share trading for juju
TRANSCRIPT
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 1/91
A
PROJECT REPORT
ON
SCOPE AND CURRENT SCENARIO OF ONLINE TRADING IN EQUITY MARKET
Submitted in Partial Fulfillment of MBA
Batch 2010-2012
NORTHERN INDIA ENGINEERING COLLEGE
Submitted to: Faculty guidance:
Mrs. Akansha Mr. Prakash Yadav
(Faculty of MBA, NIEC) (Faculty of MBA, NIEC)
Submitted by:
PRITI SINGH
MBA (FULL TIME)
Batch 2010-2012
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 2/91
CERTIFICATE
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 3/91
ACKNOWLEDGEMENT
The research study was undertaken by me in partial fulfillment of my course. It has
been a great pleasure having gone through as a trainee in Nirmal bang & Securities which is
India‘s well-known and starkly established retail brokerage firm.
I express my thanks to Dr. M.K. Rastogi (Head of MBA Department) and my
faculty member Mrs. Akansha Maam of Babu Banarasi Das of Northern India
Engineering College, Lucknow, for extending her support.
I cannot refrain myself from expressing my deep sense of gratitude to Mr. Rahul
Anand (Area Sales Manager, Lucknow) for his esteemed guidance and inspirations. I am
also heartily thankful to Manish Kanti Paul (Associate Vice President) and each and
every member of the in Nirmal bang & Securities for being so co-operative and helpful.
(Priti Singh)
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 4/91
PREFACE
Finance is the lifeblood of a company or firm. Finance is an orderly and insightful
process for thinking about and planning for wealth maximization and maximum utilization of
resources. The process starts with opening of company in the market place. It is a dynamic
process. The finance manager uses research to identify opportunities and make financial
policy for company so that company could perform better than its rivals. The finance process
involves collection of funds from public or partners of the firm, proper utilization of funds in
order to get benefit from the market, segmenting the market and choosing those target market
that the company can satisfy in a superior way. The company must formulate a broad strategy
and define a specific marketing mix and financial plan to optimize the long-run performance.
The company builds in a set of control so that it evaluates results and operates as a learning
organization constantly improving know-how.
The successful completion of this project was a unique experience for me because by
visiting many places and interacting with various persons, I have achieved a better knowledge
about financial institute services especially in context of share market. The experience, which
I gained from this project, was essential point of my career. This project is being submitted
which contains detailed analysis of the research undertaken by me.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 5/91
CONTENTS
ACKNOWLEDGEMENT.........................................................................
PREFACE..............................................................................................
CERTIFICATE..........................................................................................
EXECUTIVE SUMMARY.......................................................................6
INTRODUCTION OF SHARE MARKET....................................................8
COMPANY PROFILE ..........................................................................15
SWOT ANALYSIS ............................................................................48
STOCK MARKET …………………............................................................51
MONEY MARKET AND CAPITAL MARKET ….......................................62
HISTORY OF STOCK MARKET..............................................................72
IMPORTANCE OF STOCK MARKET….....................................................77
STOCK TRADING ................................................................................78
OBJECTIVE .......................................................................................87
RESEARCH METHODOLOGY …............................................................88
DATA ANALYSIS AND INTERPRETATION …..........................................95
FINDINGS .....................................................................................103
SUGGESTION ...................................................................................106
CONCLUSION .................................................................................107
LIMITATION OF STUDY………………………………………………………………………109
BIBLIOGRAPHY ...................................................................................110
ANNEXURE ………………………………………………………………………………….….111
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 6/91
Executive Summary
In the times of economic recession and global meltdown, when global stock indices
are breaching their previous lows, stock prices are falling headlong making new lows every
day, and business newspapers like The Economic Times are coming up with headlines like
―Saare Zameen Par‖ on a regular basis, investors are really worried about their investment.
The market volatility really effects the investors‘ investment in a very large way. So, in this
project I will try to find out how the market volatility effect the stock market where people
invest and how the investors are really overcome this market volatility situation.
The equity markets have been on a roller-coaster ride in the past few weeks. While India is
relatively shielded from the sub-prime problem, its alignment to international markets and an
increased presence of foreign investors, especially hedge funds, has made our stock markets
move in tandem with global markets. Investors are looking for some other place to invest
their hard-earned money. Commodity market is one such market which has provided a good
opportunity to the investors to earn good returns. People are looking to diversify their
portfolios to maximize their return on investment. Commodity market is one such place
where some good money can be made. Commodity prices are on the rise and the further
outlook for the boom in these markets is positive. Analysts expect the commodity market to
provide hefty returns to the investor‘s money.
Investors at this time are facing the all-important question of how to insulate themselves from
this heavy volatility? To answer this question, let us look at the options available for an
equity investor. There are three main investment avenues for a person wishing to invest in
equities. These are direct equities, equity mutual funds and portfolio management schemes.
Many investors prefer direct equities, since it gives them the freedom to make their own
decisions and adequate flexibility to manage their portfolios.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 7/91
However, most investors are lost as to what and when they should buy or sell, and often rely
on market tips, which can be dangerous. Others prefer mutual funds, especially through the
systematic investment plan route, since it gives them professional fund management expertise
and zero headache, but at a higher cost.
So, in this project I will try to analyze that how the market volatility effect the Indian Stock
market and the commodity market as well as the investors who invest in Stock market. Thus,
I would like to cover certain aspects of the equity markets as a whole to find out whether it is
a safe place to invest or not.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 8/91
INTRODUCTION ABOUT TOPIC
As per the title suggest the project report has been prepared regarding the scope and
current scenario of online trading in Indian equity market. Online trading was initiated byNSE in India and soon after the other exchanges also followed it. There was a major boom in
yr. 2000 when lots of online trading companies came with a bang but only few were survived
because of lack of computer knowledge and low internet penetration.
There are two types of online trading companies one is the banking online trading companies
and the other is non-banking trading.
A few examples of banking online trading companies are HDFC securities, ICICI direct.com,
UTI securities etc.
On the other hand non banking trading companies are Nirmal Bang, sharekhan.com, Angel
Broking, Reliance Money etc.
Today online trading contributes are about 8-10%. It is continuously growing and has a huge
market potential.
A study was undertaken to determine the growth of various online trading companies in Indiain terms of trade done by them through online and services provided by them. Major findings
indicates that out of a survey of 100 respondents it was seen that 77 investors prefer online
trading because of few major factors such as time saving convenience, protection through
Freudian brokers etc. although during my research project I‘ve seen that most of the
respondents feel online trading, a secure way of investing into stock market still a few of
them feel it unsafe and a bit complicated but they posses information about online trading.
Today the online trading companies having cut-throat competition in our offering whose
brokerage discounts lower margin money and zero balance accounts.
Due to the rising education awareness and use of internet there is a huge potential for online
trading in future and companies must come up with innovative offerings to capture the
untapped market.
A market is an environment that allows buyers and sellers to trade or exchange goods,
services, and information. These interactions define demand and supply characteristics and
are therefore fundamental to economies. A market can be defined as a place where any type
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 9/91
of trade takes place. Markets are dependent on two major participants – buyers and sellers.
Buyers and sellers typically trade goods, services and/or information. Historically, markets
were physical meeting places where buyers and sellers gathered together to trade. Although
physical markets are still vital, virtual marketplaces supported by IT networks such as the
internet have become the largest and most liquid. Some markets are very competitive, with a
number of vendors selling the same kinds of products or services. Conversely, some markets
have low or no competition, particularly if the industry is protected by government
legislation.
The number of buyers and sellers involved will have a direct bearing on the price of the good
or service to be sold, and has become known as the law of supply and demand. Where there
are more sellers than buyers, the availability of supply will push down prices. If there are
more buyers than sellers, the increased demand will push up prices.
Markets can appear spontaneously when there are goods or services to be exchanged, or they
can be planned and regulated. Free markets operate under ‗laissez-fare‘ conditions, in that the
government does not intervene in how the market operates. These markets may be distorted if
a seller gains monopoly power by managing the majority of supply (or indeed if a buyer
develops monophony power by managing demand). Governments or trade bodies often step
in when such distortions undermine the smooth functioning of free markets. The currency
markets are the largest continuously traded markets in the world. Twenty four hours a day,
seven days a week, governments, banks, investors and consumers are buying and selling
every currency, leading to massive money flows constantly changing hands. Stock markets
have become highly complex markets that allow investors to buy shares in companies or in
funds that aggregate companies or industries together. Most stock markets today are
primarily electronic networks, although they often maintain a physical location for buyers,
sellers and market makers to interact directly. Markets originally started as marketplaces
usually in the centre of villages and towns, for the sale or barter of farm produce, clothing
and tools. These kinds of street markets developed into a whole variety of consumer-oriented
markets, such as specialist markets, shopping centers, supermarkets, or even virtual markets
such as eBay. With the rising price of oil and food, commodity markets are once again under
the spotlight. Commodities underpin economic activity. Commodity markets include: energy
(oil, gas, coal and increasingly renewable energy sources such as biodiesel), soft commodities
and grains (wheat, oat, corn, rice, soya beans, coffee, cocoa, sugar, cotton, frozen orange
juice, etc), meat, and financial commodities such as bonds. Capital goods markets helpbusinesses to buy durable goods to be used in industrial and manufacturing processes. A
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 10/91
number of services can also be associated with these goods. Transactions tend to be
wholesale with large quantities of goods being transacted at low prices. Everyone has seen it
and everyone is wishing if he should have buy stocks before this rally.
Online Trading has existed amongst people for ages and with the arrival of the internet,
online trading is the buzzword of the day. With the internet as a platform it is very easy to
trade in the instruments of your choice as and when you want. Gone are the days when you
actually had to make daily rounds of the stock exchange or go to your broker. Now you
need not even make any calls but can simply trade as and when you want by the click of a
mouse. There are several web sites online that allow you to trade on the stock exchange or
the commodity exchange or any other case.
