Stock broking ltd.

Executive summary
MBA10008008 KES IEMS, HUBLI Page 1
Stock broking ltd.
India is one of the countries among the fastest growing economic countries in the
world. It has emerged as the world's fastest growing wealth creator, thanks to a
buoyant stock market and higher earnings. A number of Indian companies
performing well which reflects an accelerated growth in corporate earnings.
Forty-four per cent of Top 1 Fortune ! companies are present in India.
The stock e"change comes in the secondary market. #tock e"change performs
acti$ities such as trading in %&uity share, securities, 'eri$ati$es etc. #tock
broking industry is growing at an enormous rate, as more and more people are
attracted towards stock e"changes with the hope of making profits. (rimary
in$estment ob)ecti$e of any indi$idual or organi*ation is to ma"imi*e the
+eturns and minimi*ing ,arket risk
The pro)ect deals with an introduction to stock market- how interest rate affect
on in$estment in stock market- as the in$estors are more concerned of returns
and they want to be far from risk - so I ha$e done the pro)ect on impact of
interest changes on nifty.
The core area of this pro)ect focuses on interest rate risk in$ol$ed in inde"
return of nifty indices. .hich tell an ad$isory about the risk le$el of inde"
return. This pro)ect contains some elementary statistics which are used in
calculation which help in drawing inferences.
The study is undertaken to assess /impact of interest changes on nifty0 at
1etworth 'irect, 'harwad 2ranch 34ocation Address- 5rishna ,ansion, 62
7ill +oad, 1ear 7ead (ost 8ffice, 'harwad9.
1etworth has been successfully pro$iding premium financial ser$ices and
information for more than a decade. 8ur aim has consistently been to
empower in$estors to take charge of their financial future : help them grow
their 1etworth.
1etworth has always endea$ored to make a difference in the financial ser$ices
space. It constantly focuses on scaling and upgrading the technology
infrastructure so as to pro$ide the best ser$ices to the in$estors. .e ha$e a
presence of o$er ; centers across India. .e are managed by a talented team
of o$er <=>! professionals and are ser$ing o$er 1, clients.
MBA10008008 KES IEMS, HUBLI Page <
Stock broking ltd.
Title of te !ro"ect
#Impact of interest changes on 1ifty$
%&"ective'
To understand why +2I has changed the interest rate fre&uently.
To study impact of interest rate changes on in$estment for last <
? years.
To suggest in$estors for taking better in$estment decision.
(ata )ollectio* Tools
!rimary (ata
Interaction with e"ternal and Internal @uide which helped to the study and gets right
direction to the pro)ect.
Seco*+ary (ata
Aollecting the data from 2ooks, and $arious .ebsites, this includes Alosing ,arket
$alue of stock inde" B#:( A1C 1iftyD.
Statistical Tools Use+
#tatistical tools are Arithmetic ,ean, #tandard 'e$iation, and Aorrelation.
Statistical Soft,are Use+
To calculate Arithmetic A$erage, #tandard 'e$iation, Aorrelation I am using
,#-%"cel software.
Limitatio*s
I ha$e chosen the impact interest rate changes on inde" return for last < ? year
from <1 - <1<.
The selected inde" is 1#% Bi.e. #:( A1C 1iftyD.
And I ha$e used three formulae to calculate impact interest rate change.
MBA10008008 KES IEMS, HUBLI Page ;
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-i*+i*.s'
1. There is continuous decrease in market inde" returns due to higher interest rate
risk.
<. There is continuous increase in interest rate since last < ? year that affect the
security traders because cost of borrowing would increases so that leads to earn
less return and also continuous decreases in market indices.
;. And there is both positi$e and negati$e correlation between inde" returns- it
indicates high $ariation with high risk in inde" return.
=. The high interest rate affect on infrastructure, automobile, banking sector, because
these are the few which affects more when change in interest rate than other.
!. %$en though decrease in repo rate by ! points it is not helping stock market to
get refresh to mo$e upward.
E. %$en though decrease in repo rate by ! points it is not helping stock market to
get refresh to mo$e upward.
Su..estio*s'
1. Today stock market showing negati$e sign in market mo$ement and growth, so I
would like suggest in$estors to in$est their money in go$ernment bonds to get
assured rate of return.
<. In$est in banking sector because this sector performs well for longer term when
rate $aries.
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Stock broking ltd.
;. .hen interest rate is at peak, it is better to in$est in beaten down infrastructure,
real estate stocks for &uicker return.
.
I/(UST01
!0%-ILE
MBA10008008 KES IEMS, HUBLI Page !
Stock broking ltd.
Stoc2 Mar2et %vervie, '
The main function of the stock market is to enable trade in the shares of public
companies, which in turn reflect the performance of the companies whose shares are
traded in the stock market. 7ere is pro$iding you with a detailed #tock ,arket
8$er$iew. #tock markets are also a $ital part of an economy or the economic system
of a country. Today most economies around the world are )udged by the performance
of their stock markets. The stock markets ser$e a $ital purpose in the growth and
de$elopment of a company that wants to e"pand. #uch companies with e"pansion
plans and new pro)ects are in need of funding and the stock market ser$es as the best
platform from which a company can FsellG itself to the discerning public on the basis
of merit among other things. To trade in the stock market a company has to be
absolutely transparent about its $ital fundamentals such as re$enues, income, assets,
liabilities, infrastructure, etc. as this allows the in$esting public to make a fair
assessment of the said companyGs market worth.
.ith o$er < million shareholders, India has the third largest in$estor base in
the world after the 6#A and Hapan. 8$er I, companies are listed on the stock
e"changes, which are ser$iced by appro"imately >,! stockbrokers. The Indian
capital market is significant in terms of the degree of de$elopment, $olume of trading
and its tremendous growth potential.
There are <; recogni*ed stock e"changes in India, including the 8$er the
Aounter %"change of India B8TA%ID for small and new companies and the 1ational
#tock %"change B1#%D which was set up as a model e"change to pro$ide nation-wide
ser$ices to in$estors. 1#%, which in the recent past has accounted for the largest
trading $olumes, has a fully automated screen based system that operates in the
wholesale debt market segment as well as the capital market segment.
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India's market capitali*ation was amongst the highest among the emerging
markets. Total market capitali*ation of the 2#% as on Huly ;1, 1II> was +s !,!>;.>
billion growing by 1J percent o$er a period of twel$e months and as of August <!
was o$er K! billion Babout +s << lakh croresD.
India has emerged as the worldGs 1!th largest e&uity market after it added se$eral
companies to the billion dollar club in terms of capitali*ation in the last three months,
taking the total to J1 companies. India has become the third largest Asian market
Be"cluding Hapan and AustraliaD after ha$ing toppled 5orea, Ahina and #ingapore that
ha$e J, ! and => firms with billion-dollar market capitali*ation respecti$ely. India
is also inching closer to outpacing Taiwan that has J= such companies but lags far
behind 7ong 5ong which has 1>, the highest in Asia.
As of end-,arch <, the assets under management by the Indian ,F
industry stood at a staggering +s 1,1;,! crore. .hile income funds accounted for
assets of +s =J,= crore, growth funds had assets of +s ;,E11 crore. 2alanced funds
accounted for another +s <E,>!> crore of assets as of end-,arch <. 4i&uid funds
had +s 1,!<I crore, money market funds +s EIJ crore, gilt funds +s <,;> crore and
%4## with +s ;,;E crore made up the balance.
2ombay #tock %"change B2#%3, one of the oldest in the world, accounts for
the largest number of listed companies and has also started a screen-based trading
system with the introduction of the 2ombay 8n-4ine Trading system.
The number of companies listed on the 2#% at the end of 'ecember 1II= was
=,><. This was more than the aggregate total of companies listed in I emerging
markets B,alaysia, # .Africa, ,e"ico, Taiwan, 5orea, (hilippines, Thailand, 2ra*il
and AhileD. The number of companies was also more than the in de$eloped markets of
Hapan, 65, @ermany, France, Australia, #wit*erland, Aanada and 7ong 5ong.
There is a large presence of FIIs in the Indian capital market with o$er =!1
FIIs and ;J foreign brokers registered with #%2I. The cumulati$e in$estment of FIIs
in the Indian stock market stood at 6#K E.!I billion in Huly 1IIE and 6# K1< billion
in April <. #ince Hanuary <!, FII's ha$e pumped in KJ billion into Indian
MBA10008008 KES IEMS, HUBLI Page >
Stock broking ltd.
markets, compared to KJ.! billion in entire <= and KE.E billion in entire <;.
Foreign in$estors in$ested K=.< billion in Hune-August <!, which is much higher
than the K;.=1 billion flows India recei$ed between Hanuary and ,ay.
