ORGANISATIONAL STUDY OF HEDGE FINANCE, KOCHI

INTERNSHIP REPORT

Submitted to

MAHATMA GANDHI UNIVERSITY, KOTTAYAM

In partial fulfilment of required for the award of

BACHELOR DEGREE IN COMMERCE

SUBMITTED BY

GOPIKRISHNAN.N

170021080684

Under the guidance of

Mr. Ashish.C.Pious

(Head of department)

RAJAGIRI COLLEGE OF MANAGEMENT AND APPLIED SCIENCES

KAKKANAD
 DECLERATION

I, GOPIKRISHNAN.N , hereby declare that the

presented report of internship titled “ORGANISATIONAL STUDY” of
HEDGE FINANCE, KOCHI is uniquely prepared by me after the
completion of one month work at Kochi branch of Hedge finance.

I also confirm that the report is only prepared for my academic

requirement, not for any other purpose. It might not be used with the
interest of the opposite party of the corporation.
 ACKNOWLEDGEMENT

First of all, I thank Almighty God for all His blessings.

I would like to express my deep sense of gratitude to our principal
Rev Fr A.J.Savins for his innovative ideas and encouragement for this
work.
I would like to express my deep gratitude to Mr. Ashish C Pious
(head of department) for his innovative ideas and encouragement for
this work.
I would like to express my deep gratitude to Mrs. Chithra V Menon
(Assistant Professor, department of marketing) for her innovative
ideas and work.
I would like to express my sincere thanks to “HEDGE FINANCE,
KOCHI” for providing wonderful opportunity to do study in the
organisation.
I hereby, extend our thanks to Mr Rajanikanth C.S Assistant Vice
President of Hedge Finance, Kochi for his sustained encouragement
and co operation which helped us for completing this study and also
other employees of Hedge for their assistance and co operation.
I take this opportunity to thank my parents and friends helped us and I
would like to record my special thanks to other people who have
helped us directly or indirectly in bringing out this report successfully.
 INDEX

SL.NO CONTENT PAGE NO

1. INTRODUCTION

2. INDUSTRY PROFILE

3. COMPANY PROFILE

4. CONCLUSION

5. BIBILIOGRAPHY

6. SUGGESTIONS
 INTRODUCTION

The Indian Broking industry has grown rapidly in the past

couple of years. Financial intermediaries have played a significant role
in recovering the chaotic economic conditions in the recent years and
this has therefore given a new life to the broking industry in the
financial sector. Increased competition and newer opportunities have
been a driving force for the changes in the trading pattern,
improvement in technology, diversification of operations and
introduction of new products. The various investor awareness
programs and regulations have also contributed to creating an
environment that is favourable for the growth of the Broking industry
in India.

The advent of technology has resulted in rapid increase in the

internet-based broking segment. This rapid growth of online trading in
terms of size and volume has resulted in easy accessibility and faster
facilitation through various technological platforms. A major trend of
consolidation is also seen in the current scenario, as many small stock
broking firms find it difficult to retain their clients due to difficulties
in providing value added services.
 According to ICRA, in its earlier reports on the Brokerage
Sector in FY12-13- ‘The industry is witnessing signs of consolidation.
The market share of the top 100 brokers on the NSE has increased
substantially to ~89% as at August 2013 from 77% as at March 2013
and 73% as at March 2011. With companies needing to continuously
spend on upgrading their technology framework, the current
environment provides opportunity for the larger players to further
consolidate their positions. Further, we believe that the mid-sized
brokers are being forced to cut back and shut businesses in those areas
where they do not have scale whereas some of the smaller brokers face
survival issues.
 INDUSTRY PROFILE

ALL ABOUT STOCK BROKING:

Stock broking is where a person (or an organization), who is

licensed to participate in the securities market, buys and sells securities
and shares on the behalf of their clients. Such individuals or
organizations are known as stock brokers. They play the role of an
agent. The process of buying and selling of stock is done through a
stock exchange which is a mutual organization that facilitates the
trading of securities and shares among the stockbrokers. There are
many stock exchanges in the world such as the NASDAQ in the U.S.,
London Stock Exchange, Bombay Stock Exchange, Tokyo Stock
Exchange and Australian Stock Exchange (ASX).

A stock broker is a person who provides valuable service and

information to an investor to help him in making correct investment
decisions. They perform different functions based on the needs of the
clients. The following are the three major roles they play.

