A REPORT

ON
A STUDY ON INVESTOR’S PERCEPTION
TOWARDS ONLINE TRADING

BY
ANKEM LAKSHMI PRADEEP

RELIGARE SECURITIES LTD

MATS School of Business & IT

BANGALORE
2006-2008

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ACKNOWLEDGEMENT:

The satisfaction that is generated by the successful completion of a task would

remain unfulfilled without mentioning people who have encouraged and guided at
every step toward the completion of the task.
I express my sincere thanks to Prof. NVH Krishnan and Prof.
Udayachandra, Deans of MATS School of Business and IT, Bangalore, for their
valuable suggestions and help to prepare this project.
I express my deep sense of gratitude to my external guide Mrs. Bernali &
Mr.Dhimant (Manager online trading), Mr.vijay, mr.Tarique, Mr.pardeep, &
Mr. Manish for offering me suggestions and help in successfully completing my
project report. . He has been a constant source of inspiration and motivation.
I wish to take this opportunity to express my deep sense of gratitude to Dr
R K Panigrahi , MATS School of Business, Bangalore, for his invaluable
guidance in this endeavor. I sincerely thank him for his suggestions and help to
prepare this report
I would like to express my sincere thank all the department heads, in-charge and
the administrative staff of the organizations for giving me relevant information
and support required to complete my study.
I humbly acknowledge there is always some scope for further improvement
and to that end sincerely I invite valuable suggestions of your by which my future
assignments, projects could be benefited

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3
INTRODUCTION

Constructive uses of new technologies have always contributed positively

towards improving human life standards and the economy of a country .Such as
online trading, in equity markets it increased trade volumes and number of
investors trading in stock markets. Online trading was started in India in the year
1995,where a new system is formed which allows the investor to trade through an
internet site where banks and demat accounts are electronically integrated .Such
services are provided by many financial institutions like ICICI, Religare, HDFC,
India bulls and so on.

Data Collection Methods:

A)Primary Data – Interview will be collected with trading advisors, investors and
company professionals and questionnaires will be collected from targeted
customers.
B)Secondary Data
• Company records and reports
• Magazines, journals, pamphlets, advertisements.
• Standard reference textbooks
• Websites like nseindia.com and money control.com
The purpose of using the secondary data is to increase the accuracy of analysis.

1.5 PLACE OF THE STUDY

The study was conducted in Bangalore.

Limitations to the study

 Getting appropriate response from the respondents
 Getting appointment from the investors.
 The study is limited to the curriculum.

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Literature Review
“Marketing management 12e-Analysing consumer markets” by Philip
Kotler states that perceptions are more important than reality and it affects the
consumers actual behaviour.Perception is defined as the process by which an
individual selects,organizes,and interprets information inputs to create a
meaningful picture of the world.

“Online stock trading in India: An empirical investigation”

In 2007,Nidhi walia and Ravinder kumar’s research report examined the
investor’s preference for traditional trading and online trading, investor’s
perception on online trading and comparing current usage of online trading and
offline trading. This study reveals that out of every 100 investors only 28 trade
online, which points out a question as why investors were not able to realize the
importance of technology in stock trading.
Online trading has gained momentum from just 0.5% of total traded
volumes 5 Years back, which now accounts for 5% of the total trading volume of
approximately Rs 14000 Cr on NSE. Over the past 2 years, the value of all trades
executed through internet on NSE has grown from less than Rs 100 cr in June
2003 to over Rs 700 Cr in June 2005.
The major findings of the study are that Indian investors are more
conservative, they do not change easily and indian traditional traders still choose
brokers for trading ,whereas net traders are more comfortable with online trading
for its transparency and complete control of the terminal.

Understanding and managing customers perceptions

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In September 2006, “Effective executive” special edition speaks about
understanding customers perception to get a distinctive competitive advantage in
the market.

Internet trading in India is discussed in chapter 11,Dalal street journal’s stock

market book, which highlights the introduction to online trading, advantages and
disadvantages of it and value added services provided by online trading service
providers.