The recent decision of the go$ernment of easing limits on inward portfolio
in$estment, with an increase in the ceiling for FII and non-resident Indians from <=
percent to ;L, pro$ides a tremendous incenti$e to FII in$estment. FIIs are also
permitted to in$est self owned funds in the debt market and in unlisted securities.
Aurrent list of debt funds appro$ed by #%2I includes 62#, 7#2A, ,organ @renfell,
2uchanan Aapital, amongst others.
The capital markets in India are regulated by the #ecurities and %"change
2oard of India B#%2ID under the pro$isions of the #ecurities Aontracts B+egulationsD
Act, 1I!E and #ecurities and %"change 2oard of India Act, 1I<<. #%2I has issued
detailed guidelines for capital issues, disclosure by public companies and in$estor
protection.
Securities Exca*.e Boar+ of I*+ia 4SEBI3
#%2I was set up as an autonomous regulatory authority by the @o$ernment of India in
1IJJ /To protect the interest of the in$estors in the securities and to promote the
de$elopment of and to regulate the securities market and the matters connected
therewith or incidental thereto0. It is empowered by two acts namely FThe #%2I Act,
1II< and The #ecurities Aontract B+egulationD Act, 1I!E to perform the function of
protecting in$estorsG rights and regulating the capital markets.
0ole of )a5ital Mar2et
1. It is the indicator of the inherent health of the economy.
<. It is the largest source of funds with long or indefinite maturity for companies and
thereby enhances capital formation in the economy.
;. It offers a number of in$estment a$enues to the in$estors.
=. It helps in channeli*ing the sa$ings pool in the economy towards in$estments,
which are more efficient and gi$e a better rate of return thereby helping in optimum
allocation of capital in the country.
!rimary Mar2et'
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Stock broking ltd.
The primary market is the place where the new offerings by companies are made
either as Initial (ublic 8ffer BI(8D or +ights Issue. I(8s are offerings made by the
companies for the first time while rights are offerings made to the e"isting
shareholders. In$estors who prefer to in$est in the primary issues are called #tags.
Seco*+ary Mar2et'
#econdary market consists of stock e"changes where the buy orders and sell orders
are matched in the organi*ed mannerM there are at present <! recogni*ed stock
e"changes in India and are go$erned by the #ecurities Aontracts B+egulationD Act
B#A+AD.
Mar2et I*+ices
A stock market inde" should capture the beha$ior of the o$erall e&uity market.
mo$ements of the inde" should represent the returns obtained by /typical0 portfolios
in the country the )ob of the inde" is to purely capture the mo$ement of stock market
as a whole BI.e. news about the countryD and not the mo$ement of indi$idual stocks
due to news about the company Bi.e. product launchD.inde" helps us to know how the
market is fairing.
%6E06IE7 %- I/(IA I/(E8 SE06I)ES 9 !0%(U)TS LT(: 4IISL3
India Inde" #er$ices : (roducts 4td. BII#4D is a )oint $enture between the 1ational
#tock %"change of India 4td. B1#%D and A+I#I4 4td. Bformerly the Aredit +ating
Information #er$ices of India 4imitedD. II#4 has been formed with the ob)ecti$e of
pro$iding a $ariety of indices and inde" related ser$ices and products for the capital
markets. II#4 has a consulting and licensing agreement with #tandard and (oor's
B#:(D, the world's leading pro$ider of in$estible e&uity indices, for co-branding
II#4's e&uity indices.
/ATI%/AL ST%)K E8)HA/;E 4/SE3
The 1ational #tock %"change of India 4imited has genesis in the report of the 7igh
(owered #tudy @roup on %stablishment of 1ew #tock %"changes. It recommended
promotion of a 1ational #tock %"change by financial institutions BFIsD to pro$ide
access to in$estors from all across the country on an e&ual footing. 2ased on the
recommendations, 1#% was promoted by leading Financial Institutions at the behest
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Stock broking ltd.
of the @o$ernment of India and was incorporated in 1o$ember 1II< as a ta"-paying
company unlike other stock e"changes in the country.
8n its recognition as a stock e"change under the #ecurities Aontracts
B+egulationD Act, 1I!E in April 1II;, 1#% commenced operations in the .holesale
'ebt ,arket B.',D segment in Hune 1II=. The Aapital ,arket B%&uitiesD segment
commenced operations in 1o$ember 1II= and operations in 'eri$ati$es segment
commenced in Hune <.
The following years witnessed rapid de$elopment of Indian capital market with
introduction of internet trading, %"change traded funds B%TFD, stock deri$ati$es and
the first $olatility inde" N India OIC in April <J, by 1#%.
August <J saw introduction of Aurrency deri$ati$es in India with the launch of
Aurrency Futures in 6#' I1+ by 1#%. Interest +ate Futures was introduced for the
first time in India by 1#% on ;1st August <I, e"actly after one year of the launch of
Aurrency Futures.
.ith this, now both the retail and institutional in$estors can participate in
e&uities, e&uity deri$ati$es, currency and interest rate deri$ati$es, gi$ing them wide
range of products to take care of their e$ol$ing needs.
%ur Missio*

1#%'s mission is setting the agenda for change in the securities markets in India. The
1#% was set-up with the main ob)ecti$es ofP
%stablishing a nation-wide trading facility for e&uities, debt instruments,
%nsuring e&ual access to in$estors all o$er the country through an appropriate
communication network,
(ro$iding a fair, efficient and transparent securities market to in$estors using
electronic trading systems,
%nabling shorter settlement cycles and book entry settlements systems, and
,eeting the current international standards of securities markets.
Tere are t,o 2i*+s of 5layers i* /SE'
BaD Trading members and BbD (articipants.
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+ecogni*ed members of 1#% are called trading members who trade on behalf
of themsel$es and their clients. (articipants include trading members and large
players like banks who take direct settlement responsibility.
Trading at 1#% takes place through a fully automated screen-based trading
mechanism which adopts the principle of an order-dri$en market. Trading members
can stay at their offices and e"ecute the trading, since they are linked through a
communication network. The prices at which the buyer and seller are willing to
transact will appear on the screen. .hen the prices match the transaction will be
completed and a confirmation slip will be printed at the office of the trading member.
1#% has se$eral ad$antages o$er the traditional trading e"changes. They are as
followsP
1#% brings an integrated stock market trading network across the nation.
In$estors can trade at the same price from anywhere in the country since inter-
market operations are streamlined coupled with the countrywide access to the
securities.
'elays in communication, late payments and the malpracticeGs pre$ailing in
the traditional trading mechanism can be done away with greater operational
efficiency and informational transparency in the stock market operations, with
the support of total computeri*ed network.
!romoters
1#% has been promoted by leading financial institutions, banks, insurance companies
and other financial intermediariesP
Industrial 'e$elopment 2ank of India 4imited
Industrial Finance Aorporation of India 4imited
4ife Insurance Aorporation of India
#tate 2ank of India
IAIAI 2ank 4imited
I4 : F# Trust Aompany 4imited
#tock 7olding Aorporation of India 4imited
#2I Aapital ,arkets 4imited
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2ank of 2aroda
Aanara 2ank
@eneral Insurance Aorporation of India
1ational Insurance Aompany 4imited
The 1ew India Assurance Aompany 4imited
The 8riental Insurance Aompany 4imited
6nited India Insurance Aompany 4imited
(un)ab 1ational 2ank
8riental 2ank of Aommerce
Indian 2ank
6nion 2ank of India
Infrastructure 'e$elopment Finance Aompany 4td.
L%;%'
The logo of the 1#% symbolises a single nationwide securities trading facility
ensuring e&ual and fair access to in$estors, trading members and issuers all o$er the
country. The initials of the %"change $i*., 1, # and % ha$e been etched on the logo
and are distinctly $isible. The logo symbolises use of state of the art information
technology and satellite connecti$ity to bring about the change within the securities
industry. The logo symbolises $ibrancy
S9! )/8 /ifty
#:( A1C 1ifty is a well di$ersified ! stock inde" accounting for <! sectors of the
economy. It is used for a $ariety of purposes such as benchmarking fund portfolios,
inde" based deri$ati$es and inde" funds.
#:( A1C 1ifty is owned and managed by India Inde" #er$ices and (roducts 4td.
BII#4D, which is a )oint $enture between 1#% and A+I#I4. II#4 is India's first
speciali*ed company focused upon the inde" as a core product. II#4 ha$e a consulting
MBA10008008 KES IEMS, HUBLI Page 1<
Stock broking ltd.
and licensing agreement with #tandard : (oor's B#:(D, who are world leaders in
inde" ser$ices.
The a$erage total traded $alue for the last si" months of all 1ifty stocks is
appro"imately =>L of the traded $alue of all stocks on the 1#%
1ifty stocks represent about !JL of the total market capitali*ation as on
'ecember ;, <!.
