A SUMMER TRAINING PROJECT REPORTONA STUDY OF PERCEPTION OF CUSTOMERS TOWARDS SHAREKHAN AND COMPARISON WITH FIVE OTHER BROKRING FIRMS

SUBMITTED IN THE PARTIAL FULFILLMENT FOR THE AWARD OFDEGREE OF MASTER IN BUSINESS ADMINISTRATION 2013-15

UNDER THE GUIDANCE OF:Mr Sumit GulatiAssistant ProfessorSUBMITTED BY:Maaz AbdullahROLL No. 1303870086MBA, Semester 3rdBatch 2013 - 2015

INSTITUTE OF TECHNOLOGY AND SCIENCE MOHANNAGAR GHAZIABADAn ISO 9001:2008 Certified Institute (Approved by AICTE, HRD Ministry, Govt. of India)Affiliated to Uttar Pradesh Technical University, Noida U.P.)

STUDENT DECLARATION

This is to certify that I have completed the Project titled A STUDY OF PERCEPTION OF CUSTOMERS TOWARDS SHAREKHAN AND COMPARISON WITH FIVE OTHER BROKERING FIRMS under the guidance of Mr Sumit Gulati in the partial fulfilment of the requirement for the award of the degree of Master in Business Administration from Institute of Technology And science , Mohannagar. This is an original work and has not been submitted anywhere else.

Name of the student: Maaz Abdullah (Sign)Course: MBABatch: 2013-15

CERTIFICATE

This is to certify that Maaz Abdullah MBA 2013-15 batch, a student of INSTITUTE OF TECHNOLOGY AND SCIENCE GHAZIABAD has undertaken the project on A STUDY OF PERCEPTION OF CUSTOMERS TOWARDS SHAREKHAN AND COMPARISON WITH FIVE OTHER BROKERING FIRMS The survey, data collection and analysis work for preparing has been carried by the student in partialFulfilment of the recruitment for the award of MBA, under my guidance and supervision.I am satisfied with work of Maaz Abdullah. I wish his further success and growth in his career.

(Signature)Prof. Sumit GulatiDate:

ACKNOWLEDGEMENT

I hereby take this opportunity to thank SHAREKHAN PVT. LTD, for providing me a corporate exposure through the course of my summer internship.I would like to express my sincere gratitude towards my company guide Mr Ashish Kumar Gupta, for providing me great insights about stock markets for guiding me all throughout and for being a great support.I would also like to thank Mr Sumit Gulati, my faculty guide for instructing me and giving me his valuable advice on my project.I am also like to thank to my friends Neeraj, Pramod, and Arshad Ali. I would like to extend my gratitude to I.T.S Mohannagar, for providing me such a platform. Last but not the least all my friends and family for their support and co-operation.

Thanking You,Maaz Abdullah, 1303870086

EXECUTIVE SUMMARYThe present report is prepared for In partial fulfilment of the Requirements for the award of Degree of Master of Business Administration.. New ideas and innovations have always been the hallmark of progress made by mankind. At every stage of development, there have been two core factors that drive man to ideas and innovation. These are increasing returns and reducing risk, in all facets of life. The financial markets are no different. The endeavour has always been to maximize returns and minimize risk. A lot of innovation goes into developing financial products cantered on these two factors. It has spawned a whole new area called financial engineering.Derivatives are among the forefront of the innovations in the financial markets and aim to increase returns and reduce risk. They provide an outlet for investors to protect themselves from the vagaries of the financial markets. These instruments have been very popular with investors all over the world.The good news is that E-MARKETING is inexpensive, fast, and easy to carry out and it can be more effective than any other marketing channel available today if youre smart. Being smart is to be strategic. Online trading is now become very popular due to this e marketing only.In this project, firstly I have given the overview of Indian stock market how it was originate in India. How Indian financial system of India works .I have also provided the detail about the various financial product of Sharekhan pvt ltd mainly which include demat accounts, now a days why it is must.The various strategies adopted for generating the leads for the Sharekhan. According to me telecalling was one of best way to generate the clients for Sharekhan. After this I have also mentioned about the learning which I learned after completing this project.

TABLE OF CONTENTS FOR PROJECT REPORTSerial No.Particular

Page No.

1.INTRODUCTION BACKGROUND RESEARCH PROBLEM RESEARCH OBJECTIVE 7-52

2.LITRATURE REVIEW53-54

3.

RESEARCH METHODOLGY TYPES OF DATA CHOICE OF METHOD FOR DATA COLLECTION SAMPLE SIZE SAMPLING TECHNIQUE

55-68

68

4.

5.

6.

7.

8. 9. Data Analysis & Interpretation

FINDINGS

CONCLUSION

SUGGESTION

BIBLOGRAPHY

APENDIX- QUESTIONNAIRE 69-76

77

78

79

80

81

INTRODUCTION

INTRODUCTION OF STOCK MARKET

Indian Stock Markets are one of the oldest in Asia. Its history dates back to nearly 200 years ago. The earliest records of security dealings in India are meagre and obscure. The East India Company was the dominant institution in those days and business in its loan securities used to be transacted towards the close of the eighteenth century. By 1830's business on corporate stocks and shares in Bank and Cotton presses took place in Bombay. Though the trading list was broader in 1839, there were only half a dozen brokers recognized by banks and merchants during 1840 and 1850. The 1850's witnessed a rapid development of commercial enterprise and brokerage business attracted many men into the field and by 1860 the number of brokers increased into 60.In 1860- 61 the American Civil War broke out and cotton supply from United States of Europe was stopped; thus, the 'Share Mania' in India begun. The number of brokers increased to about 200 to 250. However, at the end of the American Civil War, in 1865, a disastrous slump began (for example, Bank of Bombay Share which had touched Rs 2850 could only be sold at Rs. 87).In 1887, they formally established in Bombay, the "Native Share and Stock Brokers' Association" (which is alternatively known as "The Stock Exchange"). In 1895, the Stock Exchange acquired a premise in the same street and it was inaugurated in 1899. Thus, the Stock Exchange at Bombay was consolidated. Thus in the same way, gradually with the passage of time number of exchanges were increased and at currently it reached to the figure of 24 stock exchange For a new investor, the stock market can feel a lot like legalized gambling. "Ladies and gentlemen, place your bets! Randomly choose a stock based on gut instinct and water cooler chatter! If the price of your stock goes up -- and who knows why? -- you win! If it drops, you lose!" Isn't that why so many people got rich during the dot-com boom -- and why so many people lost their shirts (not to mention their retirement savings) in the recent recession?

INDIAN FINANCIAL SYSTEM

IMPORTANCE OF STOCK MARKET:

Function and purpose

Stock market is an important part of the economy of a country. The stock market plays a play a pivotal role in the growth of the industry and commerce of the country that eventually affects the economy of the country to a great extent. That is reason that the government, industry and even the central banks of the country keep a close watch on the happenings of the stock market. The stock market is important from both the industrys point of view as well as the investors point of view.Whenever a company wants to raise funds for further expansion or settling up a new business venture, they have to either take a loan from a financial organization or they have to issue shares through the stock market. In fact the stock market is the primary source for any company to raise funds for business expansions. If a company wants to raise some capital for the business it can issue shares of the company that is basically part ownership of the company. To issue shares for the investors to invest in the stocks a company needs to get listed to a stocks exchange and through the primary market of the stock exchange they can issue the shares and get the funds for business requirements. There are certain rules and regulations for getting listed at a stock exchange and they need to fulfill some criteria to issue stocks and go public.

The stock market is primarily the place where these companies get listed to issue the shares and raise the fund. In case of an already listed public company, they issue more shares to the market for collecting more funds for business expansion. For the companies which are going public for the first time, they need to start with the Initial Public Offering or the IPO. In both the cases these companies have to go through the stock market.

This is the primary function of the stock exchange and thus they play the most important role of supporting the growth of the industry and commerce in the country. That is the reason that a rising stock market is the sign of a developing industrial sector and a growing economy of the country.Of course this is just the primary function of the stock market and just an half of the role that the stock market plays. The secondary function of the stock market is that the market plays the role of a common platform for the buyers and sellers of these stocks that are listed at the stock market. It is the secondary market of the stock exchange where retail investors and institutional investors buy and sell the stocks. In fact it is these stock market traders who raise the fund for the businesses by investing in the stocks.For investing in the stocks or to trade in the stock the investors have to go through the brokers of the stock market. Brokers actually execute the buy and sell orders of the investors and settle the deals to keep the stock trading alive. The brokers basically act as a middle man between the buyers and sellers. Once the buyer places a buy order in the stock market the brokers finds a seller of the stock and thus the deal is closed. All these take place at the stock market and it is the demand and supply of the stock of a company that determines the price of the stock of that particular company.

