SUMMER TRAINING PROJECT REPORT

ON
Study of Stock Exchange At TATA SECURITIES

FOR THE PARTIAL FULFILMENT OF THE DEGREE

BACHLOUR OF BUSINESS ADMINISTRATION

(TWO YEAR FULL TIME MANAGEMENT COURSE)
Batch (2015-2018)

SUBMITTED BY

KAMLESH SINGH RAWAT

BBA YEAR - 3rd
RTU Roll no. 6500079

UNDER THE GUIDANCE OF:

MR. MUKESH kumar jakhar
SUBMITTED TO:

Faculty of management studies

SHEKHAWATI GROUP OF INSTITUTION SIKAR.

(affiliated to PANDIT DINDYAL university)

 DECLARATION BY THE STUDENT

I KAMLESH SINGH RAWAT S/O MR. BALAM SINGH RAWAT student of

BBA YEAR-3 (2017-18) Hereby declare that I have completed a project as Summer trainee
on the topic Study of Stock Exchange At TATA SECURITIES for the partial fulfilment
of the degree of BBA course ,it is my original work and it has not been copied from others.

Place;-
Date;
SIGNATURE –
KAMLESH SINGH RAWAT
TABLE OF CONTENTS

S. NO.
TOPICS Page no.
EXECUTIVE SUMMARY 4
INTRODUCTION TO TOPIC 5
BOMBAY STOCK EXCHANGE 6
NATIONAL STOCK EXCHANGE 7
STOCK EXCHANGE 8
TATA SECURITIES 9
DEMAT SERVICES 14
CLIENT FOCUS 16
WIDE OPTION WHILE TRADING 21
TRADING DERIVATIVES 25
STOCK MARKET 32
HISTORY 33
IMPORTANCE OF STOCK MARKET 34
BEHAVIOUR OF STOCK MARKET 37
MARGIN BUYING 43
BASIC RISK IN TRADING 47
FINDING AND RECOMMONITION 51
CONCLUSION 53
BIBLIOGRAPHY
 ACKNOWLEDGEMENT

I would like to express my heartfelt thanks to many people. This dissertation is an effort
to contribute towards achieving the desired objectives. In doing so, I have optimized all
available resources and made use of some external resources, the interplay of which, over
a period of time, led to the attainment of the set goals.
I take here a great opportunity to express my sincere and deep sense of gratitude to my
esteemed faculty MR. MUKESH for giving me an opportunity to work on this project.
The support & guidance from sir, was of great help & it was extremely valuable.
I also express my sincere thanks to all the people who, directly or indirectly, contributed
in time, energy and knowledge to this effort.

KAMLESH SINGH RAWAT

1
 PREFACE

The microstructure of the stock market in which brokers work is highly Dynamic and
volatile. Many stocks are available to be bought and sold, each exhibiting its own patterns
and characteristics that are highly unpredictable. With so many options and
considerations that need to be taken into account, it is an extremely difficult task for a
broker to investigate aspects of the stock market and consistently provide effective
Advice to their clients.
Thus, brokers perform their day-to-day tasks with the aid of a broker system. Such a
system should provide tools for interacting with Exchanges and performing analysis. As a
consequence, these broker Systems are quite large and complicated by themselves. This
research aims to analysis Stock broker on the basis of their Services, products, growth,
and their competitiveness. Because Stockbrokers are one of the main participants in stock
exchanges Worldwide, they often act as an agent for their clients, making trades on their
behalf. They also act as advisors, providing suggestions to their Clients on what stocks to
buy and sell.

2
 EXECUTIVE SUMMARY

STUDY OF STOCK EXCHANGE AT “TATA SECURITIES LIMITED”

There is growing competition between brokerage firms in post reform India. For investor
it is always difficult to decide which brokerage firm to Choose.
Research was carried out to find which brokerage house people prefer and to figure out
what people prefer while investing in stock market. This study suggests that people are
reluctant while investing in stock and Commodity market due to lack of knowledge.
Main purpose of investment is returns and liquidity, commodity market is less preferred
by investors due to lack of awareness. The major findings of this study is that people are
interested to invest in stock market but them Lack knowledge. Through this report we
were also able to understand, what our Company’s (Tata securities) positive are and
strong points, on the basis of which we come to know what can be the basis of pitching to
a potential Client.
At the end of the report limitations, SWOT analysis, conclusion of the research and
Appendix which includes questionnaire and the list of the city where the Argent capital
are running. Last there is Bibliography, FAQ, and Glossary that has the technical terms of
the report.
 3
INTRODUCTION TO TOPIC

In most industrialized countries, a substantial part of financial wealth is not managed

directly by savers, but through a financial intermediary, which implies the existence of an
agency contract between the investor (the principal) and a broker or portfolio manager
(the agent). Therefore, delegated brokerage management is arguably one of the most
important agency relationships intervening in the economy, with a possible impact on
financial market and economic developments at a macro level. In most of the metros,
people like to put their money in stock options instead of dumping it in the bank-lockers.
Now, this trend pick pace in small but fast developing cities like Chandigarh, Gurgaon,
Jaipur, Ambala etc. My research is based on the residents of jaipur and its nearby areas.
As the per-capita-income of the city is on the higher side, so it is quite obvious that they
want to invest their money in profitable ventures. On the other hand, a number of
brokerage houses make sure the hassle free investment in stocks. Asset management
firms allow investors to estimate both the expected risks and returns, as measured
statistically.

There are mainly two types of Portfolio management strategies.

1. Passive Portfolio Strategy
2. Active Portfolio Strategy

1. Passive Portfolio Strategy: A strategy that involves minimal expectation

Input, and instead relies on diversification to match the performance of
Some market index. A passive strategy assumes that the marketplace will
Reflect all available information in the price paid for securities

2. Active Portfolio Strategy: A strategy that uses available information and

Forecasting techniques to seek a better performance than a portfolio that is

5
 6

BOMBAY STOCK EXCHANGES:

This stock exchanges, Mumbai, popularity known as “BSE” was established in 1875 as
“The native share and stock brokers associations”, as a voluntary non-profit making
association.

It has an evolved over the years into its status as the premiere stock exchanges in the
country. It may be noted that the stock exchanges the oldest one in Asia, even older than
the Tokyo Stock Exchanges, which was founded in 1878.

The exchanges, while providing an efficient and transparent market for trading in
securities, upholds the interests of the investors and ensures redressed of their grievances,
whether against the companies or its own members brokers.

It also strives to educate and enlighten the investors by making available necessary
informative inputs and conducting investor’s education programmers.

A governing board comprises of elected directors, 2SEBI nominees, 7 public

representatives and an executive director is the apex body, which decides the policies and
regulates the affairs of the exchanges.

The executive director as the chief executive officer is responsible for the day today
administration of the exchanges. The average daily turnover of the exchange during the
year 2000-01 (April-March) was Rs 3984.19 crores and average numbers of daily trades
5.69 Lakhs

However the averages daily turnover of the exchanges during the year 2001-2002 has
declined to Rs. 1224.10 crores and number of average daily trades 5.69 Lakhs.