Impact cost of the #:( A1C 1ifty for a portfolio si*e of +s.! million is
.>L
#:( A1C 1ifty is professionally maintained and is ideal for deri$ati$es
trading
MBA10008008 KES IEMS, HUBLI Page 1;
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)%M!A/1
!0%-ILE
/ET7%0TH (I0E)T
,oney ,anagement Aentre
1etworth has been successfully pro$iding premium financial ser$ices and
information for more than a decade. 8ur aim has consistently been to empower
in$estors : business associates to take charge of their financial future : help them
grow their 1etworth
1etworth has always stri$ed to make a difference in the financial ser$ices
space. It constantly focuses on scaling and upgrading the technology infrastructure so
as to pro$ide the best ser$ices to its in$estors : business associates.
MBA10008008 KES IEMS, HUBLI Page 1=
Stock broking ltd.
.e ha$e a presence of o$er ; centers across India. 8ur network includes
o$er < business associates who share our success story. .e are managed by a
talented team of o$er <=>! professionals and are ser$ing o$er 1, clients.
www.networthdirect.com - an ad$anced, web based platform that enables us to
pro$ide you the con$enience 3one window all products9 : consolidation 3one
statement all in$estments9 which you can e"tend to all your clients.
.e pro$ide our business associates with some of the best a$ailable technology to
enhance their clients trading e"perience. 8ur online back offices my networth is
amongst the best in the industry and helps you track all updates on your clients
trading history. All in all.. it is one platform that will let you and your clients li$e a
world class in$estment e"perience .
7e are:::::
,embers of 2#%, 1#%, ,AC-#C, ,AC, 1A'%C, IA%C and '( of A'#4 :
1#'4.
.inners of A12A-TO1J's Financial Ad$isor Awards <J for 2est +egional
4e$el Financial Ad$isor B.estern +egionD.
(roclaimed amongst the most read research analysts by Thomson +euters
consistently o$er a period of time.
A Aharter member of Financial (lanning #tandards 2oard of India 3F(#29
%ur %&"ective'
To help indi$iduals set and achie$e their long-term financial goals through
in$estments, ta" planning, asset allocation, risk management and retirement planning.
.e pro$ide all the tools needed to increase our clientGs net worth and help the client
accomplish al of hisM her financial ob)ecti$es.
6isio*, Missio* 9 <uality !olicy
6isio*
/To empower our in$estors and business associates to take charge of their
financial future and help them to grow their net-worth0.
Missio*
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Stock broking ltd.
/%thical transparent technology dri$en performance oriented compliant customer
centric0.
<uality 5olicy
#tri$e to be a reliable source of $alue-added financial products and ser$ices
and constantly guide the indi$iduals and institutions in making a )udicious
choice of same.
#tri$e to keep all stake-holders Bshareholders, clients, in$estors, employees,
suppliers and regulatory authoritiesD proud and satisfied.
Aontinue to uphold the $alues of honesty : integrity and stri$e to establish
unparalleled standards in business ethics.
6se state-of-the art information technology in de$eloping new and inno$ati$e
financial products and ser$ices to meet the changing needs of in$estors and
clients.
/et,ort .rou5'
.e belie$e in mutual growth : benefit. All our offerings and systems are customi*ed
to achie$e growth for our associates, without whom we cannot claim success. 8ur
associates are present in all ma)or cities in India. .e also ha$e an e"tensi$e branch
network through which we can cater to all needs of our associates.
/et,ort .rou5 com5rises of = com5a*ies
1etworth #tock 2roking 4td. B7olding company - listed on the 2#% since
1II=D
1etworth Aommodities : In$estments 4imited Bfacilitates commodities
tradingD
1etworth .ealth #olutions 4td. B.holly owned subsidiary deli$ering
financial planning : ad$iceD
1etworth #oftTech 4td. BI#8 I1P< certified company pro$ides software
solutionsD
+a$isha Financial #er$ices ($t. 4td.B12FA engaged in financing, primarily it
pro$ides loan against securitiesD
/et,ort Stoc2 Bro2i*. Lt+: >/SBL?
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Stock broking ltd.
1#24 is a member of the 1ational #tock %"change of India 4td B1#%D and
the 2ombay #tock %"change 4td B2#%D in the Aapital ,arket and 'eri$ati$es
BFutures : 8ptionsD segment. 1#24 has also ac&uired membership of the currency
deri$ati$es segment with 1#%, 2#% : ,AC-#C. It is 'epository participants with
Aentral 'epository #er$ices India BA'#4D and 1ational #ecurities 'epository BIndiaD
4imited B1#'4D. .ith a client base of o$er 14 loyal customers, 1#24 is spread
across the country though itGs o$er <!Q branches. 1#24 is listed on the 2#% since
1II=.
/et,ort )ommo+ities 9 I*vestme*ts Limite+. >/)IL?
1#A4 is the commodities arm of 1#24. It is a member at the ,ulti
Aommodity %"change of India B,ACD, 1ational Aommodity : 'eri$ati$es %"change
B1A'%CD and IA%C : is backed by solid research : analytics in Aommodities.
/et,ort 7ealt Solutio*s Lt+: >/7SL?
1.#4 is into the business of deli$ery of Financial (lanning : Ad$ice. ItGs
$ision is to FAd$ice : %"ecute money related solutions toMfor our customers in the
most Aon$enient : Aonsolidated manner, while making sure that their e"perience
with us is always pleasant : memorable resulting in positi$e ad$ocacyG. The product
: #er$ices include Financial (lanning, 4ife Insurance, 8n-line Trading Account,
,utual Funds, 'ebenturesM2onds, @eneral Insurance, 4oans and 'epository #er$ices.
/et,ort Soft Tec Lt+: >/SL?
1#4 is an I#8 I1P< Aertified Aompany. It is into Application 'e$elopment :
maintenance. 2uilding : Implementation of packaged software across $arious
functions within the Financial #er$ices Industry is at its core. It also pro$ides data
center ser$ices which include hosting of websites, applications : related ser$ices. It
combines a uni&ue deli$ery model infused by a distinct culture of customer
satisfaction.
0avisa -i*a*cial Services !vt: Lt+: >0-SL?
+F#4 is a +2I registered 12FA engaged in financing, primarily it pro$ides loan
against securities.
!0%(U)T 9 SE06I)ES'
.ith greater choices comes greater $alue. 1etworth offers you more choices by
pro$iding a wide array of products and personali*ed ser$ices, so you can take charge
MBA10008008 KES IEMS, HUBLI Page 1>
Stock broking ltd.
of your financial future with confidence. #o whether you are a new in$estor or a
seasoned one, we ha$e the resources and ad$ice you would need to make smart, well-
researched in$estments and help you grow your 1etworth.
%&uity
'eri$ati$es
Aommodities
Aurrency 'eri$ati$es
I(8
(ortfolio ,anagement #er$ices
,utual Funds
4oans : 2onds
Insurance B4ife : @eneralD
'epository #er$ices
.ealth ,anagement #er$ices
8nline (latform
Aall : Trade
E@uity
8ur e"perienced trading consultants and ad$anced trading tools will pro$ide the
support you need to achie$e your long-term goals $ia the stock markets. .e trade on
the 2#%, 1#% and A1 and our website has facilities such as li$e stock tickers, news
updates, and more, to help our clients stay in the know. .e also pro$ide 1+I specific
ser$ices to meet the needs of our clients who li$e abroad.
(erivatives
'eri$ati$es are financial contracts whose $alueMprice is dependent on the
beha$ior of the price of one or more basic underlying assets Bsimply known as
underlyingD. These contracts are legally binding agreements, made on the trading
screen of stock e"changes, to buy or sell an asset in future. The asset can be a share,
inde", interest rate, bond, rupeeMdollar e"change rate, sugar, crude oil, soybean,
cotton, coffee etc.
)ommo+ities
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1etworth now offers to in$estors a platform to trade in A8,,8'ITR
F6T6+%#. As a member of the ,ulti Aommodity %"change of India 4td. and of the
1ational Aommodity and 'eri$ati$e %"change, we offer futures trading in 1
commodities Bgold, sil$er, castor, soya, canolaMmustard oil, crude palm oil, +2'
palmolein and cottonD 1A'%C and in gold, sil$er and castor seed, rubber through
,AC.
)urre*cy +erivatives
The launch of currency deri$ati$es in India, in ,ay this year opened one more
lucrati$e a$enue for trading. The recommendations were made )ointly by the #%2I
and the +2I. Aurrency deri$ati$es can be described as contracts between the sellers
and buyers, whose $alues are to be deri$ed from the underlying assets i.e. the
currency amounts.
I!%
Initial public offering BI(8D, also referred to simply as a Spublic offeringS, is the
first sale of stock by a pri$ate company to the public. I(8 is a way for a company to
raise money from in$estors for its future pro)ects and get listed to #tock %"change.