Trading:
Trading is defined as buying and selling shares in stock exchange. There are two
types of trading i.e. Online trading(via internet) and Offline trading(via broker or
call).

Online Trading:
Online trading refers to trading via the internet .The onset of online trading
changed the traditional value proposition of trading ,allowing online brokers to
supply investors with rich ,interactive information in real time including market
updates ,investment research and robust analytics. The result is an integrated
trading experience that combines execution with interactive analysis shown by the
growth of the online customer community from a mere 23000 average trades on
NSE per day in a year 2000 to over 52000 average trades in 2002.

Advantages of Online trading :

1 Time:

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 Customers can trade online with a real time basis and buying and selling of
shares happens with a press of a button.

2 Flexibility:
Customers can modify the placing orders according to the market
movements.
3 Standardized Procedure:
When the order is accepted by the exchange ,it will give pay-in and pay-out
dates and customer can easily expect the cash or shares to be credited to his
account.
4 One stop shop:
Bank statements and transaction statements can be viewed at the click of a
button.
5 Informed Research:
Service providers carry stock analysis like intraday and EOD(End of day)
technical charting which helps the customer to make right choices
6 Flexibility of timing
Customers can place orders before start of a trading session.

Disadvantages of Online Trading:

1 Limited Knowledge:
In online terminal, investor can’t get customized expert advice, whereas
in offline the broker gives suggestions according to investors strategy (i.e.
short term or long-term)

2 Brokerage is high compared to offline.

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 3 Privacy is less due to hacking scandals

4 Transactional errors due to technical problems

Value added services

1 Trading in shares
1 Spot Trading: When an investor is looking at an immediate liquidity
option . ‘Cash on spot’, money is credited to his bank a/c the same evening
and not on the exchange pay-out date. This money can then be withdrawn
from any of bank ATMs.
2 BTST: Buy today and sell tomorrow is a facility that allows investor to
sell shares even one day after the buy order date ,without investor having to
wait for the receipt of shares into his demat a/c.
3 Trading on NSE/BSE: Through some of the service providers, we can
trade on both NSE and BSE
4 Margin Trading :Investor can trade an intra-settlement trading up to
4 times of the investor’s available funds ,wherein investor take long
buy/short sell positions in stocks with the intention of squaring off the
position within the same settlement cycle.

2 Investing in Mutual funds: Some of the major service providers bring the same
convenience while investing in Mutual Funds as well as Hassle free and paperless
investing.
Once the investor place a request for investing in a particular fund, there are no
manual process involved .Investor’s funds are automatically debited or credited
while simultaneously crediting or debiting investors unit holdings.

3 Derivatives:

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 Futures: Through online trading service providers, one can trade in index and
stock futures on the NSE. In futures trading, investor takes buy/sell positions in
index or stocks contracts having a long contract period of up to 3 months.

Options: Through online trading service providers ,one can trade in index and
stock options.

4 IPO’s Online: Investors could also invest in Initial Public Offers(IPO’s) online
without going through the hassles of filling any application form/paperwork. They
can get in-depth analysis of new IPO’s issues (Initial Public Offerings) that are
likely to hit the market and analysis on these. IPO calendar ,recent IPO listings,
prospectus/offer documents ,and IPO analysis are also provided.

5 Other services: Displaying indices of major world markets, nifty futures, daily
share prices of all scrip’s ,monthly and yearly highs/lows of share prices are listed,
technical charts of intraday and EOD(End of Day) are also provided. Company
profiles, breaking news and snapshots of latest developments in the market are
displayed in the website.

The major internet service trading providers in the Indian markets are Religare,
HDFC, ICICIdirect, Share khan and India bulls. The major comparative analysis
parameters taken by customers are a/c opening charges, brokerage and annual
charges.

