inferential statistics try to determine cause and effect so descriptive and exploratory study is conducted. A questionnaire method was constructed and various investors filled up the questionnaire and that becomes the base for analysis.
Data Collection Techniques Primary Data Primary research involves the collection of original primary data by researchers. It is often undertaken after researchers have gained some insight into an issue by reviewing secondary research or by analyzing previously collected primary data. It can be accomplished through various methods, including questionnaires and telephone interviews in market research.
Method of Data Collection The data collection component of research is common to all fields of study help us to collect the main points as gathered information. Data collection methods for impact evaluation vary along a continuum. At the one end of this continuum are quantitative methods and at the other end of the continuum are Qualitative methods for data collection. A questionnaire is a question format that limits respondents with a list of answer choices from which they must choose to answer the question. [1] Commonly these types of questions are in the
form of multiple choices, either with one answer or with check-all-that-apply, but also can be in scale format, where respondent should decide to rate the situation on scale.
Drafting of a questionnaire
A questionnaire is a research instrument consisting of a series of questions and other prompts for the purpose of gathering information from respondents. Although they are often designed for statistical analysis of the responses, Questionnaires have advantages over some other types of surveys in that they are cheap, do not require as much effort from the questioner as verbal or telephone surveys, and often have standardized answers that make it simple to compile data.
Sample Design
The sample design encompasses all aspects of how to group units on the frame, determine the sample size, allocate the sample to the various classifications of frame units, and finally, select the sample.There are two types of sampling: non-probability and probability sampling. Nonprobability sampling uses a subjective method of selecting units from a population, and is generally fast, easy and inexpensive. Therefore, it's sometimes useful to perform things like preliminary studies, focus groups or follow-up studies. 1. The whole number of people or inhabitants in a countr y or region 2. The total of individuals occup ying an area or making up a whole.
Sample Size
The sample size is an important feature of any empirical study in which the goal is to make inferences about a population from a sample. In practice, the sample size used in a study is determined based on the expense of data collection, and the need to have sufficient statistical power. The Sample Size for this study is 100.
Sampling Method SAMPLE SIZE OF MY STUDY IS 100.
A sampling method is a procedure for selecting sample members from a population.
Convenience sampling is used in exploratory research where the researcher is interested in getting an inexpensive approximation of the truth. As the name implies, the sample is selected because they are convenient. The sampling method used is convenience sampling.
Limitations a. Questionnaire is not suitable when a spontaneous answer is very much required. b. Sample size may be inadequate c. There may be certain extraneous factors which are not taken into consideration. d. Investor Psychology changes with time.
CHAPTER-4
DATA ANALYSIS AND INTERPRETATION
Q1 . Occupation of the respondant .
Count of Row Labels others self employed service student (blank) Grand Total
Occupation 4 37 55 4 100
Total 60 50 40
Total
30 20 10 0 others self employed service
student
(blank)
INTERPRETATION: In this question, service people are more interested in investing in stock Market rather than any other occupation and second is self employed are investing in stock market.
Q2. Age of the respondants. Count of Age of the Row Labels 26-30
respondent 52
31-36 Below 25 More than 36 (blank) Grand Total
26 14 8 100
Total 26-30 31-36 Below 25 More than 36 (blank)
INTERPRETATION: In this context, between the age of 26-30. Group of people are more interesting in investing , it means youth are more concerned for extra benefits rather than any age of the respondants.
Q3- Gender of the respondants . Row Labels Female Male
Count of Gender 41 59
(blank) Grand Total
100
INTERPRETATION: In this context, male people are more investing in stock market rather than female people. Male are more opportunities to invest in the stock market because it requires a regular watch in the market structure.
Q4- Annual income of the respondants. Row Labels 1 lakh-3 lakh 3 lakh-5 lakh Less than 1 lakh
Count of Annual income of the respondent 2 45 3
more than 5 lakh (blank) Grand Total
50 100
INTERPRETATION: IN this question , people who are earned more than 5 lakh rupees they are investing more in the market , they are more concerned for stock market rather than any other annual income of the respondants.
Q5- Duration of investment in no of years.
Row Labels 1-2 year 2-5 year Less than 1 year More than 5 year (blank)
Duration of investments 41 32 20 7
Grand Total
100
INTERPRETATION: In this context, people are more interested in investing for a period of 2 —5 years, rather rather than any other time spam period.it shows people go for more than 1 year investment decision rather than for a short time period and second is go for a 2-5 years decision
Q6- Source of information about investment .