The average daily turnover of the exchanges during the year 2001-2003 has declined and
number of average daily trades during the period is also decreased.The Ban on all
deferral products like BLESS AND ALBM in the Indian capital markets by SEBI with
effect from July 2, 2001, abolition of account period settlements, introduction of
compulsory rolling settlements in all scripts trades on the exchanges.With effect from
dec31, 2001 etc. have adversely impacted the liquidity and consequently there is a
considerable decline in the daily turnover at the exchanges. The average daily turnover of
the exchanges present scenario is 110363 (Laces) and number of average daily trades
1057(laces) 7
 8
NATIONAL STOCK EXCHANGES:

The NSE was incorporated is now 1992 with an equity capital of Rs 25 crores. The
international securities consultancy (ISC) of Hong Kong has helped in setting up NSE.

ISE has prepared the details business plans and installation of hardware and software
system. The promotion for NSE were financial institutions, insurances companies, banks
and SEBI capital markets Ltd, infrastructure leasing and financial services Ltd and stock
holding corporation Ltd.

It has been set up to strengthen the move towards professionalization of the capital
market as well as provide nation wide securities trading facilities to investors. NSE is not
an exchange in the traditional sense where broker own and manage the exchanges.

A two tier administrative set up involving a company board and a governing aboard of
the exchanges is envisaged. NSE is a national market for shares PSU bonds, debentures
and government securities since infrastructure and trading facilities are provided.

Stock Exchange
What is the role of a Stock Exchange in buying and selling shares?
The stock exchanges in India, under the overall supervision of the regulatory
authority, the Securities and Exchange Board of India (SEBI), provide a trading
platform, where buyers and sellers can meet to transact in securities. The
trading platform provided by NSE is an electronic one and there is no need for
buyers and sellers to meet at a physical location to trade. They can trade
through the computerized trading screens available with the NSE trading
members or the internet based trading facility provided by the trading members
of NSE.
What is Demutualisation of stock exchanges?
Demutualisation refers to the legal structure of an exchange whereby the
ownership, the management and the trading rights at the exchange are
segregated from one another.
How is a demutualised exchange different from a mutual exchange?
In a mutual exchange, the three functions of ownership, management and
trading are concentrated into a single Group. Here, the broker members of the
exchange are both the owners and the traders on the exchange and they
further manage the exchange as well. This at times can lead to conflicts of
interest in decision making. A demutualised exchange, on the other hand, has
all these three functions clearly segregated, i.e. the ownership, management
and trading are in separate hands.

10

COMPANY PROFILE

The securities and trading business is brought to you by Tata securities limited, a wholly
owned subsidiary of Tata capital limited. A Tata security limited is engaged in the
business of providing broking and distribution services to both retail and institutional
customers.

Tata securities limited distributes third party investment products and offer stock broking
services in its capacity as a member of the Bombay stock exchange limited (BSE), the
national stock exchange of India limited (NSEIL) and association of mutual funds of
India (AMFI). Tata securities limited is also a depository participant with the central
depository services (India) limited (CDSL) and national securities Depository limited
 (NSD)

11

TATA CAPITAL
Tata Capital is a finance company that fulfills the financial needs of retail and
institutional customers in India. It was established in 2007 as a wholly owned subsidiary
of Tata Sons and is registered with the Reserve Bank of India as a systemically important
non-deposit taking non-banking financial company (NBFC).
The company is focused on providing multiple financial services through an extensive
network of over 1,000 customer touch-points covering tier I, tier II and tier III cities.

Areas of business
Tata Capital has financial products and services in the following seven sectors:

·19 Distribution and broking: Third-party investment products, equity and commodity
trading for retail and institutional customers.

·20 Retail finance: Passenger and commercial vehicle loans, used car loans, personal loans,
home loans, credit cards and consumer durable loans for retail customers.

·21 Commercial finance: Financial products for small and medium enterprises and project
 finance for capital equipment and infrastructure.

·22 Investment banking: Advisory and debt and equity market products for corporate and
small and medium enterprises.

·23 Private equity: Investments in India and other countries.

·24 Wealth management: Suite of advisory and investment offerings for high net worth
individuals.

·25 Rural finance: Relevant financial products for rural customers, including financing of
farm equipment, agricultural inputs and agricultural enterprises.

The company has entered into an understanding with Japan-based Mizuho Securities Co
to promote an alliance in private equity, investment banking including cross border
merger and acquisition, securities business including broking and distribution, structured
finance and other business areas such as wealth management. It has also entered into an
understanding with Equifax Inc and CRISIL to develop plans to create a credit
information company in India.

12

Joint ventures, subsidiaries, associates

·26 Tata Securities (TSL): A wholly owned subsidiary of Tata Capital Limited engaged in
retail and institutional distribution and broking. TSL distributes third-party
investment products and offers stock broking services of buying, selling or dealing in
securities, including futures and options, in its capacity as a member of the Bombay
Stock Exchange and the National Stock Exchange. TSL is also a depository
participant.

·27 Tata Capital Markets (TCML): A wholly owned subsidiary of Tata Capital engaged in
debt and equity capital markets and M&A advisory. TCML has a category I merchant
banking license from the Securities and Exchange Board of India.

·28 E-Next: A KPO unit specializing in the area of financial services; owned by Tata Capital,
Tata Sons and others.
·29 Tata Capital also owns around 4 per cent of equity capital of Development Credit Bank,
a growing private sector bank.

Location
The company is headquartered in Mumbai, India.

13

MANADATORY DOCUMENT:-

·30 PROOF FO IDENTITY (For individual /Karta / Sole proprietor / Authorized person
(s) for Partnership, corporate and Trust)

Photocopy of PAN card

·31 PROOF OF ADDRESS (For individual / Karta / Sole proprietor / Authorized

person (s) for Partnerships, Corporate and Trust)

Photocopy of any one of the following:

Passport, Voter ID Card, Driving license, Bank Passbook, Rent Agreement, Ration
 Card, Current Telephone Bill, Current Electric Bill, Flat Maintenance Bill, and
Certificate Issued by employer registered under MAPIN, Insurance Policy.

·32 BANK AND DP PROOF:

·33 Letter from client’s banker certifying the account number and the period
from which the accounts in operation as per prescribed format.

·34 Copy of a pas book / bank statement containing name of the client

·35 Copy of current transaction statement / holding statement / certification by

DP containing the name of DP and client

4. PROOF OF INCOME AND ASSETS:

·36 Copy of the salary of the constituent for the last month

·37 Income tax statement for the last 2 financial years

·38 Assets liability statement

·39 Copy of the values certificate in case of immovable property

5.FOR MINORS:

In additional to the abovementioned documents, the following documents would also

be required for minors.

1.Birth certificate of Minor.