From an in$estor point of $iew, I(8 gi$es a chance to buy stocks of a company,
directly from the company at the price of their choice BIn book build I(8'sD. Although
an I(8 offers more control o$er the price at which the in$estor is willing to buy the
stock it is no less risky than buying a stock in the market.From a company
prospecti$e, the single most important use of an I(8 is the pro$ision of funds. I(8's
pro$ide capital for the companyGs future growth or for paying its pre$ious borrowings
and allows the companyGs stock to be traded publicly in the #tock ,arket.
!ortfolio Ma*a.eme*t Services
1%T.8+T7 (,# will help you achie$e your ob)ecti$e of preser$ing and
growing capital by conducting a thorough analysis of your in$estment needs, returns
e"pected and risk taking ability. 8ur focus is to craft a basket of #tocks, 2onds, and
,utual Funds through strong research and corporate interface, keeping in mind your
risk-profile in specific relation with the e$er-changing marketing dynamic.
I*vestme*t !iloso5y
.e focus on a 2ottom 6p approach to stock picking. The stock selection process
starts with fundamental analysis of companies and includes management meeting and
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plant $isits to get a first hand feel of the company, rather than depending solely on
&uantitati$e analysis. The in$estment process is fairly rigorous and includes
&ualitati$e as well as &uantitati$e criteria and builds upon the decade long e"perience
of 1etworth in Indian e&uity markets.
Be*efits of &ei*. ,it /et,ort !MS
(ortfolio ,anagement with a difference e$ery in$estor, whether indi$idual or
corporate, has uni&ue needs based on their ob)ecti$es and risk profiles. .e recogni*e
the difference and design tailored in$estment ad$ice to achie$e specific in$estment
ob)ecti$es.
!rofessio*al Ma*a.eme*tA .e offer professional management of your
e&uity portfolio with an aim to deli$er consistent returns while controlling risk.
)o*ti*uous Mo*itori*.A .e recogni*e that portfolios need to be constantly
monitored and periodically churned to optimi*e the results.
0is2 )o*trolA The portfolios are managed through a strong research dri$en
in$estment process with complete transparency and highest standards of ser$ice.
Tra*s5are*cyA Rou will get regular account statements and performance
reports on a monthly basisM That's not all- web-enabled access ensure that you are
)ust a click away from all information relating to your in$estment.
Hassle -ree %5eratio*A 8ur (ortfolio ,anagement #er$ice relie$es you from
all the administrati$e hassles of your in$estments. .e pro$ide periodic reporting
on the performance and other aspects of your portfolio.
(e+icate+ 0elatio*si5 Ma*a.erA 8ur +elationship ,anagers speciali*e in
pro$iding personal in$estment management ser$ices to achie$e your in$estment
ob)ecti$e.
Mutual fu*+s
,utual funds are in$estment companies that pool money from in$estors at large
and offer to sell and buy back its shares on a continuous basis and use the capital thus
raised to in$est in securities of different companies.
Loa*s
2anks are a type of financial intermediary whose principal ser$ice among many
others is to pro$ide loans to its customers who could be indi$idualsM corporationsM
self-employed (rofessionalsM publicM pri$ate companies etc. The loans are in turn
funded by the deposits of its e"isting customers
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(e5ository Services
.e offer 'epository facilities to facilitate a seamless transaction platform as a
part of our $alue-added ser$ices for our clients. 1etworth is a depository participant
with the Aentral 'epository #er$ices BIndiaD 4td. BA'#4D and 1ational #ecurities
'epository 4td. B1#'4D for trading and settlement of demateriali*ed shares.
7ealt Ma*a.eme*t Services
1etworth .ealth is into the business of deli$ery of Financial (lanning : Ad$ice.
.hate$er may be your goal, without a Financial (lan in place it's impossible to
achie$e. .e help you achie$e e"actly that through our proprietary Financial (lanning
(rocess - my plan it helps you achie$e your life goals. %$ery retail in$estor, in today's
fast paced world, is searching for con$enience and e"pecting consolidation for hisMher
in$estments.
%*li*e !latform
1etworth direct is not )ust a website, it is an online platform packed with
products : ser$ices that will pro$ide a magnificent customer e"perience for our
clients.
1etworth direct pro$ides clients access toP
eAtra*sact this is the platform where our customers can trade online in $arious
financial instruments. It is con$eniently integrated with multiple payment
gateways and our depository ser$ices to pro$ide a seamless transaction
capability.
My /et,ort This pro$ides access to your accounts and statements online
and with <=C> a$ailability. Rou can $iew your portfolio across all assets and
get a consolidated $iew. www.networthdirect.com is based on three pillars -
pace, web-based and shortest. !ace A In todayGs fast paced world, the
disposable time for e$eryone is getting s&uee*ed. In these kinds of stringent
times, customer is looking for less time consuming a$enues without
compromising on the ser$ice standards.
7e& &ase+ B
Internet penetration in India is rising at a $ery fast pace. ,ore and more people
are getting net sa$$y. .eb enables the customers to gain fle"ibility, pri$acy :
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security. .eb is easy, knowledge hea$y, paperless, instant and pri$ate.Sortest
distance between us and our clients. This stems from the philosophy of customer care.
.e are in a ser$ice industry and thus the nearer we are to our clients the stronger will
be the differentiator.
/et ,ort Boar+ of (irectors
# ( Hain Ahairman M Ahair (erson
# ( Hain A%8
,anish A)mera %"ecuti$e director and AF8
#an)ay ,ohta Independent 'irector
,oheet Agrawal Independent 'irector
(ra$een Toshniwal Independent 'irector
1: S7%T A/AL1SIS
#.8T analysis in$ol$es e"amination of $arious factors affecting acti$ely on
the business en$ironment. The two most important parts of #.8T analysis are
drawing conclusions from the #.8T listings about the companyGs o$erall
situation and acting on those conclusions to better match the companyGs strategy
to its resource strengths and market opportunities, to correct the weaknesses and
to defend against threats.
ST0E/;TH
1etworth is one of the premier financial ser$ices organi*ation in India.
#trong market research which is backed by a highly &ualified team of research
analysts.
It is powered by a high distribution network maintained trough professional
management.
%fficient grie$ance handling.
Technology dri$en organi*ation.
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@reater transparency.
Aompany offers hassle free operations.
1etworth offers in$estors more choices by pro$iding a wide array of products
and personali*ed ser$ices managed by top-notch professional employees.
7EAK/ESS
7igher o$erall unit costs relati$e to key competitors.
Training the workers take lots of time and money.
Aomple" terms and conditions of broking.
The firm is not so aggressi$e.
7igh employee turno$er.
%!!%0TU/ITIES
It can become more competiti$e by listing in either of the stock e"changes.
%"panding the companyGs product line to meet a broader range of customer
needs.
Ability to grow rapidly because of sharply rising clientGs demand for stocks.
It can increase its institutional client base by ac&uiring new business
brokerage.
@lobali*ation of productsMser$ices.
TH0EATS
Increasing intensity of competition among industry ri$als.
%ntry of potent new competitors.
Ahanging #%2I +ules and +egulations.
.rong )udgment of analysts.
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Threat of +isk ,anagement.
)om5etitors I*formatio*
The 1etworth is sub)ect to nationwide competition with many stock broking
firms.
Few of them are listed belowP
I4 : F# Aompany
India Info line
2onan*a
Anand +athi
,otilal 8swal
5ar$y
Oentura
#hare 5han
+eliance money
5otak #ecurities 4td
+eligare #ecurities 4td
IAIAI direct
7#2A 'irect In$est
Angel financing
Acieveme*tsCA,ar+s
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1etworthGs #oftware di$ision has achie$ed I#8 I1P< certification from
2#I.
1etworth @roup won A12A TO1JGs Financial Ad$isor Award <J, for the
categoryP /2est +egional 4e$el Financial Ad$isor0
+ated :+anked by A#IA ,81%R <! polls for o$erall country research
strategy.
A charter member of Financial (lanning #tandards 2oard 8f India 3F(#29.
/et ,ort %r.a*iDatio* )art at Bra*c Level
MBA10008008 KES IEMS, HUBLI Page <!
0elatio*si5 Ma*a.er 0elatio*si5 Ma*a.er 0elatio*si5 Ma*a.er
Mar2eti*.
Ma*a.er
Mar2eti*.
Ma*a.er
%ffice &oy
%5eratio*s
Ma*a.er
(ealer (ealer (ealer
Bra*c Ma*a.er
Stock broking ltd.
/ET7%0TH (I0E)T
(HA07A( B0A/)H
1etworth 'irect 'harwad 2ranch started on >
th
August <J.
2ranch codeP =1!