These web sites that allow online trading act as brokerages and allow you to make your
transactions using their web site. As any normal broker would do these web sites would
also charge a small brokerage fee on your every transaction. These days people want to be
trading on every thing like stocks trading, commodity trading, currency trading, futures
trading as well as on mutual funds and derivatives. Hence there are ample opportunities
for people to invest and trade in something that would give you the desired results. The
forms of trading can be done though an online brokerage.
A key to trading successfully is to have good knowledge about what is happening around
you. Yes many people try and predict what the markets are going to do next but every
future prediction is based on the present. And hence having the knowledge of what is
happening and how is it going to impact the market is necessary to make good profits. You
also need to diversify your investments. Hence you could invest a part of your total
portfolio in stocks, another part could be dedicated to currency trading, another part could
be used for commodity trading etc. This is generally done by investors so that if one market
or one form of investment is going through a bad phase then other forms of investments
will keep the portfolio in balance.
While trading it is important to remember that the markets can be a risky proposition and
hence not all your wealth or income be dedicated to trading. It is also important to
understand that the markets can be volatile at times or at times function in a very
unprecedented manner. And hence at such times it is important to have diversified your
investments in order to minimize your losses. If you are not well aware of trading then do
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 11/91
not worry for trading is no rocket science and definitely online trading is very simple to
understand. This web site will tell you about the various online web sites where you can
make an online trading account. Also the web site will throw light on what the different
forms of online trading are.
Investing online, or self-directed investing, has become the norm for individual investors
and traders over the past decade with many, if not all brokers now offering online services
with unique trading platforms
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 12/91
ABOUT NIRMAL BANG
INTRODUCTION:-
Nirmal Bang Group is one of the largest retail broking house in India, providing
the investors state of art services in capital markets in the country. The Group has
memberships of Bombay Exchange Limited, National Stock of India Limited, Multi
Commodity Exchange of India Limited, National Commodity and Derivatives Exchange
Limited and is also a depository participant of NSDL and CDS (I) L, the depositories of
the country.
They started in 1986 under Late Shri Nirmal Bang as sub brokers but have grown
steadily and progressively since then. Their clients had contributed tremendously to their
growth they recognize and applaud that, they value their relationship with the customers
and for their convenience had all investing avenues under one roof.
NIRMAL BANG consultant-
As the flagship company of the NIRMAL BANG Group, NIRMAL BANG
Private Limited has always remained at the helm of organizational affairs, pioneering
business policies, work ethic and channels of progress.
NIRMAL BANG believes that they were best positioned to venture into that
activity as a Depository Participant. They were one of the early entrants registered as
Depository Participant with NSDL (National Securities Depository Limited), the first
Depository in the country and then with CDSL (Central Depository Services Limited).
Today, It service over 1Lac customer accounts in this business spread across over 350
cities/towns in India and are ranked amongst the largest Depository Participants in the
country with a growing secondary market presence.
It has transferred this business to NIRMAL BANG SECURITIES PRIVATE
LIMITED (NBSPL), their associate and a member of NSE, BSE, MCX and NCDEX.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 13/91
NIRMAL BANG --- Early Days
The birth of NIRMAL BANG was on a modest scale in 1986. It began with the
vision and enterprise of a small group of practicing Chartered Accountants who founded
the flagship company. NIRMAL BANG Securities Private Limited. It started with
consulting and financial accounting automation, and carved inroads. Since then, They
have utilized their experience and superlative expertise to go from strength to
strength…to better their services, to provide new ones, to innovate, diversify and in the
process, evolved NIRMAL BANG as one of India‘s premier integrated financial service
enterprise.
Thus over the last 20 years NIRMAL BANG has traveled the success route,
towards building a reputation as an integrated financial services provider, offering a wide
spectrum of services. And they have made this journey by taking the route of quality
service, path breaking innovations in service, versatility in service and finally totality in
service.
Their highly qualified manpower, cutting-edge technology, comprehensive
infrastructure and total customer-focus has secured for them the position of an emerging
financial services giant enjoying the confidence and support of an enviable clientele
across diverse fields in the financial world. Their values and vision of attaining total
competence in their servicing has served as the building block for creating a great
financial enterprise, which stands solid on their fortresses of financial strength - their
various companies.
With the experience of years of holistic financial servicing behind them and years
of complete expertise in the industry to look forward to, They have now emerged as a
premier integrated financial services provider. And today, they can look with pride at the
fruits of their mastery and experience – comprehensive financial services that are
competently segregated to service and manage a diverse range of customer requirements.
Business Focus:-
The focus of the business is the Customer – Customer service, Customer education,
Customer support, Customer relations and last but not the least Customer acquisition.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 14/91
Trade execution transparency, timely settlements, risk monitoring and superior service
shall have topmost priority, in the best interests of all concerned.
VISION STATEMENT
“TO CREATE VALUABLE RELATIONSHIP AND PROVIDE THE
BEST FINANCIAL SERVICES MOST PROFESSIONALLY ”
MISSION STATEMENT
“TO WORK TOGETHER WITH INTEGRITY & MAKE OUR
CUSTOMER FEEL VALUED‖
CORE VALUE
“RESPECT OUR COLLEAGUE AND THE BUSINESS
ITSELF”
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 15/91
BOARD OF DIRECTORS
NIRMAL BANG GROUP
NAME POSITION
Mr. Dilip M. Bang Director
Mr. Kishore M. Bang Director
Mr.Rakesh Bhandari Chartered Accountant
Mr. Deepak Agarwal Chartered Accountant
Mr.Suvinay Sharma Chartered Accountant
Mr.Naresh Samdani Chartered Accountant
Mr. Deepak Patel Chartered Accountant
Mr. Sunil Jain Chartered Accountant
Mr.Anup Agarwal Chartered Accountant
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 16/91
Mr.Brijmohan Bohra Chartered Accountant
Miss. Monika Bafna Chartered Accountant
Mr.Brijmohan Bohra Chartered Accountant
]
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 17/91
Principal Activities Of
„NIRMAL BANG GROUP‟
• NIRMAL BANG Securities Private Limited
Member: National Stock Exchange of India Limited
Member: Bombay Stock Exchange Limited
Participant: National Securities Depository Limited
Participant: Central Depository Service (India) Limited
NIRMAL BANG Commodities Private Limited
Member - Multi Commodity Exchange of India Limited
Member - National Commodities and Derivatives Exchange Ltd.
BANG Equity Broking Private Limited
Member - Bombay Stock Exchange Ltd
Nadi Finance & Investment Private Limited
RBI registered Non Banking Finance Company
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 18/91
Strength:-
24 years of research and broking experience
Understandings of the markets
All financial needs under one roof
Scalable and robust infrastructure
Full fledge research unit comprising of both fundamental & technical research
Dedicated, Qualified and Loyal staff
Flexible Brokerage charges
Weakness:- Low Brand Image in the market.
Low Professionalism
Low Advertisements
Opportunity:-
Large potential market for delivery and intra-day transactions.
Open interest of the people to enter in to stock market for investing
Attract the customers who are dissatisfied with other brokers & DPs.
Up growing markets in commodity and forex trading
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 19/91
Threats:-
Decreasing rates of brokerage in the market. A Increasing competition against
other brokers & DPs.
Poor marketing activities for making the company known among the customers.
A threat of loosing clients for any kind of weakness of the company. An Indirect
threat from instable stock market, i.e., low/no profitof NIRMAL BANG's clients
would lead them to go for other broker/DP.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 20/91
“SERVICES of NIRMAL BANG”
OFFLINE:
Offline A/c is the A/c for the investors who are not familiar with the use of
computer.
The A/C opening charges applied(One time)
For 1st Year Demat A/C is Free, On 2nd Year AMC charge is applicable.
ONLINE:
Requirement for online trading:
Linked Bank Account
ONLINE
OTHER SERVICES
NIRMAL BANG SERVICES
OFFLINE
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 21/91
Benefits of online trading
Freedom from paperwork
-time portfolio tracking
OTHER SERVICES:
Dial-n-Trade
Mutual Fund
Commodity
Derivative
Depository Participants
Distribution of Financial Services
Research Based Advices
Portfolio Management System
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 22/91
DnT (Dial- n – Trade)
Dial n Trade is the name of the phone-trading facility offered by NIRMAL BANG.
A call center wholly dedicated to order placement / confirmation.
Easy 2-step process for order placement.
Step1. Enter your PHONE ID
Step2. Enter your Client Code
On successful dial, call gets transferred to call center executives.
NIRMAL BANG Securities Private Limited, one of the cornerstones of the NIRMAL
BANG edifice, flows freely towards attaining diverse goals of the customer through
varied services. Creating a plethora of opportunities for the customer by opening up
investment vistas is backed by research-based advisory services. Here, growth knows no
limits and success recognizes no boundaries. Helping the customer create waves in his
portfolio and empowering the investor completely is the ultimate goal.
Stock Broking Services
We offer trading on a vast platform; National Stock Exchange, Bombay Stock Exchange,
MCX & NCDEX. More importantly, we make trading safe to the maximum possible
extent, by accounting for several risk factors and planning accordingly. We are assisted in
this task by our in-depth research, constant feedback and sound advisory facilities. Our
highly skilled research team, comprising of technical analysts as well as fundamental
specialists, secure result-oriented information on market trends, market analysis and
market predictions.
To empower the investor further we have made serious efforts to ensure that our research
calls are disseminated systematically to all our stock broking clients through various
delivery channels like email, chat, SMS, phone calls etc.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 23/91
MUTUAL FUNDS
Introduction:
Everybody talks about mutual funds, but what exactly are they? Are they like
shares in a company, or are they like bonds and fixed deposits? Will I lose all my money
in funds or will I become an overnight millionaire? Big questions that get answer in just
five minutes.
Meaning:
A mutual fund is a pool of money that is invested according to a common
investment objective by an asset management company (AMC). The AMC offers to
invest the money of hundreds of investors according to a certain objective – to keep
money liquid or give a regular income or grow the money long term. Investors buy a
scheme if it fits in with their investment goals, like getting a regular income now or
letting the money accumulate over the long term. Investors pay a small fraction of their
total funds to the AMC each year as investment management fees.