1. Execution Only role: The stock broker specifically carries

out the instructions given by the clients regarding the buying and
selling of stocks.
2. Advisory Dealing role: The stock broker advises the clients
as to what type of shares and securities they should consider while
buying or selling. However, the final decision regarding the trade lies
with the client.
3. Discretionary Dealing role: The stock broker sells/buys
securities and shares on behalf of the clients, based on the investment
objective of each client

Stock brokers are governed by SEBI Act, 1992, Securities

Contracts (Regulation) Act, 1956, Securities and Exchange Board of
India [SEBI (Stock brokers and Sub brokers) Rules and Regulations,
1992], Rules, Regulations and Bye laws of stock exchange of which
he is a member as well as various directives of SEBI and stock
exchange that is issued from time to time. Every stock broker is
required to be a member of a stock exchange as well as registered with
SEBI. Only Govt. tax rates like, security transaction tax, stamp duty
and service tax are uniform. Other charges like brokerage for delivery
trades, intraday trades, minimum transaction charge, statement
charges, DP charges, annual maintenance charges etc., may vary from
one broker to another.

There are many types of stock brokers. Some of them are:

 Full service stock broker/investment advisor: They analyze

portfolios, suggest stocks, offer clients accounts from which they can
buy stocks, and provide a whole range of other services. These
stockbrokers charge commissions for their service, usually from one
to three percent of the money invested. Full-service stockbrokers
charge at the high end of the range.
 Discount stock broker: They only carry out the transactions,
such as buying or selling stocks, as desired by the client. People who
prefer to do their own research into their investments mostly go to a
discount broker.

A Sub-Broker is a person who is not a member of the Stock

Exchange but acts on behalf of a member-broker as an agent; or who
assists the investors in buying, selling and dealing in securities through
such member-brokers.

The two main functions that a stock broking firm engages in

are:

 Underwriting: When a stock broking firm owns a new

security issue in its inventory, it takes on a certain amount of risk. The
reward for taking on this risk is obtained through the profit that the
underwriting firm makes from the difference in the buying and selling
prices. The issuer does not have to assume the same risk since he is
assured of the payment by the underwriter regardless of the price at
which the selling takes place.
 Principal Trading: A stock broking firm either acts as a
principal or as an agent. As a principal, it holds the securities (that are
traded in the secondary market) in its own inventory for a certain
period of time and then sell them off at a higher price later. As an
agent, it only participates in the trading on behalf of the seller or the
buyer but it does not own the securities at point during the transaction.

The financial market has recently seen a major rise in the

popularity of stock broking as these days more people want to invest
in securities that offer quick and higher returns. But they either do not
have the required expertise and knowledge to make sound investment
decisions or they lack the time to continuously follow the trends in the
market. Hence stock broking is seen as a wise option to make good
investments.

EVOLUTION OF STOCK BROKING INDUSTRY IN INDIA

The history of stock brokers dates back to 1602 during which

the first stock exchange started its operations in Amsterdam. The
Amsterdam Stock Exchange was involved in buying and selling of
shares for the Dutch East India Company. However, later on the stock
exchanges that came up in the United States, especially the New York
Stock Exchange or Wall Street (as it is called now), gained more
popularity and became the hub of brokerage activities.

The Indian Stock Broking industry is one of the oldest trading

industries that existed even before the establishment of the BSE in
1875. In 1864, there were almost 1000 brokers in Mumbai who traded
in stocks.

In the 1970s the Foreign Exchange Regulations Act (FERA)

was introduced that helped in giving a new momentum to retail
investing since it encouraged many MNCs to divest their foreign
equity.

The Securities and Exchange Board of India (SEBI), which

was set up in 1988 as an administrative arrangement, was given
statutory powers after the enactment of the SEBI Act in 1992. The
main function of SEBI was to protect investor interests in securities,
to promote the development of securities markets and to regulate the
securities markets.

Later in the nineties, the numerous economic reforms that

were introduced brought about many changes such as abolition of
open outcry, introduction of electronic trading, consent for FIIs and
for ADRs/ GDRs, transparency in IPO issues, T+2 settlement cycles,
dematerialisation of shares and e-broking.
 The broking industry is fast emerging as a high growth
segment in the Indian financial services map, in terms of business
growth, distribution and network, and enterprise value. Even though
there are plenty of brokerage firms in India, currently the brokerage
segment is largely dominated by the foreign brokerage.

