final report latest(2)

8/8/2019 Final Report Latest(2)

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SUMMER TRAINING REPORT SUBMITTED TOWARDS THE

PARTIAL FULFILLMENT OF POST GRADUATE DEGREE IN

INTERNATIONAL BUSINESS

CUSTOMERS PERCEPTION

TOWARDS INVESTMENTS IN

EQUITY MARKET

SUBMITTED BY:

VIVEK KUMAR GARGMBA-IB (2009-20011)

Roll No. : A1802009165

INDUSTRY GUIDE FACULTY GUIDE

MR. DEEPAK BANGA DR. AJIT MITTAL

BRANCH SALES MANAGERDESTIMONEY ENTERPRISES PVT. LTD.

AMITY INTERNATIONAL BUSINESS SCHOOL, NOIDA

AMITY UNIVERSITY UTTAR PRADESH

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Company Certificate

DESTIMONEY ENTERPRISES PVT. LTD.

TO WHOM IT MAY CONCERN

This is to certify that Vivek Kumar Garg, a student of AmityInternational Business School, Noida, undertook a project onCustomers Perception towards Investments in Equity Market at

Destimoney Enterprises Pvt. Ltd. from 03/05/2010 to 30/06/2010.

Mr. Vivek Kumar Garg has successfully completed the project underthe guidance ofMr. Deepak Banga. He is a sincere and hard-workingstudent with pleasant manners.

We wish all success in his future endeavours.

Mr. Deepak Banga,

Branch Sales Manager

Destimoney Enterprises Pvt. Ltd.

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CERTIFICATE OF ORIGIN

This is to certify that Mr. Vivek Kumar Garg, a student of Post GraduateDegree in MBA - IB, Amity International Business School, Noida hasworked in the Destimoney Enterprises Pvt. Ltd., under the able guidanceand supervision of Mr. Deepak Banga, Branch sales Manager,Destimoney Enterprises Pvt. Ltd.

The period for which he was on training was for 8 weeks, starting from03/05/2010 to 30/06/2010. This Summer Internship report has the requisitestandard for the partial fulfillment the Post Graduate Degree in InternationalBusiness. To the best of our knowledge no part of this report has been

reproduced from any other report and the contents are based on originalresearch.

Signature SignatureDr. Ajit Mittal Vivek Kumar Garg

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ACKNOWLEDGEMENT

I express my sincere gratitude to my industry guide Mr. DeepakBanga, Branch Sales Manager, Destimoney Enterprises Pvt.

Ltd. for his able guidance, continuous support and cooperationthroughout my project, without which the present work would nothave been possible.

I would also like to thank the entire team of DestimoneyEnterprises Pvt. Ltd., for the constant support and help in the

successful completion of my project.

Also, I am thankful to my faculty guide Dr. Ajit Mittal of myinstitute, for his continued guidance and invaluableencouragement.

Signature

Vivek Kumar Garg

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Index

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Chapter No. Subject Page No.

Ch. # 1.0 Executive Summary.

Ch. # 2.0 Research Methodology2.1 Primary Objective(s).2.2 Hypothesis2.3 Research Design2.4 Sample Design..2.5 Scope of the Study.2.6 Limitations.

Ch. # 3.0 Critical Review of Literature.Ch. # 4.0 Company Profile .

4.1 Industry Profile..4.2 SWOT Analysis.

Ch. # 5.0 Data..

5.1 Primary Data5.2 Secondary Data...

Ch. # 6.0 Findings & Analysis.

Ch. # 7.0 Recommendations

Ch. # 8.0 Bibliography.

Ch. # 9.0 Annexure..

Ch. # 10.0 Case Study..

Ch. # 11.0 Synopsis of the project.

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Chapter 1

ExecutiveSummary

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Indian investor had to endure a sluggish economy, the steep marketdeclines prompted by deteriorating revenues, alarming reports ofscandals ranging from illegal corporate accounting practices likethat of Satyam to insider trading to make investment decisions.

By the time Indian economy has shown a remarkable improvementsince the last years recession. As a result of that stock market isable to attract large number of Indian investors from past one yearor so.

Stock market has been subjected to speculations and inefficiencies,which are beached to the rationality of the investor. Traditionalfinance theory is based on the two assumptions. Firstly, investors

make rational decisions; and secondly investors are unbiased intheir predictions about future returns of the stock. Howeverfinancial economist have now realized that the long heldassumptions of traditional finance theory are wrong and found thatinvestors can be irrational and make predictable errors about thereturn on investment on their investments. This empirical study onIndividual Investors Behavior is an attempt to know the profile ofthe investor and also know the characteristics of the investors so as

to know their preference with respect to their investments. Thestudy also tries to unravel the influence of demographic factors likegender and age on risk tolerance level of the investor.

This project is an attempt to analyze the characteristics of theIndian individual investors and makes an attempt to discover therelationship between a dependent variable i.e. Risk Tolerancelevel and independent variables such as Age, Gender of anindividual investor on the basis of the small research/survey. This

study is also an attempt to understand the concept of risk & returnthrough portfolio manager by a third party service provider.

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Indian investors are high income, well educated, salaried, andindependent in making investment decisions and conservativeinvestors. From the research it was found that irrespective ofgender, most of the investors (41%) are found have low risk

tolerance level and many others (34%) have high risk tolerancelevel rather than moderate risk tolerance level.

It is also found that there is a strong negative correlation betweenAge and Risk tolerance level of the investor. Television is themedia that is largely influencing the investors decisions.

Hence, this study can facilitate

1. The investment product designers to design products whichcan cater to the investors who are low risk tolerant.

2. The third party service providers to increase their level ofservice quality approach through efficient portfoliomanagement in order to compete in the perfect servicemarket.

3. This empirical study is also used as an input to fill the servicequality gaps.

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Chapter 2

ResearchMethodology

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3.1 PRIMARY OBJECTIVES

1. To identify the objective of investment plan of an Indian

individual investor.

2. To know the preferred investment avenues of the Indianindividual investor segregated in terms of financial literacy.

3. To know the risk tolerance level of the individual investor inorder to suggest a suitable investment portfolio.

4. To identify the preferred sources of information influencinginvestment decisions.

5. To study the dependence/independences of the demographicfactors (Gender and Age) of the investor and his/her risktolerance level.

3.2 HYPOTHESIS

Hypothesis 1:

H01: Gender of the investor and the Risk tolerance level are twoindependent attributes of the investor.

Hypothesis 2:

H02: With Increase in Age decreases the Risk tolerance level.There is a negative correlation between Age & Risk Tolerance.