Commodity
Organized futures market evolved in India by the setting up of "Bombay Cotton
Trade Association Ltd." in 1875. In 1893, following widespread discontent amongst
leading cotton mill owners and merchants over the functioning of the Bombay Cotton
Trade Association, a separate association by the name "Bombay Cotton Exchange Ltd."
Was constituted. A future trading in oilseeds was organized in India for the first time withthe setting up of Gujarati Vyapari Mandali in 1900, which carried on futures trading in
groundnut, castor seed and cotton. Before the Second World War broke out in 1939
several futures markets in oilseeds were functioning in Gujarat and Punjab. There were
booming activities in this market and at one time as many as 110 exchanges were
conducting forward trade in various commodities in the country.
The securities market was a poor cousin of this market as there were not many papers to
be traded at that time. The era of widespread shortages in many essential commodities
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 24/91
resulting in inflationary pressures and the tilt towards socialist policy, in which the role of
market forces for resource allocation got diminished, saw the decline of this market since
the mid-1960s.
This coupled with the regulatory constraints in 1960s, resulted in virtual dismantling of
the commodities future markets. It is only in the last decade that commodity future
exchanges have been actively encouraged. However, the markets have been thin with
poor liquidity and have not grown to any significant level.
Derivative
The emergence of the market for derivative products, most notably forwards, futures and
options, can be traced back to the willingness of risk-averse economic agents to guard
themselves against uncertainties arising out of fluctuations in asset prices. By their very
nature, the financial markets are marked by a very high degree of volatility. Through the
use of derivative products, it is possible to partially or fully transfer price risks by
locking-in asset prices. As instruments of risk management, these generally do not
influence the fluctuations in the underlying asset prices. However, by locking-in assetprices, derivative products minimize the impact of fluctuations in asset prices on the
profitability and cash flow situation of risk-averse investors.
Depository Participants
The onset of the technology revolution in financial services Industry saw the
emergence of NIRMAL BANG as an electronic custodian registered with National
Securities Depository Ltd (NSDL) and Central Securities Depository Ltd (CSDL).
NIRMAL BANG set standards enabling further comfort to the investor by promoting
paperless trading across the country and emerged as the top 3 Depository Participants
in the country in terms of customer serviced. Offering a wide trading platform with a dual
membership at both NSDL and CDSL, we are a powerful medium for trading and
settlement of dematerialized Shares. We have established live DPMs, Internet access to
accounts and an easier transaction process in order to offer more convenience to
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 25/91
individual and corporate investors. A team of professional and the latest technological
expertise allocated exclusively to our demat division including technological
enhancements like SPEED-e; make our response time quick and our delivery impeccable.
A wide national network makes our efficiencies accessible to all.
EQUITIES
CONCEPT:
In accounting and finance, equity is the residual claim or interest of the most junior
class of investors in assets, after all liabilities are paid. If liability exceeds assets, negativeequity exists. In an accounting context, Shareholders' equity (or stockholders' equity,
shareholders' funds, shareholders' capital or similar terms) represents the remaining interest in
assets of a company, spread among individual shareholders of common or preferred stock.
At the start of a business, owners put some funding into the business to
finance operations. This creates a liability on the business in the shape of capital as the
business is a separate entity from its owners. Businesses can be considered,
for accounting purposes, sums of liabilities and assets; this is the accounting equation. After
liabilities have been accounted for the positive remainder is deemed the owner's interest in
the business.
This definition is helpful in understanding the liquidation process in case
of bankruptcy. At first, all the secured creditors are paid against proceeds from assets.
Afterward, a series of creditors, ranked in priority sequence, have the next claim/right on
the residual proceeds. Ownership equity is the last or residual claim against assets, paid
only after all other creditors are paid. In such cases where even creditors could not get
enough money to pay their bills, nothing is left over to reimburse owners' equity. Thus
owners' equity is reduced to zero. Ownership equity is also known as risk capital or liable
capital.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 26/91
FACTORS THAT INFLUENCE THE PRICE OF THE STOCK:
Broadly there are two factors:
(1) Stock specific environment rather than the performance of any particular company.
Events favorable to an economy, political or regulatory environment like high economic
growth, friendly budget, stable government etc. can fuel euphoria in the investors,
resulting in a boom in the market. On the other hand, unfavorable events like war,
economic crisis, communal riots, minority government etc. depress the market
irrespective of certain companies performing well. However, the effect of market-specific
factor is generally short-term.
Despite ups and downs, price of a stock in the long run gets stabilized based on
the stock specific factors. Therefore, a prudent advice to all investors is to analyze and
invest and not speculate in share.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 27/91
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 28/91
STOCK MARKET
Stock exchange or bourse is a corporation or mutual organization which provides
facilities for stock brokers and traders, to trade company 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 and other pooled investment products and Bonds. To be able to trade a security
on a certain stock exchange, it has to be listed there.
Usually there is a central location at least for recordkeeping, but trade is less and
less linked to such a physical place, as modern markets are electronic networks, which
gives them advantages of speed and cost of transactions. Trade on an exchange is by
members only.
A stock exchange is often the most important component of a stock market. There
is usually no compulsion to issue stock via the stock exchange itself, nor must stock be
subsequently traded on the exchange. Such trading is said to be off exchange or over-the-
counter. This is the usual way that Bonds are traded.
The initial offering of stocks and bonds to investors is by definition done in the primary
market and subsequent trading is done in the secondary market.
Increasingly more and more stock exchanges are part of a global market for securities.
Supply and demand in stock a market is driven by various factors which, as in all free
markets, affect the price of stocks (see stock valuation). Although common, the term 'the
stock market' is a somewhat abstract concept for the mechanism that enables the trading
of company stocks. It is also used to describe the totality of all stocks and sometimes
other securities, with the exception of bonds, commodities, and derivatives. The term is
used especially to apply within one country as, for example, in the phrase "the stock
market was up today", or in the term "stock market bubble". Bonds are still traditionally
traded in an informal, over-the-counter) market known as the bond market. Commodities
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 29/91
are traded in commodities markets, and derivatives are traded in a variety of markets (but,
like bonds, mostly 'over-the-counter').
The stock market is distinct from a stock exchange, which is an entity (a corporation or
mutual organization) in the business of bringing buyers and sellers of stocks and
securities together. For example, 'the stock market' in the United States includes the
trading of all securities listed on the NYSE, the NASDAQ, the Amex, as well as on the
many regional exchanges, the OTCBB, and Pink Sheets. European examples of stock
exchanges include the Paris Bourse (now part of Euro next), the London Stock Exchange
and the Deutsche Börse.
STOCK EXCHANGE:-
The stock exchange is the important segment of its capital market. If the stock
exchange is well-regulated function smoothly, then it is an indicator of healthy capital
market. If the state of the stock exchange is good, the overall capital market will grow
and otherwise it can suffer a great set back which is not good for the country. The
government at various stages controls the stock market and the capitals market.
A capital market deals in financial assets, excluding coin and currency. Banking
accounts compromises the majority of financial assets. Pension and provident funds
insurance policies shares and securities.
Financial assets are claim of holders over issuer (business firms and
governments). They enter low different segment of financial market.
Those having short maturities that are non transferable like bank savings and
current accounts set the identification of the monetary financial assets. This market is
known as money market, Equity, Preferential shares and bonds and debentures issued by
companies and securities issued by the government constitute the financial assets, which
are traded in the capital market.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 30/91
Money Market and Capital Market:-
Both money market and capital market constitute the financial market.
Capital market generally known as stock exchange. This is a institution around which
every activity of national capital market revolves. Through the medium stock exchange
the investor gets on impetus and motivations to invest in securities without which they
would not be able to liquidate the securities. If there would have been no stock exchange
many of the savers would have hold their saving either in cash i.e. idle or in bank with
low interest rate or low returns. the stock exchange provides the opportunity to investors
for the continuous trading in securities. It is continuously engaged in the capital
mobilization process.
Another consequence of non-existence of stock exchange would have been low saving of
the community, which means low investment and lower development of the country.
S - Securities provide for investor.
T - Tax Benefits planning and exemption.
O - Optimum return on investment.
C - Cautious Approach.
K - Knowledge of Market.
Ex - Exchange of Securities Transacted.
C - Cyclopedia of Listed Companies.
H - High Yield.
A - Authentic Information
N - New Entrepreneur encouraged.
G - Guidance of Investor & Company.
E - Equity
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 31/91
HISTORY OF THE STOCK MARKET
In 12th century France the courratiers de change were concerned with managing
and regulating the debts of agricultural communities on behalf of the banks. As these men
also traded in debts, they could be called the first brokers. Some stories suggest that the
origins of the term "bourse" come from the Latin bursa meaning a bag because, in 13c.
Bruges, the sign of a purse (or perhaps three purses), hung on the front of the house
where merchants met.
However, it is more likely that in the late 13th century commodity traders in
Bruges gathered inside the house of a man called Van der Burse, and in 1309 they
institutionalized this until now informal meeting and became the "Bruges Bourse". The
idea spread quickly around Flanders and neighboring counties and "Bourses" soon
opened in Ghent and Amsterdam.
In the middle of the 13th century Venetian bankers began to trade in government
securities. In 1351 the Venetian Government outlawed spreading rumors intended to
lower the price of government funds. There were people in Pisa, Verona, Genoa and
Florence who also began trading in government securities during the 14th century.
This was only possible because these were independent city states not ruled by a
duke but a council of influential citizens. The Dutch later started joint stock companies,
which let shareholders invest in business ventures and get a share of their profits - or
losses. In 1602, the Dutch East India Company issued the first shares on the Amsterdam
Stock Exchange. It was the first company to issue stocks and bonds.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 32/91
PREDOMINANT FUNCTION OF STOCK MARKET
RAISING CAPITAL FOR BUSINESSES
The Stock Exchange provides companies with the facility to raise capital for expansion
through selling shares to the investing public.