So the stock market is not only providing the much required funds for boosting the business, but also providing a common place for stock trading. It is the stock market that makes the stocks a liquid asset unlike the real estate investment. It is the stock market that makes it possible to sell the stocks at any point of time and get back the investment along with the profit. This makes the stocks much more liquid in nature and thereby attracting investors to invest in the stock market.

COMPANY PROFILE

PROFILE OF THE COMPANY :

NAME OF THE COMPANY : Sharekhan ltd.

YEAR OF ESTABLISHMENT: 1925

HEADQUATER: ShareKhan SSKI A-206 Phoenix House Phoenix Mills Compound Lower Parel Mumbai - Maharashtra, INDIA- 400013

NATURE OF BUISNESS : Service Provider

SERVICES:Online Services, Depository Services and Technical Research.

NO OF EMPLOYEES: Over 5500

WEBSITE: www.sharekhan.com

SLOGAN: Your Guide to The Financial Jungle.

SHAREKHAN LOGO : COMPANY DETAIL:

Sharekhan is one of the top retail brokerage houses in India with a strong online trading platform. The company provides equity based products research, equities, derivatives, depository, margin funding, etc.. It has one of the largest networks in the country with 1200+ share shops in 400 cities and Indias premier online trading portal www.sharekhan.com. With their research expertise, customer commitment and superior technology, they provide investors with end-to-end solutions in investments .They provide trade execution services through multiple channels as an internet Platform, telephone and retail outlets. Sharekhan was established by Morakhia family in 1999-2000 and Morakhia family ,continues to remain the largest shareholder. It is the retail broking arm of the Mumbai-based SSKI [SHRIPAL SHEWANTILAL KANTILAL ISWARNATH LTD] Group. SSKI which is established in 1930 is the parent company of Sharekhan ltd. With a legacy of more than 80 years in the stock markets, the SSKI group ventured into institutional broking and corporate finance over a decade ago. Presently SSKI is one of the leading players in institutional broking and corporate finance activities. Sharekhan offers its customers a wide range of equity related services including trade execution on BSE, NSE, and Derivatives. Depository services, online trading, Investment advice, Commodities, etc. Sharekhan Ltd. is a brokerage firm which is established on 8th February 2000 and now it is having all the rights of SSKI. The company was awarded the 2005 Most Preferred Stock Broking Brand by Awaaz Consumer Vote. It is first brokerage Company to go online. The Company's online trading and investment site www.Sharekhan.com - was also launched on Feb 8, 2000. This 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 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. Sharekhan has one of the best states of art web portal providing fundamental and statistical information across equity, mutual funds and IPOs. One can surf across 5,500 companies for in-depth information, details about more than 1,500 mutual fund schemes and IPO data. One can also access other market related details such as board meetings, result announcements, FII transactions, buying/selling by mutual funds and much more. Sharekhan's management team is one of the strongest in the sector and has positioned Sharekhan to take advantage of the growing consumer demand for financial services products in India through investments in research, pan-Indian branch network and an utstanding technology platform. Further, Sharekhan's lineage and relationship with SSKI Group provide it a unique position to understand and leverage the growth of the financial services sector. We look forward to providing strategic counsel to Sharekhan's management as they continue their expansion for the benefit of all shareholders. Sharekhan has always believed in investing in technology to build its business. The company has used some of the best-known names in the IT industry, like Sun Microsystems, Oracle, Microsoft, Cambridge Technologies, Nexgenix, Vignette, Verisign Financial Technologies India Ltd, Spider Software Pvt Ltd. To build its trading engine and content.The Morakhiya family holds a majority stake in the company. HSBC, Intel & Carlyle are the other investors. With a legacy of more than 80 years in the stock markets, the SSKI group ventured into institutional broking and corporate finance 18 years ago. Presently SSKI is one of the leading players in institutional broking and corporate finance activities. SSKI holds a sizeable portion of the market in each of these segments. SSKIs institutional broking arm accounts for 7% of the market for Foreign Institutional portfolio investment and 5% of all Domestic Institutional portfolio investment in the country. It has 60 institutional clients spread over India, Far East, UK and US. Foreign Institutional Investors generate about 65% of the organizations revenue, with a daily turnover of over US $ 2 million. The Corporate Finance section has a list of very prestigious clients and has many firsts to its credit, in terms of the size of deal, sector tapped etc.

ACHIEVEMENTS OF SHAREKHAN:

Rated among the top 20 wired companies along with Reliance, HUJl, Infosys, etc by Business Today, January 2004 edition. Awarded Top Domestic Brokerage House four times by Euro money and Asia money. Pioneers of online trading in India amongst the top 3 online trading websites from India. Most preferred financial destination amongst online broking customers. Winners of Best Financial Website award. Indias most preferred brokers within 5 years. Awaaz customers Award 2005.

FUTURE PLAN: 3,00,000 plus retail customers being serviced through centralized call centers/ web solutions. Branches / Semi branches servicing affluent / aggressive traders through high skill financial advisor. 250 independent investment managers/ franchisee servicing 50,000 highly valued clients. New initiatives Portfolio management Services and commodities trading. VISION :

To be the best retail brokering Brand in the retail business of stock market.

MISSION:

To educate and empower the individual investor to make better investment Decisions through quality advice and superior service.

SHAREKHAN IS INFACT:

Among the top 3 branded retail service providers No. 1 player in online business Largest network of branded broking outlets in the country serving more than 7,00,000 clients.

SHAREKHAN OUTLET OFFER FOLLOWING SERVICES:

Online BSE and NSE executions (through BOLT & NEAT terminals) . Free access to investment advice from Sharekhan's Research team . Sharekhan Value Line (a monthly publication with reviews of recommendations, stocks to watch out for etc.) . Daily research reports and market review (High Noon & Eagle Eye) , Pre-market Report (Morning Cuppa) . Daily trading calls based on Technical Analysis. Cool trading products (Daring Derivatives and Market Strategy). Personalised Advice . Live Market Information. Commodities Trading . IPOs & Mutual Funds Distribution . Internet-based Online Trading: Speed Trade.

REASON TO CHOOSE SHAREKHAN LIMITED

EXPERIENCE :

SSKI has more than eight decades of trust and credibility in the Indian stock market. In the Asia Money broker's poll held recently, SSKI won the 'India's Best Broking House for 2004 ' award. Ever since it launched Sharekhan as its retail broking division in February 2000, it has been providing institutional level research and broking services to individual investors.

TECHNOLOGY :

With its online trading account one can buy and sell shares in an instant from any PC with an internet connection. One can get access to its powerful online trading tools that will help him take complete control over his investment in shares.

ACCESSIBILITY :

Sharekhan provides ADVICE, EDUCATION, TOOLS AND EXECUTION services for investors. These services are accessible through its centres across the country 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, one can get access to a wide range of information on Sharekhan Limiteds content-rich portal.

INVESTMENT ADVICE:

Sharekhan has dedicated research teams of more than 30 people for fundamental and technical researches. Its analysts constantly track the pulse of the market.

SHAREKHAN LIMITEDS MANAGEMENT TEAM:

Mr. Dinesh Murikya Owner of the company:

The Sharekhan Group of Companies was brought to life by Mr. Dinesh Murikya. He Venture into stock trading with an intention to raise capital for his own independent enterprise. However, he recognised the opportunity offered by the stock market to serve individual investors. Thus Indias first retail-focused stock-broking house was established in 1925. Under his leadership, Sharekhan became the first broking house to embrace new technology for faster, more effective and affordable services to retail investors.

DIRECTORS:

MR. TARUN SHAH CEO- SHARE KHAN

A science graduate from St. Xaviers College, Mumbai, Mr. Tarun Shah started his professional life in sales and marketing in a chemicals company. His hands on approach and rigorous experience in sales led him to higher challenges that the capital markets provided.In 1987, he joined SSKI, a brokerage firm with over five decades of legendary service to its credit. MR SHANKAR VAILAYA- DIRECTOR (OPERATION) OF SHAREKHAN

A graduate in commerce from the University of Mangalore and an Associate of TheMember of the Institute of Chartered Accountants of India,Mr. Shankar Vailaya heads the operations, finance and legal functions.

MR. JAIDEEP ARORA DIRECTOR (PRODUCT&TECHNOLOGY)

Jaideep Arora,completed his B.Tech from IIT (Kanpur) and his PGDM from IIM Kolkata.