Hypothesis 3:

H03: There is a significant role of third party service providers/intermediaries in minimizing the risk in equitymarket.

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3.3 RESEARCH DESIGN

TYPE OF RESEARCH:

A research work is done in order to discover the relationship between dependent variable i.e. Risk tolerance level andindependent variables such as Age, Gender of an individualinvestor on the basis of the survey. To study the investors

behavior a descriptive research is used.

DATA SOURCES:

The research is supported by collective interpretation of primarydata and secondary data sources.

DATA COLLECTION METHOD:

Data collection method used is totally based on customerinteraction. Individual meetings were conducted with differentinvestors. Every meeting was followed by taking inputs on thedesigned questionnaire, provided in the annexure.

METHODOLOGY:

Based on the responses of the questionnaire, analysis has beencarried out. Statistical methods such as Chi-square test ofindependence of attributes and Correlation have been used touncover relationships among the variables.

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DATA ANALYSIS:

1. For measuring the risk tolerance level cumulative scale hasbeen used.

2. To study the dependency/Independency of the factors Chi-square test of independence of attributes was used.

3. Correlation is used to know the relationship between Risktolerance level and the Age of the investor.

4. This study strengthens the fact that Mutual funds are the best

available instruments in the financial market to minimize therisk of investing money in equity market directly.

The questionnaire consists of 30 questions of which first 7questions were focused to know the demographic characteristicsof the investor. 5 questions are designed to define the role ofthird party service providers/intermediaries. Rest 13 questionsare to find the investment details, risk tolerance level of the

investor and were focused to accomplish the other objectives ofthe study.

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3.4 SAMPLE DESIGN

POPULATION OF THE STUDY:

The population for the study included the investors differenteconomic sectors/zones like service class investors, smallinvestors, self employed, chartered accountants, propertydealers etc. in Delhi and NCR region in order to understand thenecessary aspects of an individual investor.

SAMPLING TECHNIQUES:

Many investors were reluctant to reveal their investment detailsespecially the amount of money invested so; referral samplingmethod is used for this empirical study.

SAMPLE SIZE:

Research has been carried out with a sample size of 50 investorswith which one can easily represent the population properly.

3.5 SCOPE OF THE STUDY

The study is totally based on investors behavior and perceptionabout investments considering the current scenarios in theequity market. The biggest concern with the service providers isthe quality maintenance on sale and after sale of financial

products. This research is on present market scenarios as it issupported by latest data and the outcomes are taken as an inputsource in filling up the gaps in SERVQUAL GAP model(Quality model) being proposed to Destimoney Enterprise Pvt.Ltd.

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3.6 LIMITATIONS

1. TIME CONSTRAINT:

This research is performed in a period of 40 days, so timespent on the study might have an impact on actual findings.

2. GEOGRAPHICAL LIMITATIONS:

This study is done in selective areas of Delhi & NCR regions.

3. LACK OF HOMOGENOUS DATA:

The data collected is not homogeneous. Different investorswith different demographics with different perceptions areselected. So homogeneity is difficult to achieve.

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Chapter 3

Critical Review of theLiterature

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Stock market has been subjected to speculations and inefficiencies,which are beached to the rationality of the investor. Traditionalfinance theory is based on the two assumptions. Firstly, investorsmake rational decisions; and secondly investors are unbiased in

their predictions about future returns of the stock. Howeverfinancial economist have now realized that the long heldassumptions of traditional finance theory are wrong and found thatinvestors can be irrational and make predictable errors about thereturn on investment on their investments.

This empirical study on Individual Investors Behavior is anattempt to know the profile of the investor and also know the

characteristics of the investors so as to know their preference withrespect to their investments. The study also tries to unravel theinfluence of demographic factors like gender and age on risktolerance level of the investor. Literature suggests that majorresearch in the area of investors behavior has been done by

behavioral scientists such as Weber (1999), Shiller (2000) andShefrin (2000). Shiller (2000) who strongly advocated that stockmarket is governed by the market information which directly

affects the behavior of the investors.

Several studies have brought out the relationship between thedemographics such as Gender, Age and risk tolerance level ofindividuals. Of this the relationship between Age and risk tolerancelevel has attracted much attention. It was suggested that ones

biological, demographic and socioeconomic characteristics;together with his/her psychological makeup affects ones risktolerance level. It was also suggested that an individuals risk

tolerance is related to his/her household situation, lifecycle stageand subjective factors. Mittra (1995) discussed factors that wererelated to individuals risk tolerance, which included years untilretirement, knowledge sophistication, income and net worth.

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Most of the scientists concluded that males are more risk tolerantthan females. Wallach and Kogan (1961) were perhaps the first tostudy the relationship between risk tolerance and age. It is foundthat risky asset fraction of the portfolio to be positively correlated

with income and age and negatively correlated with marital status.Morin and Suarez found evidence of increasing risk aversion withage although the households appear to become less risk averse astheir wealth increases. They found that the change in the riskyasset holdings were not uniform. He found individuals to increasetheir investments in risky assets throughout their working life time,and decrease their risk exposure once they retire. Lewellen et.alwhile identifying the systematic patterns of investment behavior

exhibited by individuals found age and expressed risk takingpropensities to be inversely related with major shifts taking placeat age 55 and beyond.

Indian studies on individual investors' were mostly confined tostudies on share ownership, except a few. The RBI's survey ofownership of shares and enquiry into the ownership pattern ofIndustrial shares in India were a few in this direction. The

NCAER's studies brought out the frequent form of savings ofindividuals and the components of financial investments of ruralhouseholds. The Indian Shareowners Survey brought out a volleyof information on share owners. Rajarajan V (1997, 1998, 2000and 2003) classified investors on the basis of their demographics.He has also brought out the investors' characteristics on the basisof their investment size. He found that the percentage of riskyassets to total financial investments had declined as the investormoves up through various stages in life cycle. Also investors'

lifestyles based characteristics has been identified. The abovediscussion presents a detailed picture about the various facets ofrisk studies that have taken place in the past. In the present study,the findings of many of these studies are verified and updated.

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Chapter 4

Company Profile

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working out of 4 offices; New York, Mumbai, Dubai, andBangalore.FINANCIAL SERVICE DOMAIN

Destimoney is one of Indias leading retail financial services anddistribution companies, a world-class customer-centric servicesenterprise that fulfils the financial needs of Middle India, withglobal processes and a focus on profitable growth.

Destimoney distributes all financial products, and manufactures aselect few. They develop individually structured financial productsfor their customers - from universal real life needs for family,

security, health assurance and education to wealth creation andhome ownership; on to lifestyle and business requirements, andcontinuing along the road to retirement and estate planning,

ALLINANCES & PARTNERSHIPS

Strategic partnership with PNB to acquire up to a 49% stakein its housing finance subsidiary.