14

·40 ADDITIONAL DOCUMENTS FOR NON-INDIVIUALS:

·41 Copy of the balance sheet for the last 2 financial years (copies of annual balance
sheet to be submitted every years)

·42 Copy of latest share holding pattern including list of all those holding more than
5% in the share capital of the company, duly certified by the company secretary/
whole time Director/MD. (copy of updated shareholding patterns to be submitted
every year)

·43 Copies of the memorandum and articles of association in case of a company / body
corporate or partnership deed in case of a partnership firm

·44 Copy of the Resolution of Board of Directors’ approving participation in equity /

derivatives/ debts trading and naming authorized persons for dealing in securities.

·45 Photographs of partners/whole time directors, individual promoters holding 5% or

more, either directly or indirectly, in the shareholding of the company and of
persons authorized to deal in securities.

·46 Net worth certified by Chartered accountant.

·47 Declaration on letterhead of firm as per prescribed format for sole proprietorship
and partnership Firms.

15
 TATA SECUIRITIES LTD.
World class services that we offer for you:

·48 DEMAT A/C opening is free and after 1 year annual maintenance charge
(AMC) Rs/- 200 only.

·49 Trading software provided to its costumers is made by TATA CONSULTANCY

SERVICES (TCS).

·50 Calls made by TATA dealer hit’s 85% to 90%

·51 Online Pay In-Pay out by self if you have trading software.

·52 All market info. Regarding shares will notify you by calls, messages and email.

·53 Providing one stock dealer.

Our Brokerage rates:

INTRADAY DELIVERY

.03 paisa (Flexible) .30 paisa (Flexible)

Limits 4-6 times Limits 4-6 times

Documents needed for opening DEMAT A/C are:-

·54 PAN card.

·55 Address proof (voter ID, driving license, aadhar card)

·56 One Photograph passport size.

·57 6 months bank statement.

·58 Cheque with margin.

16

DEMAT SERVICES

A Tata securities is a registered member (Depository participant) of CDSL.

In this system, physical security holding are converted into electronic (or in other words,
dematerialized) holdings.

Why Tata securities Demat Account?

·59 Demat A/C free open.

·60 Demat access through internet and phone.

·61 Portfolio valuation on the account statements.

·62 Online execution of transactions at branches.

·63 Special rates for stock market intermediaries and sub brokers.

·64 Transaction update from back-office four times a day.

Transfer of shares and settlements

Transfer and settlements have never been easy as it under the depository system. All that
is required is an instruction slip from you. If you are selling securities then it has to be a
delivery instruction slip. If you are purchasing securities it has to be a receipt instruction
slip or standing instruction for credit.

Receipt of Corporate Benefits

Even securities establishment like bonus and right can be credit to your Demat account
electronically. All you have to do is choose the right option in the share application from.
Crash benefits like dividend and interest will, however be forward to you directly and not
through the depository.

17

Holding & Transaction Statements

We provide statements of holding cum transaction every month at Zero cost.

Dematerialization of shares

At you request we arrange to convert your physical holding into electronic from. To do
this would require opening an account with CDSL through us called “Beneficiary
Account” in the name and style in which the shares are held and lodge the share
certificates with us accompanied by a dematerialized request from, separate for each
scrip.

You are required to only make sure that CDSL has admitted that scrip for
dematerialization. An up to date list will be provided to you who will be constantly
updated.

Dematerialization

You have the option to convert your electronic shares back to physical shares.

Pledge-Hypothecation

You can also avail against your electronic shares. This process is also much faster than in
the case of physical shares
 18

WHY CHOOSE US?

CLIENT FOCUS

·65 Client relationship from the core of our business. We value each client, no matter
what size, as a long-term relationship. And we seek to provide unmatched services
to each client and place him as a partner at the center of everything we do.

·66 From the very beginning of the relationship, we work closely with every client to
identify his financial goals and risk tolerance levels and leverage our strength of
the product offering, research and financial strength to help achieve his goals. In
the process, we become a professional partners, creating opportunity, and adding
value and transform vision into reality.
Diverse services offering

·67 In addition to traditional broking services, we are also equipped to handle

commodity trading facility as well as currency derivatives and have access to a
wide range of financial services like IPOs, mutual funds and insurance.

Timely services

·68 In an increasingly competitive environment, clients today require personalized

solution and greater flexibility and responsiveness than ever before. Our
professionals are always ‘on call’. We provide them services throughout the year
and not just at the end of the year. We believe such service is essentials for
delivering solution and constructive relationship. 19

Able team

·69 We have developed a strong and enduring team by recruiting from leading
graduate and postgraduate universities and promoting from within. Our team
work together to provide superior results to our client. At the same time, each of
our clients is assigned a specific team member who ‘owner’ the relationship,
providing continuity, responsiveness and a point of easy access to the firm.

Culture

·70 We strive to maintain standards at all times and lay emphasis on honesty, integrity
and confidentiality. We speak and act to ensure transparency at all levels and in
everything we do.

Financial strength
·71 The strength of our balance sheet is such that it gives greater confidence to all our
retail and institutional clients in detail with us. The financial strength of the group
helps in future building the network and infrastructure to cater to the larger
market.

Back office:

For back office operations, we use the lidha Didha system of Apex Soft cell Pvt. Ltd. This
is one of the top most back office software in the industry. It has the capacity to process
over one lakh traders in a five minute frame. Our operation teams has an easy-to-navigate
client login system, which is used to generate activity reports, short-terms and long-term
tax reports, holding and portfolio valuation reports as well as trading to delivery activity
reports. We also have the requisite infrastructure needed to handles STP, upload and
download and download information to or from exchanges, bank and depositories,
support units to ensure delivery notes, bills and ledgers of trading accounts and cash
management services for efficient and effective fund management within the group.
20

Client interface: We have trading terminal (both direct and indirect), online
monitoring, control terminal (administration terminals) and back office support terminal
(settlement terminal) across all location and centers.

We have India’s best single screen Multi Exchanges Trading Software platform. Our entire
centers across the country are connected through our own network, leased ISDN lines and
LAN network, MPLS and internet.

The high-end IBM serves with sophisticated security features that we use caters to trading
points across the country. This also gives u rte advantage of scalability in terms of location
and size of our planned operations. We provide telephonic and chat support for technical
and functional issues of branches, franchises and all our clients. Our websites www.Tata
securities.com is comprehensive and provides online feeds, net trading and provides
online feed, net trading portfolio tracking tool. Investors also have access to a wide range
of financial news, information and various research reports facilitating quick decision-
making.

Our online trading portal at www.Tata securities.com is equipped with facilities like all
segment broadcasts, multi-features graphs, online payment gateways and automatic
password mailer utility for better security. It user-friendly navigation allows easy viewing
of trading accounts, depository accounts and research reports, which are linked to the
trading platform.

The website also has a provision for creating portfolios and monitoring them on a regular
basis. Our ‘wealth trackers’ module helps investors in getting ready updates n their
investment so that they can know the changing trends of the markets and the impact of
the same on their portfolio.