MOBILIZING SAVINGS FOR INVESTMENT
When people draw their savings and invest in shares, it leads to a more rational
allocation of resources because funds, which could have been consumed, or kept in idle
deposits with banks, are mobilized and redirected to promote business activity with
benefits for several economic sectors such as agriculture, commerce and industry,
resulting in a stronger economic growth and higher productivity levels.
FACILITATE COMPANY GROWTH
Companies view acquisitions as an opportunity to expand product lines, increase
distribution channels, hedge against volatility, increase its market share, or acquire other
necessary business assets. A takeover bid or a merger agreement through the stock
market is the simplest and most common way to company growing by acquisition or
fusion.
REDISTRIBUTION OF WEALTH
By giving a wide spectrum of people a chance to buy shares and therefore become
part-owners (shareholders) of profitable enterprises, the stock market helps to reduce
large income inequalities. Both casual and professional stock investors through stock
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 33/91
price rise and dividends get a chance to share in the profits of promising business that
were set up by other people.
CORPORATE GOVERNANCE
By having a wide and varied scope of owners, companies generally tend to
improve on their management standards and efficiency in order to satisfy the demands of
these shareholders and the more stringent rules for public corporations by public stock
exchanges and the government. Consequently, it is alleged that public companies
(companies that are owned by shareholders who are members of the general public and
trade shares on public exchanges) tend to have better management records than privately-
held companies (those companies where shares are not publicly traded, often owned bythe company founders and/or their families and heirs, or otherwise by a small group of
investors). However, some well-documented cases are known where it is alleged that
there has been considerable slippage in corporate governance on the part of some public
companies
CREATES INVESTMENT OPPORTUNITIES FOR SMALL INVESTORS
As opposed to other businesses that require huge capital outlay, investing in
shares is open to both the large and small stock investors because a person buys the
number of shares they can afford. Therefore the Stock Exchange provides an extra source
of income to small savers.
GOVERNMENT RAISES CAPITAL FOR DEVELOPMENT PROJECTS
The Government and even local authorities like municipalities may decide to
borrow money in order to finance huge infrastructure projects such as sewerage and
water treatment works or housing estates by selling another category of securities known
as bonds. These bonds can be raised through the Stock Exchange whereby members of
the public buy them. When the Government or Municipal Council gets this alternative
source of funds, it no longer has the need to overtax the people in order to finance
development.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 34/91
IMPORTANCE OF STOCK MARKETS
FUNCTION AND PURPOSE:
Just as it is important that networks for transport, electricity and
telecommunications function properly, so is it essential that, for example, payments can
be transacted, capital can be saved and channeled to the most profitable investment
projects and that both households and firms get help in handling financial uncertainty and
risk as well as possibilities of spreading consumption over time. Financial markets
constitute an important part of the total infrastructure for every society that has passed the
stage of largely domestic economies.
The financial system performs three main tasks: firstly, it handles transfer of
payments; secondly, it channels savings to investments with a good return for future
consumption; and thirdly, it spreads and reduces (local enterprise) economic risks in
relation to the players' targeted returns (but note that systemic risk is not thereby
reduced — it merely becomes less concentrated and uneven). Moreover, unforeseen risks,
or catastrophic risks (such as the complete collapse of the financial system or governmentinstitutions), may not be capable of being spread, or insured against.
The smooth functioning of all these activities facilitates economic growth in that
lower costs and enterprise risks promote the production of goods and services as well as
employment. In this way the financial system contributes to increased prosperity.
The stock market is one of the most important sources for companies to raise
money. Experience has shown that the price of shares and other assets is an important
part of the dynamics of economic growth. Rising share prices, for instance, tend to be
associated with increased business investment and vice versa. Share prices also affect the
wealth of households and their consumption. Therefore, central banks tend to keep an
Argus eye on the control and behavior of the stock market and, in general, on the smooth
operation financial system functions. Financial stability is the raison d'être of central
banks.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 35/91
WELL KNOWN STOCK EXCHANGES
This is a list of stock exchanges that offers trading in securities besides trading in
future contracts are.
New York Stock Exchange
Tokyo Stock Exchange
NASDAQ
London stock Exchange
Euro next
Toronto Stock Exchange
Frankfurt Stock Exchange
Hong Kong Stock Exchange
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 36/91
BOMBAY STOCK EXCHANGE
Introduction:
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. BSE's pivotal and pre-eminent role in the development of the
Indian capital market is widely recognized. It migrated from the open outcry system to an
online screen-based order driven trading system in 1995. Earlier an Association of Persons (AOP), BSE is now a corporatized and demutualised entity incorporated under
the provisions of the Companies Act, 1956, pursuant to the BSE (Corporatisation and
Demutualisation) Scheme, 2005 notified by the Securities and Exchange Board of India
(SEBI). With demutualisation, BSE has two of world's best exchanges, Deutsche Bores
and Singapore Exchange, as its strategic partners.
Over the past 133 years, BSE has facilitated the growth of the Indian corporate
sector by providing it with an efficient access to resources. There is perhaps no major
corporate in India which has not sourced BSE's services in raising resources from the
capital market.
Today, 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
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 37/91
4,700 listed companies, which for easy reference, are classified into A, B, S, T and Z
groups.
The BSE Index, SENSEX, is India's first stock market index that enjoys an iconic
stature, and is tracked worldwide. It is an index of 30 stocks representing 12 major
sectors. The SENSEX is constructed on a 'free-float' methodology, and is sensitive to
market sentiments and market realities. Apart from the SENSEX, BSE offers 21 indices,
including 12 sect oral indices. BSE has entered into an index cooperation agreement with
Deutsche Bores. This agreement has made SENSEX and other BSE indices available to
investors in Europe and America. Moreover, Barclays Global Investors (BGI), the global
leader in ETFs through its shares® brand, has created the 'shares® BSE SENSEX India
Tracker' which tracks the SENSEX. The ETF enables investors in Hong Kong to take an
exposure to the Indian equity market.
The first Exchange Traded Fund (ETF) on SENSEX, called "Spice" is listed on
BSE. It brings to the investors a trading tool that can be easily used for the purposes of
investment, trading, hedging and arbitrage. Spice allows small investors to take a long-
term view of the market.
BSE provides an efficient and transparent market for trading in equity, debt
instruments and derivatives. It has a nation-wide reach with a presence in more than 359
cities and towns of India. BSE has always been at par with the international standards.
The systems and processes are designed to safeguard market integrity and enhance
transparency in operations. BSE is the first exchange in India and the second in the world
to obtain an ISO 9001:2000 certifications. It is also the first exchange in the country and
second in the world to receive Information Security Management System Standard BS
7799-2-2002 certification for its BSE On-line Trading System (BOLT).
BSE continues to innovate. In recent times, it has become the first national level
stock exchange to launch its website in Gujarati and Hindi to reach out to a larger number
of investors. It has successfully launched a reporting platform for corporate bonds in
India christened the ICDM or Indian Corporate Debt Market and a unique ticker-cum-
screen aptly named 'BSE Broadcast' which enables information dissemination to the
common man on the street.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 38/91
In 2006, BSE launched the Directors Database and ICERS (Indian Corporate
Electronic Reporting System) to facilitate information flow and increase transparency in
the Indian capital market. While the Directors Database provides a single-point access to
information on the boards of directors of listed companies, the ICERS facilitates the
corporate in sharing with BSE their corporate announcements.
BSE also has a wide range of services to empower investors and facilitate smooth
transactions:
HISTORY
For the premier stock exchange that pioneered the securities transaction business
in India, over a century of experience is a proud achievement. A lot has changed since
1875 when 318 persons by paying a then princely amount of Re. 1, became members of
what today is called Bombay Stock Exchange Limited (BSE).
Over the decades, the stock market in the country has passed through good and
bad periods. The journey in the 20th century has not been an easy one. Till the decade of
eighties, there was no measure or scale that could precisely measure the various ups and
downs in the Indian stock market. BSE, in 1986, came out with a Stock Index-SENSEX-
that subsequently became the barometer of the Indian stock market.
The launch of SENSEX in 1986 was later followed up in January 1989 by
introduction of BSE National Index (Base: 1983-84 = 100). It comprised 100 stocks
listed at five major stock exchanges in India - Mumbai, Calcutta, Delhi, Ahmadabad and
Madras. The BSE National Index was renamed BSE-100 Index from October 14, 1996
and since then, it is being calculated taking into consideration only the prices of stocks
listed at BSE. BSE launched the dollar-linked version of BSE-100 index on May 22,
2006.
With a view to provide a better representation of the increasing number of listed
companies, larger market capitalization and the new industry sectors, BSE launched on
27th May, 1994 two new index series viz., the 'BSE-200' and the 'DOLLEX-200'. Since
then, BSE has come a long way in attuning itself to the varied needs of investors and
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 39/91
market participants. In order to fulfill the need for still broader, segment-specific and
sector-specific indices, BSE has continuously been increasing the range of its indices.
BSE-500 Index and 5 sect oral indices were launched in 1999. In 2001, BSE launched
BSE-PSU Index, DOLLEX-30 and the country's first free-float based index - the BSE
TECk Index. Over the years, BSE shifted all its indices to the free-float methodology.
Some Risk management are also taken by BSE they are as follows
1. Know your client scheme
Under the procedure the member brokers of the exchange are compulsory required to
obtain detailed information of clients prior to commencement of any transactions with
new clients. A similar procedure is also to be followed for existing clients. This
information is to be made available to the exchange authorities whenever called for. In
case the member broker fails to furnish the same it is viewed seriously.
2. Verification of shares at members office
The exchange has outlined the process i.e. in case the transaction in a script with one
particular client in a settlement exceeds Rs 10 laks then the member are to send thephotocopies of the transfer deeds and the share certificates to the company/ registrar for
verification of the material particulars. The basic idea behind the introduction of this
procedure is to prevent fake/forged/stolen shares from being introduced in the market.