Row Labels Brokers Internet ads Newspapers Others (blank) Grand Total
Source of information about market 66 13 16 5 100
INTERPRETATION: In this question, it shows people are more interesting to get advice or getting information from brokers other than any other mode of source , it shows people are interested in getting financial / professional advice for investing decision.
Q7- Awareness about investment options available in the market.
Row Labels
Awareness about stock market
No
51
Yes
49
(blank) Grand Total
100
INTERPRETATION: In this context it shows how many people are aware about investment plans and investment products available in the market. In our data, people are more aware related to investment options in the market.
Q8- Factors affecting investment decision .
Row Labels Family members Financial consultants Friends others (blank) Grand Total
Factors affecting your investment decision 17 49 30 4 100
INTERPRETATION: In this question, it shows what are the factors affecting to investors while choosing investment decision. In our data financial consultants are more affective to choose investment decision , as they are professional in nature they know market better than the people .
Q9- Investment options available in the market.
Row Labels Commodity market monetary market others Stock market (blank) Grand Total
Investment options you prefer the most 25 16 7 52 100
INTERPRETATION: In this context, it shows options available in the market for investors . in our data , people are more interesting in stock market rather than any other options .people are willing to take risk with investment as stock market gives more benefits with pertaining risk also.
Q10. Type of trading prefer the most in the market.
Row Labels
Type of trading prefer in stock market
Offline trading
27
Online trading
73
(blank) Grand Total
100
INTERPRETATION: In this question , it shows people are more interesting in doing trading online than the offline. It shows how people are doing trading, people are more educated , more computer based, they know how to trading and what options should be opt.
Q11 - Brokerage charged by dealers In the stock market .
Row Labels
Brokerage charged by investors in stock market
10-20 paisa
28
20-30 paisa more than 30 paisa
67 5
(blank) Grand Total
100
INTERPRETATION: In this context , brokerage charged by dealers in the stock market , In our data brokers charged their brokerage between 10- 20 paise per transaction, and second is charged between 10-20 paise per transaction.
Q 12 - Is it a good option to investment in the market.
Row Labels
Is it a good option to invest in stock market
1
20
2
58
3
16
4
6
(blank) Grand Total
100
Total 70 60 50 Total
40 30 20 10 0 1
2
3
4
(blank)
INTERPRETATION : In this context, people views about stock market , Is it a good option available for them , in our data most of the people are agree that it is a good option for investing money in the stock market.
Q13 - Recommend anyone to invest in the stock market .
Row Labels
Recommend anyone to invest in stock market
No
31
Yes
69
(blank) Grand Total
100
INTERPRETATION : In this question, people respond according to their views in their mind, if people has a positive view towards stock market than it responds positively and if people having a negative attitude towards stock market than it respond negatively (no).
CHAPTER -5 FINDINGS AND SUGGESTIONS :
FINDINGS: People who are doing jobs are more concerned towards stock market , they invest more
than any other occupation. In our data 55% people are investing in the stock market are from service Self employed people are 37% who investing in a stock market. Age of the respondants in our data , who are more active in investing in stock market. Youth are more concerned for benefits and investment decisions . People are mostly from (26- 30) years.
Second is people from (31-36) years. Most of the people are males over women. Male are more concerned for investment point of view. In our data 51% male are doing investment . People who are investing in a stock market are from big braket of earnings, In our data , most of the people are from ( more than 5 lakh ) . It constitutes almost 50% data who are investing having a braket of more than 5 lakh rupees. People are investing for more than a period of (1 – 2 ) years , it means that people gave a time spam to their investment to give them returns , Second is people investing more in a (2-3) years time spam. People are getting more information from brokers . As now, people are thinking more practically they consult form the experts who have access knowledge about stock market , they advice in a better way than any other professionals.
Now a days , People are more aware towards stock market. They are more concerned for their investment palns, almost 51% people are more aware in our data , who have awareness towards stock market. Most of the factors are affected by financial consultants, as they have market knowledge, they advice in a better way to investors for investments , which particular security choose for getting higher returns. Second factor affecting the friends , as friends advice when they personally feel or have a
knowledge for market . Stock market is the most preffered option choose by the investors , as it gives higher returns than any other market . And second is commodity market , which preferred by the investors. People prefer trading the most in the market is “online trading “ Almost 73% people prefer online trading , as people are educated they understand the context of market and they know how to trade online because when the things in hand
people are more concerned. Brokerage charged by the dealers is 20-30 paise per transaction . In our data, almost 67% brokers charged this paise , it depends upon the transaction also ( size and lot) of the securities matters a lot , It is a good option available for the investors to invest their money in a better way and getting higher returns .