Scope for online Trading:

“Profiling internet shoppers: A study of expected adoption of online shopping
in India”, a research paper submitted by Darshan Parikh suggests that the
continuous growth in the number of internet users and broadband subscribers, and

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the rapid pace of technological improvements and innovations also held the
promise of greater acceptance of the digital medium by consumers.
Understanding online Investors perception is a major marketing challenge in
financial service sector because lack of awareness in the minds of customers about
the emerging financial service products, frequent scams , privacy and non-
compliance of rules etc. in the financial service industry is resulting in the loss of
confidence of the investors. Interference of regulatory bodies like SEBI and often
changes in the guidelines and policies of these regulatory bodies. Confused
government policies with regarding to tax and legal issues also affect marketing of
the financial products.

CRM(Customer Relationship Management)-a digital perspective:

“CRM(Customer Relationship Management)-a digital perspective” by Dr S V
Gole discusses about e-CRM, critical aspects of CRM and advantages of applying
CRM digitally. CRM provides means and methods to enhance the experience of
the individual customers so that they will remain loyal and provides technical and
functional tools for customer identification , capturing and retention.
e-CRM helps internet trading service providers in segmenting, targeting and
positioning the market. It also helps in identifying potential traders and provide
more value added services like flexible brokerage charges and giving more
exposure in the investments.

The Characteristics of online Investors:

This article is taken in “Journal of Behavioral science” submitted by Konnari
Uchida. It explores the characteristics of Japanese online investors. Main findings
of the research are young men are more likely to engage in online trading
,employed investors trade online more frequently ,implying that proximity to the
information network of the workplace investor decisions to trade online. Japanese
online investors prefer capital gains, do not prefer low-volatility stocks, refer to

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chart data when making investing decisions more frequently , and tend to choose
stocks to buy and sell on their own.

OBJECTIVES OF THE STUDY

The main objectives of the study are:

 To study investor’s perception on online trading like safety regarding
online frauds ,transaction errors and speed/connectivity problems.
 To identify innovative value added services
 To identify STP(Segmentation, Targeting and Positioning) strategy for
online trading
 To study a comparative analysis on the services provided by major online
trading service providers in the market.
 To identify customer rankings on user friendliness of online terminal
 To help the company in building a strategy for their online services.
 To study CRM aspects in online trading services.

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12
 FINANCIAL SERVICES SECTOR

INTRODUCTION:

Financial services are vital tools of machinery for economy and they lubricate
the wheels of economic development. In advanced nations, giant economies like
USA,UK,Japan,etc..,.major portion of the national income is accounted from the
services sector and minimum from the product sector.

Indian economy has undergone a sea change in its structure, policy and
regulation, due to liberalization and globalization, since 1991.Markets for services
are no exception to this. The contribution of service sector (including financial
services sector) for GDP has increased to 51% in 2003,from 36 % in 1980.The
financial service sector include factoring, merchant banking, venture capital ,etc.

Financial services like banking, merchant banking, factoring, Insurance, Venture

capital ,act as vital machinery of an economy. These financial services that
facilitate, financial transactions of individuals and institutional services resulting
in their resources allocation activities through time. The sector that deals with such
financial services is known as “financial services sector”. Once the economy
crosses the subsistence level, financial services become more prominent and
important to that economy. Financial services in current days are emerging as a
crucial industry world over and is termed as a sun rise industry. The services
offered by this sector not only raise the required funds, but also lead to the
efficient management of funds.Today,the financial service products, as turned out

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to by financial services industry are innovative and paving ways for vivid
opportunities for further economic development.

Share of service sector in GDP

60

50

40
% of share

India
30
China
20

10

0
1980 1990 2000 2001 2002 2003
Year

Emergence of financial services industry in India

Services sector industry has started gaining large scale momentum since the
process of liberalization in 1991.Prior to its contribution to GDP was around 40
% ,but since 1992 it has been grown rapidly and reached a value of 51 %
GDP.Contribution of service sector to GNP in advanced counties like USA is as
high as 75%.In India many innovative financial products and services like credit
cards,ATMs,consumer finance, venture financing have been emerging since 1980s
And these financial services have become an integral component of Indian
financial system. This integration is largely attributed to the liberalization of
economic policies and deregulation that led to economic changes ,development
and contemporary evolution of capital market and financial dis-intermediation.