Destimoney recently entered into a partnership withDhanlaxmi Bank to enable the Banks customers to trade onDestimoneys online e-broking platform.

Under the new partnership with Artha Money, Artha moneyscustomers will be able to seamlessly access and useDestimoneys online equity trading platform, whileDestimoneys customers will be able to use Artha Moneys

online commodity trading platform.

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DESTIMONEY GROUP

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The Destimoney Group at present has 4 business lines;

Destimoney India Services Pvt. Ltd, which provides portfoliomanagement services.

Destimoney Enterprises Pvt. Ltd, which provides financialadvisory services and distributes

o Insurance products

Bajaj Allianz Life Insurance.

Royal Sundram Health Cover.

o Loans

Personal loans.

Home loans (In partnership with Punjab NationalBank.)

LAP (Loan against property).

o Fixed deposits, mutual funds, structured products.

Destimoney Securities Pvt. Ltd., which deals with broking ofstocks & shares.

Decimal Point Analytics, which is into global researchoutsourcing businesses.

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VISION

Destimoney vision is to build a world class customer centricfinancial services enterprise that fulfils the financial needs ofMiddle India with Global Processes and focuses on profitablegrowth. Destimoney plans to do this, by distributing all financial

products and manufacturing a select few and building anorganization that unlocks the potential across four dimensions, viz.individual, team, customer and market place.

MISSION

Organizations mission is to forge strong, sustained relationshipswith the clients by creating value for them within a transparentand controlled investment process.

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4.1 INDUSTRY PROFILE

FINANCIAL SERVICES INDUSTRY IN INDIA

SPECIAL PREFERENCE TO MUTUAL FUND INDUSTRY

In last few years, India has emerged as the one of the most rapidlygrowing economies in the world. India has been categorized with

nations like Brazil, Russia and China (BRIC Nations) who aregoing to be the prime drivers of world economy in next fewdecades. Even if we take the case of recovery form economicdownfall last year, India has managed to perform far better thanother nations. Right from banking system to financial regularities,the country has thrived on discipline and out-performance. The

booming Indian economy resulted in widespread growth andarrival of new industries. The most sparkling phenomenon is in

form of financial market of India.

Financial services in India has taken a giant leap from the days ofstanding in banks queue for several hours for opening a savingaccount or trying to get some fixed deposits (FD) done. Thefinancial services have increased manifold and now people havethe choice to choose the one that most suitably fits the bill.There are several services like broking firms, investment services,

financial consulting, evergreen national banks, numerous privatebanks, mutual funds, car and home loans, equity market and other banking services. Services are many and offered by blue chipnames of the industry. Most of the companies in financial segmentoffer taxation services, project consultancy services and all theservices of wide financial gamut. Whether its taking a car loan or

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booking your favorite house, going for pension plan or gettingyour child insured, numerous attractive financial services areavailable at affordable costs. Personal banking services haveacquired an altogether new meaning. Now customers have multiple

choices to choose from. One can find all the financial services onthe internet that are just a call away.

THE MUTUAL FUND INDUSTRY

Mutual fund is a common pool of money in to which investorswith common investment objective place their contributions thatare to be invested in accordance with the stated investmentobjective of the scheme. The investment manager would invest the

money collected from the investor in to assets that are defined/ permitted by the stated objective of the scheme. For example,an equity fund would invest equity and equity related instrumentsand a debt fund would invest in bonds, debentures, giltsetc. Mutual Fund is a suitable investment for the common man as it

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offers an opportunity to invest in a diversified, professionallymanaged basket of securities at a relatively low cost.

MUTUAL FUND HISTORY INDIA

Unit Trust of India (UTI) was the first mutual fund set up inIndia in the year 1963. In early 1990s, Government allowed publicsector banks and institutions to set up mutual funds. UTI has anextensive marketing network of over 40,000 agents all over thecountry. In the year 1992, Securities and exchange Board of

India (SEBI) Act was passed. The objectives of SEBI are toprotect the interest of investors in securities and to promote thedevelopment of and to regulate the securities market.

In 1995, the RBI permitted private sector institutions to set upMoney Market Mutual Funds (MMMFs). They can invest intreasury bills, call and notice money, commercial paper,commercial bills accepted/co-accepted by banks, certificates ofdeposit and dated government securities having unexpired maturity

up to one year.

As far as mutual funds are concerned, SEBI formulates policiesand regulates the mutual funds to protect the interest of theinvestors. SEBI notified regulations for the mutual funds in 1993.Thereafter, mutual funds sponsored by private sector entities wereallowed to enter the capital market. The regulations were fullyrevised in 1996 and have been amended thereafter from time totime. SEBI has also issued guidelines to the mutual funds fromtime to time to protect the interests of investors.

All mutual funds whether promoted by public sector or privatesector entities including those promoted by foreign entitiesare governed by the same set of Regulations. There is nodistinction in regulatory requirements for these mutual funds and

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all are subject to monitoring and inspections by SEBI. The risksassociated with the schemes launched by the mutual fundssponsored by these entities are of similar type

TYPES OF MUTUAL FUNDS

A mutual fund scheme can be classified into open-ended schemeorclose-ended scheme depending on its maturity period.

Open-ended Fund

An open-ended Mutual fund is one that is available for

subscription and repurchase on a continuous basis. These Funds donot have a fixed maturity period. Investors can conveniently buyand sell units at Net Asset Value (NAV) related prices which aredeclared on a daily basis. The key feature of open-end schemes isliquidity.

Close-ended Fund

A close-ended Mutual fund has a stipulated maturity period e.g. 5-7 years. The fund is open for subscription only during a specified

period at the time of launch of the scheme. Investors can invest inthe scheme at the time of the initial public issue and thereafter theycan buy or sell the units of the scheme on the stock exchangeswhere the units are listed. In order to provide an exit route to theinvestors, some close-ended funds give an option of selling backthe units to the mutual fund through periodic repurchase at NAVrelated prices. SEBI Regulations stipulate that at least one of the

two exit routes is provided to the investor i.e. either repurchasefacility or through listing on stock exchanges. These mutual fundsschemes disclose NAV generally on weekly basis.