Address of 1etworth 'irect 'harwad 2ranchP-
T@4<-;, 5rishna ,ansion,
62 7ill +oad,
1ear 7ead (ost 8ffice,
'harwad - !J1
'harwad 5arnataka
(hone 1oP J;E-;<=E!! M J;E-<===E<1
2ranch ,anagerP - (ra$een 'anda$ati
%mployeesP-
1itin 1 @hatage BAash 'ealerD
,ohan 1adiger B,arketing %"ecuti$eD
Oi)ay 5umar 5ulkarni BF:8 dealerD
,allikar)un B8ffice 2oyD
Total 1umber of Alients in 1etworth 'irect 'harwad 2ranch isP - 1<= Alients
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In 1etworth 'irect 'harwad 2ranch most of the Alients are traded in %&uities.
2rokerage 'etails in 1etworth 'irect
!ro+ucts Mar.i* 4I*tra+ay3 (elivery
%&uity .!L .!L
F:8 .!L .!L
Aommodities .EL .EL
THE%0%TI)AL
-0AME7%0K
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Systematic 0is2'
The systematic risk affects the entire market. The economic conditions,
political situations and the sociological changes affect the security market. These
factors are beyond the control of the corporate and the in$estor. The in$estor cannot
a$oid them. This is subdi$ided intoP
i: ,arket +isk
ii: Interest +ate +isk
iii: (urchasing (ower +isk.
0ETU0/
The ,arket return is calculated by following formulaP-
TodayGs market returnU TodayGs inde" N ResterdayGs inde"
ResterdayGs inde"
4ike daily returns, weekly returns can be calculated by using this weekGs and last
weekGs price instead of todayGs and yesterdayGs prices in the abo$e mentioned
formula. ,onthly returns also can be calculated.
A0ITHMETI) A6E0A;E
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The statistic familiar to most people is the arithmetic a$erage. The arithmetic mean of
a set of $alues is obtained by di$iding the sum of the $alues by the number of $alues
in the set, customarily designated by the symbol C BC-barD, isP
C U V"
1
STA/(A0( (E6IATI%/
6nderstanding the nature of the risk is not ade&uate unless the in$estor or analyst is
capable of e"pressing it in some &uantitati$e terms. ,easurement cannot be assured
of cent per cent accuracy because risk is caused by numerous factors such as social,
political, economic and managerial efficiency. ,easurement pro$ides an appro"imate
&uantification of risk. The statistical tool often used to measure and used as a pro"y
for risk is the standard de$iation.
It is a measure of the $alues of the $ariables around its mean or it is the s&uare root of
the sum of the s&uared de$iations from the mean di$ided by the number of
obser$ances. The standard de$iation helps to measure the $ariability of return.
W U XB" N"D
<

X1
)orrelatio*'
The Aorrelation coefficient measures the nature and the e"tent of relationship
between the stock market inde" return and the stock return in a particular period
+U n
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I*+ia I*terest 0ate'
The benchmark interest rate in India was last reported at J percent. In India,
interest rate decisions are taken by the +eser$e 2ank of India's Aentral 2oard of
'irectors. The official interest rate is the benchmark repurchase rate. From <
until <1, India's a$erage interest rate was !.J< percent reaching an historical high
of 1=.! percent in August of < and a record low of ;.<! percent in April of
<I.
0BI 0e5o rate or 2ey sort term le*+i*. rate
.hen reference is made to the Indian interest rate this often refers to the repo
rate, also called the key short term lending rate. If banks are short of funds they can
borrow rupees from the +eser$e 2ank of India B+2ID at the repo rate, the interest rate
with a 1 day maturity. If the central bank of India wants to put more money into
circulation, then the +2I will lower the repo rate. The re$erse repo rate is the interest
rate that banks recei$e if they deposit money with the central bank. This re$erse repo
rate is always lower than the repo rate. Increases or decreases in the repo and re$erse
repo rate ha$e an effect on the interest rate on banking products such as loans,
mortgages and sa$ings.
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7y 0BI is i*crease+ i*terest rateE
-actors affecti*. i*terest rate moveme*t a*+ -orces &ei*+ I*terest 0ates
Inflation
4i&uidity
7igh 8il prices
#tock market conditions
International borrowings
Fiscal deficit and go$ernment borrowings
,onetary (olicy
@rowth in the economy
@lobal li&uidity
6ncertainty
#upply and 'emand
India Inflation +ate
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The inflation rate in India was recorded at >.<; percent in April of <1<. 7istorically,
Inflation rate refers to a general rise in prices measured against a standard le$el of
purchasing power. The most well known measures of Inflation are the A(I which
measures consumer prices, and the @'( deflator, which measures inflation in the
whole of the domestic economy
Implications of a rising inflation rate
+ising food prices Aommodity prices #timulus packages %"pensi$e borrowing
Impact on stock markets %ssential goods' prices
Rear P <1< -->.<;, <11-->.!, <1--I.=>, <I--1=.I>
Fiscal deficit
'ue to the higher than anticipated non-ta" re$enue from ; @ spectrum auction... I
ha$e brought down the fiscal deficit from !.! per cent to !.1 per cent of the @'( for
<1-11,S ,ukher)ee said in his <11-1< 2udget speech. India's fiscal deficit had
ballooned to E.; per cent of the @'( in <I-1 in $iew of stimulus spending worth
billions of dollars to combat global financial meltdown. the medium term fiscal
policy, ,ukher)ee pegged the rolling target of fiscal deficit at =.1 per cent for <1<-
1;, and ;.! per cent for <1;-1=.
#tock market condition
In <I the market was in a reco$ery mode- in <1 it consolidated. 1e"t year prices
will reflect the performance of the corporate sector and respond less to the e"ternal
shocks.In <1 stock prices increased <!L almost all the rise being in the second half
of the year though corporate performance was better in the first half. The difference
was the in$estment by FIIs to which the market is e"tremely sensiti$e. The +2I has
estimated that a 1L fluctuation in FII in$estment results in a ;!L $ariation in stock
prices. In the first half of <1 FII net in$estment was a mere +s. ; billion- in the
second fi$e months it rose to +s. 11 billion.
Ho, I*terest 0ates Affect te Stoc2 Mar2et'

%ssentially, interest is nothing more than the cost someone pays for the use of
someone elseGs money.D The interest rate that applies to in$estors is the +2I repo rate
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This is the cost that banks are charged for borrowing money from Indian +eser$e
banks. .hy is this number so importantY It is the way the central bank attempts to
control inflation. Inflation is caused by too much money chasing too few goods Bor
too much demand for too little supplyD, which causes prices to increase. 2y
influencing the amount of money a$ailable for purchasing goods, the +2I can control
inflation. 8ther countries' central banks do the same thing for the same reason.
2asically, by increasing the central repo rate, the central bank attempts to lower the
supply of money by making it more e"pensi$e to obtain
Effects of a* I*crease
.hen the central bank increases the repo rate, it does not ha$e an immediate
impact on the stock market. Instead, the increased federal funds rate has a single
direct effect - it becomes more e"pensi$e for banks to borrow money from the central
bank. 7owe$er, increases in the discount rate also cause a ripple effect, and factors
that influence both indi$iduals and businesses are affected.
The first indirect effect of an increased +2I repo rate is that banks increase the
rates that they charge their customers to borrow money. Indi$iduals are affected
through increases to credit card and mortgage interest rates, especially if they carry a
$ariable interest rate. This has the effect of decreasing the amount of money
consumers can spend. After all, people still ha$e to pay the bills, and when those
bills become more e"pensi$e, households are left with less disposable income. This
means that people will spend less money, which will affect businesses' top and
bottom lines Bthat is, re$enues and profitsD. Therefore, businesses are also indirectly
affected by an increase in the central bank rate as a result of the actions of indi$idual
consumers. 2ut businesses are affected in a more direct way as well. They, too,
borrow money from banks to run and e"pand their operations. .hen the banks make
borrowing more e"pensi$e, companies might not borrow as much and will pay a
higher rate of interest on their loans. 4ess business spending can slow down the
growth of a company, resulting in decreases in profit.
Stoc2 !rice Effects
Alearly, changes in the federal funds rate affect the beha$ior of consumers and
business, but the stock market is also affected. This price fluctuates as a result of the
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different e"pectations that people ha$e about the company at different times.
2ecause of those differences, they are willing to buy or sell shares at different prices.
If a company is seen as cutting back on its growth spending or is making less
profit - either through higher debt e"penses or less re$enue from consumers - then the
estimated amount of future cash flows will drop. All else being e&ual, this will lower
the price of the company's stock. If enough companies e"perience a decline in their
stock prices, the whole market, or the inde"es that many people e&uate with the
market, will go down
I*vestme*t Effects
For many in$estors, a declining market or stock price is not a desirable outcome.
In$estors wish to see their in$ested money increase in $alue. #uch gains come from
stock price appreciation, the payment of di$idends - or both Furthermore, in$esting in
stocks can be $iewed as too risky compared to other in$estments.