OTHER DIRECTORS: Mr Pathik Gandotra : Head of Research Mr Rishi Kohli : Vice President of Equity Derivatives

HIERARCHY IN SHAREKHAN:

Sales Side

Dealing Side

Trainees

Junior Dealer

Super Trainees

Dealer

Sales Executives

Relationship manager

Senior sales executives

Senior Relationship manager

Business development executive

Equity advisor

Assistant sales manager

Assistant Branch Manager

Deputy manager

Branch Manager

Territory manager

Cluster Head

Area sales manager/ Cluster manager

Directors

Regional sales manager

CEO

Regional Head

Vice president

Directors

CEO

\SWOT ANALYSIS

STRENGTHSWEAKNESSES

1. First brokerage firm to go online.

2. PMS Services.

3. Technology

4. Online fund transfer.

5. Research reports.

6. Clients (average of15,000 accounts per year) 7. Recommendations from clients.

8. Free Demat a/c opening.

9. Low annual maintenance charge

10. Different variety of financial products.

1.High brokerage charges but now they have overcome this by a new prepaid scheme in which brokerage is reduced to half.2. Lesser emphasis on customer retention.

3. Lack of awareness among customers because of non-aggressive promotional strategies (print media, newspapers, etc).

OPPORTUNITIES

With the booming capital market it can successfully launch new services and raise its clients base.

It can easily tap the retail investors with small saving through promotional channels like print media, electronic media, etc.

Increasing usage of internet through broadband connectivity may boost a whole new breed of investors for trading in securities

Learnings and tasks performed in my SIT:

To project Sharekhan as an authority in the retail stock trading business. To execute business for the company by selling demat accounts. To study the various products of Sharekhan. To know how to open and close the calls. To learn the online terminal used for trading. To know the various policies of the company. To know how to handle various types of customers. To know various reasons for market fluctuations. To learn to manage time. To gain practical knowledge of the market. To have a practical experience of working in a reputed organization. To expand the market penetration of Sharekhan ltd. To provide pricing strategy of competitors to fight cut throat competition. Study of influencing factors affecting the purchase decision. Checking the satisfaction level of the customers towards Sharekhan Checking the awareness level of investor in online share trading.

PRODUCTS & SERVICES OF SHAREKHAN

Sharekhan ltd. Provide different Product as follows

Share online & offline Derivatives Mutual fund online Commodities online IPO online Portfolio Management Services Insurance Fixed deposits Advisory products Currency trading

PRODUCTS OF SHAREKHAN

SHAREKHANS VARIOUS TYPES OF ACCOUNT

SHARE ONLINE: Sharekhan provide online facilities for: Instant credit and transfer:-instant transfer of funds from bank account of the choice to Sharekhan trading account. Trade anywhere:-enjoy the ease of trading from any part of the world in a completely secure environment. Dial n Trade:-call toll free number (1-800-22-7050) to place orders through tele brokers. Timey advice:-make informed decisions with expert advice, investment calls and live market commentary. Real-time portfolio tracking:-benefit from real-time information for investment and current portfolio value. After-hour orders:-place order after market hours, which get executed as soon as the markets opens. Freedom from paperwork:-Integrated trading, bank and de-mat account with digital contracts removers all paperwork.Sharekhan provide different types of online accounts

CLASSIC ACCOUNT:-

The Classic Account enables customers to trade online on the NSE and the BSE, invest in IPO and Mutual Funds and access all the research and transaction reports through Sharekhans website. This account is suitable for the retail investors. The life time registration charge for this account is 750 rupees.

Features Online trading account for investing in Equities and Derivatives Free trading through Phone (Dial-n-Trade) Integration of: Online trading + Bank + Demat account\ Instant cash transfer facility against purchase & sale of shares IPO investments Instant order and trade confirmations by e-mail Single screen interface for cash and derivativesFAST TRADE:

Features Streaming quotes. Personalized market watch. Single screen interface for cash, derivatives and Commodities. New FastTrade is platform independent will support by all Operating System. New FastTrade will support all browsers in the market. New FastTrade is independent of existing website and can work even if content website is down. Fast trade is web base product and its a shown fluctuation rate.

TRADE TIGER ACCOUNT:

This is an internet-based software application, which enables one to buy and sell in an instant. It is ideal for active traders and jobbers who transact frequently during days session to capitalize on intra-day price movement.This account comes with the following features: Instant order Execution and Confirmation. Single screen trading terminal for NSE Cash, NSE F&O & BSE. Technical Studies. Multiple Charting. Real-time streaming quotes, tic-by-tic charts.

Alerts and reminders. Live market debts.

SHARE OFFLINE:As the internet has taken over the physical trade, the same is the situation in trading in shares. Even the internet has not spared trading in shares and still the conventional system of offline trading continues in todays world.

Merits of offline trading:

Low brokerage Less margin Flexibility in credit period Customized advice

Demerits of offline trading

Problems in getting in touch with the broker Limited clientele Problem of attention from the broker due to load Customer has to believe what the broker says Broker Might not give the best price

Paperwork Geographical Restriction

DIAL-N-TRADE:Sharekhan provides complete trading facility like they are giving Toll free numbers the phone trading facility as an alternative of net trading where a customer can call n number of times. Toll Free numbers: 1800-22-7500DERIVATIES:Derivatives are financial contracts whose value/price is depends on the behavior of price of one or more basic underling assets. These contracts are legally binding agreement, made on the trading screen of stock exchange, buy or sell an asset in future. The assets can be share, index, interest rate, bond, rupee- dollar exchange rate, sugar, crude oil, soybean, cotton, coffee etc. EQUITY FUTURE AND OPTION:

Future:-

An agreement between two parties to buy or sell an asset at a certain time in the Future at a certain price. Stock futures on certain specified securities and internet rate futures are available for trading at NSE (NATIONAL STOCK EXCHANGE).All the futures contracts are settled in cash.

Options:- An Options is a contract which gives the right, but not but or sell the underlying at a stated price, which a buyer of an option pays the premium and Options are of two types calls and put. Calls give the buyer the right but not the obligation to buy a given quantity of the underlying asset, at a given price on or before a given future date. Calls also known as bulls. Puts give the buyer the right, but not obligation to sell a given quantity of the underlyingasset at a given price on or before a given date. Puts also known as bears.COMMODITIES ONLINE:

COMMODITIES ONLINE:Commodities are agreements to buy and sell virtually anything except, for some reason, onions. The primary commodities that are traded are oil, gold and agricultural products. Commodity derivatives comprise of raw materials and products that can be traded on special commodity exchanges across the country. Commodities expands customer investing horizon from investing in a metal company to trading in the metal itself. Trading in commodity derivative provides unique market opportunities for a wider section of participants like: investor, hedgers, arbitragers, traders, manufactures planters, exporters and importers. While trading commodities through an exchange, there are no transportation charges, no insurance costs, no storage charges and complete security when customer trade though an exchange. Customer can trade in commodities at nominal costs and carry the investment in paper from as customer want. The fundamentals for commodities are quite simple: price is a function of demand and supply. Sharekhan provides commodity facility. Sharekhan trades on two major commodity exchanges in India. MCX NCDEX

Indexes of commodities:

MCX (MULTI COMMODITY EXCHANGE OF INDIA LTD) is a state-of-the-art electronic commodity futures exchange.MCX is an independent commodity exchange based in India. It was established in 2003 and is based in Mumbai. The turnover of the exchange for the period Apr-Dec 2008 was INR 32 Trillion.MCX offers futures trading in Agricultural Commodities, Bullion, Ferrous & Non-ferrous metals, Pulses, Oils & Oilseeds, Energy, Plantations, Spices and other soft commodities. MCX has also setup in joint venture the National Spot Exchange a purely agricultural commodity exchange and National Bulk Handling Corporation (NBHC) which provides bulk storage and handling of agricultural products.

NCDEX:

National Commodity & Derivatives Exchange Limited (NCDEX) is a professionally managed online multi commodity exchange promoted by ICICI Bank Limited (ICICI Bank), Life Insurance Corporation of India (LIC), National Bank for Agriculture and Rural Development (NABARD) and National Stock Exchange of India Limited (NSE). Punjab National Bank (PNB), CRISIL Limited (formerly the Credit Rating Information Services of India Limited), Indian Farmers Fertiliser Cooperative Limited (IFFCO) and Canara Bank by subscribing to the equity shares have joined the initial promoters as shareholders of the Exchange. NCDEX currently facilitates trading of thirty six commodities - Cashew, Castor Seed, Chana, Chilli, Coffee, Cotton, Cotton Seed Oilcake, Crude Palm Oil, Expeller Mustard Oil, Gold, Guar gum, Guar Seeds, Gur, Jeera, Jute sacking bags, Mild Steel Ingot, Mulberry Green Cocoons, Pepper, Rapeseed - Mustard Seed ,Raw Jute, RBD Palmolein, Refined Soy Oil, Rice, Rubber, Sesame Seeds, Silk, Silver, Soy Bean, Sugar, Tur, Turmeric, Urad (Black Matpe), Wheat, Yellow Peas, Yellow Red Maize & Yellow Soybean Meal. At subsequent phases trading in more commodities would be facilitated.