Fund according to Investment Objective:

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A scheme can also be classified as growth fund, income fund, orbalanced fund considering its investment objective. Such schemesmay be open-ended or close-ended schemes as described earlier.Such schemes may be classified mainly as follows:

Growth / Equity Oriented Scheme

The aim of growth funds is to provide capital appreciation over themedium to long- term. Such schemes normally invest a major partof their corpus in equities. Such funds have comparatively highrisks. These schemes provide different options to the investors likedividend option, capital appreciation, etc. and the investors maychoose an option depending on their preferences. The investorsmust indicate the option in the application form. The mutual fundsalso allow the investors to change the options at a later date.Growth schemes are good for investors having a long-term outlookseeking appreciation over a period of time.

Income / Debt Oriented Scheme

The aim of income funds is to provide regular and steady income

to investors. Such schemes generally invest in fixed incomesecurities such as bonds, corporate debentures, Governmentsecurities and money market instruments. Such funds are less riskycompared to equity schemes. These funds are not affected becauseof fluctuations in equity markets. However, opportunities of capitalappreciation are also limited in such funds. The NAVs of suchfunds are affected because of change in interest rates in thecountry. If the interest rates fall, NAVs of such funds are likely toincrease in the short run and vice versa. However, long term

investors may not bother about these fluctuations.

Balanced Fund

The aim of balanced funds is to provide both growth and regularincome as such schemes invest both in equities and fixed income

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securities in the proportion indicated in their offer documents.These are appropriate for investors looking for moderate growth.They generally invest 40-60% in equity and debt instruments.These funds are also affected because of fluctuations in share

prices in the stock markets. However, NAVs of such funds arelikely to be less volatile compared to pure equity funds.

Money Market or Liquid Fund

These funds are also income funds and their aim is to provide easyliquidity, preservation of capital and moderate income. Theseschemes invest exclusively in safer short-term instruments such astreasury bills, certificates of deposit, commercial paper and inter-

bank call money, government securities, etc. Returns on theseschemes fluctuate much less compared to other funds. These fundsare appropriate for corporate and individual investors as a means to

park their surplus funds for short periods.

Gilt Fund

These funds invest exclusively in government securities.

Government securities have no default risk. NAVs of theseschemes also fluctuate due to change in interest rates and othereconomic factors as is the case with income or debt orientedschemes.

Index Funds

Index Funds replicate the portfolio of a particular index such as theBSE Sensitive index, S&P NSE 50 index (Nifty), etc. These

schemes invest in the securities in the same weightage comprisingof an index. NAVs of such schemes would rise or fall inaccordance with the rise or fall in the index, though not exactly bythe same percentage due to some factors known as "tracking error"in technical terms. Necessary disclosures in this regard are made inthe offer document of the mutual fund scheme. There are also

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market; comprising 0.32 percent share of the global AUM of USD18.97 trillion.

Products

Debt products dominate the product mix and comprised 49 percentof the total industry AUM as of FY 200915, while the equity andliquid funds comprised 26 percent and 22 percent respectively.Open-ended funds comprised 99 percent of the total industry AUMas of March 2009.

Industry Structure

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The Indian mutual fund industry currently consists of 38 playersthat have been given regulatory approval by SEBI. The industryhas witnessed a shift has changed drastically in favour of privatesector players, as the number of public sector players reduced from11 in 2001 to 5 in 2009.

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The public sector has gradually ceded market share to the privatesector. Public sector mutual funds comprised 21 percent of theAUM in 2009 as against 72 percent AUM share in 2001.

Operations

The Indian mutual fund industry while on a high growth pathneeds to address efficiency and customer centricity. AMCs havesuccessfully been using outsourced service providers such ascustodians, Registrar and Transfer Agents (R&T) and more

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recently, fund accountants, so that mutual funds can focus on coreaspects of their business such as product development anddistribution. Functions that have been outsourced are custodyservices, fund services, registrar and transfer services aimed at

investor servicing and cash management. Managing costs andensuring investor satisfaction continue to be the key goals for allmutual funds today. However, there is likely to be scope foroptimising operations costs given the trend of rising administrativeand associated costs as a percentage of AUM.

4.2 SWOT ANALYSIS

STRENGTHS

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Destimoney Enterprises Pvt. Ltd. is a leading financialservice provider under Asias leading non financialorganization New silk Route with Strategic partnershipwith PNB to acquire up to a 49% stake in its housing finance

subsidiary.

Destimoney recently entered into a partnership withDhanlaxmi Bank to enable the Banks customers to trade onDestimoneys online e-broking platform.

Under the new partnership with Artha Money, Artha moneyscustomers will be able to seamlessly access and use

Destimoneys online equity trading platform, whileDestimoneys customers will be able to use Artha Moneysonline commodity trading platform.

Destimoneys product mix comprises established andrenowned companies for investments like Bajaj Allianz,Royal Sundram etc.

Destimoneys biggest strength is in its efficiency in sale andadvisory of financial investment instruments.

WEAKNESSES

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Destimoney is very new brand for investors in the market. Soit is struggling to make its name in the market due to intensecompletion.

Till now company hasnt done much in terms of promotionalactivities to attract the customers from the market.

Companys online service is only for its own products likemutual funds and DMAT accounts.

Companys online service approach is not very effective as itdoes not provide any kind of information about product and

investment details accept its business domain.

Company is also struggling in acquiring new customers. Thecustomer acquisition rate is a bit slower as compare to itscompetitors.

OPPORTUNITIES

Company is concentrating on middle class investors under itsmiddle India Plan. But still there are other segments whichcan be targeted simultaneously.

Although company has done well in order to establish newpartnerships with financial & non financial institutions butstill company may expand its domain by involving new

product series in its product mix.

Destimoney is also going to launch its own product linealong with currently available DMAT facility. So it will

provide a good opportunity to the company to promote it selfnot as a third party service provider but also as a leadingfinancial service company.

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THREATS

As the company is new in the market, it is very selective

in its approach whether it is related to sale or to itspartners. But due to intense competition in the market,company is finding it difficult to establish a brand valueagainst the companies like India Bulls, Religare, andStandard Chartered etc.

Aggressive promotional strategies by close competitorsmay hamper Destimoneys acceptance by new clients.

The lack in technical knowledge about the products &instruments among sales staff is not a cost effectiveventure for the company.

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Chapter 5

Data

5.1 PRIMARY DATA

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The primary data are those which are collected afresh and forthe first time, and thus happen to be original in character. Wecollect primary data during the course of doing experiments in

an experimental research but in case we do research of thedescriptive type and perform surveys, whether sample surveysor census surveys, then we can obtain primary data eitherthrough observation or through direct communication withrespondents in one form or another or through personalinterviews.

In my research I personally organized the meetings &

interviews with individual customer and gathered the inputs in aquestionnaire designed for the same purpose. The questionnaireused for the purpose is shown in the ANNEXURE.