3. Inspection
The department is carrying out inspection of the member brokers records as regards
compliance of the risk management procedures
4. Insurance
The exchange presently has in place insurance policies to protect itself in the event of
losses on account of fire, damage to computer systems and a comprehensive policy that
covers risks faced by the exchange, its member brokers and the clearinghouse.
The risks covered under the basic cover of the policy are detailed as below.
- Loss to members on account of infidelity of employees.
- Loss of member on account of fake/forged/ stolen shares being introduced by hisclients.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 40/91
- Direct financial losses suffered by the member broker on account of physical loss,
destruction, theft or damage to securities and cash.
- Loss on account of securities lost in transit.
- Loss suffered on account of incomplete transaction.
- Loss sustained as final receiving member on exchange on account of default of
the introducing member.
- Loss on account of errors and omission.
- Directors and officials liability cover.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 41/91
NATIONAL STOCK EXCHANGE OF INDIA
NSE is mutually-owned by a set of leading financial institutions, banks, insurance
companies and The National Stock Exchange of India Limited (NSE), is a Mumbai-
based stock exchange. It is the largest stock exchange in India in terms of daily turnover
and number of trades, for both equities and derivative trading.[1]. Though a number of
other exchanges exist, NSE and the Bombay Stock Exchange are the two most significant
stock exchanges in India and between them are responsible for the vast majority of share
transactions. The NSE's key index is the S&P CNX Nifty, known as the Nifty, an index
of fifty major stocks weighted by market capitalization.
Other financial intermediaries in India but its ownership and management operate
as separate entities. There are at least 2 foreign investors NYSE Euro next and Goldman
Sachs who have taken a stake in the NSE. As of 2006[update], the NSE VSAT terminals,
2799 in total, cover more than 1500 cities across India. In October 2007, the equity
market capitalization of the companies listed on the NSE was US$ 1.46 trillion, making it
the second largest stock exchange in South Asia. NSE is the third largest Stock Exchange
in the world in terms of the number of trades in equities. It is the second fastest growing
stock exchange in the world with a recorded growth of 16.6%.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 42/91
ORIGINS-
NSE building at BKC
The National Stock Exchange of India was promoted by
leading financial institutions at the behest of the Government of
India, and was incorporated in November 1992 as a tax-paying
company. In April 1993, it was recognized as a stock exchange
under the Securities Contracts (Regulation) Act, 1956. NSE commenced operations in the
Wholesale Debt Market (WDM) segment in June 1994. The Capital Market (Equities)
segment of the NSE commenced operations in November 1994, while operations in the
Derivatives segment commenced in June 2000.
INNOVATIONS
NSE has remained in the forefront of modernization of India's capital and financial
markets, and its pioneering efforts include:
Being the first national, anonymous, electronic limit order book (LOB) exchange
to trade securities in India. Since the success of the NSE, existent market and new market
structures have followed the "NSE" model.
Setting up the first clearing corporation "National Securities Clearing Corporation
Ltd." in India. NSCCL was a landmark in providing innovation on all spot equity market
(and later, derivatives market) trades in India.
Co-promoting and setting up of National Securities Depository Limited, first
depository in India [2]. Setting up of S&P CNX Nifty.
NSE pioneered commencement of Internet Trading in February 2000, which led
to the wide popularization of the NSE in the broker community.
Being the first exchange that, in 1996, proposed exchange traded derivatives,
particularly on an equity index, in India. After four years of policy and regulatory debate
and formulation, the NSE was permitted to start trading equity derivatives
Being the first and the only exchange to trade GOLD ETFs (exchange traded
funds) in India.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 43/91
NSE has also launched the NSE-CNBC-TV18 media centre in association with
CNBC-TV18; it is the one of the most important stock exchange in the world.
S&P CNX NIFTY
S&P CNX Nifty is a well diversified 50 stock index accounting for 21 sectors of the
economy. It is used for a variety of purposes such as benchmarking fund portfolios, index
based derivatives and index funds.
S&P CNX Nifty is owned and managed by India Index Services and Products Ltd.
(IISL), which is a joint venture between NSE and CRISIL. IISL is India's first specialized
company focused upon the index as a core product. IISL has Marketing and licensing
agreement with standard & poor‘s (S&P), who world leaders are in index services.
The total traded value for the last six months of all Nifty stocks is approximately
65.68% of the traded value of all stocks on the NSE
Nifty stocks represent about 65.34% of the total market capitalization as on Mar
31, 2009.
Impact cost of the S&P CNX Nifty for a portfolio size of Rs.2 corer is 0.16%
S&P CNX Nifty is professionally maintained and is ideal for derivatives trading.
SENSEX & THE NIFTY
The SENSEX is an "index". What is an index? An index is basically an indicator.
It gives you a general idea about whether most of the stocks have gone up or most of the
stocks have gone down.
The SENSEX is an indicator of all the major companies of the BSE.
The Nifty is an indicator of all the major companies of the NSE.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 44/91
If the SENSEX goes up, it means that the prices of the stocks of most of the major
companies on the BSE have gone up. If the SENSEX goes down, this tells you that the
stock price of most of the major stocks on the BSE have gone down.
Just like the SENSEX represents the top stocks of the BSE, the Nifty represents the top
stocks of the NSE.
Just in case you are confused, the BSE is the Bombay Stock Exchange and the
NSE is the National Stock Exchange. The BSE is situated at Bombay and the NSE is
situated at Delhi. These are the major stock exchanges in the country. There are other
stock exchanges like the Calcutta Stock Exchange etc. but they are not as popular as the
BSE and the NSE.Most of the stock trading in the country is done though the BSE & the
NSE.
Besides SENSEX and the Nifty there are many other indexes. There is an index that
gives you an idea about whether the mid-cap stocks go up and down. This is called the
―BSE Mid-cap Index‖.
MANAGEMENT OF STOCK EXCHANGE
Management of stock exchange is done an elected body of members. These bodies are
known by different names in different stock exchange for example, the BOMBAY,
INDORE and AHEMDABAD stock exchange are managed by a ‗governing
board‘. ‗Council of management‘ governs the MADRAS stock exchange. A committee
manages the CALCUTTA stock exchange. While the ‘ board of director‘ manages stock
exchange.
These governing bodies are powerful bodies enjoying extensive administrative power of
management and control over their respective stock exchange the day-to-day function of
the stock exchanges are executed by the sub-committee like the ‗defaulters committee‘
‗listing committee‘, ‗settlement committee‘ etc.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 45/91
SEBI
SEBI Bhavan, Mumbai Headquarters of SEBI
ORGANIZATION DETAILS
Headquarters Mumbai, Maharashtra, India
Established 1992
Jurisdiction India
Head Chairman
Chairman C B Bhave
Term February 16, 2008 -
Total Staf f[1] 525
OFFICIAL WEBSITE
Website www.sebi.gov.in
SEBI is the Regulator for the Securities Market in India. Originally set up by the
Government of India in 1988, it acquired statutory form in 1992 with SEBI Act 1992
being passed by the Indian Parliament. Chaired by C B Bhave, SEBI is headquartered in
the popular business district of Bandra-Kurla complex in Mumbai, and has Northern,
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 46/91
Eastern, Southern and Western regional offices in New Delhi, Kolkata, Chennai and
Ahmadabad.
ORGANIZATION STRUCTURE
Chandrasekhar Bhaskar Bhave is the sixth chairman of the Securities Market Regulator.
Prior to taking charge as Chairman SEBI, he had been the chairman of NSDL (National
Securities Depository Limited) ushering in paperless securities. Prior to his stint at
NSDL, he had served SEBI as a Senior Executive Director. He is a former Indian
Administrative Service
Officer of the 1975 batch. The board comprises……
BOARD MEMBERS
Shri U. K. Sinha,
Chairman, SEBI,
SEBI Bhavan, Bandra Kurla Complex,
Bandra (E), Mumbai - 400051.
CHAIRMAN
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 47/91
T. V. Mohandas Pai
Chairman,
Manipal Universal Learning Pvt. Ltd.,
#70, Grace Towers, 3rd Floor,
Millers Road Bangalore - 560 052
Member Appointed
under Section 4(1)(d) of the SEBI Act , 1992
Shri Prashant Saran
Whole-Time Member, SEBI,
SEBI Bhavan, Bandra Kurla Complex,
Bandra (E), Mumbai - 400051.
Member Appointed
under Section 4(1)(d) of
the SEBI Act, 1992
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 48/91
Dr. Thomas Mathew
Joint Secretary (Capital Markets),
Department of Economic Affairs,
Ministry of Finance
New Delhi
Member Nominatedunder Section 4(1)(b) of
the SEBI Act, 1992
Shri V. K. Jairath
194 B Kalpatru Horizon,
S.K. Ahire Marg, Worli,
Mumbai 400018Member Appointed
under Section 4(1)(d) of
the SEBI Act , 1992
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 49/91
Shri Anand Sinha
Deputy Governor
Reserve Bank of India
Member Nominated
under Section 4 (1) (c)
of the SEBI Act, 1992
Shri D K Mittal
Secretary
Ministry of Corporate Affairs
Member Nominatedunder Section 4 (1) (b)
of the SEBI Act, 1992
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 50/91
FUNCTIONS AND RESPONSIBILITIES OF SEBI:
SEBI has to be responsive to the needs of three groups, which constitute the market:
the issuers of securities
the investors
The market intermediaries.
SEBI has three functions rolled into one body quasi-legislative, quasi-judicial and
quasi-executive. It drafts regulations in its legislative capacity, it conducts investigation
and enforcement action in its executive function and it passes rulings and orders in its
judicial capacity. Though this makes it very powerful, there is an appeals process to
create accountability. There is a Securities Appellate Tribunal which is a three member
tribunal and is presently headed by a former Chief Justice of a High court - Mr. Justice
NK Sodhi. A second appeal lies directly to the Supreme Court.