The far-reaching change in the Indian economy since liberalization in the

early 1990s have had a deep impact on the Indian financial sector. The

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financial sector has gone through a complex and sometimes painful process of
restructuring, capitalizing on new opportunities as well as responding to new
Challenges. During the last decade, there has been a broadening and deepening of
financial markets. Several new instruments and products have been introduced.
Existing sectors have been opened to new private players. This has given a strong
impetus to the development and modernization of the financial sector. New
players have adopted international best practices and modern technology to offer a
more sophisticated range of financial services to corporate and retail customers.
This process has clearly improved the range of financial services and service
providers available to Indian customers.
The entry of new players has led to even existing players upgrading their product
offerings and distribution channels. This continued to be witnessed in 2002-03
across key sectors like commercial banking and insurance, where private players
achieved significant success.

These changes have taken place against a wider systemic backdrop of easing
of controls on interest rates and their realignment with market rates, gradual
reduction in resource pre-emption by the government, relaxation of
stipulations on concessional lending and removal of access to concessional
resources for financial institutions. Over the past few years, the sector has also
witnessed substantial progress in regulation and supervision. Financial
intermediaries have gradually moved to internationally acceptable norms for
income recognition, asset classification, and provisioning and capital adequacy.

This process continued in 2002-03, with RBI announcing guidelines for

risk-based supervision and consolidated supervision. While maintaining its
soft interest rate stance, RBI cautioned banks against taking large interest rate
risks, and advocated a move towards a floating rate interest rate structure. The past
decade was also an eventful one for the Indian capital markets.

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Reforms, particularly the establishment and empowerment of securities and
Exchange Board of India (SEBI), market-determined prices and allocation of
resources, screen-based nation-wide trading,dematerialisation and electronic
transfer of securities, rolling settlement and derivatives trading have greatly
improved both the regulatory framework and efficiency of trading and
settlement.
On account of the subdued global economic conditions and the impact on the
Indian economy of the drought conditions prevailing in the country, 2002-03 was
a subdued year for equity markets. Despite this, the National Stock Exchange
(NSE) and the Bombay Stock Exchange (BSE) ranked
third and sixth respectively among all exchanges in the world with respect to the
number of transactions. The year also witnessed the grant of approval for setting
up of a multicommodity exchange for trading of various commodities.

The US$ 28 billion Indian financial sector has grown at around 15 per cent and
has displayed stability for the last several years, even when other markets in the
Asian region were facing a crisis. This stability was ensured through the resilience
that has been built into the system over time. The financial sector has kept pace
with the growing needs of corporate and other borrowers. Banks, capital market
participants and insurers have developed a wide range of products and services to
suit varied customer requirements. The Reserve Bank of India (RBI) has
successfully introduced a regime where interest rates are more in line with market
forces.

Financial institutions have combated the reduction in interest rates and pressure on
their margins by constantly innovating and targeting attractive consumer
segments. Banks and trade financiers have also played an important role in

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promoting foreign trade of the country. Here we will study the three industries
with respect to India.

INSURANCE AND INDIA

The insurance sector in India has come a full circle from being an open
competitive market to nationalization and back to a liberalized market again.
Tracing the developments in the Indian insurance sector reveals the 360 degree
turn witnessed over a period of almost two centuries.

A brief history of the Insurance sector

The business of life insurance in India in its existing form started in India in the
year 1818 with the establishment of the Oriental Life Insurance Company in
Calcutta. Some of the important milestones in the life insurance business in India
are:
1912: The Indian Life Assurance Companies Act enacted as the first statute to
regulate the life insurance business.
1928: The Indian Insurance Companies Act enacted to enable the government to
collect statistical information about both life and non-life insurance businesses.
1938: Earlier legislation consolidated and amended to by the Insurance Act with
the objective of protecting the interests of the insuring public.
1956: 245 Indian and foreign insurers and provident societies taken over by the
central government and nationalized. LIC formed by an Act of Parliament, viz.
LIC Act, 1956, with a capital contribution of Rs. 5 crore from the Government of
India. The General insurance business in India, on the other hand, can trace its
roots to the Triton Insurance Company Ltd., the first general insurance company
established in the year 1850 in Calcutta by the British.

