sharekhan final

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Chapter -1

INTRODUCTION


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a) Overview

The time one talks about stock market, another word also clicks and that is risk. People have

lost their millions in the stock market. This is a place of gambling for those who dont knowwhere to invest. The market behaves differently to differently people. The speculators are one

who loose most of the money. There are hedgers who keep risk in their mind but try to

minimize it by using different strategies. Though hedging doesnt always give good returns

but it helps one to take out his money with remarkable profits.

Lot of analysis is required to decide in which instrument one should invest. Many people

think that particular time is the best time to invest but the fact is that it depends on the

investor and his capacity to take risk and invest not the time. Before stepping into investment

process one should get the entire knowledge about the financial instrument options available

in the market and the risk factor involved with the instrument and the estimated returns the

investor would probably get.

SEBI AND ITS ROLE

The Securities and Exchange Board of India (SEBI) is the regulatory authority in India established

under Section 3 of SEBI Act, 1992. SEBI Act, 1992 provides for establishment of Securities and

Exchange Board of India (SEBI) with statutory powers for

(a) Protecting the interests of investors in securities

(b) Promoting the development of the securities market and

(c) Regulating the securities market. Its regulatory jurisdiction extends over corporate in the issuance

of capital and transfer of securities, in addition to all intermediaries and persons associated with

securities market. SEBI has been obligated to perform the aforesaid functions by such measures as it

thinks fit. In particular, it has powers for:

Regulating the business in stock exchanges and any other securities markets

Registering and regulating the working of stock brokers, subbrokers etc.

Promoting and regulating self-regulatory organizations

Prohibiting fraudulent and unfair trade practices


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Calling for information from, undertaking inspection, conducting inquiries and audits of the

stock exchanges, intermediaries, self regulatory organizations, mutual funds and other

persons associated with the securities market.

BSE

Bombay Stock Exchange is the oldest stock exchange in Asia with a rich heritage, now

spanning three centuries in its 133 years of existence. What is now popularly known as BSE

was established as "The Native Share & Stock Brokers' Association" in 1875.

BSE is the first stock exchange in the country which obtained permanent recognition (in

1956) from the Government of India under the Securities Contracts (Regulation) Act 1956.It

migrated from the open outcry system to an online screen-based order driven trading system

in 1995. BSE is the world's number 1 exchange in terms of the number of listed companies

and the world's 5th in transaction numbers. The market capitalization as on December 31,

2007 stood at USD 1.79 trillion. An investor can choose from more than 4,700 listed

companies, which for easy reference, are classified into A, B, S, T and Z groups.

NSE

NSE was set up by leading institutions to provide a modern, fully automated screen-based

trading system with national reach. The Exchange has brought about unparalleled

transparency, speed & efficiency, safety and market integrity. It has set up facilities that serve

as a model for the securities industry in terms of systems, practices and procedures.

NSE has played a catalytic role in reforming the Indian securities market in terms of

microstructure, market practices and trading volumes. The market today uses state-of-art

information technology to provide an efficient and transparent trading, clearing and

settlement mechanism, and has witnessed several innovations in products & services viz.

demutualization of stock exchange governance, screen based trading, compression of

settlement cycles, dematerialization and electronic transfer of securities, securities lending

and borrowing, professionalization of trading members, fine-tuned risk management systems,

emergence of clearing corporations to assume counterparty risks, market of debt and

derivative instruments and intensive use of information technology.


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This project will help the people in getting lot of their answers related to investment options

and the ways to analysis the market. The data in the project can also help the company in

making the strategy for potential investors.

b) Profile of the Organisation

Sharekhan is one of the leading retail broking House of SSKI Group which was running

successfully since 1922 in the country. It is the retail broking arm of the Mumbai-based SSKI

Group, which has over eight decades of experience in the stock broking business. Sharekhan

offers its customers a wide range of equity related services including trade execution on BSE,

NSE, Derivatives, depository services, online trading, investment advisory, Mutual Fund

Advisory etc.

The firms online trading and investment site - www.sharekhan.com - was launched on Feb

8, 2000. The site gives access to superior content and transaction facility to retail customers

across the country. Known for its jargon-free, investor friendly language and high quality

research, the site has a registered base of over two lakh customers. The number of trading

members currently stands More than 6 Lacs. While online trading currently accounts forjust over 8 per cent of the daily trading in stocks in India, Sharekhan alone accounts for 32

per cent of the volumes traded online.

The content-rich and research oriented portal has stood out among its contemporaries because

of its steadfast dedication to offering customers best-of-breed technology and superior market

information. The objective has been to let customers make informed decisions and to

simplify the process of investing in stocks.

On April 17, 2002 Sharekhan launched Speed Trade, a net-based executable application thatemulates the broker terminals along with host of other information relevant to the Day

Traders. This was for the first time that a net-based trading station of this caliber was offered

to the traders. In the last six months Speed Trade has become a de facto standard for the Day

Trading community over the net.

On October 01, 2007 Sharekhan again launched his another integrated Software based

product Trade Tiger, a net-based executable application that emulates the broker terminals

along with host of other information relevant to the Day Traders. It has another quality which

differs it from other that IT HAS THE COMBINED TERMINAL FOR EQUITY AND


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COMMODITIES BOTH.

Share khans ground network includes over 1005 centers in 410 cities in India, of which

210 are fully-owned branches.

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. Previously the

Morakiya family holds a majority stake in the company but now a world famous brand CITI

GROUP has taken 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$ 4 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. The group has placed over US$ 1 billion in private equity deals. Some of the

clients include BPL Cellular Holding, Gujarat Pipavav, Essar, Hutchison, Planetasia, and

Shoppers Stop.

PROFILE OF THE COMPANY :

Name of the company : Sharekhan ltd.

Year of Establishment : 1925

Headquarter : ShareKhan SSKI

A-206 Phoenix House


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Phoenix Mills Compound

Lower Parel

Mumbai - Maharashtra, INDIA- 400013

Nature of Business : Service Provider

Services : Depository Services, Online Services and

Technical Research.

Number of Employees : Over 3500

Website :www.sharekhan.com

Slogan : Your Guide to The Financial Jungle.

SHAREKHAN LIMITEDS MANAGEMENT TEAM:

Mr. Dinesh MurikyaOwner of the company:

The Sharekhan Group of Companies was brought to life by Mr. Dinesh Murikya. He ventured

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.
http://www.sharekhan.com/http://www.sharekhan.com/http://www.sharekhan.com/http://www.sharekhan.com/


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Mr. Tarun ShahChief Executive Officer (CEO) of the company:

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. The capital markets at that time was undergoing a sea change in its character and SSKI

under the vision and guidance of Shripal Morakhia and the commitment and hardwork of Mr.

Shah was able to change and adopt the new business practices to achieve significant growth

in a competitive environment.

Accepting new challenges is a way of life for Mr. Tarun Shah. To ensure that SSKIs foray

into retail stock broking business through Sharekhan meets with the same success every other

SSKI venture has, Mr. Tarun Shah moved in to spearhead this new effort as CEO of the

Sharekhan.

Mr.Shankar VailayaDirector (Operations) of the company:

A graduate in commerce from the University of Mangalore and an Associate of The Member

of the Institute of Chartered Accountants of India,


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Mr. Shankar Vailaya heads the operations, finance and legal functions. He is responsible for

settlements, depository operations, risk and compliance and regulatory & other legal

commitments and Treasury.