IPO:-

Initial Public Offering, the firstsaleofstockby acompanyto thepublic. CompaniesofferinganIPOare sometimes new, young companies, or sometimes companies which have been around for many years but are finally deciding to go public. IPOs are often riskyinvestments, but often have the potential for significant gains. IPOs are often used as a way for a young company togainnecessarymarket capital.From an investor point of view, IPO gives a chance to buy shares of a company, directly from the company at the price of their choice (In book build IPO's). Many a times there is a big difference between the price at which companies decides for its shares and the price on which investor are willing to buy share and that gives a good listing gain for shares allocated to the investor in IPO. From a company prospective, IPO help them to identify their real value which is decided by millions of investor once their shares are listed in stock exchanges. IPO's also provide funds for their future growth or for paying their previous borrowings. Sharekhan provides to their customer the Online IPO facility. In this facility, The customer has to feel only the bid price and the quantity for which he/she wants to buy the stock.

STEPS FOR APPLYING IPO ONLINE

CURRENCY TRADING:

CURRENCY TRADING:

Currency trading means to trade in currency of different countries and price varies because of supply and demand. Currency trading is mostly done by large companies or by people who is import export business. In price of currency there is always fluctuation. So it can be dangerous for people who have import-export business. So they make reverse position or it is also known as hedging. So by this way people minimize their risk with the help of currency trading. Currency trading is not much useful to individual investors. Sharekhan is providing offline currency trading to interested customers..

CUSTOMER SUPPORTER:

Call Centre:

There is a call centre at Bombay, where more than 200 employees are working efficiently. Their work is as powerful that they complete every call within two minutes. So customers are satisfied with them.

Relationship Manager:Sharekhan provides personal relationship manager to its customer. The work of relationship manager in Sharekhan ltd is as follow: Punching in trades for clients. Communicating intra-day trading calls and investment ideas to customers. Conducting business development activities in branches. Monitoring day to day operations at branch. Maintaining regular relations with clients.ALERTS:ON YOUR MOBILE

IN YOUR MAIL

IN MYINBOX

Variety of Alerts for equities, Mutual Funds, IPOs and Traders Get customize Daily Updates Trade Execution Alerts will be set by default for trading customers Be the first to get Research updates Setting Alerts was never easier Get the advantage of new alerts being added in the future

SEMINAR:

Sharekhan organizes seminars across the country from time to time in order to educate investors in various subjects related to the stock, derivatives and commodities markets. These exclusive Seminars are organized by Sharekhan for its Online Trading Customers for FREE. This will the the people to take investment decision.

SHAREKHAN SHOPS:

All you have to do is walk into any of our share shops across cities in India to get a host of trading and investment related services. Our friendly customer service staff will also help you with any account related queries you may have.

AFTER HOUR ORDERS:Sharekhans customer also enjoy the facility of placing orders even after trading hours and the orders are executed as soon as the market opens.

DE-MAT ACCOUNT

Overview of Demat Account :

Demat account allows you to buy, sell and transact shares without the endless paperwork and delays. It is also safe, secure and convenient.In India, a demat account, the abbreviation for dematerialized account, is a type of banking account which dematerializes paper-based physical stock shares. The dematerialized account is used to avoid holding physical shares: the shares are bought and sold through a stock broker.This account is popular in India. The Securities and Exchange Board of India (SEBI) mandates a demat account for share trading above 500 shares. As of April 2006, it became mandatory that any person holding a demat account should possess a Permanent Account Number (PAN), and the deadline for submission of PAN details to the depository lapsed on January 2007.

IS DEMAT A/C IS MUST?

Now a day, practically all trades have to be settled in dematerialized form. Although the market regulator, the Securities and Exchange Board of India (SEBI), has allowed trades of up to 500 shares to be settled in physical form, nobody wants physical shares any more. So a demat account is a must for trading and investing.

WHY TO CHOOSE DEMAT?

The demat account reduces brokerage charges, makes pledging/hypothecation of shares easier, enables quick ownership of securities on settlement resulting in increased liquidity, avoids confusion in the ownership title of securities, and provides easy receipt of public issue allotments.It also helps you avoid bad deliveries caused by signature mismatch, postal delays and loss of certificates in transit. Further, it eliminates risks associated with forgery, counterfeiting and loss due to fire, theft or mutilation. Demat account holders can also avoid stamp duty (as against 0.5 per cent payable on physical shares), avoid filling up of transfer deeds, and obtain quick receipt of such benefits as stock splits and bonuses.

WHAT IS DEMATERIALIZATION?

Dematerialization is the process by which physical certificates of an investor are converted to an equivalent number of securities in electronic form and credited into the investors account with his/her DP.

WHY DEMAT A/C IS LIKE BANK A/C?

Just as you have to open an a/c with a bank if you want to save your money, make cheque payments etc, you need to open a demat a/c if you want to buy or sell stocks. So it just like a bank a/c where actual money replaced by shares.

Example : lets say your portfolio has 100 of SATYAM, 200 of IBM and 120 of TCS shares. All these will show in youre a/c. so you dont have to possess any physical certificate that you own these shares. They all are held electronically in youre a/c.

DEMAT ACCOUNT IN SHAREKHAN:

Opening a DP account with Sharekhan One can open a Depository Participant (DP) account, either through a Sharekhan branch or through a Sharekhan Franchisee center. There is no fee for opening DP accounts with Sharekhan. However a nominal deposit (refundable) is charged towards services which will be adjusted against all future billings. All investors have to submit their proof of identity and proof of address along with the prescribed account opening form.

DE-MAT ACCOUNT OPENING CHARGES:

TYPE OF DEMAT DEPOSIT (Refundable)CHARGES (non refundable)

CLASSIC ACCOUNTRs.5000Rs.750

Rs.10000 Nil

TRADE TIGERRs.5000Rs.1000

Rs.10000/25000 Nil

List of Documents required to open an account with Sharekhan:

Proof of Identity Copy of Ration card Address Proof A copy of cancelled cheque Nominee photograph, if filled Signed Photograph of all holders

Customer can submit a photo copy of any of the following document for proof of identity:

Customer can submit a photo copy of any of the following document for residence proof:BROKERAGE STRUCTURE OF SHAREKHAN

BROKERAGE: It is the charge taken by the guiding company for helping you in buying and selling your shares. There are different charges for Intraday and Delivery.

INTRADAY:

The day to day buying and selling or daily transactions are called as Intraday. You have to buy or sell the shares within the day only.

DELIVERY:

It is the three day transaction. The day you buy the share and the next two days after that day is called as Delivery. It includes thre days. If you are buying any share then you have to sell it within three days including the buying day.

PREPAID ACCOUNT

There are three types of Prepaid account are provided to the customers accordingly they make transactions more and more. All Prepaid accounts are valid for One year only.

Prepaid BrokerageCashFutures and Options

(P.A)FuturesOptions

2000/-Intra-day 0.07%0.071.5% or Rs.80,

(Single Side)whichever is

Delivery 0.40%Higher

6000/-Intra-day 0.05%0.051% or Rs.70,

Delivery 0.25%whichever is

Higher

18000/-Intra-day 0.04%0.041% or Rs.50,

Delivery 0.20%whichever is

Higher

SHAREKHAN HAS TIE UP WITH FOLLOWING BANKS: HDFC Axis Bank IDBI Citi Bank IndusInd Bank Union Bank ICICI Oriental Bank Of Commerce. 8 bank othersNOTE :In these following bank we can transfer our funds from our bank account to trading account with the help of online banking like net banking within a second .Now there is no need to pay demand draft and cheques to the sharekhan.

BENEFIT OF SHAREKHAN DEMAT ACCOUNT:

EXPOSURE:

Sharekhan also helps their customers by providing them up to Five times Exposure. Example :- If a customer invests Rs. 20000, then he will get a exposure of 5 times of Rs. 20000 that means Rs. 20000 * 5 = Rs. 100000.But only for Five days, within 5 days the customer have to pay back the amount otherwise Sharekhan will sell your shares.

Its cost effective

You pay comparatively lower transaction fees. As an Introductory offer, we invite you to pay a flat fee of just Rs. 750/- and transact through Sharekhan.

Its offers single

Through Sharekhans associates, you can transact in equity, currency and commodities derivatives, offshore investments mutual funds, IPOs life insurance, general insurance, money transfer, money changing and credit cards, amongst others.