21

Internal control:

Compliance and internal control play a major role in determining business strategies as
well as day-to-day operation of the group. A well-equipped risk management department
ensures that the delinquency rates are minimal, while efficient risk management software
provides online MTM margin data to branches and franchisees. Our efficient back-up
system and software have been developed specially for branches and channel partners
with a capacity to handle numerous transactions. Our online position monitoring system
ensures better risk management and surveillance from our head office as well as branches
and franchises

Experienced professional:

Our teams of professional consist of individual with significant experience in securities

trading, market structure, trading technology and portfolio management. They have a
strong experience in trade execution and understanding of order flow dynamics. This
combined with technical analysis of market momentum, help our clients to determine the
price at which they buy and /or sell. We believe, we are the first choice for our clients
because we among the very best at trade executive solution and assets management
services. At Tata securities, each and every professional is focused on turning the initial
trade or investment into a collaborative, person-to-person relationship that keeps
delivering true added value.

Human Resources:

Human resources are the key to any services sectors industry. We have a strong and
vibrant workforce in every field or our activity, be it research, system, accounts,
marketing or networking. With the manpower strength of over 1100 employees, the
Company is managed by a highly motivated, qualified & talented team of professional
qualified CA’s, MBA, s, Engineers, etc with proven track records.

22

Technology:
Stock-broking being a process intensive activity, issues such as speed, accuracy, round-
the-clock system availability and system securities are of paramount importance and
technology forms the backbones of the business.

This is why Tata securities are technology driven. We boast of state-of-the-art technology
and an in-house team of highly competent software and networking engineers who
constantly review system and procedures to ensure operational efficiency.

All our branches are connected through Wide Area Network (WAN) and are served by a
centralized back office processing system, which enables clients to obtain up to date
information online at the click of a button.

Customer Focus:

Despite a rapidly expanding client base and a dizzying increase in transaction volumes,
each client at Tata securities is special. We specialize in building long term relationship
with our customers by providing them with the four things they desire most, viz., speed,
convenience, reliability and personalized services.

Our continuous strive to provide best services to our clients, results in receipt of not a
single Arbitration Award against the company since its inception.

23

WIDE OPTION WHILE TRADING:

A product for every need:

·72 A Tata security is the most comprehensive website, which allows you to invest in
 shares, mutual funds, derivatives (Future and Option) and other financial
products. Simply put, we offer you products for every investment need of yours.

Trading in shares:

·73 A Tata security offers you various options while trading in shares.

Cash trading:

·74 This is a delivery based system, which is generally done with the information of
taking delivery of shares or monies.

Margin Trading:

You can also do an intra-settlement trading up to 3 to 4 times your available funds, where
in you take long buy/short sell position in stocks with in the intention of squaring off the
position within the same day settlement cycle.

In margin trading, you take buy/sell position in stocks(s) with the intention of acquiring
off the position within the same settlement cycle. If, during the course of the settlement
cycle, he price moves in your favor (rises in case you have a buy position or falls in case
you have a sell position), you make profit. In case you have the option to take/give
delivery of buy/sell position respectively if you have sufficient cash/securities to do so.
Normally to buy shares, you have to place (ensure availability of limit) 100% of the order
value, while to sell shares, you need to have shares in your Demat account. However,
margins are blocked only to safeguard any adverse price movement.
24

Margin PLUS Trading:

·75 Through Margin PLUS you can do an intra-settlement trading up to 10 times your
available funds, where in you take long buy/sell position in stock with the
intention of squaring off the position within the same day’s settlement cycle.
 Margin PLUS will give a much higher leverage in your limits.

·76 Margin PLUS is an order placement feature where you can take a position at
market price and also place a cover order for the position specifying the SLTP and
the limit price. This will minimize the loss cover at the time of taking the position
itself. There by it gives a clear view of maximum downside involved in a
particular position at a particular price, Tata securities won’t levy a normal margin
ranging from 21% to 50%. It would block he maximum loss which customer can
suffer.

Spot Trading:

·77 This facility can be used only for selling you is demitting stocks which already
exist in your Demat account. When you are looking at an immediate liquidity
option, ‘cash on spot’ may work the best for you, on selling shares through “cash
on spot”, money is certified to your bank a/c the same evening & not on the
exchange payout date.

BTST:

·78 Buy today sell tomorrow (BTST) is a facility that allows you sell shares even on
1st and 2nd day after the buying order date, without you having to Waite for the
receipt of shares into your Demat account.

Call N Trade:

·79 Call N Trade allow you call on a local number in your city & trade on the
telephone through our customer services Executive.

·80 Trading in NSE/BSE: through Tata securities you can trade on NSE and BSE.

25
Market order:

·81 This is an order to buy sell securities at the best price obtainable in the market at
the time it is matched by the exchange. Therefore, change of its getting executed
are better. In case of market order for NSE, all market order placed which are not
executive fully; it becomes a limit order for the balance quantity at the last traded
price.

Market Order in BSE: Explanation:

Market order can be placed only during market hours (i.e., when the Exchanges is open
for trading).You could trade by placing market orders during market hours that allows
you to trade at the best obtainable price in the market at the time of execution of the
order.

Limit Order:

Limit Order is an order to buy or sell securities in which you specify the maximum price
per unit in case of a buy order and the minimum price per unit in case of sell order. The
actual transaction can be at a price more favorable than the price specified.

Allow you to place a buy/sell order at a price defined by you. The execution can happen
at a price more favorable than the price, which is defined by you, limit orders can be
placed by you during holidays & non market hours too.

Online confirmation of Order and trade:

You get online confirmation of orders and trades- the status of any order is updated on
real-time basis in the Order Book. As soon as you place your order they are validated by
the system and sent to the exchange for execution. The entire process is fully automation
and there are no manual interventions.

26
GTC, GTD and IOC Order:

A Good Till cancelled (GTC) order remains in the system until the trading members
cancels it. However, the system cancels this order if it is not trade within a number of
days parameterized by the Exchanges. A Good Till Days/Date (GTD) order allows the
user to specify the number of days/date till which the order should stay in the system if
not executed. The maximum number of days for which the GTC/GTD order can remain
in the system is notified by the exchange from time to time after which the day/date on
which the order is placed and inclusive of holidays. An immediate or cancel (IOC) order
allows the user to buy or sell a security as soon as the order is released into the system,
falling which the order is cancelled from the system. Partial match is possible for the
order and the unmatched portion of the order is cancelled immediately.

Disclose Quantity (DQ) Order:

Normally, the order quantity is disclosed in full to the market. An order with a disclosed
quantity (DQ) condition/attribute allows the trading members to disclose only a part of
the order quantity to the market. For example, an order of 1000 with a disclosed quantity
condition of 200 will mean that 200 is displaced to the market at a time. After this traded,
another 200 is automatically released soon till the full order is executed. DQ (Disclosed
Quantity) should not be less that 10% of the order quantity and at the same time should
not be greater than or equal to the order quantity.