Shankar has managed broking operations through the most turbulent times of the post

securities scam period in 1992 and has managed to steer clear of a flurry of bad papers in the

market during 1994-95.

Mr. Jaideep AroraDirector (Products & Technology) of the company:

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

Jaideep worked with ICICI for 8 years where his work spanned a gamut of functions, which

included project finance, equity sales and brokerage, investments etc. During his tenure there

he set up and headed the Institutional Equity Brokerage Desk at ICICI Securities & Finance

Co. Ltd.

Jaideep joined Sharekhan in June 2000 as Head of Product Development. A year later he took

over the reigns of the online business at Sharekhan. At present Jaideeps responsibilities

include spearheading Sharekhans online foray and overall customer acquisition effort.

Pathik Gandotra : Head of Research

Rishi Kohli : Vice President of Equity Derivatives

Nikhil Vora : Vice President of Research


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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 an Asia

money.

Pioneers of online trading in India amongst the top 3 online trading website 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 Plans:

2,00,000 plus retail customers being serviced through centralized call centres 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 :

o 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


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No. 1 player in online business

Largest network of branded broking outlets in the country serving more

than 7,00,000 clients.

Get everything you need at a Sharekhan outlet!

All you have to do is walk into any of our 640 share shops

across 280 cities in India to get a host of trading related services - our friendly customer

service staff will also help you with any accounts related queries you may have.

A Sharekhan outlet offers the following services:

Online BSE and NSE executions (through BOLT & NEAT terminals)

Free access to investment advice from Sharekhan's Research team

Sharekhan ValueLine (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

Depository Services: Demat & Remat Transactions

Derivatives Trading (Futures and Options)

Commodities Trading

IPOs & Mutual Funds Distribution

Internet-based Online Trading: SpeedTrade

REASONS TO CHOOSE SHAREKHAN LIMITED


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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 our online trading account you can buy and sell shares in an instant from any PC with

an internet connection. You will get access to our powerful online trading tools that will help

you take complete control over your investment in shares.

Accessibility

Sharekhan provides ADVICE, EDUCATION, TOOLS AND EXECUTION services for

investors. These services are accessible through our centers across the country (Over 721

locations in 210 cities) over the internet (through the website www.sharekhan.com) as well as

over the Voice Tool.

Knowledge

In a business where the right information at the right time can translate into direct profits, you

get access to a wide range of information on our content-rich portal, Sharekhan. You will also

get a useful set of knowledge-based tools that will empower you to take informed decisions.

Convenience

You can call our Dial-N-Trade number to get investment advice and execute your

transactions. We have a dedicated call-centre to provide this service via a Toll Free Number

1800-22-7500,1800-22-7050 from anywhere in India.

Customer Service

Our customer service team will assist you for any help that you need relating to transactions,

billing, demat and other queries. Our customer service can be contracted via a toll-free

number, email or live chat on www.sharekhan.com.

Investment Advice

Sharekhan has dedicated research teams of more than 30 people for fundamental and

technical researches. Our analysts constantly track the pulse of the market and provide timely

investment advice to you in the form of daily research emails, online chat, printed reports and

SMS on your mobile phone.


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BENEFITS

Free Depository A/c

Secure Order by Voice Tool Dial-n-Trade.

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

24x7 Voice Tool access to your trading account.

Personalized Price and Account Alerts delivered instantly to your Cell Phone & E-mail

address.

Special Personal Inbox for order and trade confirmations.

On-line Customer Service via Web Chat.

Anytime Ordering.

NSDL Account

Instant Cash Tranferation.

Multiple Bank Option.

Enjoy Automated Portfolio.

Buy or sell even single share.

PRODUCTS AND SERVICES OF SHAREKHAN

The different types of products and services offered by Sharekhan Ltd. are as follows:

Equity and derivatives trading

Depository services


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Online services

Commodities trading

Dial-n-trade

Portfolio management

Share shops

Fundamental research

Technical research

FINANCIAL PRODUTS AVAILABLE AT SHAREKHAN:

SHAREKHAN

EQUITY

CASH

MARGIN

BTST

SPOT

DERIVATIVES

FUTURES

OPTIONS

MUTUALFUNDS

PURCHASES

REDEMPTION

SIP & SWP

SWITCHIN/OUT

TRANSFER IN

IPOs BONDS

GOI BONDSSHAREKHAN

BONDS


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CLASSIC ACCOUNT

This account allows the client to trade through the website and is suitable for the retail

investor who is risk-averse and hence prefers to invest in stocks or who do not trade too

frequently.

It allows investor to buy and sell stocks online along with the following features like multiple

watch lists, Integrated Banking, De-mat and Digital contracts, Real-time portfolio tracking

with price alerts and Instant money transfer.

FEATURES

Online trading account for investing in Equity and Derivatives via www.sharekhan.com

Live Terminal and Single terminal forNSE Cash, NSE F&O, BSE & Mutual Funds.

Integration of On-line trading, Saving Bank and De-mat Accounts.

Instant cash transfer facility against purchase & sale of shares.

Competative transaction charges.

Instant order and trade confirmation by E-mail.

Streaming Quotes (Cash & Derivatives).

Personlized market watch.

Single screen interface for Cash and derivatives and more.

Provision to enter price trigger and view the same online in market watch.

TRADE TIGER

TRADE TIGER is an internet-based software application which is the

combination of EQUITY & COMMODITIES, that enables you to buy and sell share and

well as commodities item instantly. It is ideal forevery client of SHAREKHAN LTD.


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FEATURES

Integration of EQUITY & COMMODITIES MARKET.

Instant order Execution and Confirmation.

Single screen trading terminal for NSE Cash, NSE F&O & BSE & Commodities.

Technical Studies.

Multiple Charting.

Real-time streaming quotes, tic-by-tic charts.

Market summary (Cost traded scrip, highest value etc.)

Hot keys similar to brokers terminal.

Alerts and reminders.

Back-up facility to place trades on Direct Phone lines.

Live market debts.

DIAL-N-TRADE

Along with enabling access for your trade online, the CLASSIC and TRADE TIGER

ACCOUNT also gives you our Dial-n-trade services. With this service, all you have to do is

dial our dedicated phone lines which are 1800-22-7500, 3970-7500.

PORTFOLIO MANAGEMENT SERVICES

Sharekhan is also having Portfolio Management Services for Exclusive clients.

1. PROPRIME - Research & Fundamental Analysis.

Ideal for investors looking at steady and superior returns with low to medium risk appetite.


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This portfolio consists of a blend of quality blue-chip and growth stocks ensuring a balanced

portfolio with relatively medium risk profile. The portfolio will mostly have large

capitalization stocks based on sectors & themes that have medium to long term growth

potential.

2. PROTECH - Technical Analysis.

Protech uses the knowledge of technical analysis and the power of derivatives market to

identify trading opportunities in the market. The Protech lines of products are designed

around various risk/reward/ volatility profiles for different kinds of investment needs.

THRIFTY NIFTY: Nifty futures are bought and sold on the basis of an automated

trading system that generates calls to go long/short. The exposure never exceeds

value of portfolio i.e. there is no leveraging; but being short in Nifty allows you to earn

even in falling markets and there by generates linear

BETA PORTFOLIO:Positional trading opportunities are identified in the futures

segment based on technical analysis. Inflection points in the momentum cycles are

identified to go long/short on stock/index futures with 1-2 month time horizon. The

idea is to generate the best possible returns in the medium term irrespective of the

direction of the market without really leveraging beyond the portfolio value. Risk

protection is done based on stop losses on daily closing prices.