Some of the important milestones in the general insurance business in India are:
1907: The Indian Mercantile Insurance Ltd. set up, the first company to transact
all classes of general insurance business.
1957: General Insurance Council, a wing of the Insurance Association of India,
frames a code of conduct for ensuring fair conduct and sound business practices.
1968: The Insurance Act amended to regulate investments and set minimum
solvency margins and the Tariff Advisory Committee set up.
1972: The General Insurance Business (Nationalization) Act, 1972 nationalized
the general insurance business in India with effect from 1st January 1973.
107 insurers amalgamated and grouped into four companies viz.
the National

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Insurance Company Ltd., the New India Assurance Company Ltd.,
the
Oriental Insurance Company Ltd. and the United India Insurance
Company
Ltd. GIC incorporated as a company.

Key Players in insurance Sector of India

 Reliance General Insurance Company Ltd

 Life Insurance Corporation of India
 HDFC Insurance
 Kotak Mahindra
 ICICI Prudential
 SBI Life Insurance Company Ltd
 Oriental Insurance Company Ltd
 National Insurance Company Ltd
 Bajaj Allianz Life Insurance Company Ltd

MUTUAL FUNDS AND INDIA

Let us start the discussion of the performance of mutual funds in India from the
day the concept of mutual fund took birth in India. The year was 1963. Unit Trust
of India invited investors or rather to those who believed in savings, to park their
money in UTI Mutual Fund.

For 30 years it goaled without a single second player. Though the 1988 year saw
some new mutual fund companies, but UTI remained in a monopoly position.
The performance of mutual funds in India in the initial phase was not even closer
to satisfactory level. People rarely understood, and of course investing was out of
question. But yes, some 24 million shareholders was accustomed with guaranteed
high returns by the beginning of liberalization of the industry in 1992. This good
record of UTI became marketing tool for new entrants. The expectations of
investors touched the sky in profitability factor. However, people were miles away
from the preparedness of risks factor after the liberalization.

The Assets Under Management of UTI was Rs. 67bn. by the end of 1987. Let me
concentrate about the performance of mutual funds in India through figures. From

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Rs. 67bn. the Assets Under Management rose to Rs. 470 bn. in March 1993 and
the figure had a three times higher performance by April 2004. It rose as high as
Rs.1,540bn.

The net asset value (NAV) of mutual funds in India declined when stock prices
started falling in the year 1992. Those days, the market regulations did not allow
portfolio shifts into alternative investments. There were rather no choice apart
from holding the cash or to further continue investing in shares. One more thing to
be noted, since only closed-end funds were floated in the market, the investors
disinvested by selling at a loss in the secondary market.
The performance of mutual funds in India suffered qualitatively. The 1992 stock
market scandal, the losses by disinvestments and of course the lack of transparent
rules in the whereabouts rocked confidence among the investors. Partly owing to a
relatively weak stock market performance, mutual funds have not yet recovered,
with funds trading at an average discount of 1020 percent of their net asset value.

The supervisory authority adopted a set of measures to create a transparent and

competitive environment in mutual funds. Some of them were like relaxing
investment restrictions into the market, introduction of open-ended funds, and
paving the gateway for mutual funds to launch pension schemes.

The measure was taken to make mutual funds the key instrument for long-term
saving. The more the variety offered, the quantitative will be investors.

At last to mention, as long as mutual fund companies are performing with lower
risks and higher profitability within a short span of time, more and more people
will be inclined to invest until and unless they are fully educated with the dos and
don’ts of mutual funds.

Key Players in Mutual Funds Sector in India

 ABN AMRO Mutual Fund.