Figure 1: NSE and BSE website, ICRA analysis

SOME OF THE MAIN INDUSTRY PLAYERS

1. SHAREKHAN LIMITED
2. INDIA BULLS
3. ANGEL BROKING LIMITED
4. RELIANCE MONEY
5. INDIA INFOLINE LIMITED
6. KOTAK SECURITIES LIMITED
7. ICICI DIRECT
 8. MOTILAL OSWAL SECURITIES
9. HDFC SECURITIES
10. BAJAJ CAPITAL

COMPANY PROFILE

Hedge Equities Ltd. is one of the leading retail stock broking

house, running quite successfully in the country. Hedge offers a wide
range of equity-related services including trade execution on BSE,
NSE, derivatives, depository services, online trading, investment
advice etc. to its customers. The firm also has an online trading and
investment site –www.hedgeequities.com. This site gives access to
superior content and transaction facility to the retail customers across
the country. It aims at simplifying the process of investing in stocks.

Hedge Equities is a company that has been built on the cutting

edge experience of its founders, of over 25 years. Even though they
belong to various industries each one of them is backed with a strong
expertise in global financial markets. The Board comprises of experts
from different industries: FedEx Securities, Baby Marine Exports,
Thakker Developers, Smart Financial, S.M.Hegde (CFO – Videocon
Industries), and Padmashree Mohan Lal.
 HISTORY AND INCORPORATION

Alex K Babu, the managing director of Hedge Equities,

entered into the family business of seafood exports Baby Marine
Exports, after completing his graduation in engineering. After
receiving a thorough exposure in finance from the business, he entered
the financial market by starting up a stock broking company-Hedge
Equities Private Ltd, by 2007.

When Hedge Equities was launched, the Sensex was at

13,000. It soon touched its lowest point, at 8000, in two months. But
due to a strong capital back up, the company was able to counter the
recession with the aid of an aggressive marketing campaign and
through a wide expansion of its network. It was successful in setting
up 50 branches in the first six months. When the market recovered,
Hedge gained from the brand name it had created.

Hedge Equities was incorporated under the Companies Act

1956 as Hedge Equities Private Limited on 17th December 2007 with
the registered office at 1205, Dalamal Tower, Nariman Point. Later
the company was converted into public limited company on 17th
February, 2009.

Hedge Equities Limited's Annual General Meeting (AGM)

was last held on 28 September 2013 and as per records from Ministry
of Corporate Affairs (MCA), its balance sheet was last filed on 31
March 2013.

Hedge Equities Limited's Corporate Identification Number is

(CIN) U65990MH2007PLC176866 and its registration number is
176866.

Its registered address is 1205, DALAMAL TOWER,

NARIMAN POINT,, MUMBAI - 400021, Maharashtra INDIA.

CORPORATE OFFICE

The corporate office of Hedge is in Mamangalam, Cochin,

Kerala.

Hedge Equities has 54 branches & 52 franchises which are

spread across 4 states in India (Kerala, Karnataka, Tamil Nadu and
Maharashtra) & in Dubai.

It has opened 120 branches in Kerala in the last two years,

against an initial target of 50. Hedge owns most branches, unlike most
peers who prefer the franchisee model.

VISION OF THE COMPANY

‘At Hedge Equities, we endeavour to become a well reputed

financial services super-mart catering to the evolving needs and
unique requirements of our clientele, and partnering with them to
Build, Manage, and Grow their Wealth.’
 MISSION OF THE COMPANY

To create an ethical and sustainable financial services

platform for our customers and partner them to build business, to
provide employees with meaningful work, self-development and
progression, and to achieve a consistent and competitive growth in
profit and earnings for our shareholders and staff.

PROMISE

“To our Customers: We exist to serve and meet your needs.

Our focus is to create an ethical and sustainable financial services
platform that places your unique needs over and above everything else.

To our Employees: We will provide our employees with a

meaningful and rewarding career with emphasis on self development
and career progression.

To our Shareholders: We will spare no efforts to achieve a

consistent and competitive growth in earnings and profitability.”