STAR NIFTY: Trailing Stops Momentum trading techniques are used to spot short

term momentum of 5-10 days in stocks and stocks/index futures. Trailing stop loss

method of risk management or profit protection is used to lower the portfolio

volatility and maximize returns. Trading opportunities are explored both on the long

and the short side as the market demands to get the best of both upwards & downward

trends.

3. PROARBITRAGE - Exploit price analysis

- ONLINE IPO'S AND MUTUAL FUNDS ADVISORY IS AVAILABLE.

CHARGE STRUCTURE

1) Pre Paid Account: -

-Advance Amount which will be fully adjusted against your brokerage you paid in One year.

Following Schemes Are Available: - Brokerage will be charged -

2,000/- Scheme: - 0.070 / 0.40 %

6,000/- Scheme: - 0.025 / 0.25 %

18,000/- Scheme: - 0.040 / 0.20 %


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30,000/- Scheme: - 0.030 / 0.18 %

60,000/- Scheme: - 0.020 / 0.15 %

1,00,000/- Scheme: - 0.015 / 0.10 %

2) Normal Account: -

Cash Trading : - 0.50% or 10 Paisa per share. Min. Rs.16/- per script.

Margin Trading : - 0.10% or 5 Paisa per share.

Future & Options : - 0.10% (First Leg)

0.02% (2nd Leg if square off same day)

0.10% (2nd Leg

DEPOSITORY CHARGES

Account Opening Charges Rs. 750

Annual Maintenance Charges Rs. NIL first year

Rs. 400 Per annum from second year

onward

Minimum Brokerage Intra Day per Share:

5 Paisa each leg (buy or sell) for Intra-day Trades (For e.g. on Rs 20 Scrip, brokerage @

0.10% = 2 paisa, but there is a min. chargeable amount of 5 paisa).

Minimum Delivery Handling Charges:

10 Paisa for Delivery Trades (buy and sell) (For e.g. on a Rs 10 Scrip, brokerage @ 0.50% =

5 paisa, but there is a min. chargeable amount of 10 paisa). Rs 16/- per Scrip (brok. per Scrip

will be charged for the selling of shares). (For e.g. if a customer sells 100 shares of SAIL,

Delivery value = 2200, brokerage @ 0.5% = Rs 11, but the min chargeable amt per scrip per

day = Rs 16), so additional Rs 5/- will be charged as Min delivery handling charges).

Minimum Margin of Rs.5000/- is Required for Account Opening.


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Annual Maintenance Charges will NIL for 1st year and Rs. 400/- from 2nd year.

EXPOSURE:

It is the limit or turnover that a depository participant allows to its client to take positions at a

time on margin money in his account. Sharekhan offers an Exposure of 4 to 6.6 times ofmargin money in cash. In Futures and Options it offers 10 times of margin money.

Sharekhan also offers exposure of Trading+two days on delivery, it means that a client is not

asked to deposit margin due on his account for next two days and thereafter if it again allows

a client to hold order for additional 3 days and charges nominal interest @14% p.a. on the

same. On sixth day order will be squared off if margin money is not deposited.

TIE UPS: Tie up with eleven banks i.e. HDFC Bank Ltd, ICICI Bank, Oriental Bank Of

Commerce, IDBI Bank Ltd, Citi Bank, United Bank of India, Axis bank, Bank of India,Indusland Bank, Centurian Bank of Punjab for online money transfer. If you are having bank

a/c in one of them, you can transfer the funds and withdraw the funds online from your

trading a/c at anytime.

DOCUMENTS REQUIRED FOR ACCOUNT OPENING: -

Photo ID Proof Residence Proof (Permanent or Correspondence)

Pan Card (Mandatory) Passport

Driving License

Voter's ID

MAPIN UIN Card

Passport (valid) Voter's ID

Driving License (valid)

Letter verified by Bank

Bank Statement & Bank Passbook (latest)

Telephone Bill (latest)

Electricity Bill (latest)

Ration Card

Rent Agreement (Noterised)

Latest Insurance Policy with Bond Copy

Letter from Employer (Only in case of Army People)

--2 Photographs (Passport size & front face)

--1 Cheque of Rs. 750/- in the favor of SHAREKHAN LTD.


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INTRODUCTION TO STOCK MARKET

STOCK MARKET

A stock market is a public market for the trading of company stockand derivatives at an

agreed price; these are securities listed on a stock exchange as well as those only traded

privately. The stock market is one of the most important sources for companies to raise

money. This allows businesses to be publicly traded, or raise additional capital for expansion

by selling shares of ownership of the company in a public market.

The size of the world stock market was estimated at about $36.6 trillion US at the beginning

of October 2008. The total world derivatives market has been estimated at about $791 trillion

face or nominal value, 11 times the size of the entire world economy.

STOCK EXCHANGE

A stock exchange, (formerly a securities exchange) is a corporation ormutual organization

which provides "trading" facilities for stock brokers and traders, to trade stocks and other

securities. Stock exchanges also provide facilities for the issue and redemption of securities

as well as other financial instruments and capital events including the payment of income

and dividends. The securities traded on a stock exchange include: shares issued by

companies, unit trusts, derivatives, pooled investment products and bonds. To be able to

trade a security on a certain stock exchange, it has to be listed there.Companies that are not

listed are sold as short for Over-The-Counter.

SHARE

A share is a unit of account for various financvial instrument including stocks, bonds and

mutual funds.

The total capital of a company may be divided into small units called shares. For example, if

the required capital of a company is Rs. 5, 00,000 and is divided into 50,000 units of Rs. 10

each, each unit is called a share of face value Rs. 10. A share may be of any face value

depending upon the capital required and the number of shares into which it is divided. The

holders of the shares are called share holders. The shares can be purchased or sold only in

integral multiples.

Share consists of Equity share and preference share. Preference shareholder entitled to

dividend prior to equity holder.
http://en.wikipedia.org/wiki/Market_systemhttp://en.wikipedia.org/wiki/Tradehttp://en.wikipedia.org/wiki/Corporationhttp://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Derivative_(finance)http://en.wikipedia.org/wiki/Security_(finance)http://en.wikipedia.org/wiki/Stock_exchangehttp://en.wikipedia.org/wiki/Companieshttp://en.wikipedia.org/wiki/Moneyhttp://en.wikipedia.org/wiki/Corporationhttp://en.wikipedia.org/wiki/Mutual_organizationhttp://en.wikipedia.org/wiki/Stock_brokerhttp://en.wikipedia.org/wiki/Trader_(finance)http://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Security_(finance)http://en.wikipedia.org/wiki/Dividendhttp://en.wikipedia.org/wiki/Shareshttp://en.wikipedia.org/wiki/Unit_trusthttp://en.wikipedia.org/wiki/Derivativeshttp://en.wikipedia.org/wiki/Bond_(finance)http://en.wikipedia.org/wiki/Bond_(finance)http://en.wikipedia.org/wiki/Derivativeshttp://en.wikipedia.org/wiki/Unit_trusthttp://en.wikipedia.org/wiki/Shareshttp://en.wikipedia.org/wiki/Dividendhttp://en.wikipedia.org/wiki/Security_(finance)http://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Trader_(finance)http://en.wikipedia.org/wiki/Stock_brokerhttp://en.wikipedia.org/wiki/Mutual_organizationhttp://en.wikipedia.org/wiki/Corporationhttp://en.wikipedia.org/wiki/Moneyhttp://en.wikipedia.org/wiki/Companieshttp://en.wikipedia.org/wiki/Stock_exchangehttp://en.wikipedia.org/wiki/Security_(finance)http://en.wikipedia.org/wiki/Derivative_(finance)http://en.wikipedia.org/wiki/Stockhttp://en.wikipedia.org/wiki/Corporationhttp://en.wikipedia.org/wiki/Tradehttp://en.wikipedia.org/wiki/Market_system


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STOCKS

The shares may be fully paid or partly paid. A company may consolidate and convert a

number of its fully paid up shares to form a single stock. Stock being one lump amount can

be purchased or sold even in fractional parts.