ITS CONVENIENT :

You can access Sharekhans services through the internet Transaction kiosks The phone (call & transact) A safe and convenient way to hold securities; Immediate transfer of securities No stamp duty on transfer of securities; Elimination of risks associated with physical certificates such as bad delivery, fake securities, delays, thefts etc.; Reduction in paperwork involved in transfer of securities; Reduction in transaction cost; No odd lot problem, even one share can be sold; Nomination facility; Change in address recorded with DP gets registered with all companies in which investor holds securities electronically eliminating the need to correspond with each of them separately; Transmission of securities is done by DP eliminating Correspondence with companies; Automatic credit into demat account of shares, arising out of bonus/split/consolidation/merger etc. Holding investments in equity and debt instruments in a single account.

ACCESS TO VALUE ADDED SERVICES

Reliable research, including views of external experts with an enviable track record Live news updates from Reuters and Dow Jones CEOs / expert views on the economy and financial markets Tools that help you plan your investments, tax, retirement, etc. in the personal finance section Risk Analyser for analysis of your risk profile Asset allocators to build an appropriate investment portfolio Innovative use of technology for facilitating

Benefit For Investors

Demat account has become a necessity for all categories of investors for the following reasons/ benefits: SEBI has made it compulsory for trades in almost all scrips to be settled in Demat mode. Although, trades up to 500 shares can be settled in physical form

MY WORK PROFILE IN SHAREKHAN:

I worked there with SHAREKHAN LTD. with a profile of Management Trainee. This profile offers me to understand the need of customer and provide them the best deal possible with maximization of the profit, both for the company as well as for the customer.The most important aspect for the role of trainee is trust. So far fulfilment of the targets one needs to: Capitalize on the old and loyal client age which can be building slowly by advising people in the best possible way. Generating new leads through various activities.

TARGETS / TASKS:To sell 05 Demat accounts worth Rs. 750/- in 2 months for Sharekhan Ltd at Vaishali and Noida. To sell 3 Demat accounts in 1 month for Sharekhan ltd at Vaishali and Noida.

TASKS To collect the leads. To do the tele calling and take appointments. To attend the appointment on prescribed time. To tell the client about the company and its products. To tell the client about the advantages of opening a demat account . To convince the clients to do Online Trading. To explain him the terms and conditions of the product. To convince the client to open Demat account at Sharekhan ltd. To give a live demo of how the online terminal works. By means of presentation explaining them how to trade online. To take signatures of the client on the KYC (know your customer) form. To collect the documents required to open a demat account. To fill up the KYC form for the customer. To install the software in the client`s computer. To make the client trade. To get the references from the client.

TARGET CUSTOMERS FOR SELLING DEMAT ACCOUNT

Business class people (high class) Service class people Government Employees ( working in banking sector ) Young Adults (19-25 yrs students want to earn part time income.) Adults (35-50 yrs.) Women (literate and working women)

GENERATION OF LEADS FOR SHAREKHAN:

Since I was new in the field so I had to start from scratch and generate new leads to sustain in the market.Personal references and cold calling is one of the trusted ways of getting to the customers without meeting them. Although in cold calling the rate of conversion remained very less, for cold calling the quality and accent remains a very important criterion. This activity gives me mixed result. I often got success and generated many leads through it but it also landed me in awkward position where the customer is not ready to hear. Corporate calls always remained more difficult to crack with respect to retail sector.

The corporate were the most difficult and most temping to get the business from. It took me one day to crack Hi-tech Gears. At SHAREKHAN LTD. after getting the product knowledge in the two week at the branch I was also allotted distributor to work with. In the initial phase I was accompanied by more experienced staff. After I became known to the market and procedure I started attending calls alone only.

After the fourth week my performance also improved and I was able to get close to the targets, Although it looked difficult to achieve in the beginning. To get awareness of the every product I attended diversified calls. This helped me to implement cross selling to get better result ,follow ups also play major role when we talk about cold calling

STRATEGY ADOPTED FOR SELLING DEMATS ACCOUNTS:COLLECTING MORE AND MORE DATA THROUGH SHAREKHAN WEBSITE AND BY USING JUST DAIL APP

NOT INTERESTED TAKE REFRENCES

STRATEGY ADOPTED FOR TELECALLING :

I was supposed to use the database provided by the company to make cold calls or by directly meeting people to get new leads.

While making cold calls, we need to have:

Good Communication Skills (Voice quality is clear and articulate) Persistent and able to bounce back from rejection Good organizational skills. Ability to project a telephone personality (Enthusiasm, friendliness) Flexibility: can adapt to different types of clients and new situations.

Using a good database is very essential

Eighty per cent of our business comes from 20 per cent of our customers" is a frequent statement at any sales convention. There's hardly a sales executive who is not aware of the 80/20 rule.

While talking to customers, I analyse their needs. Whether they want to go for investment purpose or insurance or both. Suggest them the plan that best suits them. If they agree to it then either we send across the agents to close the deal or close it themselves.SYSTEMATIC PLAN AND PROCESSMY PERSONAL EXPERINCE IN SHAREKHANBefore my Summer Internship Programme, I had very little knowledge about the stock market and its fundamentals. And now after undergoing training for the 6th week at Sharekhan there is a tremendous increase in my knowledge about the stock market. I have also gained a lot of knowledge about the Sharekhan Company and its various products, schemes and policies and also about its competitors. The products which I have sold up till now are Demat accounts . And I am confident about my knowledge about demat accounts . Although nobody can claim complete expertise but there is a sea change at least from my point of view. I have learnt what are the various indices and their significance in market. I have also learnt the impact of Sensex and Nifty on overall stock market. I have learnt about various fundamentals and technical aspects, which affect the stock prices in short, run and long run. At Sharekhan we have also been taught to use the online terminal. Sharekhan is one of the top retail brokerage houses in India with a strong online trading platform. The company provides equity based products (research, equities, derivatives, depository, margin funding, etc.). It has one of the largest networks in the country with 1000 share shops in 375 cities and Indias premier online trading portal www.sharekhan.com.Out of these we have to mostly sell demat accounts. In the first week we had training sessions for 5 days in which our company guide Mr Ashish Kumar gupta gave us the complete information about the company, its products and policies. He gave us tips on how to open and close the calls. He also gave me tips on how to do telecalling. He also share information on how to fill the KYC form and what are the documents required to open the demat account. Then finally after this we were sent to the market to bring demat accounts and Mutual funds. Initially we faced many obstacles and reasons were many like bad stock market conditions and we were unable to locate potential market etc. but slowly I collected a good number of leads and references from whom so ever I met. I am still following the clients who are giving follow up dates.Our main task is to sell the online demat account. During this venture I came across many people who came from different walks of life. I have learned how to deal with them and convince them to open the demat account with Sharekhan. Selling a demat account requires special focus on targeting the customers. Each and every person does not invest in the share market. The person who will be investing in the share market should have at least the basic knowledge about the same or should have the curiosity to gain the same. So what I had to do is to identify the prospective client and then try to convince them. Wasting time on the customer who does not know anything about stock market is completely worthless. While on the call if customer asks me any query about which I am not very much sure then I call our Ashish kumar gupta sir who then clears my doubts and queries without any irritation. This not only solves clients query but also makes our concepts clear and strong. I initially met round about 5 to 10 people every day. Out of these I found 2 to 4 persons who took actual interest in the Demat account and Mutual funds. As I met more and more people, I learned how to identify the prospective clients. I came to know more about how to talk to them, how much time should be given to each client. . Even, by solving the customer queries, my own understandings were enhanced. While selling our product in the market, I also came to know more about our competitor's product like, ICICIDirect, India bulls, kotak security , Religare etc. and their strategy of marketing and the consumer's preference towards the competitor's product. I did cold calling in these 6 week and created my own database through it. In the fourth week some of the follow-ups from the third week started converting. Sharekhan also started a scheme of free demat account opening and also the one in which the brokerage reduces to half of the original brokerage of 0.03% for Intraday and 0.30% for Delivery. I met people in different locations i.e. at like in Vaishali, Noida sector 62, etc. This includes people from the Banks, Chartered Accountants, Travel agents, business people, real estate people, Customer Relationship Managers, Assistant Sales Manager, and engineers of NSN Company.Once the customer fills up the KYC form, I call him/her after 5 working days to check if he has received the welcome kit which contains the login ID and password from Bombay office of Sharekhan. After he receives the kit I have to go to his place to install the software in his computer and also I have to tell him how to trade online i.e. I have to explain him the complete terminal. I am required to show the customer how to make a transaction and how to get access to the terminal. Also, if the client faces any problem, then those too had to be solved by me. So, it is all a very good learning experience for me. We have to take about 25 signatures of the customer on the KYC form. This is again a big challenge because they say that now they don`t have enough time to sign in 25 places. And if the sign mismatches even a little then there is again some long procedure to make that form acceptable. I had faced this kind of situation. My second client Mr Ahmad Zama signature on the passport photocopy was different from that on his PAN card. So the form got rejected. And he even said that if this form will not proceed further then he don`t want to open the Demat account and asked me to return the cheque. Due to this I was very depressed for 2-3 days but then maybe I called him at a right time as he instantly asked me given another copy of passport with matched signature and I was very happy that day. At Sharekhan, the atmosphere is perfectly cordial. There are senior trainees and back office people always to solve the difficulties we faced in approaching a customer, filling up the form, demonstrating the terminal, or solving the customers queries. Even our Ashish sir helped us in solving our problems. I am gone in a market in alternate days.