 Birla Sun Life Mutual Fund.
 Bank of Baroda Mutual Fund (BOB Mutual Fund). .
 ING Vysya Mutual Fund.
 Prudential ICICI Mutual Fund.
 Sahara Mutual Fund.
 State Bank of India Mutual Fund.
 Tata Mutual Fund.

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DEMAT ACCOUNT AND INDIA

There are quite a few institutions that are directly and/or indirectly connected with
dematerialized operations of securities. Understanding the inter-linkages and
functional responsibilities of these institutions will help us to have correct and
holistic perspective about functioning of dematerialization. The institutions
connected with demat operations include; a) Depositories, b) Stock Exchanges
(SEs), c) Clearing Corporations (CCs) / Clearing Houses (CHs), d) Depository
Participants (DPs), e) Registrars and Transfer Agents (RTAs). Both the
depositories NSDL and CDSL are primarily promoted by the two leading stock
exchanges viz., National Stock Exchange of India Ltd (NSE) and The Stock
Exchange, Mumbai (BSE) respectively. Besides, there are many other institutional
promoters in both the depositories. Both are registered as organizations-for-profit
and professionally managed. Inter-connectivity between these two depositories has
been established, thus DPs and investors can transfer smoothly their shares from
one account to another between the depositories. Most of the stock exchanges are
connected with the depositories to provide trading in dematerialization segment.
Eventually, all the exchanges will be connected to either of or both the
depositories. Resultantly, functioning of exchanges altered with the
commencement of depositories; shorter trade cycles, negligible bad-deliveries,
immediate transfer of beneficial ownership and lower transaction costs. An in-
depth study on transaction cost for equity shares in India by Raju (2000) revealed
substantial decrease in transaction costs and observed that the dematerialization as
one of the important factor for this trend.

Functioning of clearing corporations / clearing houses materially changed after the

entry of depositories; reduced manpower requirements and faster clearing
operations. It also helped them to diversify into related businesses such as on-line
stock lending. Depository participants are the new commercial intermediaries that
sprang up. They interpose between investor and depository. It can be stated that
they are the back-bone for the success of dematerialization. RTAs facilitate
dematerialisation and rematerialisation of shares.

Major Players In Online Trading Brokerage Houses in India

 ICICI Securities Ltd.
 Kotak Securities Ltd.
 India bulls Financial Services Limited
 India Infoline
 IL&FS investmart Limited
 SSKI Ltd.

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  Motilal Oswal Securities
 Religare Securities Ltd.
 Geojit Securities
 HDFC Securities

Online Trading: Indian scenario

In the Indian context ,online trading can be rightly called as a recent

phenomenon ,which took root with the change of century i.e. April 2000,and even
till day online trading is not much popular among investors for which a list of
factors can be blamed. This fact is more clear from the information available that
where number of stocks exchanges in India has grown from 7 exchanges in 1946
to total 23 exchanges till 2005,only 2 stock exchanges are providing online share
trading .Indian stock exchanges have started adopting technology because it
provides the necessary impetus for the organization to retain its competitive edge
and ensure timeliness and satisfaction in customer service.

Market share in Online Trading

Others
24%
ICICIdirect
ICICIdirect India Bulls
50% Others
India Bulls
26%

Online trading has gained momentum from just 0.5% of total traded volumes 5
Yrs back, which now account for 5% of total trading volume of approximately Rs
14000 Cr. On Once-Over the past two years ,the value of all trades executed
through internet on NSE has grown from less than Rs 100 Cr in June 2003 to over
Rs 700 Cr in June 2005.Online trading is growing by 150 % per annum.Now NSE
has 108 registered brokers and 1.053 million internet trading subscribers.

However mainly 5 companies control 90 % of the market in Internet

trading.ICICIdirect.com has around 50 % market share ,whereas India Bulls hold
26% share ,other dominant players are Kotak securities and Share Khan .ICICI has

21
been able to gain its dominant presence in Internet trading because they have
strong connectivity of stock trading,demat account, bank account ,etc.ICICIDirect
has recorded 6,75,000 registered customers and has become 10th largest online
broker in US whereas share khan and 5paisa are loosing their way.