DEBENTURES

The term Debenture is derived from the Latin word debere which means to owe a debt. A

debenture is a loan borrowed by a company from the public with a guarantee to pay a certain

percentage of interest at stated intervals and to repay the loan at the end of a fixed period.

DIVIDEND

The profit of the company distributed among the share holders is called Dividend. Each

share holder gets dividend proportionate to the face value of the shares held. Dividend is

usually expressed as a percentage.

YIELD OR RETURN

Suppose a person invests Rs. 100 in the stock market for the purchase of a stock. The

consequent annual income he gets from the company is called yield or return. It is usually

expressed as a percentage.

BROKERAGE

The purchase or sale of stocks, shares and debentures is done through agents called Stock

Brokers. The charge for their service is called brokerage. It is based on the face value and is

usually expressed as a percentage. Both the buyer and seller pay the brokerage.

When stock is purchased, brokerage is added to cost price. When stock is sold, brokerage is

subtracted from the selling price.

DEPOSITORY

A depository is like a bank wherein the deposits are securities (viz. shares, debentures,

bonds, government securities, units etc.) in electronic form. There are two type of

depository: National Security Depository Ltd and Central Depository Services Ltd.


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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 to the investors

account with his Depository Participant (DP).

PRIMARY AND SECONDARY MARKET

PRIMARY MARKET

The primary market provides the channel for sale of new securities. Primary market provides

opportunity to issuers of securities; Government as well as corporate, to raise resources to

meet their requirements of investment and/or discharge some obligation.

They may issue the securities at face value, or at a discount/premium and these securities

may take a variety of forms such as equity, debt etc. They may issue the securities in

domestic market and/or international market.

SECONDARY MARKET

Secondary market refers to a market where securities are traded after being initially offered

to the public in the primary market and/or listed on the Stock Exchange. Majority of the

trading is done in the secondary market. Secondary market comprises of equity markets and

the debt markets. For the general investor, the secondary market provides an efficient

platform for trading of his securities. For the management of the company, Secondary equity

markets serve as a monitoring and control conduitby facilitating value-enhancing control

activities, enabling implementation of incentive-based management contracts, and

aggregating information (via price discovery) that guides management decisions.

PRODUCTS IN THE SECONDARY MARKETS

Following are the main financial products/instruments dealt in the Secondary market which

may be divided broadly into Shares and Bonds:

SHARES

Equity Shares: An equity share, commonly referred to as ordinary share, represents the form

of fractional ownership in a business venture.

Rights Issue/ Rights Shares: The issue of new securities to existing shareholders at a ratio to

those already held, at a price. For e.g. a 2:3 rights issue at Rs. 125, would entitle a

shareholder to receive 2 shares for every 3 shares held at a price of Rs. 125 per shares


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Bonus Shares: Shares issued by the companies to their shareholders free of cost based on the

number of shares the shareholder owns.

Preference shares: Owners of these kind of shares are entitled to a fixed dividend or dividend

calculated at a fixed rate to be paid regularly before dividend can be paid in respect of equity

share. They also enjoy priority over the equity shareholders in payment of surplus. But in the

event of liquidation, their claims rank below the claims of the companys creditors,

bondholders/debenture holders.

Cumulative Preference Shares: A type of preference shares on which dividend accumulates

if remained unpaid. All arrears of preference dividend have to be paid out before paying

dividend on equity shares.

Cumulative Convertible Preference Shares: A type of preference shares where the dividend

payable on the same accumulates, if not paid. After a specified date, these shares will be

converted into equity capital of the company.

BOND

Bond is a negotiable certificate evidencing indebtedness. It is normally unsecured. A debt

security is generally issued by a company, municipality or government agency. A bond

investor lends money to the issuer and in exchange, the issuer promises to repay the loan

amount on a specified maturity date. The issuer usually pays the bond holder periodic

interest payments over the life of the loan. The various types of Bonds are as follows:

Zero Coupon Bond: Bond issued at a discount and repaid at a face value. No periodic

interest is paid. The difference between the issue price and redemption price represents the

return to the holder. The buyer of these bonds receives only one payment, at the maturity of

the bond.

Convertible Bond: A bond giving the investor the option to convert the bond into equity at a

fixed conversion price.

Treasury Bills: Short-term (up to one year) bearer discount security issued by government

as a means of financing their cash requirements.

SHORT-TERM FINANCIAL OPTIONS AVAILABLE FOR INVESTMENT

SAVINGS BANK ACCOUNT is often the first banking product people use, which offers

low interest (4%-5% p.a.), making them only marginally better than fixed deposits.

MONEY MARKET OR LIQUID FUNDS are a specialized form of mutual funds that invest

in extremely short-term fixed income instruments and thereby provide easy liquidity. Unlike

most mutual funds, money market funds are primarily oriented towards protecting your


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capital and then, aim to maximize returns. Money market funds usually yield better returns

than savings accounts, but lower than bank fixed deposits.

FIXED DEPOSITS WITH BANKS are also referred to as term deposits and minimum

investment period for bank FDs is 30 days. Fixed Deposits with banks are for investors with

low risk appetite, and may be considered for 6-12 months investment period as normally

interest on less than 6 months bank FDs is likely to be lower than money market fund

returns.

LONG-TERM FINANCIAL OPTIONS AVAILABLE FOR INVESTMENT

POST OFFICE SAVINGS: Post Office Monthly Income Scheme is a low risk saving

instrument, which can be availed through any post office. It provides an interest rate of 8%

per annum, which is paid monthly. Minimum amount, which can be invested, is Rs. 1,000/-

and additional investment in multiples of 1,000/-. Maximum amount is Rs. 3,00,000/- (if

Single) or Rs. 6,00,000/- (if held Jointly) during a year. It has a maturity period of 6 years.

Premature withdrawal is permitted if deposit is more than one year old. A deduction of 5% is

levied from the principal amount if withdrawn prematurely.

PUBLIC PROVIDENT FUND: A long term savings instrument with a maturity of 15 years

and interest payable at 8% per annum compounded annually. A PPF account can be opened

through a nationalized bank at anytime during the year and is open all through the year for

depositing money. Tax benefits can be availed for the amount invested and interest accrued

is tax-free. A withdrawal is permissible every year from the seventh financial year of the

date of opening of the account and the amount of withdrawal will be limited to 50% of the

balance at credit at the end of the 4th year immediately preceding the year in which the

amount is withdrawn or at the end of the preceding year whichever is lower the amount of

loan if any.