Problems faced while selling products: Customer dissatisfied with the services. People fear about the Market fluctuations Past experience, word of mouth. People do not want insurance products. Lack of knowledge and less awareness about demat account. People risk appetite is very low, so they are afraid of mutual fund as well

ACHIEVEMENT:

SERIAL NOWEEK NO.ACHIEVEMENT

NAME OF THE CLIENTTYPE OF ACCOUNTAMOUNT / ASSET

A.(15/06/14 22/06/14)NILNILNILNIL

B.(28/6/14-06/7/14)NILNILNIL NIL

C.(07/7/14 - 14/7/14)2 DEMAT A/C1.Mr.Bisharat khan 2.Mr.Ahmad zama khanClassic accountsRs.750/-(Rs.750/- each)

D.(16/7/14 - 22/7/14)NILNILNILNIL

E.

(23/07/14 - 1/08/14)

5 DEMAT A/C1.Mrs.Afsha khan

2Classic account

Rs.750/- -

LEARNINGS: Importance of information technology in the field of stock broking is immense. Stock broking companies run with the help of IT. The terminal through which the brokers buy and sell shares is a software that completely depends on the internet. For Sharekhan, this terminal has been designed by the software company Spider. Buying and selling through internet is fast. As soon as the prices of the shares goes up or comes down then they can be sold or purchased instantly within seconds. Customer Relationship is very necessary for the company to retain the customers. In Sharekhan I have learned how to maintain good relations with the customers by giving them the proper service and solving their queries regarding the share market. I have also learned how to maintain good relation with the employees and the co-trainees. In Sharekhan Ltd. I have learned a lot relating to the finance and marketing Learned the meaning of the words that are mostly used in the share market. Learned about various products of the Sharekhan Limited. Learned various aspects regarding Share Market. Learned about various products used in the share market especially Demat accounts .Learned how to use online trading terminal. Enhanced my communication and convincing skills. Learned how to take appointments. Learned how to approach the customers. Learned how to open and close the calls. Learned how to interact with people, how to convince them and guide them in trading. Learned the various policies of the company. Learned to manage time properly. LIMITATIONS OF ACHEVING

Due to bad market conditions people are becoming more and more pessimistic about investing in the share market. After the depreciation of rupee upto the level of Rs 60, SENSEX fell tremendously from 21000 . In this crash many people lost their money amounting from 2 Lakhs to 4-5 crore or even more. So when we approach them they tell us how much they used to trade in shares and how much money they have lost in the share market. They even tell us that we are doing our training at very wrong time. While telecalling sometimes the clients do not give positive response, may be because they are really busy or may be not interested in the demat accounts. While cold calling when we met the owners of big shops. They said that if they had spare money they will invest it in their shops and not in the share market. They don`t want to take risk. There are some negative rumors in the market about Sharekhan ltd. some people have very bad experience with Sharekhan in terms of services and charges. This may not be the fault of the company but of some of the marketing executives who don`t disclose all the details about charges and products and once the demat account has been opened they don`t pay any attention to their old clients and thus fail to give proper services to the clients. Sharekhan takes no charges for opening Demat accounts but there is a initial deposit of Rs.10,000/-. It is just a margin money which has to be kept with Sharekhan till the account opens. As soon as the account opens this money can be kept as it is in the demat account or it can be completely used for buying shares or it can be partially used and the rest of the amount can be withdrawn. But clients fail to understand this. They think that these are the charges they start suspecting it. So its very difficult to convince them to deposit that much amount and open a demat account.Points to Remember You may choose your DP based on your evaluation of their reputation, service standards, charges, other conveniences, etc. Account opening procedure should typically take 2-5 days. In case of a minor, the depository account should be opened in the name of the minor and the guardians name should be mentioned. The guardian will sign as signatory on behalf of the minor. For selling the securities of the minor, a court order should be obtained. In case of any difficulties, contact your DP. Only securities admitted by NSDL can be dematerialized. The list is available with your DP. Only securities registered in the name of the account holder can be dematerialized. Dematerialization is normally completed within 15 days after the share certificates have reached the issuer/their R&T Agent. Thus it may take you a month from the date you hand over shares, to receive demat credit. Dematerialization would be done only when the issuer / their R&T Agent is satisfied of genuineness of securities & ownership status All the joint holders should sign the DRF. Demat requests with name(s) not matching exactly with the name(s) appearing on the certificates merely on account of initials not being spelt out fully or put after or prior to the surname, would be processed, provided the signature(s) of the client(s) on the DRF tallies with the specimen signature(s) available with the issuer/ their R & T agent. If the signature in the DRF does not match with the signature available with the issuer/ their R & T agent, the issuer/ their R & T agent may at the time of demat confirmation, ask for additional documentation (like bank attestation/ notarization, etc.) to prove that the certificate belongs to the person who forwarded the DRF. In case there is any problem in processing the DRF, contact your DP and if he cannot resolve the problem you may contact NSDL

LITERATURE REVIEW

LITERATURE REVIEW:

According to jayanth .R. verma (July 1997) on Indian Money MarketMarket Structure, Covered Parity and Term Structure:-

In the context of the relatively recent deregulation of interest rates in India, this paper analyses the structure and inter-relationships of money market interest rates and studies the extent to which covered interest parity holds in India. The paper shows that there was a major structural break in September 1995 when in the wake of turmoil in the foreign exchange markets, covered interest arbitrage came into play in a big way for the first time.

According to Jayanth R Varma (November 2004) on Towards a Unified Market for Trading Gilts in India:-

A Working Group of the Reserve Bank of India (RBI) under the chairmanship of Dr. R. H. Patil has recommended that Indian government securities should be traded in two separate and segregated markets. Banks and primary dealers are to trade on an anonymous electronic screen based order matching trading system a monopoly exchange based on the Negotiated Dealing System (NDS) owned by the RBI. Households, pension and provident funds and most other investors are proposed to be relegated to a separate segregated market driven by compulsory market making. The Patil Report also recommends that the RBI should indulge in systematic market manipulation in the NDS to reduce the borrowing cost of the government. This paper argues for a reconsideration of most elements of this design. Government securities are a unique asset class to which all Indians should have non-discriminatory access. Segregated markets are unacceptable. Nor are monopolies desirable since intense competition is the principal mechanism for fostering innovation and investor protection.

According to Rajnish Mehra (June 2010) on INDIAN EQUITY MARKETS MEASURES OF FUNDAMENTAL VALUE:-

In this paper, we take a critical look at the relationship between the value of capital stock in the Indian corporate sector and the valuation of claims to this capital stock in capital markets. We address the question of whether Indian equity valuations over the period 1991- 2008 are consistent with three key market fundamentals: corporate capital stock, after tax corporate cash flows and net corporate debt. Our analysis extends the neo-classical growth model to include intangible capital and key features of the tax code and uses national account statistics to estimate the equilibrium value of corporate equity relative to GDP. Our framework can provide policy makers with a benchmark to identify deviations in equity markets relative to those implied by economic fundamentals. In addition, it facilitates a quantitative assessment of policy changes such as, for example, the effect of changes in dividend taxation on stock prices. We caution the reader that although our framework is well suited to examining secular movements in the value of equity relative to GDP, it is not suitable to address high frequency price movements in the stock market. In fact, we know of no framework that can satisfactorily account for these movements in terms of the underlying fundamentals. High frequency volatility remains a puzzle. Based on our analysis, we conclude that in a large measure, Indian equity markets were fairly priced over the 1991-2008period.

According to Debjiban Mukherjee (April 2007) On Comparative Analysis of Indian Stock Market with International Markets:-The stock market is witnessing heightened activities and is increasingly gaining importance. In the current context of globalization and the subsequent integration of the global markets this paper captures the trends, similarities and patterns in the activities and movements of the Indian Stock Market in comparison to its international counterparts. This study covers New York Stock Exchange (NYSE), Hong Kong Stock exchange (HSE), Tokyo Stock exchange (TSE), Russian Stock exchange (RSE), Korean Stock exchange (KSE) from various socio-politico-economic backgrounds. Both the Bombay Stock exchange (BSE) and the National Stock Exchange of Indian Limited (NSE) have been used in the study as a part of Indian Stock Market. The time period has been divided into various eras to test the correlation between the various exchanges to prove that the Indian markets have become more integrated with its global counterparts and its reaction are in tandem with that are seen globally.