In our data almost 58% people are agreed that , stock market is a good option in the
market for investors to invest their money . Recommend by people who are investing in a stock market . In our data almost 70% people are willing to recommend others . It affects due to response/ attitude towards market, if someone is getting returns than he recommend others also .
SUGGESTIONS: Youth are more concerned for their futures and benefits but he should also take care of
risk pertaining to particular security on which he invest as it is a matter of money which he invest in a market. People are from higher group of income they invest more in a stock market rather than any other income group , in my view people are from lower segment, or earning low should also invest their money in their market there are many other options available , it gives a returns or help them in case of urgency. People are investing more in a ( 1-2) yr spam they should take care that, investment in securities is a risk pertaining activity so he should invest less than 1 year in a particular security. People invest more in a stock market there are many others options available in a market which gives higher return. Brokerage charged by dealers per transaction , it is a negotiable term mean people who has good knowledge about this, he can negotiate with the broker . Recommendation by anyone given only, when he has a positive approach towards stock market .
CHAPTER -6 CONCLUSION
Stock is equity, bonds are debt. Bondholders are guaranteed a return on their investment and have a higher claim than shareholders. This is generally why stocks are considered
riskier investments and require a higher rate of return. Stock prices change according to supply and demand. There are many factors influencing
prices, the most important of which is earnings. Stock market contains a bull and bear situation . Income group affecting while investment decision. Source of information available in the market. Purpose of trading for investment or getting higher returns.
Having stock in a company means you are an owner. How many shares of stock you have determines the extent of that ownership. As part owner, you receive dividends and have voting rights.
BIBLIOGRAPHY
https://en.wikipedia.org/wiki/Stock_market#Indirect_vs._direct_investment www.google,com http://www.emeraldinsight.com/doi/abs/10.1108/17554171211213568 http://shodhganga.inflibnet.ac.in/bitstream/10603/274/9/09_chapter%203.pdf http://abhinavjournal.com/images/Management_&_Technology/Mar13/21.pdf http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2029642 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1353729 http://www.academia.edu/814165/A_study_on_pricing_behaviour_in_indian_stock_mark
et_with_reference_to_powergrid_corporation_of_inida_limited http://www.iosrjournals.org/iosr-jbm/papers/AETM%2715_MBA/2/15-MBA-143.pdf https://www.researchgate.net/publication/222510687_Analysing_stock_market_behaviou r_in_a_small_capital_market
ANNEXURE 1. OCCUPATION SELF EMPLOYED STUDENT SERVICE
OTHERS
2. AGE OF THE RESPONDANTS BELOW 25 26-30 31-36 MORE THAN 36 3. GENDER MALE FEMALE 4. ANNUAL INCOME OF THE RESPONDANTS LESS THAN 1 LAKH 1-3 LAKH 3-5 LAKH MORE THAN 5 LAKH
5. DURATION OF INVESTMENT LESS THAN 1 YEAR 1-2 YEAR 2-5 YEAR MORE THAN 5 YEAR 6. SOURCE OF INFORMATION BROKERS NEWSPAPERS INTERNET ADS OTHERS 7. AWARENESS ABOUT INVESTMENT OPTIONS IN THE MARKET YES NO 8. FACTORS AFFECTING INVESTMENT DECISION. FAMILY MEMBERS
FRIENDS FINANCIAL CONSULTANT OTHERS
9. INVESTMENT
OPTIONS PREFER THE MOST STOCK MARKET COMMODITY MARKET MONETARY MARKET OTHERS
10. TYPE OF TRADING PREFER IN MARKET ONLINE TRADING OFFLINE TRADING 11. BROKERAGE CHARGED BY DEALERS 10-20 PAISE 20-30 PAISE MORE THAN 30 PAISE 12. GOOD OPTIONS TO INVEST IN STOCK MARKET STRONGLY AGREE AGREE NEUTRAL DISAGREE STRONGLY DISAGREE 13. RECOMMEND ANYONE TO INVEST IN STOCK MARKET YES No