COMPANY FIXED DEPOSITS: These are short-term (six months) to medium-term (three

to five years) borrowings by companies at a fixed rate of interest which is payable monthly,

quarterly, semi-annually or annually. They can also be cumulative fixed deposits where the

entire principal along with the interest is paid at the end of the loan period. The rate of

interest varies between 6-9% per annum for company FDs. The interest received is after

deduction of taxes.

BONDS: It is a fixed income (debt) instrument issued for a period of more than one year

with the purpose of raising capital. The central or state government, corporations and similar

institutions sell bonds. A bond is generally a promise to repay the principal along with a

fixed rate of interest on a specified date, called the Maturity Date.


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MUTUAL FUNDS: These are funds operated by an investment company which raises

money from the public and invests in a group of assets (shares, debentures etc.), in

accordance with a stated set of objectives. It is a substitute for those who are unable to invest

directly in equities or debt because of resource, time or knowledge constraints. Benefits

include professional money management, buying in small amounts and diversification.

Mutual fund units are issued and redeemed by the Fund Management Company based on the

fund's net asset value (NAV), which is determined at the end of each trading session. NAV is

calculated as the value of all the shares held by the fund, minus expenses, divided by the

number of units issued. Mutual Funds are usually long term investment vehicle though there

some categories of mutual funds, such as money market mutual funds which are short term

instruments. Types of mutual funds are discussed below:

CLOSE END MUTUAL FUND

A closed-end mutual fund has a set number of shares issued to the public through an initial

public offering. These funds have a stipulated maturity period generally ranging from 3 to 15

years. The fund is open for subscription only during a specified period. Investors can invest

in the scheme at the time of the initial public issue and thereafter they can buy or sell the

units of the scheme on the stock exchanges where they are listed.

Once underwritten, closed-end funds are trade on stock exchanges like stocks or bonds. The

market price of closed-end funds is determined by supply and demand and not by net-asset

value (NAV), as is the case in open-end funds. Usually closed mutual funds are trade at

discounts to their underlying asset value.

OPEN END MUTUAL FUND

Open-end funds raise money by selling shares of the fund to the public, in a manner similar

to any other company, which sell its stock to raise the capital. An open-end mutual fund does

not have a set number of shares. It continues to sell shares to investors and will buy back

shares when investors wish to sell. Units are bought and sold at their current net asset value.

Open-end funds are required to calculate their net asset value (NAV) daily. Since the NAV

of an open-end fund is calculated daily, it serves as a useful measure of its fair market value

on a per-share basis. The NAV of the fund is calculated by dividing the fund's assets minus

liabilities by the number of shares outstanding. Open-end funds usually charge an entry or

exit load from the investors.

LARGE-CAP MUTUAL FUNDS


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Large cap funds are those mutual funds, which seek capital appreciation by investing

primarily in stocks of large blue chip companies with above-average prospects for earnings

growth.

MID-CAP MUTUAL FUNDS

Mid cap funds are those mutual funds, which invest in small / medium sized companies.

EQUITY MUTUAL FUND

Equity mutual funds are also known as stock mutual funds. Equity mutual funds invest

pooled amounts of money in the stocks of public companies.

BALANCED FUND

Balanced fund is also known as hybrid fund. It is a type of mutual fund that buys a

combination of common stock, preferred stock, bonds, and short-term bonds

GROWTH FUNDS

Growth funds are those mutual funds that aim to achieve capital appreciation by investing in

growth stocks.

EXCHANGE TRADED FUNDS (ETFs)

ETFs are listed on a recognized stock exchange and their units are directly traded on stock

exchange during the trading hours.

VALUE FUNDS

Value funds are those mutual funds that tend to focus on safety rather than growth, and often

choose investments providing dividends as well as capital appreciation.

MONEY MARKET FUND

A money market fund is a mutual fund that invests solely in money market instruments.

Money market instruments are forms of debt that mature in less than one year and are very

liquid

SECTOR FUND

Sector mutual funds are those mutual funds that restrict their investments to a particular

segment or sector of the economy.

INDEX FUNDS

An index fund is a mutual fund or exchange-traded fund) that aims to replicate the

movements of an index of a specific financial market.

FUND OF FUNDS

A fund of funds (FoF) is an investment fund that holds a portfolio of other investment funds

rather than investing directly in shares, bonds or other securities.


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DERIVATIVES

Derivative is a product whose value is derived from the value of one or more basic variables,

called underlying. The underlying asset can be equity, index, foreign exchange (forex),

commodity or any other asset. Derivative products initially emerged as hedging devices

against fluctuations in commodity prices and commodity-linked derivatives remained the

sole form of such products for almost three hundred years. The financial derivatives came

into spotlight in post-1970 period due to growing instability in the financial markets.

However, since their emergence, these products have become very popular and by 1990s,

they accounted for about two-thirds of total transactions in derivative products.

TYPES OF DERIVATIVES

FORWARDS: A forward contract is a customized contract between two entities, where

settlement takes place on a specific date in the future at todays pre-agreed price.

FUTURES: A futures contract is an agreement between two parties to buy or sell an asset at

a certain time in the future at a certain price. Futures contracts are special types of forward

contracts in the sense that the former are standardized exchange-traded contracts, such as

futures of the Nifty index.

OPTIONS: An Option is a contract which gives the right, but not an obligation, to buy or

sell the underlying at a stated date and at a stated price. While a buyer of an option pays the

premium and buys the right to exercise his option, the writer of an option is the one who

receives the option premium and therefore obliged to sell/buy the asset if the buyer exercises

it on him. Options are of two types - Calls and Puts options:

'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.

Puts give the buyer the right, but not the obligation to sell a given quantity of underlying

asset at a given price on or before a given future date.

Presently, at NSE futures and options are traded on the Nifty, CNX IT, BANK Nifty and 116

single stocks.

WARRANTS: Options generally have lives of up to one year. The majority of options

traded on exchanges have maximum maturity of nine months. Longer dated options are

called Warrants and are generally traded over-the counter.


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PRECAUTIONS ONE MUST TAKE BEFORE INVESTING IN THE STOCK

MARKETS

Here are some useful pointers to bear in mind before you invest in the markets:

Make sure your broker is registered with SEBI and the exchanges and do not deal

with unregistered intermediaries.

Ensure that you receive contract notes for all your transactions from your broker

within one working day of execution of the trades.

All investments carry risk of some kind. Investors should always know the risk that

they are taking and invest in a manner that matches their risk tolerance.

Do not be misled by market rumors, luring advertisement or hot tips of the day.

Take informed decisions by studying the fundamentals of the company. Find out the

business the company is into, its future prospects, quality of management, past track

record etc Sources of knowing about a company are through annual reports,

economic magazines, database available with vendors or your financial advisor.

If your financial advisor or broker advises you to invest in a company you have never

heard of, be cautious. Spend some time checking out about the company before

investing.

Do not be attracted by announcements of fantastic results/news reports, about a

company. Do your own research before investing in any stock.

Do not be attracted to stocks based on what an internet website promotes, unless you

have done adequate study of the company.

Be cautious about stocks which show a sudden spurt in price or trading activity.

Any advice or tip that claims that there are huge returns expected, especially for

acting quickly, ma y be risky and may to lead to losing some, most, or all of your

money.

c) Problems of the organisation

Sometimes there are unknown reasons on the basis of which markets operate and the

findings of the project may not hold true in such cases. That is the reason why the

market is sometimes called as Irrational creature.