According To GopiKrishna Suvanam & Amit Trivedi on Imbalances Created because of Structured Products in Indian Equity markets:-This paper is study of effect of hedging of structured products on exchange traded equity products. We look at various aspects of the structured product markets including the motivation to buy, the risks of the products, the hedging behaviour and the effect of hedging on exchange traded products. We conclude the hedging would be volatility supportive in a sell off and would be volatility suppressing in significant rally. We also suggest introduction of some new exchange products that would make theHedging process easy and also would help some retail investors express their view in a better fashionWithout the transaction costs involved in structured products.

RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

For the purpose of literature survey, a sample survey was adopted through the Structured Questionnaire, and information was gathered by those who had conducted study, the information was also searched in libraries in various reports, journals and internet sites were also scanned for the authenticities of the subject matter.

Definition Of Research Design:It is a basic plan, which guides the data collection and analysis phases of the project. It is a frame work, which specifies the type of information to be collected, the resources of data collection procedure.

Type of Research: Descriptive studies are well structured, they tend to be rigid and its approach cannot be changed every now and then. Descriptive study is undertaken in many circumstances:1. When the researcher is interested in knowing the characteristics of certain groups such as age, profession.

1. When the researcher is interested in knowing the proportion of people in given population who have behaved in a particular manner, making projection of certain things. The objective of this kind of study is to answer the why, who, what, when and how of the subject under consideration. We will be taking descriptive research because our research includes comparative analysis in Delhi-NCR region and by the help of primary data assisted by questionnaire we will accomplish this task. A research design is a market plan or model for conduction a formal Investigation. It is a specification of methods and procedures for acquiring the Information needed for solving of any problem. Research design is the strategy for a study and the plan by which the strategy is to be carried out. It specifies the methods and procedures for the collection, measurement and analysis of data. Unfortunately, there is no simple classification of research designs that covers the variation found in practice.

BASIC RESEARCH:The research which is done for knowledge enhancement, the research which does not have immediate commercial potential. The research which is done for human welfare, animal welfare and plant kingdom welfare. It is called basic, pure, fundamental research. The main motivation is to expand man's knowledge, not to create or invent something. There is no obvious commercial value to the discoveries that result from basic research. Basic research lay down the foundation for the applied research. Dr.G.Smoot says people cannot foresee the future well enough to predict what is going to develop from the basic research E.g.:-how did the universe begin?

APPLIED RESEARCH:Applied research is designed to solve practical problem of the modern world, rather than to acquire knowledge for knowledges sake. The goal of applied research is to improve the human condition. It focuses on analysis and solving social and real life problems. This research is generally conducted on large scale basis, it is expensive. As such, it often conducted with the support of some financing agency like government, public corporation, world bank, UNICEF, UGC, Etc.,. According to hunt, applied research is an investigation for ways of using scientific knowledge to solve practical problems for example:- improve agriculture crop production, treat or cure a specific disease, improve the energy efficiency homes, offices, how can communication among workers in large companies be improved? Applied research can be further classified as problem oriented and problem solving research. Problem oriented research:- research is done by industry apex body for sorting out problems faced by all the companies. E.g.:- WTO does problem oriented research for developing countries, in India agriculture and processed food export development authority (APEDA) conduct regular research for the benefit of agri-industry. Problem solving:-this type of research is done by an individual company for the problem faced by it. Marketing research and market research are the applied research. For e.g.:- Videocon international conducts research to study customer satisfaction level, it will be problem solving research. In short, the main aim of applied research is to discover some solution for some pressing practical problem.

QUANTITATIVE RESEARCH:Quantitative research aim to measure the quantity or amount and compares it with past records and tries to project for future period. In social sciences, quantitative research refers to the systematic empirical investigation of quantitative properties and phenomena and their relationships. The objective of qualitative research is to develop and employ mathematical models, theories or hypothesis pertaining to phenomena. The process of measurement is central to quantitative research because it provides fundamental connection between empirical observation and mathematical expression of quantitative relationships. Statistics is the most widely used branch of mathematics in quantitative research. Statistical methods are used extensively with in fields such as economics and commerce. Quantitative research involving the use of structured questions, where the response options have been Pre-determined and large number of respondents is involved.eg:-total sales of soap industry in terms of rupees cores and or quantity in terms of lakhs tones for particular year, say 2008,could be researched, compared with past 5 years and then projection for 2009 could be made.

QUALITATIVE RESEARCH:Qualitative research presents non-qualitative type of analysis. Qualitative research is collecting, analyzing and interpreting data by observing what people do and say. Qualitative research refers to the meanings, definitions, characteristics, symbols, metaphors, and description of things. Qualitative research is much more subjective and uses very different methods of collecting information, mainly individual, in depth interviews and focus groups. The nature of this type of research is exploratory and open ended. Small number of people are interviewed in depth and or a relatively small number of focus groups are conducted. Qualitative research can be further classified in the following type. I. Phenomenology:-a form of research in which the researcher attempts to understand how one or more individuals experience a phenomenon. E.g.:-we might interview 20 victims of bhopal tragedy. II. Ethnography:- this type of research focuses on describing the culture of a group of people. A culture is the shared attributes, values, norms, practices, language, and material things of a group of people. E.g.:-the researcher might decide to go and live with the tribal in Andaman island and study the culture and the educational practices. III. Case study:-is a form of qualitative research that is focused on providing a detailed account of one or more cases. SAMPLING: A process of selecting a sample to determine certain characteristics of a population. In statistics, quality assurance, and survey methodology, sampling is concerned with the selection of a subset of individuals from within a statistical population to estimate characteristics of the whole population. Acceptance sampling is used to determine if a production lot of material meets the governing specifications. Two advantages of sampling are that the cost is lower and data collection is faster than measuring the entire population. Each observation measures one or more properties (such as weight, location, color) of observable bodies distinguished as independent objects or individuals. In survey sampling, weights can be applied to the data to adjust for the sample design, particularly stratified sampling (blocking). Results from probability theory and statistical theory are employed to guide practice. In business and medical research, sampling is widely used for gathering information about a population.

Population definition:Successful statistical practice is based on focused problem definition. In sampling, this includes defining the population from which our sample is drawn. A population can be defined as including all people or items with the characteristic one wish to understand. Because there is very rarely enough time or money to gather information from everyone or everything in a population, the goal becomes finding a representative sample (or subset) of that population. Sometimes that which defines a population is obvious. For example, a manufacturer needs to decide whether a batch of material from production is of high enough quality to be released to the customer, or should be sentenced for scrap or rework due to poor quality. In this case, the batch is the population.Although the population of interest often consists of physical objects, sometimes we need to sample over time, space, or some combination of these dimensions. For instance, an investigation of supermarket staffing could examine checkout line length at various times, or a study on endangered penguins might aim to understand their usage of various hunting grounds over time. For the time dimension, the focus may be on periods or discrete occasions.In other cases, our 'population' may be even less tangible. For example, Joseph Jagger studied the behavior of roulette wheels at a casino in Monte Carlo, and used this to identify a biased wheel. In this case, the 'population' Jagger wanted to investigate was the overall behavior of the wheel (i.e. the probability distribution of its results over infinitely many trials), while his 'sample' was formed from observed results from that wheel. Similar considerations arise when taking repeated measurements of some physical characteristic such as the electrical conductivity of copper. This situation often arises when we seek knowledge about the cause system of which the observed population is an outcome. In such cases, sampling theory may treat the observed population as a sample from a larger 'super population'. For example, a researcher might study the success rate of a new 'quit smoking' program on a test group of 100 patients, in order to predict the effects of the program if it were made available nationwide. Here the super population is "everybody in the country, given access to this treatment" - a group which does not yet exist, since the program isn't yet available to all.Note also that the population from which the sample is drawn may not be the same as the population about which we actually want information. Often there is large but not complete overlap between these two groups due to frame issues etc. (see below). Sometimes they may be entirely separate - for instance, we might study rats in order to get a better understanding of human health, or we might study records from people born in 2008 in order to make predictions about people born in 2009.Time spent in making the sampled population and population of concern precise is often well spent, because it raises many issues, ambiguities and questions that would otherwise have been overlooked at this stage.