-ollo,i*. are te some sector ,ic affects more ,e* i*terest rate
ca*.e ta* oter
Ba*2i*. stoc2s
2anking stocks are the biggest hit by interest rate changes. A high interest rate blows
a double whammy to banks. (eople do not borrow because of high interest rate but
deposit because of the same reason. 5eeping money in $ault does no help to banks.
7ence when the interest rate goes up, banking stocks are hit first. The re$erse is true
too. 4ow interest rate pushes banking stocks higher and in$estors reap the benefits of
in$esting at the right time.
I*frastructure stoc2s
Infrastructure stocks are other interest rate sensiti$e stocks. Infrastructure sector
is highly le$eraged sector. 7ence rise in interest rate is de$astating for it. +eal estate
de$elopers depend on bank loan to build the properties and buyers too depend on
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home loan from banks to buy their home. A high interest rate is not feasible for both.
7ence in high interest rate regime, infrastructure stocks are hit hard.
#imilarly, when the interest rate is low, infrastructure stocks do well. 7ome buyers
get cheaper loan to buy home and builders de$elop properties to satisfy the demand
for properties. In case of infrastructure, it is not only the real estate sector that gets
impacted but infrastructure related stocks such as cement and steel.
Automotive Sector
Automoti$e sector depends, )ust like infrastructure, on the interest rate. ,ost of
the people take loan to buy their $ehicle. If the interest rate is high, the cost of
buying $ehicle is more and the %,I is higher. 7ence buyers postpone the decision to
buy $ehicle. The demand slows down, production falls, and profit goes down.
0BI 0ATE )HA/;ES 7ITH (ATE
April 1>, <1< J. L .
8ctober <!, <11 J.! L .
#eptember 1E <11 J.<! L .
Huly <E <11 J. L
Hune 1E <11 >.! L
,ay ; <11 >.<! L
,arch 1> <11 E.>! L
Hanuary <! <11 E.! L .
1o$ember < <1 E.<! L .
#eptember 1E <1 E. L .
Huly <> <1 !.>!L .
,arch 1I <1 !.!L
April < <1 !.<!L
Huly < <1 !.!L
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METH%(%L%;1
To5ic'
Implication of interest rate changes on nifty /
Stateme*t of 5ro&lem
%&"ective'
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To understand why +2I has changed the interest rate fre&uently.
To study impact of interest rate changes on in$estment for last < ? years.
To suggest in$estors for taking better in$estment decision.
(ata collectio* tools
!rimary (ata
Interaction with e"ternal which helped to learn some of the common terms used
in stock market. Interaction with internal guide and other professors helped this
pro)ect in clarifying doubts associated with the study and gets a right direction to the
pro)ect.
Seco*+ary (ata
Aollecting the data from 2ooks, 'ocuments and $arious .ebsites, which
includes Alosing ,arket price of selected scripts, closing price of #tock Inde" B#:(
A1C 1iftyD etc.
Statistical Tools use+' +isks of interest rate calculation done by using statistical
tools are Arithmetic ,ean, #tandard 'e$iation, and Aorrelation.
Statistical Soft,are use+' To calculate Arithmetic A$erage, #tandard 'e$iation,
2eta and Alpha I am using ,#-%"cel software. Formulas used in ,#-%"cel for
calculating are
A$erage-AO%+A@%
#tandard 'e$iation- #T'O%
Aorrelation- A8++%4
Limitatio*s'
I ha$e chosen the impact interest rate changes on inde" return for last < ? year
from <1 - <1<.
The selected inde" is 1#% Bi.e. #:( A1C 1iftyD.
And I ha$e used three formulae to calculate impact interest rate change.
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)AL)ULATI%/S
A/( A/AL1SIS
1: As o* 1FA0GAH010
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!articulars Before rate ca*.e After rate ca*.e
,ean
.;<< -.JJ
#tandard de$iation
.=I 1.<E
Aorrelation
.;
I*ter5retatio*'
1. The before rate change, returns of the market inde" was .;<<L and
after hike in rate it has decreased to -.JJ .
<. The before rate change standard de$iation BriskD of the market inde" was
.=IL and after hike in rate it increases to 1.<EL.
;. Oalue of Aorrelation between returns of market inde" before rate change
and after hike in rate is .;L.
H: As o* H0A0IAH010
!articulars Before rate ca*.e After rate ca*.e
,ean
-.1E .!
#tandard de$iation
.JI 1.<1
Aorrelation
.=J
I*ter5retatio*'
1. The before rate change, returns of the market inde" was - .1EL and
after hike in rate it increases to .!L.
<. The before rate change standard de$iation BriskD of the market inde"
was .JIL and after hike in rate it increases to 1.<1L.
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;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is .=L.
G: As o* HA0JAH010
!articulars Before rate ca*.e After rate ca*.e
,ean
-.;I .<
#tandard de$iation
1.J 1.1>
Aorrelation
.<!
I*ter5retatio*'
1. The before rate change, returns of the market inde" was - .;IL
and after hike in rate it increased to .<L.
<. The before rate change standard de$iation BriskD of the market
inde" was 1.JL and after hike in rate it increased to 1.1>L.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is .<!L.
I: As o* HJA0JAH010
!articulars Before rate ca*.e After rate ca*.e
,ean
.E .>!
#tandard de$iation
.=< .E;
Aorrelation
.1;
I*ter5retatio*'
1. The before rate change, returns of the market inde" was .EEL
and after hike in rate it increased to .>!L.
MBA10008008 KES IEMS, HUBLI Page =1
Stock broking ltd.
<. The before rate change standard de$iation BriskD of the market
inde" was .=<L and after hike in rate it increased to .E;L.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is .1;L.
=: As o* 1KA0FAH010
!articulars Before rate ca*.e After rate ca*.e
,ean
.J< -.1>
#tandard de$iation
.>; 1.!J
Aorrelation
-.;J
I*ter5retatio*'
1. The before rate change, returns of the market inde" was .J<L and
after hike in rate it decreased to -.1>L.
<. The before rate change standard de$iation BriskD of the market
inde" was .>;L and after hike in rate it increased to 1.!JL.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is -.;JL.
K: As o* 0HA11AH010
!articulars Before rate ca*.e After rate ca*.e
,ean
.>; -.!
#tandard de$iation
1.J 1.E
Aorrelation
-.1>
MBA10008008 KES IEMS, HUBLI Page =<
Stock broking ltd.
I*ter5retatio*'
1. The before rate change, returns of the market inde" was .>;L and
after hike in rate it decreased to -.!L.
<. The before rate change standard de$iation BriskD of the market inde"
was 1.JL and after hike in rate it increased to 1.EL.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is -.1>L.
J: As o* H=A01AH011
I*ter5retatio*'
1. The before rate change, returns of the market inde" has -.<>L
and after hike in rate it increased to .JEL.
<. The before rate change standard de$iation BriskD of the market
inde" was 1.1IL and after hike in rate it increased to <.>JL.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is .!JL.
8: As o* 1JA0GAH011
MBA10008008 KES IEMS, HUBLI Page =;
!articulars Before rate ca*.e After rate ca*.e
,ean
-.<> .JE
#tandard de$iation
1.1I <.>J
Aorrelation
.!J
Stock broking ltd.
I*ter5retatio*'
1. The before rate change, returns of the market inde" was -.1!L
and after hike in rate it increased to .!L.
<. The before rate change standard de$iation BriskD of the market
inde" was 1.EL and after hike in rate it increased to <.J1L.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is -.1L.
F: As o* 0GA0=AH011
!articulars Before rate ca*.e After rate ca*.e
,ean
-.<I ..=1
#tandard de$iation
.I> 1.<>
Aorrelation
.>J
I*ter5retatio*'
MBA10008008 KES IEMS, HUBLI Page ==
!articulars Before rate ca*.e After rate ca*.e
,ean
-.1! .!
#tandard de$iation
1.EJ <.J1
Aorrelation
-.1
Stock broking ltd.
1. The before rate change, returns of the market inde" was -.<IL
and after hike in rate it increases to .=1L.
<. The before rate change standard de$iation BriskD of the market inde"
was .I>L and after hike in rate it increases to 1.<>L.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is .>L.
10:As o* 1KA0KAH011
!articulars Before rate ca*.e After rate ca*.e
,ean
-.<E .!=
#tandard de$iation
.=I <.;
Aorrelation
.;;
I*ter5retatio*'
1. The before rate change, returns of the market inde" was -.<EL and
after hike in rate it increased to .!=L.
<. The before rate change standard de$iation BriskD of the market inde"
was .=IL and after hike in rate it increased to <.;L.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is .;;L.
11: As o* HK:0JAH011
MBA10008008 KES IEMS, HUBLI Page =!
!articulars Before rate ca*.e After rate ca*.e
,ean
.11 -.1;
#tandard de$iation
.II <.>I
Aorrelation
-.E11
Stock broking ltd.