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Mostly investors who invest in the stock market have money and they just want to

invest with no predefined objectives in mind and hence they rely upon the suggestions

of the distributors and marketing executives, which deviates the actual behaviour from

the expected behaviour.

Lack of awareness of stock market: since the area is not known before, it takes a lot of

time in convincing people to invest in share market

Some respondents are unwilling to talk or they dont have time to respond.

Misleading concepts: some people think that shares are too risky and are just another

name of gamble. But its not at all risky for long term investors.

SWOT ANALYSIS OF SHAREKHAN

(My observation)

STRENGTHS

1. Big client base

2. In-house research house

3. online as well as offline trading

4. Online IPO/ MF services

5. Share shops

6. Transparent

7. User friendly tie ups with 10 banks

8. Excellent order execution speed and reliability

WEAKNESS

1. Lack of awareness among customer

2. Less focus on customer retention

3. Less Exposure


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OPPORTUNITIES

1. Diversification

2. Product modification

3. Improve Web based trading

4. Provide competitive brokerage

5. Concentrate on PMS

6. Focus on Institutional investors

7. Concentrate on HNIs (high net worth investor)

THREATS

1. Aggressive promotional strategies by close competitor like Religare, Angel Broking and

India bulls.

2 More and more players are venturing into this domain, which can further reduce the earning

of Share Khan.

3 Stock market is very volatile, risk involves is very high.

Competitors Information:-

HDFC BANK

HDFC BANK is one of the leading Depository Participant (DP) in the country with over 8

Lac demat accounts.


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HDFC Bank Demat services offers you a secure and convenient way to keep track of your

securities and investments, over a period of time, without the hassle of handling physical

documents that get mutilated or lost in transit.

HDFC BANK is Depository participant both with National Securities Depositories Limited

(NSDL) and Central Depository Services Limited (CDSL).

Features & Benefits :

As opposed to the earlier form of dealing in physical certificates with delays in transaction,

holding and trading in Demat form has the following benefits:

Settlement of Securities traded on the exchanges as well as off market transactions.

Shorter settlements thereby enhancing liquidity.

Pledging of Securities.

Electronic credit in public issue.

Auto Credit of Rights / Bonus / Public Issues /Dividend credit through ECS.

Auto Credit of Public Issue refunds to the bank account.

No stamp duty on transfer of securities held in demat form.

No concept of Market Lots.

Change of address, Signature, Dividend Mandate, registration of power of attorney,

transmission etc. can be effected across companies held in demat form by a single

instruction to the Depository Participant (DP).

Holding / Transaction details through Internet / email.

In case you need any more information or have any queries , feedback & complaints , you

may please mail us [email protected]

HDFC Bank Ltd provides convenient facility called 'SPEED-e' (Internet based transaction)

whereby account holder can submit delivery instructions electronically through SPEED-e

website (https://speede.nsdl.com). SPEED-e offers secured means of transaction processing

eliminating preparation of instruction slips and submission of the same across the counter to

the depository participant. The 'IDEAS' facility helps in viewing the current transactions and

balances (holdings) of Demat account on Internet on real time basis.
mailto:[email protected]:[email protected]:[email protected]://speede/https://speede/https://speede/https://speede/mailto:[email protected]


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Disclaimer:

Whatever have been stated above are in the good interest of the Investor / Demat Applicants /

holders to provide a brief picture about the depository system. You are requested go through

the guidelines of the depositories before taking any further action. For detailed guidelines,

you are requested to approach your nearest HDFC Bank branch. HDFC Bank will not be

responsible for any misunderstanding / act based on the above. Also HDFC Bank might ask

for additional information / documentation than what has been stated above to process your

application / instruction.

ICICI DIRECT

ICICI Direct (or ICICIDirect.com) is stock trading company of ICICI Bank. Along with stock

trading and trading in derivatives in BSE and NSE, it also provides facility to invest in IPOs,

Mutual Funds and Bonds.

Trading is available in BSE and NSE.

ICICI Direct offers 3 different online trading platforms to its customers.

Type of Account:

1. Share Trading Account:

Share Trading Account by ICICI Direct is primarily for buying and selling of stocks

in BSE and NSE.

This account allows Cash Trading, Margin Trading, Margin PLUS Trading, Spot

Trading, Buy Today Sell Tomorrow and Call and Trade on phone.


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ICICIDirect.com website is the primary trading platform for this trading account.

They also provide installable application terminal based application for high volume

trader.

1. Wise Investment Account:

Online Mutual funds investment allows investor to invest on-line in around 19 Mutual

Fund companies. ICICI Direct offers various options while investing in Mutual Funds

like Purchase Mutual Fund, Redemption and switch between different schemes,

Systematic Investment plans, Systematic withdrawal plan and transferring existing

Mutual Funds in to electronic mode. This account also provides facility to invest in

Government of India Bonds and ICICI Bank Tax Saving Bonds.

Active Trader account gives more personalized investment options to the investors. It

allows investor to use online and offline stock trading. It also provides with

independent market expertise and support through a dedicated Relationship Manager

from ICICI.

Active Trader also provides commodity trading.

Brokerage and fees

Account opening fees : Rs 750/- (One time nonrefundable)

Brokerage: ICICIDirect.com brokerage varies on volume of trade and inclusive of demat

transaction charges, service taxes and courier charges for contract notes. It ranges from 0.1%

to 0.15% for margin trades, 0.2% to 0.425% for squared off trades and 0.4% to 0.85% on

delivery based trades.

Disadvantages of ICICI Direct:

Getting access to ICICIDirect.com website during market session can be frustrating.

5Paisa.com

5paisa is the trade name of India Infoline Securities Private Limited (5paisa), member of

National Stock Exchange and The Stock Exchange, Mumbai. 5paisa is a wholly owned


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subsidiary of India Infoline Ltd, Indias leading and most popular finance and investment

portal. 5paisa has emerged as one of leading players in e-broking space in India.

The companys brokerage is one of the lowest in the industry. It also provides the research on

commodities. Investors can benefit from its analysis and advice available at the click of the

mouse. For those who prefer to trade the traditional way, India Infoline investor points are

available across the country.

India Info line was founded by a group of professionals in 1995. Its institutional investors

include Intel Capital, one of the leading technology companies in the world promoted by the

U K government, ICICI, TDA and Reeshanar. The company offers a slew of products such as

stock and derivatives broking, commodities broking and mutual funds.

India Bulls

Indiabulls is India's leading retail financial services company with 77 locations spread across

64 cities. Its size and strong balance sheet allows providing varied products and services at

very attractive prices, our over 750 Client Relationship Managers are dedicated to serving

your unique needs.

Indiabulls is lead by a highly regarded management team that has invested crores of rupees

into a world class Infrastructure that provides real-time service & 24/7 access to all

information and products. The Indiabulls Professional Network offers real-time prices,

detailed data and news, intelligent analytics, and electronic trading capabilities, right at yourfinger-tips. This powerful technology is complemented by our knowledgeable and customer

focused Relationship Managers.

Indiabulls offers a full range of financial services and products ranging from Equities,

Derivatives, Demat services and Insurance to enhance wealth.