5.2 SECONDARY DATA

The secondary data, on the other hand, are those which have

already been collected by someone else and which have alreadybeen passed through the statistical process.

Secondary data used in the report is based on initial search oninternet for various similar empirical studies and journals byvarious behavioral scientists and is being highlighted in theANNEXURE.

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Chapter 6

Findings&

Analysis

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Table 1 and Table 2 show the Demographics and othercharacteristics of the sample investors.

Table 1: Demographics of the sample Investor

Parameter Number of

Respondents

Percentage

Gender

Male 40 80.0

Female 10 20.0

Total 50 100.0

Age (in Years)Below 30 18 36.7

30-60 22 44.0

60 & above 10 20.0

Total 50 100.0

Martial Status

Unmarried 11 22.0

Married 39 78.0Total 50 100.0

Employment Status

Salaried 33 65.3

Business 14 28.7

Retired (Others) 3 06.0

Total 50 100.0

Monthly Earnings(Rs.)

Up to 10000 1 2.0

10001 - 30000 15 30.0

30000 and above 34 68.0

Total 50 100.0

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Education Level

Under Graduate 5 10.0

Graduate 22 43.3Post Graduate & Above 23 46.6

Total 50 100.0

Financially Responsible

Only yourself 6 12.0

1 person in addition to yourself 5 10.7

2-3 persons in additions to yourself 18 35.3

4-5 persons in additions to yourself 16 32.7

>5 persons besides yourself 5 09.3

Total 50 100.0

Occupation

Accounts, Finance & Investment 22 43.3

Professionals 19 38.7

Others 9 18.0

Total 50 100.0

INTERPRETATION:

Table 1 above shows, that 40 (80%) of the investors are menand the rest 10 (20%) are females. Generally males bear thefinancial responsibility in Indian society, and therefore theyhave to make investment (and other) decisions to fulfill thefinancial obligations. When it comes to age, it was found that

36.7% are young and significant number (53.3%) of them is inthe age group of 35 to 50. The marital status of 78% of theinvestors was found to be married and the rest are unmarried.This is because a married individual is considered to havedependents so relatively more invested and involved in makingfinancial investments. Nearly 65% of the investors belong to the

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salaried class, 29% were business class and the rest were retired.It was found that 68% of investors whose monthly earningsabove rupees 30000 are interested in investments since these

people have surplus amount due to which they are able to think

of investments. 23(47%) of the individual investors covered inthe study are postgraduates; 22(43%) investors are graduatesand 5(10%) of the investors are under-graduates. From table 1,it is interesting to note that most investors (covered in the study)can be said to possess higher education (Bachelor Degree andabove), and this factor will increase the reliability ofconclusions drawn about the matters under investigation.22(43%) of the investors covered in the study have been found

to be in professions related to finance, accountancy, investment,banking, broking, and financial management etc and 19(39%) ofthe respondents are software engineers, architects, medical anddental practitioners, teachers, lawyers etc. 9(18%) of therespondents can be said to belong to 'non-accounting or non-financial' occupations and the other occupations.

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Table 2: Other Characteristics of Sample Investor

Parameter Number of

Respondents

Percentage

Reading Behaviour4 or more sources 20 39.3

2-3 sources 13 26.7

Only one source 17 34.0

Total 50 100.0

Investment Decisions are based

Taken on own initiative 37 74.0

Own initiative but with the help ofexpert

9 18.0

Made by expert on investors behalf 4 08.0

Total 50 100.0

Regularity of Investment

Decisions

Frequently 30 59.3

Not so frequently 20 40.7Total 50 100.0

INTERPRETATION:

The study has attempted to enquire about other characteristics ofinvestor such as the reading behavior of the Investors. From table2, it is noteworthy to find that 20 (39%) of the investors read four

or more sources, 13(27%) of the investors read two to threesources, 17 (34%) of the investors only one source. One mayinfer from the figures of table 2 that most investors tend not todepend upon expert advice and help while making investmentdecisions. However, the majority of the investors 37(74%) makeinvestment decisions without the help and advice from experts;

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only 9 (18%) investors consult some experts, for advice ininvestment decisions. And 4 (8%) of the investors allow theexpert to take decision on their behalf. Most of the investors 30(59%) make investment decisions on a regular basis.

OBJECTIVE OF INVESTMENT PLAN:

When investor was queried about his/her objective behind anyinvestment, given that all the available investment avenuesavailable to him will assure safety, liquidity and tax benefit, theobjective of investment plan of the investors is shown in thefollowing table 3.

Table 3: Objectives of investment plan

Parameter Number of

Respondents

Percentage

Objective of Investment Plan

Capital appreciation 21 42.0

Balance of capital appreciation &

current income

22 43.3

Supplement of current income 7 14.7

Total 50 100.0

Based on table 3, we can conclude that the investors objective ofinvestment plan is capital appreciation or balance of capitalappreciation and current income. It is clear that investors invest toaccumulate wealth rather as an avenue to supplement theirincome.

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PREFERRED INVESTMENT AVENUES:

Based on the quantity of risk, the investment avenues areclassified as follows Fixed Deposits/Bonds, Insurance schemes,

Mutual Fund Schemes, Equities, Commodities and Real Estate.Investors were asked to choose preferred avenues. The resultantobtained, based on Weighted Mean Value is given in table 4

Table 4: Preferred investment avenues

Investment Avenues WMV Rank

Fixed Deposits/PPF/Bonds 5.2 I

Insurance Schemes 4.9 IIMutual Fund Schemes 3.9 IV

Equities 4.2 III

Commodities/Derivatives 1.8 V

Real Estate 1.0 VI

From table 4, it can be concluded that the investors preferFDs/Bonds/PPFs avenues than insurance schemes next to

Equities and Mutual Funds. It was interesting to know that Indianindividual investors still prefer to invest their surplus amount inrisk free investment avenues next to insurances schemes. Table 4confirms that Indian investors are conservative investors.

Although the investors are not very sure about investing theiramount in equity market because of the its risky nature. Still theyhave a clear point of view that MFs are the best availableinstruments to invest the money in equity market through AMCs.

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FINANCIAL LITERACY:

When investors were queried about their financial literacy i.e.their ability or knowledge about financial terms or aspects of

investments, it was found that most of the investors are financialilliterates. And the responses are shown in table 5.

Table 5: Financial Literacy

Frequency Percentage

Financial Literates 19 37.3

Financial Illiterates 31 62.7

Total 50 100.0

In spite of majority of the occupants (22) are from accounts andfinancial related jobs most of them astonishingly expressedignorance about the mechanism of investments, and the dynamicsof risk and returns.