Stop Loss Order:

A stop loss order allows the client to place an order which gets activated only when the
market price of the relevant securities reached or crosses a threshold price specified by
the investors in the form of ‘stock loss trigger price’. When a stop loss trigger price
(SLTP) is specified in a limit order, the order becomes one which is conditional on the
market price of the stock crossing the specified SLTP. The order remains passive (i.e. not
eligible for execution) till the condition is satisfied. Once the last traded price of the stock
reached or surpasses the SLTP, the order becomes activated and then on behaves like a
normal limit order. It is used as a tool to limit the maximum loss on a position.
 27

Stop Loss by Order:

‘A’ short sell reliance shares at Rs. 325 in experience that the price will fall. However, in
the event the price rises above his buy price ‘A’ would like to limit sell order specifying a
stock loss trigger price Rs. 305 and a limit price of Rs. 300.

Trade in derivatives:

Future:

Through Tata securities you can now trade in index and stock futures on the NSE in
future trading, you take buy/sell position in index or stock (S) contract having a longer
contract period of up to 3 month.

Trading in FUTURE is simple if, during the course of the contract life, the price moves in
favor (i.e. rises in case you have a bye position or sell in case you have a sell position),
you make a perfect. Presently only selected stock, which meet the certain liquidity and
volume, have been enabled for future trading. Calculate index and now your margin are
tools to help you in calculating your margin requirement and also the index & stock price
movement.

Option:

An option is a contract, which gives buyer the right to buy or sell shares at a specific
prices, on a before a specific date. For this, the buyer has to pay to the seller some money,
which is called premium. There is now obligation on the buyer to complete the
transaction if the price is not favorable to him. To take the buy/sell position on
index/stock option, you have to place certain % of order value as margin. With option
trading, you can leverage on your trading limit buy taken buy/sell position much more
that what you could have taken in cash segment.

28

The buyer of a call option has the right but not the obligation to purchase the underlying
asset at the specified strike price buy paying a premium whereas the seller of the call has
the obligation of selling the underlying asset at the specified strike price.

The buyer of a put option as the right but not the obligation to sell the underlying asset at
the specified strike price paying a premium whereas the seller of the put has the
obligation of buying the underlying the asset at the specified price. Buy paying lesser
amount of premium, you can create position order option and take advantage of more
trading opportunities.

Switch:
To suit your changing needs you may wish to shift monies between different schemes.
You can switch your monies online form one schemes to another in the some fund family
without any hassles.

Systematic investment plans (SIP)

SIP allows you to invest a certain some of money over a period of time periodically. Just
fill in investment amount, the period of investment and the frequency of investing and
submit. We will do the rest for you automatically investing periodically for you.

Systematic withdrawal plan:

This allows you to withdraw or certain some money over up period of time periodically.
Transfer-in: we can convert to existing mutual funds into electronic more through a
transfer-in request.

29

IPOS and BONDS Online:

You can also invest in initial public offers (IPO’s) and bonds online without going
through the hassles of filling any application form/paperwork.

Get –in-depth analysis for new IPO’s issue (initial public offering) which are about to hit
the market and analysis on these. IPO calendar, recent IPO listing, prospectus/offer
document, and IPO analysis are few of the features, which help you, keep

You can also invest in initial public offers (IPO’s) and bonds online without going
through the hassles of filling any application form/paperwork. Get –in-depth analysis for
new IPO’s issue (initial public offering) which are about to hit the market and analysis on
these. IPO calendar, recent IPO listing, keep on talk of the IPO markets
 30

Issue of Shares
Why do companies need to issue shares to the public?
Most companies are usually started privately by their promoter(s). However, the
promoters' capital and the borrowings from banks and financial institutions may
not be sufficient for setting up or running the business over a long term. So
companies invite the public to contribute towards the equity and issue shares to
individual investors. The way to invite share capital from the public is through a
'Public Issue'. Simply stated, a public issue is an offer to the public to subscribe
To the share capital of a company. Once this is done, the company allots shares
to the applicants as per the prescribed rules and regulations laid down by SEBI.
What are the different kinds of issues?
Primarily, issues can be classified as a Public, Rights or Preferential issues
(also known as private placements). While public and rights issues involve a
detailed procedure, private placements or preferential issues are relatively
simpler. The classification of issues is illustrated below:
Initial Public Offering (IPO) is when an unlisted company makes either a fresh
issue of securities or an offer for sale of its existing securities or both for the first
time to the public. This paves way for listing and trading of the issuer's
securities.
A follow on public offering (Further Issue) is when an already listed
company makes either a fresh issue of securities to the public or an offer for
sale to the public, through an offer document.
Rights Issue is when a listed company which proposes to issue fresh
securities to its existing shareholders as on a record date. The rights are
normally offered in a particular ratio to the number of securities held prior to the
issue. This route is best suited for companies who would like to raise capital
without diluting stake of its existing shareholders.

31
A Preferential issue is an issue of shares or of convertible securities by listed
companies to a select group of persons under Section 81 of the Companies
Act, 1956 which is neither a rights issue nor a public issue. This is a faster way
for a company to raise equity capital. The issuer company has to comply with
the Companies Act and the requirements contained in
the Chapter pertaining to preferential allotment in SEBI guidelines which interalia
include pricing, disclosures in notice etc.
Classification of Issues
What is meant by Issue price?
The price at which a company's shares are offered initially in the primary
market is called as the Issue price. When they begin to be traded, the
market price may be above or below the issue price.
What is meant by Market Capitalisation?
The market value of a quoted company, which is calculated by multiplying
its current share price (market price) by the number of shares in issue is
called as market capitalization. E.g. Company A has 120 million shares in
issue. The current market price is Rs. 100. The market capitalisation of
company A is Rs. 12000 million.

What is the difference between public issue and private placement?

When an issue is not made to only a select set of people but is open to the
general public and any other investor at large, it is a public issue. But if the
issue is made to a select set of people, it is called private placement. As per
Companies Act, 1956, an issue becomes public if it results in allotment to 50
persons or more. This means an issue can be privately placed where an
allotment is made to less than 50 persons.
 32

What is an Initial Public Offer (IPO)?

An Initial Public Offer (IPO) is the selling of securities to the public in the
primary market. It is when an unlisted company makes either a fresh issue of
securities or an offer for sale of its existing securities or both for the first time to
the public. This paves way for listing and trading of the issuer's securities. The
sale of securities can be either through book building or through normal public
issue.
Who decides the price of an issue?
Indian primary market ushered in an era of free pricing in 1992. Following this,
the guidelines have provided that the issuer in consultation with Merchant
Banker shall decide the price. There is no price formula stipulated by SEBI.
SEBI does not play any role in price fixation. The company and merchant
banker are however required to give full disclosures of the parameters which
they had considered while deciding the issue price. There are two types of
issues, one where company and Lead Merchant Banker fix a price (called fixed
price) and other, where the company and the Lead Manager (LM) stipulate a
floor price or a price band and leave it to market forces to determine the final
price (price discovery through book building process).
What does 'price discovery through Book Building Process' mean?
Book Building is basically a process used in IPOs for efficient price discovery. It
is a mechanism where, during the period for which the IPO is open, bids are
collected from investors at various prices, which are above or equal to the floor
price. The offer price is determined after the bid closing date.
 33

Importance Of Stock Market:

Function and purpose

The stock market is one of the most important sources for companies to raise money.
This allows businesses to be publically traded or raised additionally capital for expansion
by selling share of ownership of the company in a public market.