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Kotak Securities Limited (kotakstreet.com):

Kotak Securities Ltd., a strategic joint venture between Kotak Mahindra Bank and Goldman

Sachs (holding 25% - one of the worlds leading investment banks and brokerage firms) is

Indias leading stock broking house with a market share of 5 - 6 %. Kotak Securities Ltd. has

been the largest in IPO distribution - It was ranked number One in 2003-04 as Book Running

Lead Managers in public equity offerings by PRIME Database. It has also won the Best

Equity House Award from Finance Asia - April 2004.

The company has a full fledged research division involved in Macro Economic studies,

sectoral research and company specific equity research combined with a strong and well

networked sales force which helps deliver current and up to date market information and

news.

Kotak Securities Ltd is also a depository participant with National Securities Depository

Limited (NSDL) and Central Depository Services Limited (CDSL) providing dual benefit

services wherein the investors can use the brokerage services of the company for executing

the transactions and the depository services for settling them.The company has 42 branches servicing around 1, 00,000 customers. Kotakstreet.com the

online division of Kotak Securities Limited offers Internet Broking services and also online

IPO and Mutual Fund Investments.

Kotak Securities Limited manages assets over 1700 crores under Portfolio Management

Services (PMS) which is mainly to the high end of the market. Kotak Securities Limited has

newly launched Kotak Infinity as a distinct discretionary Portfolio Management Service

which looks into the middle end of the market.

Motilal Oswal Securities Ltd. (MOSt):

One of the top-3 stock-broking houses in India, with a dominant position in both institutional

and retail broking, MOSt is amongst the best-capitalized firms in the broking industry in

terms of net worth.


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MOSt was founded in 1987 as a small sub-broking unit, with just two people running the

show. Focus on customer-first-attitude, ethical and transparent business practices, respect for

professionalism, research-based value investing and implementation of cutting-edge

technology have enabled it to blossom into a thousand-member team.

The institutional business unit has relationships with several leading foreign institutional

investors (FIIs) in the US, UK, Hong Kong and Singapore. In a recent media report MOSt

was rated as one of the top-10 brokers in terms of business transacted for FIIs.

The retail business unit provides equity investment solutions to more than 50,000 investors

through 270 outlets spanning 150 cities and 22 states. MOSt provides Advice-Based Broking,

Portfolio Management Services (PMS), E-Broking Services, Depository Services,

Commodities Trading, and IPO and Mutual Fund Investment Advisory Services. Its Value

PMS Scheme gave a 160% post-tax return for the year ended March 2004.

With value investing at the core of its investment philosophy, a strong research team

consistently provides high-performance ideas.

MOSts equity research has been consistently ranked very highly in surveys conducted by

leading international publications like Asiamoney and Institutional Investor. In Asia Money

Brokers Poll 2003 MOSt has been rated as the Best Domestic Research House - Mega Funds

,while in 2000 and 2002 it has been rated as the Best Domestic Equity Research House and

Second best amongst Indian Brokerage firms respectively.

IDBI Capital Market Services Ltd.

IDBI Capital is a leading Indian securities firm offering a complete suite of products and

services to individual, institutional and corporate clients.

IDBI Capital Market Services Ltd. (IDBI Capital), a wholly owned subsidiary of Industrial

Development Bank of India (IDBI), is a leading Indian securities firm, offering a complete

suite of products and services to individual, institutional and corporate clients. Our services

include fixed income trading, equities brokerage, debt and equity derivatives, research,

private placements, depository services, portfolio management and distribution of financial
http://www.motilaloswal.com/eag.htmhttp://www.motilaloswal.com/pms.htmhttp://www.motilaloswal.com/ebroking.htmhttp://www.motilaloswal.com/depository.htmhttp://www.motilaloswal.com/commodities/commodities.htmhttp://www.motilaloswal.com/mutual.htmhttp://www.motilaloswal.com/eag.htmhttp://www.motilaloswal.com/eag.htmhttp://www.motilaloswal.com/mutual.htmhttp://www.motilaloswal.com/commodities/commodities.htmhttp://www.motilaloswal.com/depository.htmhttp://www.motilaloswal.com/ebroking.htmhttp://www.motilaloswal.com/pms.htmhttp://www.motilaloswal.com/eag.htm


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products. Over the last five years, we have emerged as a leading player in each of these

businesses.

March 1995 - Commenced Equity Broking on NSE CM segment

July 1995 - Built agent Distribution Network across the country

October 1996 - Commenced Debt Broking on NSE WDM segment

December 1996 - Started operations as a Depository Participant

1996 - Started to act as Arranger to Privately Placed Bond issues

April 1998 - Commenced operations as a Portfolio Manager

February 1999 - Acquired membership of BSE, Mumbai

November 1999 - Started operations as a Primary Dealer

June 2000 - Acquired Derivatives memberships of BSE and NSE

March 2002 - Achieved an outright secondary market turnover exceeding Rs100,000

cr in G-Secs

October 2002- Commenced trading in Interest Rate Swaps

Refco - Sify Securities India Pvt. Ltd

Refco-Sify Securities India Pvt. Ltd., headquartered in Mumbai, is a joint venture between

the Refco Group Holding Ltd., USA; and Satyam Infoway Limited (NASDAQ: SIFY) to

offer online and offline equity and derivatives trading for retail customers as well as

execution and clearing services for financial institutions.

Refco also provides clients with prime brokerage services, fixed income, equities, foreign

exchange, OTC derivatives and asset management.

Refco is a leader in providing clients with the latest technological advances in products and

services. Its proprietary systems and global infrastructure provide the flexibility to meet all

client requirements.

Client service is what sets Refco apart from its competitors. Refco understands the unique

business requirements of each of its clients and tailors its products and services to meet those

requirements.


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UTI SECURITIES LTD.: (UTISEL)

UTI Securities Ltd was incorporated on June 24, 1994 by Unit Trust of India as a 100%

subsidiary and on the repealing of the UTI Act, the capital is now held by the Administrator

of the Specified Undertaking of Unit Trust of India (ASUUTI). UTI Securities has been

working as an independent professional entity for providing financial intermediary and

advisory services to its corporate and retail clientele.

The Company has presence in major cities with 20 branches and 50 franchisees to service a

wide range of clients. The company has also invested in the joint-venture company with

Standard Chartered Bank viz. Standard Chartered UTI Securities (P) Ltd. that is engaged

in primary dealership and Government securities. The company is very soon going to start

Commodity Trading through its subsidiary, USEc Commodities Ltd, which provides facility

of commodity trading on NCDEX and MCX.

KARVY

Karvy is a premier integrated financial services provider, and ranked among the top five in

the country in all its business segments, services over 16 million individual investors in

various capacities, and provides investor services to over 300 corporate, comprising the who

is who of Corporate India. Karvy has a professional management team and ranks among the

best in technology, operations and research of various industrial segments.

History of Karvy :- The birth of Karvy was on a modest scale in 1981. It began with thevision and enterprise of a small group of practicing Chartered Accountants who founded the

flagship company, Karvy Consultants Limited. They started with consulting and financial

accounting automation and carved inroads into the field of registry and share accounting by

1985. Since then, karvy utilized its experience and superlative expertise to go from strength

to strength, to better their services, to innovate, diversify and in the process, evolved as one of

Indias premier integrated financial service enterprise.