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 Company profile
Religare Securities Ltd.

Religare Securities Ltd is a Ranbaxy promoter group company, is one of India’s

largest and fastest growing integrated financial services institutions. The company
offers a large and diverse bouquet of services ranging from equities, commodities,
insurance broking, to wealth advisory, portfolio management services, personal
finance services, Investment banking and institutional broking services. The
services are broadly clubbed across three key business verticals- Retail, Wealth
management and the Institutional spectrum. Religare Enterprises Limited is the
holding company for all its businesses, structured and being operated through
various subsidiaries.

Religare’s retail network spreads across the length and breadth of the country with
its presence through more than 900 locations across more than 300 cities and
towns. Having spread itself fairly well across the country and with the promise of
not resting on its laurels, it has also aggressively started eyeing global
geographies.

Vision

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To build Religare as a globally trusted brand in the financial services domain and
present it as the ‘Investment Gateway of India’

Mission

Providing financial care driven by the core values of diligence and transparency.

Brand Essence

Religare is driven by ethical and dynamic processes for wealth creation

KEY PERSONS

Mr. Sunil Godhwani - CEO & Managing Director, Religare Enterprises Limited

Mr. Shachindra Nath - Group Chief Operating Officer, Religare Enterprises

Limited

Mr. Anil Saxena - Group Chief Financial Officer, Religare Enterprises Limited

SERVICES RENDERED by Religare Securities Ltd:

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 Equity & Derivative
Trading
Lending Services Institutional Distribution
Services

Insurance Broking
Depository
Services
Private Equity

Commodities
Internet Broking
Trading Services

International
Investment
Wealth Equity &
Banking
Management Commodities
Services

EQUITY AND DERIVATIVE TRADING:

The term equity derivative describes a class of financial instruments whose value
is at least partly derived from one or more underlying equity securities. Market
participants trade equity derivatives in order to transfer or transform certain risks
associated the underlying. Options are by far the most common equity derivative,
however there are many other types of equity derivatives that are actively traded.

INSTITUTIONAL DISTRIBUTON SERVICE

The Client Service Manager will be responsible for all aspects of client reporting
for institutional investment clients and industry organizations. The candidate will
also be responsible for client servicing which includes working with clients,
internal groups and UK based portfolio management.

DEPOSITORY SERVICES

Depository is an organisation which holds your securities in electronic (also

known as
‘book entry’) form, in the same manner as a bank holds your money. Further, a

25
depository also transfers your securities without actually handling securities, in the
same
day as a bank transfers funds without actually handling cash.

COMMODITIES BROKING SERVICES

Commodity Broking Services specialises in offering online accounts to clients

wishing to deal in the Foreign Exchange, Bullion, Futures, Commodities, CFDs
and International/Domestic Equities markets all from the one account.
Commodity Broking Services specialise in offering commodity price risk
management to agricultural producers and end users.

WEALTH MANAGEMENT SERVICES

Wealth management services are provided by banks, professional trust companies,

and brokerages. For those with sizeable assets [usually over $500,000],
professional wealth management can help you plan your estate or invest your
assets based on personal criteria and financial goals.

INVESTMENT BANKING

Investment Banking is facing a strangle of challenges today – lower margins,

compliance issues, workflow disconnects and data redundancies.

Investment banks need a partner who can work in market-time to address all these
business challenges.

INSURANCE BROKING

The term Insurance Broker became a regulated term under the Insurance Brokers
(Registration) Act 1977which was designed to thwart the bogus practices of firms
holding themselves as brokers but in fact acting as representative of one or more
favoured insurance companies.
Insurance brokerage is largely associated with general insurance (car, house etc.)
rather than life insurance, although some brokers continued to provide investment
and life insurance brokerage until the onset of more onerous Financial Services
Authority regulation in 2001.
Insurance broking is carried out today by many types of organizations including
traditional brokerages, Independent Financial Advisers (IFAs) and telephone or
web-based firms.