I*ter5retatio*'
1. The before rate change, returns of the market inde" was .11L and
after hike in rate it decreased to -.1;L.
<. The before rate change standard de$iation BriskD of the market
inde" was .IIL and after hike in rate it increased to <.>IL.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is -.E1L.
1H: As o* 1KA0FAH011
!articulars Before rate ca*.e After rate ca*.e
,ean
.1! .<1
#tandard de$iation
1.<I <.;;
Aorrelation
-.;<
I*ter5retatio*'
1. The before rate change, returns of the market inde" was .1!L and
after hike in rate it increased to .<1L.
<. The before rate change standard de$iation BriskD of the market inde"
was 1.<IL and after hike in rate it increased to <.;;L.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is -.;<L.
1G: As o* H=A10AH011
MBA10008008 KES IEMS, HUBLI Page =E
Stock broking ltd.
I*ter5retatio*'
1. The before rate change, returns of the market inde" was .<=L and
after hike in rate it decreased to .=>L.
<. The before rate change standard de$iation BriskD of the market
inde" was 1.1;L and after hike in rate it increased to 1.;L.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is .=;L.
1I: As o* 1JA0IAH01H
!articulars Before rate ca*.e After rate ca*.e
,ean
.IE .<
#tandard de$iation
.J; 1.1=
Aorrelation
.<I
I*ter5retatio*'
1. The before rate change, returns of the market inde" was .IL and
after decrease in rate it decreased to .<L.
<. The before rate change standard de$iation BriskD of the market inde"
has 1.1=L and after decrease in rate it decreased to .J;L.
MBA10008008 KES IEMS, HUBLI Page =>
!articulars Before rate ca*.e After rate ca*.e
,ean
.<= .=>
#tandard de$iation
1.1; 1.;
Aorrelation
.=;
Stock broking ltd.
;. Oalue of Aorrelation between returns of market inde" before rate
change and after hike in rate is .<IL.
-I/(I/;S'
1. There was continuous raise in the interest rate since last < ? year due
to, inflation high oil prices, li&uidity etc.
<. There is continuous decrease in market inde" returns due to higher
interest rate risk.
;. There is continuous increase in interest rate since last < ? year that
affect the security traders because cost of borrowing would increases
so that leads to earn less return and also continuous decreases in
market indices.
=. And there is both positi$e and negati$e correlation between inde"
returns- it indicates high $ariation with high risk in inde" return.
!. The high interest rate affect on infrastructure, automobile, banking
sector, because these are the few which affects more when change in
interest rate than other.
E. %$en though decrease in repo rate by ! points it is not helping stock
market to get refresh to mo$e upward.
MBA10008008 KES IEMS, HUBLI Page =J
Stock broking ltd.
SU;;ESTI%/SC0E)%M%/(ATI%/'
1. Today stock market showing negati$e sign in market mo$ement and
growth, so I would like suggest in$estors to in$est their money in
go$ernment bonds to get assured rate of return.
<. In$est in banking sector because this sector performs well for longer
term when rate $aries.
;. .hen interest rate is at peak, it is better to in$est in beaten down
infrastructure, real estate stocks for &uicker return.
MBA10008008 KES IEMS, HUBLI Page =I
Stock broking ltd.
)%/)LUSI%/
.ith a rapid growth in capital market it becomes difficulty to in$estor to take the
wise in$est decision market is getting to much $olatile locally and globally which has
lot to do with in$estments.
The pro)ect being undertaken in at networth, 'harwad imports $arious things
about in$estments. .hile doing this pro)ect it came to know that why reser$e bank of
india do they changes in repo rate, how the increase or decrease in the interest rate
affects on inde" returns, and how it affects on stock market. This pro)ect helped me to
learn about the stock market.
In$estors should undertake effecti$e and timely analysis before in$esting into the
stock market, as most of the in$estors do not undertake any study before entering into
a in$estment. As interest rate is also one of a ma)or factor which affects on inde"
return. .hen you are deciding on in$esting in a security and it is important you
understand what kind of interest rate risk you can recei$e.

MBA10008008 KES IEMS, HUBLI Page !
Stock broking ltd.
BIBLI%;0A!H1
B%%KS
#ecurity Analysis : (ortfolio ,anagement N (unitha$athy (andian
7EBSITES
www.nseindia.com
www.networthdirect.com
www.moneycontrol.com
www.in$estopedia.com
www.global rates.com
www.tradingeconomics.com
www.blogs.reuters.comMindia..
www.stockforyouindia.com
MBA10008008 KES IEMS, HUBLI Page !1
Stock broking ltd.
A**exure'
date close Date Close date close date Close
1-Apr-10 5290.5 1-Jul-10 5251.4 1-Oct-10 6143.4 3-Jan-11 6157.6
5-Apr-10 5368.4 2-Jul-10 5237.1 4-Oct-10
6159.4
5 4-Jan-11
6146.3
5
6-Apr-10 5366 5-Jul-10 5235.9 5-Oct-10 6145.8 5-Jan-11 6079.8
7-Apr-10 5374.65 6-Jul-10 5289.05 6-Oct-10
6186.4
5 6-Jan-11
6048.2
5
8-Apr-10 5304.45 7-Jul-10 5241.1 7-Oct-10 6120.3 7-Jan-11 5904.6
9-Apr-10 5361.75 8-Jul-10 5296.85 8-Oct-10
6103.4
5
10-Jan-
11
5762.8
5
12-Apr-10 5339.7 9-Jul-10 5352.45
11-Oct-
10
6135.8
5
11-Jan-
11 5754.1
13-Apr-10 5322.95 12-Jul-10 5383
12-Oct-
10 6090.9
12-Jan-
11
5863.2
5
15-Apr-10 5273.6 13-Jul-10 5400.65
13-Oct-
10 6233.9
13-Jan-
11 5751.9
16-Apr-10 5262.6 14-Jul-10 5386.15
14-Oct-
10
6177.3
5
14-Jan-
11
5654.5
5
19-Apr-10 5203.65 15-Jul-10 5378.75
15-Oct-
10
6062.6
5
17-Jan-
11
5654.7
5
20-Apr-10 5230.1 16-Jul-10 5393.9
18-Oct-
10
6075.9
5
18-Jan-
11
5724.0
5
21-Apr-10 5244.9 19-Jul-10 5386.45
19-Oct-
10 6027.3
19-Jan-
11
5691.0
5
22-Apr-10 5269.35 20-Jul-10 5368
20-Oct-
10 5982.1
20-Jan-
11 5711.6
23-Apr-10 5304.1 21-Jul-10 5399.35
21-Oct-
10 6101.5
21-Jan-
11 5696.5
26-Apr-10 5322.45 22-Jul-10 5441.95
22-Oct-
10
6066.0
5
24-Jan-
11
5743.2
5
27-Apr-10 5308.35 23-Jul-10 5449.1
25-Oct-
10 6105.8
25-Jan-
11 5687.4
28-Apr-10 5215.45 26-Jul-10 5418.6
26-Oct-
10 6082
27-Jan-
11 5604.3
29-Apr-10 5254.15 27-Jul-10 5430.6
27-Oct-
10
6012.6
5
28-Jan-
11
5512.1
5
30-Apr-10 5278 28-Jul-10 5397.55
28-Oct-
10 5987.7
31-Jan-
11 5505.9
3-May-10 5222.75 29-Jul-10 5408.9 29-Oct- 6017.7 1-e!-11 5417.2
MBA10008008 KES IEMS, HUBLI Page !<
Stock broking ltd.