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Religare Securities Limited (RSL)

Religare Securities Limited (RSL), a 100% subsidiary of Religare enterprises Limited is a

leading equity and securities firm in India. The company currently handles sizeable volumes

traded on NSE and in the realm of online trading and investments; it currently holds a

reasonable share of the market. The major activities and offerings of the company today are

Equity Broking,

Depository Participant Services, Portfolio Management Services, International Advisory Fund

Management Services, Institutional Broking and Research Services. To broaden the gamut of

services offered to its investors, the company offers an online investment portal armed with a

host of revolutionary features.

RSL is a member of the National Stock Exchange of India, Bombay Stock Exchange of India,

Depository Participant with National Securities Depository Limited and Central Depository

Services (I) Limited, and is a SEBI approved Portfolio Manager.

Religare has been constantly innovating in terms of product and services and to offer such

incisive services to specific user segments it has also started the NRI, FII, HNI and Corporate

Servicing groups. These groups take all the portfolio investment decisions depending upon a

clients risk / return parameter.

Religare has a very credible Research and Analysis division, which not only caters to the need

of our Institutional clientele, but also gives their valuable inputs to investment dealers.


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Chapter 2

OBJECTIVES AND METHODOLOGY


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OBJECTIVE

The primary objective is:

Checking the awareness level of online share trading.

Evaluation of preferred investments in various mode and industry.

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.

Analyzing the preferred broking house.

Checking the satisfaction level of the customers towards preferred broking house.

The secondary objective is:

To make clients and let them know about the different services offered by

the SHAREKHAN.

To understand the problem faced by customers and finding way to solve

the queries.

Scope of study

It is the study of how, when, what, and why people buy. Its elements blend with the elements

of marketing and psychology. It helps us to understand the buyer decision making process,

both individually and in groups. It helps us to study the characteristics of individual

consumers like demographic, psychographic, and other behavioral variables in an attempt to

understand peoples needs and wants.

The study of consumer behavior helps the firms and organizations in improving their

marketing strategies by understanding various issues such as:

How consumer thinks, feels, and select between different alternatives? (e.g., brands,

products)

How is consumer influenced by his or her environment?(e.g., culture, family, friends)

Consumer knowledge or information processing abilities.


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How marketers can adapt and improve their marketing campaigns and strategies to

reach the consumers more effectively.

REASONS FOR STUDYING CONSUMER BEHAVIOR

Consumer analysis helps managers in many ways like:

Designing the marketing mix.

Segmenting the market place accordingly to consumer needs and wants.

Positioning and differentiating products of their companies differently to each

consumer.

Provides knowledge about overall human behavior.

Provides the recent trend in the market among the consumer preferences.

METHODOLOGY

take frm saurabh

Questionnaire Design

In our survey, answers were of interest not intrinsically but because there exists a relationship

to something we were supposed to measure. Our questionnaire was reliable and provided

consistent results. In comparable situations, and valid; answers correspond to what they are

intended to measure. It is always what they are intended to measure. It was always important

to us to remember that the answers are valuable to us to the extent that it can be shown to

have a predictable relationship to facts or subjective states that are of interest.

There were two main objectives in mind while designing the questionnaire:

To maximize the proportion of subjects answering our questionnaire that is, the

response rate.

To obtain accurate relevant information for our survey.


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CHAPTER 3

CONCEPTUAL DISCUSSION


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ONLINE SHARE TRADING

Online share trading is done with the help of computer, internet connection and with trading

or de-mat account is called online share trading, or we can say that online trading is the

trading of securities via the internet. If you would like to do online share trading then you

should have a computer, internet connection and online trading account. It is done via internet

means that all the transaction are settled electronically.

Advantages:

The first and main benefit of this is that in online trading the member does not need to

go to the share market for checking, which consumes a lot of time. All the

information about shares, stock market is just one click away and it has made trading

much simple, easy and attractive.

Dependence on broker or anybody else is nil for placing or squaring off the order. In

short one is his/her own boss for trading of shares.

Its not possible or viable for a broker to update customers about each and every news

of the market or any news which can have any influence on the share market. So if

someone is doing online trading himself, then a disaster can be averted. People can

get news and updates on various websites and also on their online trading system and

most of the information will be free of cost.

All the transactions and related documents can be seen online and can also be

downloaded to the PC without depending on any broker. Status of the amount can

also be checked on daily basis through online trading system.

Disadvantages

One may face a problem of disconnection from internet and hence will not be able to

login-in and do share trading.

One may also face problem like electricity cut-off and at that time one has to call his

broker and place the order for execution.

Due to all of the above advantages it is clear that the trading in India is spreading like fire and

is surely going to increase in the future.


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OFFLINE SHARE TRADING

In offline trading the transactions are done through the phone and when to buy or sell is

directed through phone. In other words trading will be done by another person on ones

behalf based on the instructions given by one, and then the other person can be a broker. The

broker will do buying and selling of shares on ones behalf depending on the instructions

given by one. This type of trading was done in the past but nowadays most of the trading is

done through computers i.e. online. E.g. Suppose that if Mr. X wants to sell n number of

shares when the share price reaches Rs. 100, then X will tell his broker to sell the share at Rs

100 (i.e. when the price of Rs. 100 is reached).

Nevertheless, with all the convenience of online trading there are still investors who prefer

the old fashion way of offline trading. Offline trading has lost some popularity but it is still

the main form of investing. Offline trading offers many benefits as well.

Advantages:

The one benefit that an investor appreciates the most is that they are not alone when

making investment decisions.

There are experienced and professional brokerage companies that handle their

investments for them.

Investors are not faced with the challenge of making these vital investment decisions;

especially, if they do not have the experience necessary to make the appropriate

investments.

Also, there is someone there to answer any questions that may cause concerns.

Not to mention, with offline trading mistakes are less likely to take place. No one wants to

throw their money away or stand by and watch someone else throw their money away. It may

be wise to hire a professional to assist you in making the correct investment decisions if youfeel you lack the knowledge necessary.

The reason why online trading has emerged is due to the emergence of IT. Doing transactions

online is always advantageous and easy plus less time is taken by doing transactions online.

Also following are the disadvantages of doing transactions offline:

Not the cheapest fees available.


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Lost some of its competitiveness in attracting new customers with higher commission

rates.

Time consuming process.

Slow process than online trading. A delay of even a second can change the value of aparticular stock greatly.

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 meager 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 exchanges.


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TRANSACTION CYCLE:

A person holding assets (Securities/Funds), either to meet his liquidity needs or to reshuffle

his holdings in response to changes in his perception about risk and return of the assets,

decides to buy or sell the securities. He selects a broker and instructs him to place buy/sell

order on an exchange. The order is converted to a trade as soon as it finds a matching

sell/buy order. At the end of the trade cycle, the trades are netted to determine the obligations

of the trading members securities/funds as per settlement cycle. Buyer/seller delivers funds/

securities and receives securities/funds and acquires ownership of the securities.

A securities transaction cycle is presented above. Just because of this Transaction cycle, the

whole business of Securities and Stock Broking has emerged. And as an extension of stock

broking, the business of Online Stock broking/ Online Trading/ E-Broking has emerged.

Placing

Order

Settlement

of trades

Decision to trade

TradeExecution

Clearing of

Trades

Funds orSecurities

Transaction

Cycle


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At the end of the American Civil War, the brokers who thrived out of Civil War in 1874,

found a place in a street (now appropriately called as Dalal Street) where they would

conveniently assemble and transact business. 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.

sharekhan final

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