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 SWOT ANALYSIS OF RELIGARE

STRENGTHS

• It is the Ranbaxy promoter group company.

• It has a good research team.

• No Annual maintenance charges for their online broking services.

WEAKNESS

• It has changed its name from FORTIS to RELIGARE where the maximum

Customers don’t know about this.

OPPORTUNITY

• Financial services sector in India is growing by leaps and bounds.

• In the up coming days RELIGARE is coming up with their own mutual

fund and Banking.

THREATS

• Cut-throat competition from corporate big houses like Reliance and ICICI

• As they have changed the name of their company the customer still did not
know about RELIGARE.

Products offered by Religare:

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 Religare products are well known for Online Trading ,Offline Trading,
Portfolio Management Services , Commodity Trading and Intuitional Broking
services.

1.Online Trading in Equity Markets:

Online Trading products in Equity markets are named as RACE, which is
divided into three segments ,RACE-basic, lite and Pro.

Features of RACE products:

 Fixed Brokerage and Exposure

 Call center support provided for trading, back-office and IT support
 Minimum branch level support
 Fully automated processes
 Feature-rich software
 Interest on cash margin deposited with Religare
 Target Group – Mass Market
 USP
o Interest on cash margin deposited with Religare
o Better quality product at competitive brokerage

Offline Trading Products in Equity markets are named as R-ALLY,which is

divided into
R-ALLY Classic
Trade over the phone
R-ALLY Lite
A browser based internet trading facility
R-ALLY Pro
An application based diet odin(software) over Internet

Features of R-ALLY products:

 Flexible brokerage & exposure
 No call center support
 Full branch level support
 High level of manual intervention for flexible processes
 Basic software
 No interest on cash margin
 Target Group – High Volume Traders.

2. DEPOSITORIES:

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 • Religare is among the few major Depository Participants holding securities
worth more than Rs.6000 crores under its management. RSL provides
depository services to investors as a Depository Participant with NSDL and
CDSL.
• The Depository system in India links issuers, depository participants,
depositories National Securities Depository Limited (NSDL) and Central
Depository Services (India) Limited (CDSL) and clearing house / clearing
corporation of stock exchanges. These facilitate holding of securities in
dematerialized form and securities transactions are processed by means of
account transfers.

3. PORTFOLIO MANAGEMENT:
SCHEMES:
Panther
The Panther portfolio aims to achieve higher returns by taking aggressive
positions across sectors and market capitalizations. It is suitable for the “High risk
high return” investor with a strategy to invest across sectors and take advantage of
various market conditions.
Tortoise
The Tortoise portfolio aims to achieve growth in the portfolio value over a period
of time by way of careful and judicious investment in fundamentally sound
companies having good prospects. The scheme is suitable for the “Medium Risk
Medium Return” investor with a strategy to invest in companies which have
consistency in earnings, growth and financial performances.
Elephant
The Elephant portfolio aims to generate steady returns over a longer period by
investing in securities selected only from BSE 100 and NSE 100 index. This plan

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is suitable for the “Low Risk Low Return” investor with a strategy to invest in
blue chip companies, as these companies have steady performance.
Caterpillar
The Caterpillar portfolio aims to achieve capital appreciation over a long period of
time by investing in a diversified portfolio. The investment strategy would be to
invest in scrips which are poised to get a re-rating either because of change in
business, potential fancy for a particular sector in the coming years/months,
business diversification leading to a better operating performance, stocks in their
early stages of an upturn or for those which are in sectors currently ignored by the
market.

4. INSTITUTIONAL BROKING SERVICES

The mission of this division is to institutionalize and implement a process driven

approach to cater to the needs of leading corporate houses and institutions.
The division would like to be seen as a one stop investment gateway and
knowledge repository for its clients servicing their unique and sophisticated needs.
The division is structured as a separate SBU and is housed out of Mumbai,
manned by a small yet fleet footed and extremely skilled group of top notch
professionals drawn from the best in the industry.

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