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SOURCES OF INVESTMENT INFORMATION:

When investors were asked to rank their various sources ofinvestment information, the following Weighted Mean Values

were obtained which are given in table 6.

Table 6: Sources of investment information

Sources of Investment Information WMV Rank

News Papers/Magazines 3.6 II

Electronic Media (T.V.) 3.9 I

Peer group/Friends 3.3 III

Broker/Financial Advisor 2.2 IVInternet 2.0 V

Most of the investors get their information related to investmentthrough electronic media (TV- NDTV Profit, CNBC and some

business news channels) next to print media (News paper/Business news paper/ Magazines). This could be becausePrint/Electronic media is easy and readily accessible investmentinformation when compared to the other sources of investmentinformation.

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TESTING OF HYPOTHESIS:

Hypothesis 1:

H01: Gender of the investor and the Risk tolerance level are twoIndependent attributes of the investor.

Table 7: Gender and Risk Tolerance Level

LOW

RISK

MODERATE RISK HIGH

RISK

TOTAL

MALE 16 12 12 40

FEMALE 5 1 4 10TOTAL 21 13 16 50

From above table I tried to find out the expected values for eachrisk level, which are as follows

The expectations of male investors:

Low risk group = 40 x 21 = 16.850

Moderate risk group = 40 x 13 = 10.450

High risk group = 40 x 16 = 12.850

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The expectations of female investors:

Low risk group = 10 x 21 = 4.250

Moderate risk group = 10 x 13 = 2.650

High risk group = 10 x 16 = 3.250

We can now calculate value of 2 as follows:

Groups Observed

frequency

Oij

Expected

frequency

Eij

Oij - Eij2

(OijEij)/ Eij

Male

Low Risk 16 16.8 -0.8 0.04

ModerateRisk

12 10.4 2.4 0.55

High Risk 12 12.8 -0.8 0.05

Female

Low Risk 5 4.2 0.8 0.15

ModerateRisk

1 2.6 -1.6 0.98

High Risk 4 3.2 0.8 0.20

Total 1.97

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2

Hence, 2 = (OijEij)/ Eij = 1.97

Degree of freedom = (c-1)*(r-1) = (3-1)*(2-1) = 2.

The table value of2 for two degrees of freedom at 5% level ofsignificance is 5.991 which is much higher than the computedvalue, 1.97, i.e.

2 (Tabulated) > 2 (Calculated)

Hence, the hypothesis set stands true.

i.e. Gender of the investor and the Risk tolerance level are twoIndependent attributes of the investor.

We conclude that Gender and Risk tolerance are the twoindependent attributes of the investor. In the current empiricalanalysis, it is found that irrespective of gender most of theinvestors are low risk tolerant or high risk tolerant rather thanmoderate risk tolerant. Generally, it is considered that women tend

to be risk averse in comparison with men.

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Hypothesis 2:

H02: With Increase in Age decreases the Risk tolerance level.

There is a negative correlation between Age & Risk Tolerance.

Table 8: Age and Risk Tolerance Level

RISK

AGE

LOW

RISK

(60)%

TOTAL

BELOW 30 6 3 9 18

30 60 11 6 5 22ABOVE 60 4 4 2 10TOTAL 21 13 16 50

The above table can be interpreted as follows:

X

Y

0-30 30-60 >60

m 20 50 80

uv

-1 0 +1 f fv f v2

fuv

0-30 20 -1 66

3 0 9 -9 18 -18 18 -3

30-60 50 0 110

6 0 5 0 22 0 0 0

>60 80 +1 4 -4 4 0 2 2 10 10 10 -2

f 21 13 16 n=50 fv =-8

fv2

=28

fuv=

-5

fu -21 0 16 fu=

-5

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f u2 21 0 10 fu

2

=

31

fuv 2 0 -7 fuv=

-5Where, m = mid value of the interval.

u = x(i) Mid value & v = y(i) Mid valuesize of interval (d) size of interval (d)

Now substituting the table values into the formula given below,

Where r = Karl Pearsons Coefficient

(-5) (-5)*(-8)r = 50

31 25 X 28 6450 50

r = -5.08/28.5 = -0.79

By which we can conclude that there is a strong negativecorrelation between Age and Risk tolerance. Age accounts for the

major differences in risk taking decisions by the investors. Theolder an investor, the better seemed his/her performance incomparison to the younger ones. Over-confidence in their owninvestment ability among the youngsters largely accounts for theexcessive trading among younger investors leading to lowerreturns and this direct to decline in the risk tolerance level.

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Hence, set hypothesis stands true.

i.e. With Increase in Age decreases the Risk tolerance level.

There is a negative correlation between Age & Risk Tolerance.

Hypothesis 3:

H03: There is a significant role of third party serviceproviders/intermediaries in minimizing the risk in equity market.

When the investors were asked about their experience with third

party service providers like Religare, Sherkhan, India Bulls &Destimoney. The responses were analysed, interpreted & tabulatedas under in table 7.

Table 9: Role of service providers/intermediaries

Parameter Number of

Respondents

Percentage

Investment through 3

rd

partyservice provider

Yes 36 72.0

No 14 28.0

Total 50 100.0

Knowledge about third party

service providers/intermediaries

Very Low 11 22.0

Low 6 12.0

Moderate 22 44.0

High 11 22.0

Total 50 100.0

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Basis of choosing a service

provider/broker

Less brokerage charges orcommission

12 24.0

Effective fund allocation 19 38.0After sale service 4 8.0

Transparency 5 10.0

Brand 10 20.0

Total 50 100.0

Amount invested through 3rd

party service provider

(10 20) % 8 16.0(20 50) % 6 12.0

>50 % 14 28.0

Full Amount 22 44.0

Total 50 100.0

Mutual Funds Better returns

with moderate risk

Disagree 3 6.0Somewhat disagree 5 10.0

Somewhat Agree 8 16.0

Completely Agree 34 68.0

Total 50 100.0

Preference to invest in SIPs

Yes 42 84.0

No 4 8.0Cant Say 4 8.0

Total 50 100.0

Met the return expectations with

third party service providers

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Not At all 6 12.0

Somewhat 5 10.0

Yes 23 46.0

Fully satisfied 16 32.0

Total 50 100.0

Its very clear from table 7 that 72% of people like to investthrough third party service providers because of inadequateknowledge about the instruments as well as due to lack ofexperience. More than 40% investors supported to invest fullamount through the intermediaries. 68% of investors prefer mutualfunds as the best instrument to minimize the risk in equity market.At the same time 84% of investors look toward the systematic

Investment plans (SIPs). All in all investors are satisfied/OK withthe services being provided by these service providers.