The liquidity that an exchange provides affords investors the ability to quickly and easily
sell securities. This is an attractive feature of investing in stocks, compared to other less
liquid investment such as real estates.

History has shown that the price of shares and other assets is an important part of the
dynamic of economies activity, and can influence or be an indicator of social mood.

An economy where the stock market is on the rise is considered to be an up and coming
economy.

In fact, the stock market is often considered the primary indicators of a country’s
economics strength and development. Rising share prices, for instance, tend to be
associated with increased business investment and vice versa.
Share prices also affect the wealth of household and their consumption.

Therefore, central banks tend to keep an eye on the control and behavior of the stock
market and, in general, on the smooth operation of financial system functions. Financial
stability is the raison d’être of central banks.

34

Exchanges also act as the clearinghouses for each transaction, meeting that they collect
and deliver the shares, and guarantee payment to the seller of a securities. This eliminates
the risk to an individual buyers or seller that the counterparty could default on the
transaction.
The smooth functioning of all these activities facilities economies growth in that lower
costs enterprise risks promote the production of goods and services as well as
employment.

In this way the financial system contribution to increased prosperity. An important aspect
of modern markets, however, including the stock markets, is absolute discretion.

For example, in the USA stock we see more unrestrained acceptance of any firm than in
similar markets. Such as, Chinese firms with no significant value to American society to
just name one segment.

This profit USA banker on Wall Street, as they reap large commissions from the
placement, and the Chinese company which yields funds to invest in china.

Yet accrues no intrinsic value to the long-term stability of the American economy, rather
just short-term profits to American business man and the Chinese; although, when foreign
company has a presence in the new market, there can be benefits to the market’s citizens.

Conversely, there are very few large foreign corporation listed on the Toronto Stock
exchange TSX, Canada’s largest stock exchange. This discretion has insulated Canada to
some degree to worldwide financial condition.

In order for the stock markets to truly facilitate economy’s growth via lower costs and
better employment, great attention must be given to the foreign participants being
allowed in. Relation of the stock market to the modern financial system.
The financial system in most western countries has undergone a remarkable
transformation. One features of this development is disintermediation. A portion of the
funds involved in saving and financing bank lending and deposit operation.
35
The general public’s heightened interest in investing in the stock market, either directly or
through mutual funds, has been an important component of this process. Statistics show
that in recent decades share have made up an increasingly large proportion of household’s
financial assets in many countries.
In the 1970’s, in Sweden, deposit account and other very liquid assets with little risk
made up almost 60 percent of households’ financial wealth, compared to less than 20
percent in the 2000s.

The major part of this adjustment in financial portfolio has directly to shares but a good
deal now take the form of various kinds of institutional investment for groups of
individuals, e.g., pension funds, mutual funds, hedge funds, insurance investment of
premiums, etc.

The trend towards form of saving with a higher risk has been accentuated by new rules
for most funds and insurance, permitting a higher proportion of shares to bonds.

Similar tendencies are to be found in other industrialized countries. In all developed

economies system, such as the European Union, the United State, Japan and other
developed nations, the trend has been the same: saving has moved away from traditional
(government insured) bank deposits to more risky securities of one sort or another.
 36

The Stock Market, Individual Investors, and Financial Risk:

Riskier long-term saving required that an individual possess the ability to manage the
associated increased risks. Stock prices fluctuated widely, in marked contrast to the
stability of (government insured) bank deposits or bonds.

This something that could affect not only the individual investors or households, but also
the economy on a large scale. The following deals with some of the risks of the financial
sectors in general and the stock market in particular.

This is certainly more important now that so many newcomers have entered the stock
market, or have acquired other ‘risky’ investment (such as ‘investment’ property, i.e., real
estate and collectables.)

With each passing year, the noise level in the stock market rises. Television
commentators, financial writers, analysis, and market strategies are all over taking each
other to get investors ‘attention’.

At the same time, individual investors, immersed in chat rooms and message boards, are
exchanging questionable and often misleading tips.

Yet, despite all this available information, investors find it increasingly difficult to profit.
Stock prices skyrocket with little reasons, then plummet just as quickly.

And people who have turned to investing for their children’s education and their own
retirement become frightened. Sometimes there appears to be no rhyme or reason to the
market, only folly.

This is a quote from the prefaces to a published biography about the long-terms value
oriented stock investors warren Buffett.

37

The behavior of the stock market:

From experiences we know that investors may ‘temporarily’ move financial prices away
from their long terms aggregate price ‘trend’ (positive or up trends are referred to as bull
markets: negative or down trends are referred to as bear markets.)

Over-reaction may occur so that excessive optimism (euphoria) may drive prices unduly
high or excessive pessimism may drive unduly low. New theoretical an empirical
arguments have since been put forward against the notion that financial markets are
‘generally’ efficient (i.e., in the sense that prices in the aggregate tends to follow a
Gaussian distribution.)

(But this largely theoretic academic viewpoint- knows as ‘hard’ EMH- also predicts that
little or no trading should take place, contrary to fact, since prices are already at or near
equilibrium, having priced in all public knowledge.) The ‘hard’ efficient-market
hypothesis is sorely tested by such events as the stock market crash in 1987, when the
Dow Jones index plummeted 22.6 percent—the largest-ever one-day fall in the United
States.

This events demonstrated that share prices can fall dramatically even though, to this day,
it is impossible to fix a generally agreed upon definite cause: a thorough search failed to
detect any ‘reasonable’ development that might have accounted for the crash. (But note
that such events are predicted to occur strictly by chance, although very rarely.)

It seems also to be the case more generally that many price movements (beyond that
which are predicted to occur ‘randomly’) are not occasioned by new information: a study
of the fifty largest one-day share prices movements in the United States in the post-war
period seems to confirm this.

However, a ‘soft’ EMH has emerged which does not required that prices remain at or near
equilibrium, but only that market participants not be able to systematically profits from
any momentary market ‘inefficiencies’.

38
Various explanation for such large and apparently non-random prices movement have
been promulgated. For instance, some research has shown that change in estimated risks,
and the use of certain strategies, such as stop-loss limit and value at Risk limits,
theoretically could cause financial markets to overcorrect.

But the best explanation seems to be that the distribution of stock market prices is non-
Gaussian (in which case EMH, in any of its current forms, would not be strictly
applicable.)

Other research has shown that psychological factors may result in exaggerated (statically
anomalous) stock prices movement (contrary to EMH which assumes such behaviors’
cancel out’).

Psychological research has demonstrated that peoples are predisposed to ‘seeing’

patterns, and often will perceive a pattern in what is, in fact, just noise, (something like
seeing familiar shapes in clouds or ink blots.)

In the present context this means that a succession of good new items about a company
may lead investors to overreact positively (unjustifiably driving the prices up). A period
of good returns also boosts the investor’s self-confidence, reducing his (psychological)
risk threshold.