SEBI has enjoyed success as a regulator by pushing systemic reforms
aggressively and successively (e.g. the quick movement towards making the markets
electronic and paperless rolling settlement on T+2 bases). SEBI has been active in setting
up the regulations as required under law.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 51/91
ROLE OF STOCK EXCHANGES
Stock exchanges have multiple roles in the economy, this may include the following:
1. Raising capital for businesses
The Stock Exchange provides companies with the facility to raise capital for
expansion through selling shares to the investing public.
2. Mobilizing savings for investment
When people draw their savings and invest in shares, it leads to a more rational
allocation of resources because funds, which could have been consumed, or kept in idle
deposits with banks, are mobilized and redirected to promote business activity with
benefits for several economic sectors such as agriculture, commerce and industry,
resulting in stronger economic growth and higher productivity levels and firms.
3. Facilitating company growth
Companies view acquisitions as an opportunity to expand product lines, increase
distribution channels, hedge against volatility, increase its market share, or acquire other
necessary business assets. A takeover bid or a merger agreement through the stock
market is one of the simplest and most common ways for a company to grow by
acquisition or fusion.
4. Redistribution of wealth
Stock exchanges do not exist to redistribute wealth. However, both casual and
professional stock investors, through dividends and stock price increases that may result
in capital gains, will share in the wealth of profitable businesses.
5. Corporate governance
By having a wide and varied scope of owners, companies generally tend to
improve on their management standards and efficiency in order to satisfy the demands of
these shareholders and the more stringent rules for public corporations imposed by public
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 52/91
stock exchanges and the government. Consequently, it is alleged that public companies
(companies that are owned by shareholders who are members of the general public and
trade shares on public exchanges) tend to have better management records than privately-
held companies (those companies where shares are not publicly traded, often owned by
the company founders and/or their families and heirs, or otherwise by a small group of
investors). However, some well-documented cases are known where it is alleged that
there has been considerable slippage in corporate governance on the part of some public
companies. The dot-com bubble in the early 2000s, and the subprime mortgage crisis in
2007-08, are classical examples of corporate mismanagement. Companies like Pets.com
(2000), Enron Corporation (2001), One.Tel (2001), Sunbeam (2001), Web van (2001),
Adelphia (2002), MCI WorldCom (2002), Parmalat (2003), American International
Group (2008), Lehman Brothers (2008), and Satyam Computer Services (2009) were
among the most widely scrutinized by the media.
7. Creating investment opportunities for small investors
As opposed to other businesses that require huge capital outlay, investing in
shares is open to both the large and small stock investors because a person buys the
number of shares they can afford. Therefore the Stock Exchange provides the opportunityfor small investors to own shares of the same companies as large investors.
8. Government capital-raising for development projects
Governments at various levels may decide to borrow money in order to finance
infrastructure projects such as sewage and water treatment works or housing estates by
selling another category of securities known as bonds. These bonds can be raised through
the Stock Exchange whereby members of the public buy them, thus loaning money to the
government. The issuance of such bonds can obviate the need to directly tax the citizens
in order to finance development, although by securing such bonds with the full faith and
credit of the government instead of with collateral, the result is that the government must
tax the citizens or otherwise raise additional funds to make any regular coupon payments
and refund the principal when the bonds mature.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 53/91
9. Barometer of the economy
At the stock exchange, share prices rise and fall depending, largely, on market
forces. Share prices tend to rise or remain stable when companies and the economy in
general show signs of stability and growth. An economic recession, depression, or
financial crisis could eventually lead to a stock market crash. Therefore the movement of
share prices and in general of the stock indexes can be an indicator of the general trend in
the economy.
STOCK BROKERS
SEBI registered stock - brokers interested in providing Internet based trading
services will be required to apply to the respective stock exchange for a formal
permission. The stock exchange should grant approval or reject the application as the
case may be, and communicate its decision to the member within thirty calendar days of
the date of completed application submitted to the exchange.
The Exchange closely monitors outstanding position of top buying member-
brokers and top selling member-brokers on a daily basis. For this purpose, it has
developed various market monitoring reports based on certain pre-set parameters. These
reports are scrutinized by officials of the Surveillance Dept. to ascertain whether a
member-broker has built up excessive purchase or sale position compared to his normal
level of business. Further, it is examined whether purchases or sales are concentrated in
one or more scrips, whether the margin cover is adequate, whether transactions have been
entered into on behalf of institutional clients and even the quality of scrips, i.e., liquid or
illiquid is looked into in order to assess the quality of exposure. The Exchange also
scrutinizes the pay-in position of the member-brokers and the member-brokers having
larger funds pay-in positions are at times, at the discretion of the Exchange, required to
make advance pay-in on T+1 day instead of on T+2 day.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 54/91
BASIC REQUIREMENTS FOR STOCK BROKERS
Trading will be on existing stock exchanges through order routing system for
execution of trades. Therefore, stockbrokers are to comply with the following before the
start of trade on Internet.
1. The broker must have a net worth of Rs. 50 lakh if he wants to avail the facility of
Internet for his own.
2. Provision for maintenance of adequate back up system.
3. The software system to be used by him should be secured and reliable.
4. To employ the qualified staff for this purpose.
5. To send order/trade confirmation to the client also through e-mail.
6. The contract notes must be issued to the clients as per existing regulation within
24 hours of the execution of trades.
7. The broker and his client should use authentication technologies.
The above are some of the important pre-requisites for the stockbroker should intend to
take benefits of trading on Internet. However, detailed guidelines issued by the SEBI for
the stock exchange
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 55/91
KIND OF STOCK BROKERS
1. Commission Broker:-
Near about all the brokers buy and sell securities for earning a commission for
investor point of view he is the most important person and responsibility is to buy and
sell stoke for his customer. It means that he acts as an agent of investor and earns
commission for his services rendered. The broker is also an independent dealer in
securities. He purchases and sells securities in his own name but he is not allowed to deal
with non-member.
2. Jobber:-
He is a professional speculator who works for a profit called ‗turn‘ he makes a
continuous auction in the market in the stoke in which he specialized. He trades in the
market evens for small difference in the prices and helps to maintain liquidity in the stoke
exchange.
3. Floor Broker:-
The floor broker buys and sells shares for the other broker on the floor of the
exchange. He is an individual member owns his seat and receives his own commission on
the orders he execute. He helps other brokers when they are buy and as compensation
receives a portion the broker.
4. Odd lit dealer:-
For trading in stock exchange there a certain number of share a fixed to be
transacted in a lot, this is known as round lat which is usually a, 100 share a. Any thing
less than the round lot are add lot. If a person is in possession of add lot of share i.e. 10,
20, 30, 40 etc. They he will has to look for the add lot dealer.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 56/91
5. Budliwala:-
He is the person who finance or provide credit facilities to the market for this
service he charges a fees called contango or backwardation charges. The budliwala gives
a fully secured loan for period of 2 to 3 weeks.
6. Arbitrageur:-
A person who is specialist in dealing with securities in different stoke exchange
centers at the same time. He makes a profit by the difference in the piece prevailing in
different centers of the market activity. For example the rte of a certain scrip is higher in
some stoke exchange than other on. In this case the broker will buy the scrip from the
marked lower price and will sell the scrip in the market at higher price. The profit of the
arbitrageur depends on the ability to get the prices from different centers before trading in
other stoke exchanges.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 57/91
RISK MANAGEMENT IN A BROKING FIRM
Risk management in a Broking Industry is a new concept in India, since it poses
maximum risk in the financial market, managing it was felt most essential by the
regulatory bodies and exchanges. Therefore NSE introduced for the first time in India,
risk containment measures that were common internationally but were absent from the
Indian Securities Market. NSCCL has put in place a comprehensive risk management
system, which is constantly upgraded to pre-empt market failures. These measures were
taken to reduce the brokers‘ risks. Whereas SEBI has given some guidelines under
Investors Protection to protect investors risks. NSE has given the following risk
management measures
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 58/91
STOCK TRADING
OVERVIEW-
The marketing of the securities on the stock exchange can be done through member of
the stock exchange. These members can be either individuals or corporate bodies.
For the process of trading in stock exchange there is the basic need for a transaction
between an individual and the broker execute customer‘s order to buy or sell on the stock
exchange trading ring. The exchange of scrip between the member of the exchange in
from of buying or selling is called trading
Broker is the member of recognized stock exchange and helps the customers in
buying or selling the securities for the brokerage that he receives.
ONLINE TRADING
In the past, investors had to call up their brokers and place an order on the telephone. The
broker would then enter the order in their system which was linked to trading floors and
exchanges.
With the advent of the internet, investors can now enter orders directly online or even
trade with other investors via electronic communication networks (ECN). Some orders
entered online are still routed through the broker allowing agents to approve or monitor the
trades. This step assists in the protection of both the client and brokerage firm from unlawful
or incorrect trades which could af fect the client‘s portfolio or the broker‘s license.
Online brokers are most often referred to as discount brokers, due to their lower feesas opposed to full service brokers who also give advice to clients.
Before choosing to invest or trade online it is important for investors to research the
online brokers that they plan to employ, assuring that they are licensed within their state or
provincial jurisdiction
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 59/91
PROCEDURE OF TRADING
1.Select of broker
The first step is buying or selling of share is to select a broker for transaction business on
behalf of the investor. The trading of securities on the stock exchange can be done
through members of the exchange.
An investor prefers to select a broker who shall.
Act with due skill. Care and diligence in the conduct of all his business.
Not create false market either singly or in concert with other.
2.Opening An Account With The Broker
The next step to open account with the broker. It helps the investor to provide his
credit worthiness, if the clients were not to do margin money with the broker.
3.Selection Of Securities
This is application for buying securities. The investor may be consulted with
broker and take advise for selection of securities.
4.Selection Of Time For Trading
This is important to get the best advantage from buying or selling the securities.
5. Placing An Order
Various method of placing an order with the broker has been evolved to give the
broker leverage when he is on the floor of the stock exchange.