Hence, we can say that the set hypothesis stands true.

i.e. There is a significant role of third party service

providers/intermediaries in minimizing the risk in equity

market.

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FINDINGS:

The study reveals that male investors dominate the investmentmarket in India.

Most of the investors possess higher education like graduationand above.

Majority of the Investors belong to accountancy and related

employment, non-financial management and some otheroccupations are very few.

Most investors read two or more sources of information to makeinvestment decisions.

The investors decisions are based on their own initiative.

The investment habit was noted in a majority of the people whoparticipated in the study.

The objective of investment was either capital appreciation or

balance of capital appreciation and current income. Investors prefer to park their funds in avenues like

PPF/FD/Bonds next to Equities and Mutual Funds Scheme.

Most of the investors get their information related to investmentthrough electronic media (TV) next to print media (News paper/Business news paper/Magazines).

Most of the investors are financial illiterates.

Gender and the risk tolerance level of the investor are

independent attributes of the investor. Increase in age decreases the risk tolerance level.

Third party financial service providers are playing a significantrole in investment market.

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Chapter 7

Recommendations/Suggestions

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RISK TOLERANCE LEVEL AND SUGGESTION OF

SUITABLE PORTFOLIO TO THE INVESTORS

The role of uncertainty and the lack of knowledge about the returnon Investment Avenue are important components of anyinvestment. The extent of an investors ability to tolerate these

uncertainties of return is referred as risk tolerance level of aninvestor. There are two common methods of estimating investorstolerance of risk.

The first method is a clear understanding of the investor andhis/her history with investment securities. The second method is touse a questionnaire designed to elicit feelings about risky assetsand the comfort level of the investor given certain changes in the

portfolio or certain investment scenarios. The second method is

used to know the risk tolerance level of the investors. Based on theresponses to the questionnaire, the cumulative scale is constructedand scores are assigned to each investor accordingly to categorizethe respondents in to i.e. Low, Moderate and High risk tolerancelevel. The investors are divided into 3 categories i.e., A, B and Cdepending on their risk tolerance starting with Low risk tolerance,Moderate risk tolerance and High risk tolerance. Generallyinvestors with a low risk tolerance act differently with regard to

risk than individuals with a high risk tolerance. Investor with ahigh level of risk tolerance would be comfortable with marketvolatility, while low risk- individuals require stability and areaverse to uncertainties. Individuals with low levels of risktolerance require lower chances of a loss, choose not to operate inunfamiliar situations and require more information about the

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performance of an investment. From the sample of 50, it has beenfound that 21 investors (41%) have low risk tolerance and theseinvestors should emphasize on capital preservation portfolio i.e.,category A asset mix is suggested to them. 13 investors (25%)

have moderate risk tolerance and these in investors shouldemphasize on balanced portfolio i.e., category B asset mix issuggested to them. And 16 investors (34%) have high risktolerance and these investors should emphasize on aggressivecapital appreciation portfolio i.e., category C asset mix issuggested to them.

Table 10: Risk Tolerance level and investor

Risk Tolerance Level Number of Investors Percentage

Low (Category A) 21 41

Medium (Category B) 13 25

High (Category C) 16 34

Total 50 100.0

The portfolio suggested to investors consists of four types of asset

classes i.e., Equities, Fixed Income Securities, Cash & Equivalentsand other Alternative assets such as art. Depending on their risktolerance the corresponding asset class has been increased ordecreased and corresponding asset mix has been suggested to eachcategory of investor. Each category of investors asset mix has beendescribed below.

Category A: Aggressive Capital Preservation Portfolio

This category of investor has low risk tolerance and shouldemphasize aggressive capital preservation. Suggested optimal assetmix is specified in figure 1.

Category B: Balanced Portfolio

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This category of investors has moderate risk tolerance and shouldemphasize a balanced approach to capital appreciation and capital

preservation. Suggested optimal asset mix is specified in figure 1.

Category C: Aggressive Capital Appreciation Portfolio

This category of investors has high-risk tolerance and shouldemphasize aggressive capital appreciation. Suggested optimal assetmix is specified in figure 1.

Figure 1: Suitable portfolio to the various category of investor.

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SUGGESTIONS/INPUTS FOR SERVQUAL MODEL

This study also serves the purpose of developing a service qualitymodel (SERVQUAL GAP MODEL reference: SIX SIGMA Referto ANNEXURE) for the third party financial service provider. Theservice gaps can be shortened through the following outcomes ofthe study:

AMCs should continuously design suitable schemes to meetthe triple needs of adequate returns, safety and liquidity in a

balanced proportion. Since the investors need for liquidity is found to be high, we

suggest that more of the new schemes opening forsubscription be Open-ended.

The target segment can be broadly divided into institutional

segment and individual investor segment. The institutionalsegment consisted of treasury departments of Corporate,Trusts etc and suitable products such as Institutional Incomeschemes and Money Market schemes can be targeted at them.

The individual investor can be in turn divided into varioussegments such as Young Families with small or no children,Middle-aged People saving for retirement and Retired Peoplelooking for steady income. Suitable products such as Growthand Balanced schemes for young families and Income

schemes with sure and steady returns for retired people canbe marketed.

By proper segmentation and by targeting the right product tothe right customer, Mutual Fund companies can hope to winthe confidence of their customers and 'own' them for alifetime.

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Negative perceptions about MFs require to be tackledthrough appropriate investor education measures by

providing Investor Education Programmes. AMC/SPONSORS should develop investor education

literature specially tailored to suit the regional needs tocreate/increase the awareness level of the investors.

Employers can influence the investment decision of theemployees by providing financial education as a benefit toemployees. Employers can be objective in hiring anindependent financial advisor to conduct an education

programme on long-term investment strategies. Employershave ready access to employees and the cost can be spread

over many employees.

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Chapter 8

Bibliography

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BIBLIOGRAPHY:

http://www.destimoney.com/

https://www.dawnaydayavsecurities.com/

http://www.ripublication.com/

http://www.wikipedia.com/

http://www.morningstar.com/

http://www.investopedia.com/

http://www.financeindia.org/

BOOKS:

Research Methodology by Kothari C. R. 2nd Edition, NewAge International Publishers.