Sampling methods:Within any of the types of frame identified above, a variety of sampling methods can be employed, individually or in combination. Factors commonly influencing the choice between these designs include. Nature and quality of the frame. Availability of auxiliary information about units on the frame. Accuracy requirements and the need to measure accuracy. Whether detailed analysis of the sample is expected. Cost/operational concerns.Simple random sampling:In a simple random sample (SRS) of a given size, all such subsets of the frame are given an equal probability. Each element of the frame thus has an equal probability of selection: the frame is not subdivided or partitioned. Furthermore, any given pair of elements has the same chance of selection as any other such pair (and similarly for triples, and so on). This minimizes bias and simplifies analysis of results. In particular, the variance between individual results within the sample is a good indicator of variance in the overall population, which makes it relatively easy to estimate the accuracy of results. However, SRS can be vulnerable to sampling error because the randomness of the selection may result in a sample that doesn't reflect the makeup of the population. For instance, a simple random sample of ten people from a given country will on average produce five men and five women, but any given trial is likely to over represent one sex and underrepresent the other. Systematic and stratified techniques, discussed below, attempt to overcome this problem by using information about the population to choose a more representative sample. SRS may also be cumbersome and tedious when sampling from an unusually large target population. In some cases, investigators are interested in research questions specific to subgroups of the population. For example, researchers might be interested in examining whether cognitive ability as a predictor in this situation because it does not provide subsamples of the population. Stratified of job performance is equally applicable across racial groups. SRS cannot accommodate the needs of researchers sampling, which is discussed below, addresses this weakness of SRS. Simple random sampling is always an EPS design (equal probability of selection), but not all EPS designs are simple random sampling.

Systematic sampling:Systematic sampling relies on arranging the study population according to some ordering scheme and then selecting elements at regular intervals through that ordered list. Systematic sampling involves a random start and then proceeds with the selection of every kth element from then onwards. In this case, k=(population size/sample size). It is important that the starting point is not automatically the first in the list, but is instead randomly chosen from within the first to the kth element in the list. A simple example would be to select every 10th name from the telephone directory (an 'every 10th' sample, also referred to as 'sampling with a skip of 10'). As long as the starting point is randomized, systematic sampling is a type of probability sampling. It is easy to implement and the stratification induced can make it efficient, if the variable by which the list is ordered is correlated with the variable of interest. 'Every 10th' sampling is especially useful for efficient sampling from databases.For example, suppose we wish to sample people from a long street that starts in a poor area (house No. 1) and ends in an expensive district (house No. 1000). A simple random selection of addresses from this street could easily end up with too many from the high end and too few from the low end (or vice versa), leading to an unrepresentative sample. Selecting (e.g.) every 10th street number along the street ensures that the sample is spread evenly along the length of the street, representing all of these districts. (Note that if we always start at house #1 and end at #991, the sample is slightly biased towards the low end; by randomly selecting the start between #1 and #10, this bias is eliminated. However, systematic sampling is especially vulnerable to periodicities in the list. If periodicity is present and the period is a multiple or factor of the interval used, the sample is especially likely to be unrepresentative of the overall population, making the scheme less accurate than simple random sampling.For example, consider a street where the odd-numbered houses are all on the north (expensive) side of the road, and the even-numbered houses are all on the south (cheap) side. Under the sampling scheme given above, it is impossible to get a representative sample; either the houses sampled will all be from the odd-numbered, expensive side, or they will all be from the even-numbered, cheap side.Another drawback of systematic sampling is that even in scenarios where it is more accurate than SRS, its theoretical properties make it difficult to quantify that accuracy. (In the two examples of systematic sampling that are given above, much of the potential sampling error is due to variation between neighbouring houses - but because this method never selects two neighbouring houses, the sample will not give us any information on that variation.)As described above, systematic sampling is an EPS method, because all elements have the same probability of selection (in the example given, one in ten). It is not 'simple random sampling' because different subsets of the same size have different selection probabilities - e.g. the set {4, 14,24,...,994} has a one-in-ten probability of selection, but the set {4,13,24,34,...} has zero probability of selection. Stratified sampling:Where the population embraces a number of distinct categories, the frame can be organized by these categories into separate "strata." Each stratum is then sampled as an independent sub-population, out of which individual elements can be randomly selected.[1] There are several potential benefits to stratified sampling. First, dividing the population into distinct, independent strata can enable researchers to draw inferences about specific subgroups that may be lost in a more generalized random sample.Second, utilizing a stratified sampling method can lead to more efficient statistical estimates (provided that strata are selected based upon relevance to the criterion in question, instead of availability of the samples). Even if a stratified sampling approach does not lead to increased statistical efficiency, such a tactic will not result in less efficiency than would simple random sampling, provided that each stratum is proportional to the group's size in the population.Third, it is sometimes the case that data are more readily available for individual, pre-existing strata within a population than for the overall population; in such cases, using a stratified sampling approach may be more convenient than aggregating data across groups (though this may potentially be at odds with the previously noted importance of utilizing criterion-relevant strata).Finally, since each stratum is treated as an independent population, different sampling approaches can be applied to different strata, potentially enabling researchers to use the approach best suited (or most cost-effective) for each identified subgroup within the population.There are, however, some potential drawbacks to using stratified sampling. First, identifying strata and implementing such an approach can increase the cost and complexity of sample selection, as well as leading to increased complexity of population estimates. Second, when examining multiple criteria, stratifying variables may be related to some, but not to others, further complicating the design, and potentially reducing the utility of the strata. Finally, in some cases (such as designs with a large number of strata, or those with a specified minimum sample size per group), stratified sampling can potentially require a larger sample than would other methods (although in most cases, the required sample size would be no larger than would be required for simple random sampling. A stratified sampling approach is most effective when three conditions are met Variability within strata are minimized. Variability between strata are maximized. The variables upon which the population is stratified are strongly correlated with the desired dependent variable. Advantages over other sampling methods:Focuses on important subpopulations and ignores irrelevant ones. Allows use of different sampling techniques for different subpopulations. Improves the accuracy/efficiency of estimation. Permits greater balancing of statistical power of tests of differences between strata by sampling equal numbers from strata varying widely in size. Disadvantages:Requires selection of relevant stratification variables which can be difficult. Is not useful when there are no homogeneous subgroups. Can be expensive to implement.Poststratification Stratification is sometimes introduced after the sampling phase in a process called "poststratification". This approach is typically implemented due to a lack of prior knowledge of an appropriate stratifying variable or when the experimenter lacks the necessary information to create a stratifying variable during the sampling phase. Although the method is susceptible to the pitfalls of post hoc approaches, it can provide several benefits in the right situation. Implementation usually follows a simple random sample. In addition to allowing for stratification on an ancillary variable, post stratification can be used to implement weighting, which can improve the precision of a sample's estimates OversamplingChoice-based sampling is one of the stratified sampling strategies. In choice-based sampling,[5] the data are stratified on the target and a sample is taken from each stratum so that the rare target class will be more represented in the sample. The model is then built on this biased sample. The effects of the input variables on the target are often estimated with more precision with the choice-based sample even when a smaller overall sample size is taken, compared to a random sample. The results usually must be adjusted to correct for the oversampling. Probability-proportional-to-size sampling:In some cases the sample designer has access to an "auxiliary variable" or "size measure", believed to be correlated to the variable of interest, for each element in the population. These data can be used to improve accuracy in sample design. One option is to use the auxiliary variable as a basis for stratification, as discussed above.Another option is probability-proportional-to-size ('PPS') sampling, in which the selection probability for each element is set to be proportional to its size measure, up to a maximum of 1. In a simple PPS design, these selection probabilities can then be used as the basis for Poisson sampling. However, this has the drawback of variable sample size, and different portions of the population may still be over- or under-represented due to chance variation in selections. To address this problem, PPS may be combined with a systematic approach.Example: Suppose we have six schools with populations of 150, 180, 200, 220, 260, and 490 students respectively (total 1500 students), and we want to use student population as the basis for a PPS sample of size three. To do this, we could allocate the first school numbers 1 to 150, the second school 151 to 330 (= 150 + 180), the third school 331 to 530, and so on to the last school (1011 to 1500). We then generate a random start between 1 and 500 (equal to 1500/3) and count through the school populations by multiples of 500. If our random start was 137, we would select the schools which have been allocated numbers 137, 637, and 1137, i.e. the first, fourth, and sixth schools.The PPS approach can improve accuracy for a given sample size by concentrating sample on large elements that have the greatest impact on population estimates. PPS sampling is commonly used for surveys of businesses, where element size varies greatly and auxiliary information is often available - for instance, a survey attempting to measure the number of guest-nights spent in hotels might use each hotel's number of rooms as an auxiliary variable. In some cases, an older measurement of the variable of interest can be used as an auxiliary variable when attempting to produce more current estimates.

Cluster sampling:Sometimes it is more cost-effective