Another phenomenon—also from psychology—that works against an objective

assessment is group thinking. As social animal, it is now easy to stick to an opinion that
differs markedly from that of a majority of the group.

An example with which one may be familiar is the reluctance to enter a restaurant that is
empty; people generally prefer to have their opinion validated by those of other in the
group.
In one paper the authors draw an analogy with gambling. In normal times the market
behaves like a game of roulette; the probabilities are known and largely independent of
the investment decision of the different players.

39
In times of market stress, however, the game becomes more like poker (herding behavior
takes over). The players now must give heavy weight to the psychology of other investors
and how they are likely to react psychology.
The stock market, as any other business, is quite unforgiving of amateurs. Inexperienced
investors rarely get the assistance and support they need.

In the period running up to 1987 crash, less than 1 percent of the analysis
recommendation had been to sell (and even during the 2000-2002 bear market, the
average did not above 5%).

In the run up to 2000, the media amplified the general euphoria, with reports of rapidly
rising share prices and the notion that large sums of money could be quickly earned in the
so called In the run up to 2000, the media amplified the general euphoria, with reports of
rapidly rising share prices and the notion that large sums of money could be quickly
earned in the so called new economy stock market.

(And later amplified the glom which descended during the 2000-2002 bear market, so
that by summer of 2002, prediction of a DOW average below 5000 were quite common).

Irrational behavior:
Sometimes the market seems to react irrationally to economic or financial news, even if
that news is likely to have no real effect on the technical value of securities itself.

But this may be more apparent than real, since often such has been anticipated, and a
counter reaction may occurs if the news is better (or worse) than expected.

Therefore, the stock market may be swayed in either by press releases, rumors euphoria
and mass panic; but generally only briefly, as more experienced investors (especially the
hedge funds quickly rally to take advantage of even the slightest, momentary hysteria.

Over the short-term, stock and other securities can be battered or buoyed by any number
of fast market-changing events, making the stock market behavior difficult to predict.
Emotion can drive prices up and down, people are generally not as rational as they think,
and the reasons for buying and selling are generally obscure.

40
Behaviorists argue that investors often behave ‘irrationally’ when making investment
decision thereby incorrectly pricing securities. This causes market inefficiencies, which,
in turn, are opportunities, to make money.
However, the whole notion of EMH is that these non-rational reactions to information
cancel out, leaving the prices of stock determined. The Dow Jones industrial Average
biggest gain in one day was 936.42 points or 11 percent, this occurred on October 12,
2008.

Crashes:
Robert shiller’s plot of the S&P composite Real prices, Earning, Dividends, and interest
Rates, from irrational exuberance, 2nd. In the prefaces to this edition, Shiller warns, “The
stock market has not come down to historical levels: the prices-earnings ratio as I defined
it in his book is still, at this writing [2005], in this mid-20s, far higher than the historical
average…..people still place too much confidence in the market and have too strong a
belief that paying attention to the gyration in their investment will someday make them
rich, and so they do not make conservative preparation for possible bad outcomes.”
Price-Earnings ratios as predictors of twenty-year returns based upto the plot by Robert
shiller. The horizontal axis shows the real price-earnings ratio of the S&P composite
stock price index as computed in Irrational Exuberance (inflation adjusted price divided
by the prior ten-year mean of inflation-adjusted earning).
The vertical axis shows the geometric average real annual return on investing in the S&P
composite stock prices index, reinvesting dividends, and selling twenty years-did do well
when prices were low relative to earnings at the beginning of the ten years.
Long-term investors would be well advised, individually, to lower their exposer to the
stock market when it is high, as it has been recently, and get into the market when it is
low.”

Stock market crash:

A stock market crash is often defined as a sharp dip in share prices of equities listed on
the stock exchanges. In parallel with various economics factors, a reason for stock market
crashes is also due to panic and investing public’s loss of confidence. Often, stock market
crashes end speculative economics bubbles.
There have been famous stock market crashes that have ended in the loss of billions of
dollars and wealth destruction on a massive scale. An increasing number of people are
involved in the stock market, especially since the social security and retirement plans are
being increasingly privatized and linked to stocks and bonds and other elements of the
market.

41
There have been a number of famous stock market crashes like the Wall Street crashes of
1929, the stock market crash of 1973-4, the Black Monday of 1987, the Dot-com bubble
of 2000, and the stock market crashes 2008.
One of the most famous stock market crashes started October 24,1929 on Black
Thursday. The Dow Jones industrial lost 50% during this stock market crash. It was the
beginning of the Great depression.
Another famous crash took place on October 19, 1987 --- Black Monday. On Black
Monday itself, the Dow Jones fell by 22.6% after completing a 5 year continuous roses in
share prices. This event not only shook the USA, but quickly spread across the world.
Thus, by the end of October, stock exchanges in Australia lost 41.8%, in Canada lost
22.5%,, in Hong Kong lost 45.8%, and in Great Britain lost 26.4%. The names, “Black
Monday” and “Black Tuesday” are also used for October 28-29, 1929.
This followed terrible Thursday –the starting day of the stock market crash in 1929. The
crash in 1987 raised some puzzles—main news and events did not predict the catastrophe
and visible reasons for the collapse were not identified.
This event raised question about many important assumptions of modern economics,
namely, the theory of rational human conduct, the theory of market equilibrium and the
hypothesis of market efficiency.
For some time after the crash, trading in stock exchanges worldwide was halted, since the
exchanges computers did not perform well owing to enormous quantity of trades being
received at one time.
This halt in trading allowed the Federal Reserve System and central banks of other
countries to take measures to control the spreading of worldwide financial crisis.
In the United State the SEC introduction several new measures of control into the stock
market in an attempt to prevent a re-occurrence of the events of Black Monday.
Computer systems were upgrades in the stock exchanges to handle larger trading volumes
in a more accurate and controlled manner. The SEC modified the margin requirement in
an attempt to lower the volatility of common stocks, stock option and the futures markets.
The New York Stock Exchanges and the Chicago Mercantile Exchange introduction the
concept of a circuit breaker. The circuit breaker halts trading if the Dow declines a
prescribed number of points for a prescribed amount of time.
·82 New York Stock Exchange (NYSE) circuit breakers.
 42

Stock market index

·83 The movement of the prices in a market or sections of a market are captured in
price indices called stock market indices, of which there are many, e.g., S&P, the
FTSE and the Euro next indices.

·84 Such indices are usually market capitalization weighted, with the weight
reflecting the contribution of the stock of the index are reviewed frequently to
include/exclude stocks in order to reflects to reflects the changing business
environment.

Leveraged strategies

·85 Stock that a traders does not actually own may be traded suing short selling;
margin buying may be used to purchase stock with borrowed funds; or,
derivatives may be used to control large blocks of stock for a much smaller of
amount of money than would be required by outright purchases or sale.

Short selling

·86 In short selling, the traders borrow stock (usually from his brokerage which holds
it’s client’s shares or its own share on account to lend to short sellers) then sells it
on the market, hoping for the price to all.
·87 The trader eventually buys back the stock, making money if the price fell in the
meantime or losing money if it rose; exiting a short position by buying back the
stock is called “covering a short position”.