Business Statistics by Gupta S P & Gupta M P, 2000, 12thEd. Sultan Chand & Sons

66
http://www.ripublication.com/https://www.dawnaydayavsecurities.com/http://www.ripublication.com/http://www.wikipedia.com/http://www.morningstar.com/http://www.investopedia.com/http://www.ripublication.com/http://www.ripublication.com/https://www.dawnaydayavsecurities.com/http://www.ripublication.com/http://www.wikipedia.com/http://www.morningstar.com/http://www.investopedia.com/http://www.ripublication.com/


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Chapter 9

Annexure

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INVESTOPEDIA

The use of this Investment Profiler is only for research purposes atall relevant times subject to the Notes and conditional upon thesigning of Declaration at the end hereof.

Name: _______________________________________________

Contact Details: ______________________________________

The name of your financial services provider

(consultant):___________________________________________

Date prepared: ______________________________________

Signature: ____________

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INVESTORS PROFILE:

1. Please specify your gender.

Male

Female

2. Please select your age group. Below 30

30-60

60 & above

3. Please specify your martial Status

Unmarried

Married

4. Please specify your employment details

Salaried

Business Retired (others)

Brand5. Would you like to mention your monthly earnings?

Up to 10000

10001-30000 30000 & above

6. Please specify your educational detail.

Under Graduate

Graduate

Post Graduate & above

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7. What is your occupation?

Accounts, Finance & Investment Professionals Others

INVESTORS INVESTMENT PROFILE:

8. Who takes the financial responsibility in your investments?

Only yourself

1 person in addition to yourself 2-3 persons in additions to yourself

4-5 persons in additions to yourself

>5 persons besides yourself

9. How many sources generally support or influence you to investin the market?

4 or more sources

2-3 sources Only one source

10. Your investment decisions are based

Taken on own initiative

Own initiative but with the help of expert

Made by expert on investors behalf

11. What do you say about regularity of your investmentdecisions?

Frequently

Not so frequently

12. What are your investment objectives?

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Capital appreciation

Balance of capital appreciation & current income

Supplement of current income13. Please rate (1 to 5) your investment avenues in the order of

preference? (Please write your rating against the options)

Fixed Deposits/PPF/BondsInsurance SchemesMutual fund schemesEquitiesCommodities/DerivativesReal Estate

14. What is your level of financial knowledge about the variousinvestment avenues in the market?

Excellent____________________________________1 Good_______________________________________2 Moderate____________________________________3 Not much___________________________________4 Very low____________________________________5

15. What are the various sources of investment information foryou?

Newspapers/Magazines

Electronic Media (T.V.)

Peer group/Friends

Broker/Financial advisor

Internet

16. What is your risk tolerance level for short term fluctuations inyour invested money in case of equity investments?

Very low____________________________________1 Low________________________________________2 Moderate____________________________________3

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High_______________________________________4 Very high__________________________________ 5

17. What is your attitude towards the following Financial

Instruments, in the Indian Capital Market? (Please mark the suitable option)

Highly

Favourable

Favourable Some What

Favourable

Not Very

Favourable

Not at all

favourable

a) Shares

b)Debentures

c)Mutual Funds

d)Bonds

18. Generally you prefer (Please Rank from 1 - first preference to 6- last preference)

Growth Schemes

Balanced Schemes

Tax Saving Schemes

Income Schemes

Index Schemes

19. You Prefer: Open End Schemes

Close End Schemes

20. Do you think Mutual fund investing is a best alternative toequity investing?

Yes

No

Do not know

ROLE OF SERVICE PROVIDERS/INTERMEDIARIES

21. Would you recommend investing your money in equity marketthrough intermediaries/third party service providers?

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No

Yes

22. What is your knowledge level about different service providers

in the financial service market? Very low__________________________________ 1 Low______________________________________ 2 Moderate__________________________________ 3 High______________________________________4

23. On what basis you choose a particular financial serviceprovider?

Less brokerage charges Effective fund allocation

After sale service

Transparency

Brand

24. How much would you like to invest in equity market throughthird party service providers?

(10-20)% (20-40)%

(40-60)%

>60%

Full amount

25. Are you able to meet your return expectations through yourthird party investor /service provider?

Not at all

Some what

Yes Completely satisfied

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GRAPHICAL REPRESENTATION OF THE FINDINGS

DEMOGRAPHICS

Figure 1 Figure 2

Figure 3 Figure 4

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Figure 5 Figure 6

RISK TOLERANCE

Figure 7

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Figure 8

Figure 9

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Figure 10

SERVQUAL GAP MODEL

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Chapter 10

Case Study

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Chapter 11

Synopsis

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INTRODUCTION

Stock market has been subjected to speculations and inefficiencies,which are beached to the rationality of the investor. Traditionalfinance theory is based on the two assumptions. Firstly, investorsmake rational decisions; and secondly investors are unbiased intheir predictions about future returns of the stock. Howeverfinancial economist have now realized that the long heldassumptions of traditional finance theory are wrong and found thatinvestors can be irrational and make predictable errors about the

return on investment on their investments.This empirical study on Individual Investors Behavior is anattempt to know the profile of the investor and also know thecharacteristics of the investors so as to know their preference withrespect to their investments.

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AIM

The study tries to unravel the influence of demographic factors likegender and age on risk tolerance level of the investor. This study

also signifies the role of mutual fund industry in order to minimizethe risk of direct investments in the equity market.

OBJECTIVES

1. To study the dependence/independences of the demographicfactors (Gender and Age) of the investor and his/her risktolerance level.

2. To know the preferred investment avenues of the Indianindividual investor segregated in terms of financial literacy.

3. To know the risk tolerance level of the individual investor inorder to suggest a suitable investment portfolio.

4. To identify the preferred sources of information influencinginvestment decisions.

SCOPE OF THE STUDY

The study is totally based on investors behavior and perceptionabout investments considering the current scenarios in the equitymarket. The biggest concern with the service providers is thequality maintenance on sale and after sale of financial products.This research is on present market scenarios as it is supported bylatest data and the outcomes are taken as an input source in fillingup the gaps in SERVQUAL GAP model (Quality model) being

proposed to Destimoney Enterprise Pvt. Ltd.

RESEARCH METHODOLOGY

The methodology of data collection is based on primary as well assecondary data. The following research methodology is proposed

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to be adopted for the course of research to achieve the objective ofthe study:

Primary Data

Primary research is an investigation which involves collection oforiginal data, using accepted research methodology. To understandthe investors demographics and investment strategies, researchwill include

1. Questionnaires.2. Semi structured interviews with agents and financialadvisors.

Secondary Data

The secondary data will be purely based on company sources,financial reports, books & internet.

CONCLUSION

This study confirms the earlier findings with regard to therelationship between gender and age, the risk tolerance level ofindividual investors. The Present study has important implicationsfor investment managers as it has come out with certain interestingfacets of an individual investor. The individual investor still prefers

final report latest(2)

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