10
4-May-10 5148.5 30-Jul-10 5367.6 1-"o#-10
6117.5
5 2-e!-11 5432
5-May-10 5124.9 2-Au$-10 5431.65 2-"o#-10 6119 3-e!-11
5526.7
5
6-May-10 5090.85 3-Au$-10 5439.55 3-"o#-10 6160.5 4-e!-11
5395.7
5
7-May-10 5018.05 4-Au$-10 5467.85 4-"o#-10 6281.8 7-e!-11 5396
10-May-10 5193.6 5-Au$-10 5447.1 5-"o#-10
6312.4
5 8-e!-11
5312.5
5
11-May-10 5136.15 6-Au$-10 5439.25 8-"o#-10 6273.2 9-e!-11
5253.5
5
12-May-10 5156.65 9-Au$-10 5486.15 9-"o#-10
6301.5
5
10-e!-
11 5225.8
13-May-10 5178.9
10-Au$-
10 5460.7
10-"o#-
10 6275.7
11-e!-
11 5310
14-May-10 5093.5
11-Au$-
10 5420.6
11-"o#-
10
6194.2
5
14-e!-
11 5456
17-May-10 5059.9
12-Au$-
10 5416.45
12-"o#-
10
6071.6
5
15-e!-
11 5481
18-May-10 5066.2
13-Au$-
10 5452.1
15-"o#-
10 6121.6
16-e!-
11 5481.7
19-May-10 4919.65
16-Au$-
10 5418.3
16-"o#-
10 5988.7
17-e!-
11
5546.4
5
20-May-10 4947.6
17-Au$-
10 5414.15
18-"o#-
10 5998.8
18-e!-
11
5458.9
5
21-May-10 4931.15
18-Au$-
10 5479.15
19-"o#-
10 5890.3
21-e!-
11 5518.6
24-May-10 4943.95
19-Au$-
10 5540.2
22-"o#-
10 6010
22-e!-
11 5469.2
25-May-10 4806.75
20-Au$-
10 5530.65
23-"o#-
10
5934.7
5
23-e!-
11
5437.3
5
26-May-10 4917.4
23-Au$-
10 5543.5
24-"o#-
10
5865.7
5
24-e!-
11 5262.7
27-May-10 5003.1
24-Au$-
10 5505.1
25-"o#-
10
5799.7
5
25-e!-
11
5303.5
5
28-May-10 5066.55
25-Au$-
10 5462.35
26-"o#-
10
5751.9
5
28-e!-
11
5333.2
5
31-May-10 5086.3
26-Au$-
10 5477.9
29-"o#-
10 5830 1-Mar-11 5522.3
date close date Close date close
1-Apr-11
5826.0
5 1-Jul-11 5627.2 3-Oct-11 4849.5
4-Apr-11
5908.4
5 4-Jul-11 5650.5 4-Oct-11
4772.1
5
5-Apr-11
5910.0
5 5-Jul-11 5632.1 5-Oct-11 4751.3
6-Apr-11
5891.7
5 6-Jul-11
5625.4
5 7-Oct-11
4888.0
5
7-Apr-11 5885.7 7-Jul-11
5728.9
5 10-Oct-11 4979.6
8-Apr-11 5842 8-Jul-11
5660.6
5 11-Oct-11
4974.3
5
MBA10008008 KES IEMS, HUBLI Page !;
Stock broking ltd.
11-Apr-11 5785.7 11-Jul-11 5616.1 12-Oct-11 5099.4
13-Apr-11 5911.5 12-Jul-11
5526.1
5 13-Oct-11
5077.8
5
15-Apr-11
5824.5
5 13-Jul-11
5585.4
5 14-Oct-11 5132.3
18-Apr-11 5729.1 14-Jul-11 5599.8 17-Oct-11
5118.2
5
19-Apr-11
5740.7
5 15-Jul-11 5581.1 18-Oct-11 5037.5
20-Apr-11
5851.6
5 18-Jul-11
5567.0
5 19-Oct-11
5139.1
5
21-Apr-11 5884.7 19-Jul-11
5613.5
5 20-Oct-11 5091.9
25-Apr-11 5874.5 20-Jul-11
5567.0
5 21-Oct-11
5049.9
5
26-Apr-11 5868.4 21-Jul-11 5541.6 24-Oct-11
5098.3
5
27-Apr-11 5833.9 22-Jul-11
5633.9
5 25-Oct-11 5191.6
28-Apr-11
5785.4
5 25-Jul-11 5680.3 26-Oct-11 5201.8
29-Apr-11 5749.5 26-Jul-11
5574.8
5 28-Oct-11 5360.7
2-May-11 5701.3 27-Jul-11 5546.8 31-Oct-11 5326.6
3-May-11
5565.2
5 28-Jul-11
5487.7
5 1-"o#-11
5257.9
5
4-May-11
5537.1
5 29-Jul-11 5482 2-"o#-11
5258.4
5
5-May-11
5459.8
5 1-Au$-11 5516.8 3-"o#-11
5265.7
5
6-May-11
5551.4
5 2-Au$-11
5456.5
5 4-"o#-11 5284.2
9-May-11 5551.1 3-Au$-11 5404.8 8-"o#-11
5289.3
5
10-May-
11
5541.2
5 4-Au$-11 5331.8 9-"o#-11
5221.0
5
11-May-
11
5565.0
5 5-Au$-11
5211.2
5
11-"o#-
11
5168.8
5
12-May-
11
5486.1
5 8-Au$-11 5118.5
14-"o#-
11
5148.3
5
13-May-
11
5544.7
5 9-Au$-11
5072.8
5
15-"o#-
11 5068.5
16-May-
11 5499
10-
Au$11 5161
16-"o#-
11
5030.4
5
17-May-
11
5438.9
5
11-
Au$11 5138.3
17-"o#-
11
4934.7
5
18-May-
11 5420.6
12-
Au$11
5072.9
5
18-"o#-
11 4905.8
19-May-
11 5428.1
16-
Au$11 5035.8
21-"o#-
11
4778.3
5
20-May-
11
5486.3
5
17-
Au$11 5056.6
22-"o#-
11
4812.3
5
MBA10008008 KES IEMS, HUBLI Page !=
Stock broking ltd.
23-May-
11
5386.5
5
18-
Au$11
4944.1
5
23-"o#-
11
4706.4
5
24-May-
11
5394.8
5
19-
Au$11
4845.6
5
24-"o#-
11
4756.4
5
25-May-
11
5348.9
5
22-
Au$11 4898.8
25-"o#-
11
4710.0
5
26-May-
11
5412.3
5
23-
Au$11 4948.9
28-"o#-
11 4851.3
27-May-
11 5476.1
24-
Au$11 4888.9
29-"o#-
11 4805.1
30-May-
11 5473.1
25-
Au$11 4839.6
30-"o#-
11
4832.0
5
31-May-
11
5560.1
5
26-
Au$11 4747.8 1-Dec-11
4936.8
5
1-Jun-11 5592
29-
Au$11 4919.6 2-Dec-11
5050.1
5
2-Jun-11
5550.3
5
30-
Au$11 5001 5-Dec-11
5039.1
5
3-Jun-11
5516.7
5 2-%ep-11 5040 7-Dec-11 5062.6
6-Jun-11
5532.0
5 5-%ep-11 5017.2 8-Dec-11
4943.6
5
7-Jun-11
5556.1
5 6-%ep-11 5064.3 9-Dec-11 4866.7
8-Jun-11
5526.8
5 7-%ep-11
5124.6
5
12-Dec-
11 4764.6
9-Jun-11
5521.0
5 8-%ep-11
5153.2
5
13-Dec-
11 4800.6
10-Jun-11 5485.8 9-%ep-11
5059.4
5
14-Dec-
11
4763.2
5
13-Jun-11 5482.8
12-%ep-
11 4946.8
15-Dec-
11
4746.3
5
14-Jun-11 5500.5
13-%ep-
11
4940.9
5
16-Dec-
11 4651.6
15-Jun-11 5447.5
14-%ep-
11
5012.5
5
19-Dec-
11 4613.1
16-Jun-11
5396.7
5
15-%ep-
11 5075.7
20-Dec-
11 4544.2
17-Jun-11 5366.4
16-%ep-
11
5084.2
5
21-Dec-
11
4693.1
5
20-Jun-11 5257.9
19-%ep-
11
5031.9
5
22-Dec-
11
4733.8
5
21-Jun-11
5275.8
5
20-%ep-
11 5140.2
23-Dec-
11 4714
22-Jun-11 5278.3
21-%ep-
11
5133.2
5
26-Dec-
11 4779
23-Jun-11 5320
22-%ep-
11
4923.6
5
27-Dec-
11 4750.5
24-Jun-11
5471.2
5
23-%ep-
11
4867.7
5
28-Dec-
11 4705.8
27-Jun-11 5526.6
26-%ep-
11 4835.4
29-Dec-
11
4646.2
5
MBA10008008 KES IEMS, HUBLI Page !!
Stock broking ltd.
28-Jun-11 5545.3
27-%ep-
11
4971.2
5
30-Dec-
11 4624.3
29-Jun-11
5600.4
5
28-%ep-
11 4945.9
30-Jun-11 5647.4
29-%ep-
11
5015.4
5

30-%ep-
11
4943.2
5
1-Dec-10 5960.9
2-Dec-10 6011.7
3-Dec-10 5992.8
6-Dec-10
5992.2
5
7-Dec-10
5976.5
5
8-Dec-10 5903.7
9-Dec-10 5766.5
10-Dec-
10
5857.3
5
13-Dec-
10
5907.6
5
14-Dec-
10 5944.1
15-Dec-
10 5892.3
16-Dec-
10
5948.7
5
20-Dec-
10
5947.0
5
21-Dec-
10
6000.6
5
22-Dec-
10 5984.4
23-Dec-
10 5980
24-Dec-
10 6011.6
27-Dec-
10 5998.1
28-Dec-
10 5996
29-Dec-
10
6060.3
5
30-Dec-
10
6101.8
5
MBA10008008 KES IEMS, HUBLI Page !E
Stock broking ltd.
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