·88 This strategy may also be used by unscrupulous traders to artificially lower the
price of a stock. Hence most markets either prevent short selling or place
restriction on when and how a short sale can occur.

·89 The practice of naked shorting is illegal in most (but not all) stock markets.\

43
Margin buying:

·90 In margin buying, trader borrows money (at interest)to buy a stock and hopes for
it to rise. Most industrialized countries have regulation that requires that if the
borrowing is based on collateral from other stock the trader owns outright, it can
be a maximum of a certain percentage of those other stocks’ value.

·91 In the United State, the margin requirements have been 50% for many years (that
is, if you want to make a $100 investment, you need to put up$500, and there is
often a maintenance margin below the $500).

·92 A margin call is made if the total value of the investor’s account cannot support
the loss of the trade.

·93 (Upon a decline in the value of the margined securities additional funds may be
requires to maintain the account’s equity, and with or wit out the margined
securities or any others within the account may be sold by the brokers to protect
its loan position. This investors is responsible for any shortfall following such
forced sale).
·94 Regulation of margin requirement (by the Federal Reserve) was implemented
after the crash of 1929. Before that, speculators typically only needed to put up a
little as 10% (or even less) of the total investment represented by the stocks
purchased.

·95 Other rules may include the prohibition of free-riding: putting in an order to buy
stocks without paying initially (there is normally a three-day grace period for
delivery of the stock.)

·96 But then selling them (before the three-days are up) and using part of the proceeds
to make the original payment (assuming that the value of the stocks has not
declined in the interim).

44

New issuance:

·97 Global issuance of equity and equity-related instrument totaled $505 billion in
2004, a 29.8% increase over the $389 billion raised in 2003. Initial public offer
(IPOs) by US issuers increased 221% with 233offering that raised $45 billion, and
IPOs in Europe, Middle East and Africa (EMEA) increased by 333% from $9
billion to $39 billion.

Investment strategies:

·98 One of the many thing people always want to know about the stock market is,
“How do I know money investing?” There are many different approaches; two
basic methods are classified as either fundamental analysis or technical analysis.
·99 Fundamental analysis refers to analyzing companies by their financial statements
founds in SEC Filing, business trends, general economic conditions, etc.

·100 Technical analysis studies prices action in market through the use of charts
and quantitative techniques to attempt to forecast prices trends regardless of the
company’s financial prospects.

·101 One examples of a technical strategy is the Trend following method, used
by John W Henry and risk control and diversification.

·102 Additional, many choose to invent via the index method. One holds a
weight or unweight portfolio consisting of the entire stock market or some
segment of the stock market (such as the S&P 500 or Wilshire 5000).

·103 The principle aim of this strategy is to maximize diversification, minimize

taxes from too frequent trading and ride the general trend of the stock market
(which, in the U.S, has averaged nearly 10% year, compounded annually, since
World War II).

45
 Taxation:

·104 According to much national or state legislation, large arrays of fiscal

obligation are taxed for capital gains. Taxes are charged by the state over the
transactions, dividends and capital gains on the stock market, in particular in the
stock market.

·105 However, these fiscal obligations may vary from jurisdiction to

jurisdiction because, among other reasons, it could be assumed that taxation is
already incorporated into the stock prices through the different taxes companies
pay to the state, or that tax free stock market operations are useful to boost
economic growth.
 46

Objectives of study:

·106 To understand & analyze the marketing strategies and analyze online

·107 Trading of Tata Securities ltd.

·108 To improve the format of daily sales report (DSR)

·109 To get the Demat account opened of potential customers in favor of Tata
Securities. Analysis of need and satisfaction of distribution of financial
services.

·110 To give a brief idea about the benefits available from Mutual Funds
investment and idea of types of schemes available.

·111 To discuss about the market trends of Mutual Funds investment.

·112 To study some of the mutual funds schemes and analyze them observe the
funds management process of mutual funds.

·113 Explore the recent developments in the Mutual Funds in India. To give an idea
 about the regulations of Mutual Funds.

47

FINDING AND RECOMMENDATION:

During my project analysis I was very keen to find some key areas which need to be
taken care seriously in the future because these are causing dissatisfaction among
distributors.

Most of distribution felt dissatisfaction with their brokers but some of disappointing areas
are-

·114 More exposure: Most of distributors want some more exposure for them clients
from their share broking companies. A Tata security is now providing super
exposure p to 15 of the margin (cash segment) the step like this really creates
satisfaction for the distributors.

·115 Brokerage problem: Some companies have very high brokerage chares which
create differences of market share of different companies and also dissatisfaction
among distributors.

·116 Fewer offers: Most of companies lag behind in giving time to time offers in order
to attract new customers.
LIMITATIONS:

·117 The time constraint was one of the major problems.

·118 The study of limited to the different schemes available under the mutual funds
selected.

·119 The study is limited to selected mutual fund schemes

·120 The lack of information sources for the analysis part.

48

Recommendation for the concerned companies:

·121 Mass reach- The new and different offers should be communicated to the large
value of potential inventors so that the offers can hit the target.

·122 Full information- The companies should reveal all the information regarding
any scheme so that investors can feel free to invest.

·123 All risks should be communicated by distributors of financial

services- It is very important for distributors to make the customers aware about
all the risks involved and he could not blame for any loss to the company.
·124 Misconceptions- There are many misconceptions in the mind of common
people that Mutual funds, online share trading etc. are only for ‘big ones’ & they
can’t enter in this field and if they will enter they will suffer losses so, by giving
example of active investors various misconceptions should be removed.

·125 Simple procedure-many potential investors are computer illiterate so they

never try their hand free.

·126 Target rural areas also- many potential investors are also trust in rural areas.
They come to cities (like in Jaipur) for various works. There should some special
offers to attract them in share trading.

·127 Employees should be trained- It is very necessary for the employees to

give an effective demo to the client about the use of various services of share
broking etc. many times they fail to make the offer understandable to the client,
this is the drawback to be overcome.

·128 Some offers for women should be introduced to get a new share of market.

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CONCLUSION

The expectations of the customers are regularly increasing because of the increasing
competition and emergence of global market. In such conditions it becomes very
necessary for a company to fulfill all the expectations of the customers and give them a
delightful experience.
A Tata securities aims to provide better services by consistently improvement. The study
concluded: - Tata securities Ltd. has better Portfolio Management services than
Other Companies Tata securities Ltd. keeps its process more transparent. Tata securities
Ltd. is giving more returns to its investors. Tata securities charges are less than other
stock brokers.
Tata securities are providing daily updates about the stocks information. Investors are
looking for those investment options where they get Maximum returns with less costs.
Market is becoming complex & it means that the individual investor will not have the
time to play stock game on his own. People are less aware about the Services provided by
Tata securities

BIBLIOGRAPHY:

·129 Www. Tata securities.com

·130 www.hseindia.com

·131 www.tatacapital.com

·132 www.google.com

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