6. Preparation Of Contract Note
SEBI circular of 4th Feb. 1991 requires that all member of the recognized
stock exchange issue contract note to the investors on the execution of trade. Brokers,therefore issue contract note to the client, which gives the name of the company, price of
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 60/91
trade, brokerage, time of execution, provision regarding arbitration etc. in term of the
bye-laws of stock exchange, this is statutory requirement and mandatory.
7. Settlement
The settlement is the process where by payment is made by brokers who have
made purchase and share delivery by those brokers who have made sales.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 61/91
DAY TRADING
Day trading (and trading in general) is the buying and selling of various financial
instruments, such as futures, options, currencies, and stocks, with the goal of making a
profit from the difference between the buying price and the selling price. Day trading
differs slightly from other styles of trading in that positions are rarely (if ever) held
overnight or when the market being traded is closed.
Day trading was originally only available to financial companies (such as banks),
because only they had access to the exchanges and market data. But with recenttechnology such as the Internet, individual traders now have direct access to the same
exchanges and market data, and can make the same trades at very low cost.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 62/91
TRADING STYLES-
There are several different styles of day trading, suited to different day trader
personalities. The styles range from short term trading such as scalping where positions
are only held for a few seconds or minutes, to longer term swing and position trading
where a position may be held throughout the trading day. Most day trading systems have
a lot of flexibility, and can have open positions for anywhere from a few minutes to a few
hours, depending upon how the trade is doing (whether it is in profit). Some day traders
will trade multiple styles, but most traders will choose a single style and only take that
type of trade.
Day trading also has different types of trade, such as trend trades, counter-trend
trades, and ranging trades. Trend trades are trades in the direction of the current price
movement (i.e. buying if the price is moving up), and counter-trend trades are trades
against the direction of the current price movement (i.e. selling if the price is moving up).
Ranging trades are trades that go back and forth between two prices, and are used when
the market is moving sideways. Most day traders will choose a single type of trade, but
some traders will take different types, and choose which one to trade depending upon the
current condition of the market.
In addition to the style and type of day trading, there are other variances between
day traders. Some day traders like to make many trades throughout the trading day, while
others prefer to wait for what they consider the best conditions for their trade, and
perhaps only make one trade per day. However many trades are made, the trading process
that is used, and the desired goal of making a profit, are the same.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 63/91
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 64/91
OBJECTIVE
Primary objective of the project are:
To study about the equity market and share trading.
To analyze the product & services of Nirmal Bang & Securities Ltd.
To learn the marketing techniques that are used to acquire a client
(was the secondary objective of the summer training).
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 65/91
RESEARCH METHODOLOGY
Introduction
Research methodology is a careful investigation or inquiry in systematic
manner and finding solution to a problem under investigation. It accompanies of
defining and redefining problems formulating hypothesis or reaching conclusion and
at last carefully testing the conclusion to determine whether they fit the formulating
hypothesis. My research methodology has a specific framework for collecting the data
in an effective manner. I have taken two types of data into consideration e.g. Primary
data and secondary data.
My major emphasis is on gathering the primary data. The secondary data will be used
to more things clear.
Research in common parlance refers to a search for knowledge. One can also
define research as a scientific and systematic search for pertinent information on a
specific topic.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 66/91
RESEARCH DESIGN
Introduction
―Research design is an arrangement of conditions for collections and analysis of data
in a manner that aims to combine relevance to the research purpose with economy in
procedure.‖ The design includes an outline of what the researcher will do from writing the
hypothesis and its operational implications to the final analysis the data.
Data Collection Method
Data collection is a basic step and of vital importance. On which success or failure of
the study depends. All researchers can tap into two sources of data.
Primary Data
Secondary Data
Primary Data
Primary data are obtained by a study specifically designed to fulfill the data needs of
the problem at hand. Such data are original in character. These data are raw material. They
are the measurement observed and recorded as a part of original study. They are original in
character. The investigator or researcher directly collects this data. The basic form of
obtaining this data is by observing and questioning.
The Primary data was a detailed interview schedule with the help of a detailed questionnaire.
The samples were drawn purposively from various areas for the relevance of study. The
primary data was collected by using the questioner method.
Secondary Data
Data which are not originally collected but rather obtained from published or
unpublished sources are known as secondary data.
They are not originally drawn by the researcher as fresh data. These are collected by some
other person for this purpose and published. These types of data can be collected through
various sources.
In this present study we have used primary and secondary data source.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 67/91
Statistical Tools Used
Data is collected and analyzed by using:
Pie chart
Tables
For this, data collection method was used. In the data collection method, both primary and
secondary data were collected to meet the objectives. The primary data was collected by a
survey based on the questionnaire.
The questions were listed in a pre arranged order and the object of enquiry was revealed to
the respondents.
QUESTIONNAIRE -
Questionnaire are formal set of questions prepare to collect the
required information. This is one of the most effective and popular technique used in
surveys. However, one has to be careful while drawing up questionnaire. Before deciding
on the questions, it is important to understand the exact nature of the information required
and who should be interviewed.
A questionnaire was prepared to identify the factors affecting the employees and also to
obtain an open feedback from the employees over different issues in the organization.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 68/91
Sampling Technique
Sampling is the process of learning about the population on the basis of a sample
drawn from it. In the sampling techniques instead of every unit of the universe only a part of
universe is studied and the conclusion is drawn on that basis for the entire universe. The
process of sampling involves three elements.
Selecting the sample,
Collecting the information,
Making an Inference about the population.
In order to collect the data from the respondent, the Judgment convenience technique was
used. The respondents who were asked to fill the questionnaire are called Sampling units.
Sample Size
Size of sample means the number of sampling units selected from the population for
investigation.
The sample size which we choose was 50
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 69/91
DATA ANALYSIS
AND
INTERPRETATION
Respondents currently investing money in share market?
YES 96%
NO 4%
INTERPRETATION
1.ALMOST ALL THE RESPONDENTS ARE INVESTING MONEY IN SHARE MARKET DIRECTLY
OR INDIRECTLY
2.VERY FEW (i.e. only 3% ) ARE NOT INVESTIN MONEY IN SHARE MARKET
YES
NO
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 70/91
RESPONDENTA DEALS IN ?
EQUITY 70%
COMMODITIES 2%
MUTUAL FUNDS 88%
OTHERS 1.2%
INTERPRETATION
1. MOST OF RESPONDENTS ARE INTERESTED IN EQUITY AND MUTUAL FUNDS
2. VERY FEW FIND GOOD RETURNS IN COMMODITES AND IN OTHER MARKET INVESTMENT OPTIONS
EQUITY
COMMODITIES
MUTUAL FUNDS
OTHERS
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 71/91
RESPONDENT’S PREFERENCE FOR INVESTMENTS -
EQUITY 8%
MUTUAL FUNDS 56%
GOVERNMENT SECURITES 36%
EQUITY 8%
MUTUAL FUNDS 56%
GOVERNMENT SECURITES 36%
INTERPRETATION
Respondents prefer government securities and mutual funds for investments r
EQUITY
MUTUAL FUNDS
GOVERNMENT SECUTIES
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 72/91
RESPONDENTS GENERALLY PREFER FOLLOWING TRADING OPTION-
OFFLINE 32%
ONLINE 68%
INTERPRETATION
1. 69% RESPONDENTS FEEL ONLINE OPTION IS MORE CONVINIENT
2. REST OF THE RESPONDENTS (i.e. 39%) PREFER OFFLINE DUE TO LACK OF TIME AND
KNOLEDGE.
ONLINE
OFFLINE
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 73/91
RESPONDENTS TRADE, BEFORE ONLINE OPTION PROVIDED TO THEM-
YES 84%
NO 16%
INTERPRETATION
1.17% OF RESPONDENTS HAVE INVESTED MONEY IN SHARE MARKET BEFORE ONLINE OPTION WAS
PROVIDED, MOST OF THEM ARE TRADERS.
2. 83% OF RESPONDENTS HAVE INVESTED MONEY IN SHARE MARKET AFTER AVAILIBILITY OF ONLINE
OPTION.
YES
NO
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 74/91
RESPONDENTS GENERALLY INTERESTED IN INTRADAY OR DELIVERY-
INTRADAY 56%
DELIVERY 44%
INTERPRETATION
MORE THAN HALF (i.e. 55%) RESPONDENTS ARE INTERESRTED IN INTRADAY AS TO SAVE THEIR
BROKERAGE CHARGE AND TO MINIMIZE THE RISK MONEY BLOCKAGE.
NEARLY HALF (i.e. 45%) RESPONDENTS ARE INTERESTED IN DELIVARY AS THEY PREFER LONG
INVESTMENTS
INTRADAY
DELIVARY
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 75/91
RESPONDENTS DURATION OF HOLDING-
DAY 54%
WEEK 26%
MONTH 16%
YEAR 4%
INTERPRETATION
RESPONDENTS HOLD A PERTICULAR SHARE OF A PERTICULAR FIRM TAKING INTOCONSIDERATION NATURE OF SHARE, IT’S UTILITY, AND RETURN ASSOCIATED WITH IT.
DAY
WEEK
MONTH
YEAR
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 76/91
RESPONDANT’S PERCENTAGE OF EARNING, THEY INVEST IN SHARE MARKET-
LESS THAN 10% 16%
LESS THAN 20% 10%
LESS THAN 30% 28%
LESSTHAN 40% 14%
MORE THAN 40% 32%
INTERPRETATION
MOST OF RESPONDENTS WHO INVEST IN MARKET WITH MORE THAN 40% OF THEIR INCOME ARE
TRADERS AND MOSTLY BELOW IT ARE SHORT TIME INVESTERS WHO WANTED TO GET BENIFITE
WITH INCREASE IN MARKET.
LESS THAN 10%
LESS THAN 20%
LESS THAN 30%
LESS THAN 40%
MORE THAN 40%
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 77/91
RESPONDANTS EXPERIANCE IN SHARE MARKET-
VERY GOOD 34%
GOOD 22%
NEUTRAL 28%
BAD 14%
VERY BAD 16%
INTERPRETATION
MOST OF THE RESPONDENTS WITH RESPONCES OF BAD (14% ) AND VERY BAD (16%) ARE NEW TO
MARKET AND RESPONEDNTS WITH RESPONCES GOOD (23%) AND NEUTRAL (27%) HAVE SPEND
MORE THAN A HALF OF DECADE IN MORE IN MARKET AND RESPONDENTS WITH VERY GOOD (34%)
RESPONCE HAVE SPEND MORE A DECADE IN MARKET AND THEREFORE THEY ARE ABLE RO READ THE
BEHAVIOUR
VERY GOOD
GOOD
NEUTRAL
BAD
VERY BAD
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 78/91
RESPONDENTS CURRENT BROKER-
NIRMAL BANG 6%
KARVY 22%
INDIABULLS 16%
ANGEL 18%
SHERKHAN 24%
OTHER 14%
INTERPRETATION
AS NIRMAL BANG IS NEW TO NORTH REGION OF INDIA VERY FEW RESPONDENTS ARE AWARE OF
NIRMAL BANG REST OF THE FIRMS ARE NOT NEW TO SAME REGION AS NIRMAL BANG
NIRMAL BANG
KARVY
INDIABUULS
ANGEL
SHERKHANOTHER
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 79/91
RESPONDENTS SATISFIED WTH BROKERAGE CHARGE THEY PAY-
HIGHLY SATISFIED 12%
SATISFIED 38%
NEUTRAL 30%
DISSATISFIED 16%
HIGHLY DISSATISFIED 4%
INTERPRETATION
HIGHLY SATISFIED (12%) AND SATISSFIED (37%) RESPONDENTS ARE BIG INVESTORS AND
THEREFORE BROKERS PROVIDE THEM SPECIAL DISCOUNT AND REST OF THE RESPONDENTS i.e.ARE
PROVIDED WITH OPTIONS ACCORDING TO THEIR INVESTMENTS AND POLICIES OF BROKER FIRM.
HIGHLY SATISFIED
SATISFIED
NEUTRAL
DISSATISFIED
HIGHLT DISSATISFIED
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 80/91
RESPONDENTS ARE SATISFIED WITH ADDITIONAL SERVICES OF THEIR BROKER.
HIGHLY SATISFIED 28%
SATISFIED 32%
NEUTRAL 28%
DISSATISFIED 8%
HIGHLY DISSATISFIED 4%
INTERPRETATION
HIGHLY SATISFIED (33%) AND SATISSFIED (29%) RESPONDENTS ARE BIG INVESTORS AND
THEREFORE BROKERS PROVIDE THEM SPECIAL SERVICES AND REST OF THE RESPONDENTS WITH
RESPONCES NEUTRAL (32%) DISSATISFIED (3%) AND HIGHLY DISSATISFIED (3%) ARE PROVIDED WITH
OPTIONS ACCORDING TO THEIR INVESTMENTS AND POLICIES OF BROKER FIRM.
HIGHLY SATISFIED
SATISFIED
NEUTRAL
DISSATISFIED
HIGHL DISSATISFIED
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 81/91
RESPONDENTS ARE SATISFIED WITH RESEARCH SUGGESTIONS OF THE BROKER.
HIGHLY SATISFIED 38%
SATISFIED 30%
NEUTRAL 24%
DISSATISFIED 6%
HIGHLY DISSATISFIED 4%
37% RESPONDENTS ARE HIGHLY SATISFIED
31% RESPONDENTS ARE SATISFIED
23% RESPONDENTS FEEL MODERATELT SATISFIED
5% RESPONDENTS ARE DISSATISFIED
4% RESPONDENTS ARE HIGHLY DISSATISFIED
HIGHLY SATISFIED
SATISFIED
NEUTRAL
DISSATISFIED
HIGHLY DISSATISFIES
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 82/91
EFFICIENCY WITH WHICH RESPONDENT’S CALLS ARE RECEIVED BY EXECUTIVES-
VERY QUICKLY 30%
QUICKLY 28%
MODERATELY 24%
LATE 12%
VERY LATE 6%
INTERPRETATION
PROMPTNESS AT RECEIVING CALLS DEPENDS ON INFRASTUCTURE OF FIRM 82%
RESPONDENTS ARE SEEMED TO BE SATISFIED BUT 18% ARE NOT COMFERTABLE WITH IT
HIGHLY SATISFIED
SATISFIED
NEUTRAL
DISSATISFIED
HIGHLY DISSATISFIES
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 83/91
RESPONDENTS ARE SATISFIED WITH RELATIONSHIP-MANAGER-
HIGHLY SATISFIED 40%
SATISFIED 26%
NEUTRAL 22%
DISSATISFIED 8%
HIGHLY DISSATISFIED 2%
INTERPRETATION
EVERY BROKER TRIES TO SATISFIED IT’S CLIENTS ESPECIALLY BIG INVESTORS THEREFORE ACCORDING
TO RESEARCH
40% RESPONDENTS ARE HIGHLY SATISFIED
27% RESPONDENTS ARE SATISFIED
22% RESPONDENTS FEEL MODERATELT SATISFIED
9% RESPONDENTS ARE DISSATISFIED
2% RESPONDENTS ARE HIGHLY DISSATISFIED
HIGHLY SATISFIED
SATISFIED
NEUTRAL
DISSATISFIED
HIGHLY DISSATISFIES
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 84/91
FINDINGS
Respondents like to invest in equity market as it provides good return but according to
their risk bearing capabilities.
For investment respondents prefer mutual funds and government securities.
Online trading option have increased the scope of trading
Most of the respondents are satisfied with their current broker and services provided by
them.
More than half of respondents have good experience in market and would like to invest
further in market.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 85/91
Conclusion And Recommendation
NIRMAL BANG AND SECURITIES is a share trading broking house that deals infinancial products like mutual fund, Online and off line trading accounts. Today the
customer/ client invest their money more wisely and with minimum risk. They want
maximum returns with minimum risk. NIRMAL BANG provides these services like trading
on line and off line. For availing these services the customer must have pan card, bank
account, address proof etc.
The project given to me in the organization was ―SCOPE AND CURRENT SCENATIO
OF ONLINE TRADING IN EQUITY MARKET”.
As my first suggestion I would like to suggest increasing the number of terminal. It will
increase the convenience for both investor and dealer.
According to the data analyzed it was found that most of the customer are not aware of De-
mat A/c, so the company should adopt extensive advertising measures to promote there
financial products .
The company should also establish a library for the employees as well as clients forenhancing knowledge.
The company should attract the market more vigorously and go in for trapping more and
new customers.
The company should provide special schemes for customers with more information to
motivate them.
The company should also try their best to make the customer aware of the technical aspect of
the schemes so that the customers do not feel that they are ignorant of any fact.
More advertisement at local level is required.
Since most of the people are unaware about the NIRMAL BANG the broking company. The
company can make them aware by educating them about it with the help of road shows and
canopies.
The next suggestion I would like to suggest is the best utilization of work force.
Special care should be given to advertising, as there was lack of awareness among the people.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 86/91
LIMITATION OF STUDY
Study is completed in the period of two months.
Most of the respondents were least interested in questionnaire.
All the respondents are of Lucknow city only.
Lack of knowledge in respondents.
It was difficult to get correct information from some of the people.
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 87/91
BIBLIOGRAPHY
Investment Management, Preeti Singh
Chandra Parsanna, Financial Management
Brochures, Catalogues, Documents and Records
Websites:-
www.finpipe.com
www.amfindia.com
www.mcxindia.com
www.ncdexindia.com
www.myiris.com
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 88/91
ANNEXURE
QUESTIONNAIRE
TOPIC: - SCOPE AND CURRENT SCENARIO OF ONLINE TRADING IN EQUITY MARKET
DATE…………..
NAME…………………………...... CONTACTNO………………......................……..
ADDRESS…………………………............ AGE............................................................
E-MAIL I.D. …………………………......... OCCUPATION….........................…………………
TIME IN MARKET..............................
Q. Are you currently investing money in share market?
Yes () No ()
Q. Which section you deal in?
EQUITY () COMMODITIES () MUTUAL FUNDS () OTHERS ()
Specify………………….
Q. Which option do you prefer for investments?
EQUITY () MUTUAL FUNDS () GOVERNMENT SECURITES ()
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 89/91
Q. Which trading option do you generally prefer?
Offline () online ()
Q. Do you trade before online trading option was introduced?
Yes () no ()
Q. Which option do you generally prefer?
Intraday () delivery ()
Q. What is your duration of holding?
Day () week () month () year ()
Q. What percentage of your earning do you invest in share market?
Less than 10% () less than 20% () less than 30% ()
Less than 40% () more than 40% ()
Q. How is your experience in share market?
Very good () good () neutral ()
Bad () very bad ()
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 90/91
Q. Who is your current broker?
Nirmal bang () karvy () Indiabulls ()
Angel () sherkhan () other ()
Q. Are you satisfied with brokerage charge you pay?
HIGHLY SATISFIED () SATISFIED () NEUTRAL ()
DISSATISFIED () HIGHLY DISSATISFIED ()
Q. Are you satisfied with additional services of your broker ?
HIGHLY SATISFIED () SATISFIED () NEUTRAL ()
DISSATISFIED () HIGHLY DISSATISFIED ()
Q. Are you satisfied with research suggestions of your broker?
HIGHLY SATISFIED () SATISFIED () NEUTRAL ()
DISSATISFIED () HIGHLY DISSATISFIED ()
Q. How promptly your calls are received by executives?
VERY QUICKLY () QUICKLY () MODERATELY ()
LATE () VERY LATE ()
8/3/2019 Share Trading for JUJU
http://slidepdf.com/reader/full/share-trading-for-juju 91/91
Q. How satisfied are you with your relation ship manager?
HIGHLY SATISFIED () SATISFIED () NEUTRAL ()
DISSATISFIED () HIGHLY DISSATISFIED ()