THE HEDGE ADVANTAGE

 At Hedge Equities, the needs of our Customers stand before

everything else.
  SEBI Registered Portfolio Manager with a dedicated
Wealth Management Services desk that aims to provide objective
guidance tailored to meet each customer’s individual needs.
 Strong Research Team backed with best of breed data
mining and analysis.
 Industry leading technology solutions that make portfolio
administration simpler and cost effective.
 A Global Outlook blended with a Local Flavour and backed
with a growing network of over 120 service outlets, 450 qualified
employees, and over 200 support associates.
 The Trust and Goodwill of over 20,000 satisfied customers.
 Member of BSE, NSE, MCX, MCXSX,NMCE,NCDEX
and Depository Participant in CDSL
 Rated as the top brand by the investor community of
Asianet channel
 Growing overseas presence with operations in Middle East
and an expanding presence in the European region and North America.

CO0RPORATE SOCIAL RESPONSIBILITY

Hedge Equities has initiated a Non Profit movement Hedge

Yuva, as a part of its Corporate Social Responsibility, which basically
focuses on educating the masses about Stock Market. The movement
aims at inculcating equity investing habits in college students. As part
of the programme, faculty from Hedge conduct presentations on
equity investment and a quarterly review of the investment portfolios
which is organised in association with finance clubs in colleges,. The
movement has also formulated various scholarship programs for the
youth.

INITIAL INVESTMENTS

Hedge Equities is classified as an Indian Non-Government

Company and is registered at the Registrar of Companies, Mumbai. Its
authorized share capital is Rs. 150,000,000 and its paid up capital is
Rs. 137,804,992.

PROMOTERS

 FEDEX SECURITIES

FedEx is a SEBI registered category I merchant banker that is

managed by a team of ex-bankers. The company concentrates on non-
fund based activities like structuring, tie up of project financing,
financial restructuring, investment banking, corporate and advisory
services. FedEx has offices in Nariman point and Vile Parle East,
Mumbai. The core management team consists of bankers with rich
experience in commercial and investment banking.

 BABY MARINE EXPORTS

Baby Marine Group, a leading Exporter of processed marine

products, started its operations in 1977 from Kozhikode and has grown
into three units and related industries that spans both the west and east
coasts of Indian. The three units namely, Baby Marine Exports, B.M
products, and Baby Marine (Eastern) Exports, are mainly aided by pre
processing units, ice factories and a fleet of insulated and refrigerated
trucks for sea food transportation.

 SMART FINANCIAL

Smart Financial is a leading financial service provider that

entered the financial market in1992. The company offers guidance to
investors as to equities, commodities, mutual funds, portfolio
management services and insurance. It offers a complete range of
financial solutions that encompasses every sphere of life.

 THAKKER GROUP

Thacker’s group that started off as a land developer and

builder in 1962, gradually diversified into commercial production of
agricultural and horticultural products, housing real estate marketing,
plantations etc. Thakker developer is the flagship company of the
group. It was established as a private limited in 1987 and later went on
to become the only public limited company in North Maharashtra that
was engaged in housing, commercial construction and land
development.

 S. M. HEDGE

Mr S. M. Hedge, a chartered accountant by profession, is the

Chief Finance Officer of the Indian Multinational Videocon
International and has been at the helm of affairs for the last 20 years.

 PADMASHREE BHARAT MOHANLAL

Padmashree Bharat Mohanlal, the South Indian movie actor,

has a few business ventures, which include Vismaya Max Film Post
production studio, college for dubbing artists at the Kinfra fill and
Video Park, Trivandrum. He is also the director of Uni Royal Marine
Exports; a Kozhikode based major Seafood Export Company.
MANAGEMENT

DIRECTORS

 ALEX K BABU

Alex K Babu is the Founder, Chairman, and Managing Director

of the Hedge Group of Companies. He is recognized for his youthful
zeal, creativity and business intelligence. He believes his role as a
business leader is to lead his organization and society through
change. According to him, the most effective way to run a company
successfully is by utilising all the resources with the objective of
bringing about a revolutionary change.

 V.S.N BHUVANENDRAN

V.S.N. Bhuvanendran who is the Chief Executive Officer of

Hedge Group of Companies, is also a writer for various financial
journals. In addition, he hosts a market related show which aims at
providing expert advices and answers to financial queries of
professionals and investors, in a leading Malayalam television
channel.
  BOBBY J ARAKUNNEL

Mr. Bobby the COO of Hedge Group of Companies, is

responsible for the entire operations of Hedge Equities. He has
showcased excellent Man-Management and Marketing Activities and
is well versed in all aspects of Indian Financial Markets. In the last 12
years, he has worked with all the major players in the financial service
sector of the country.

 MR. JOY ARRACKAL

Mr. Joy Arrackal is a successful entrepreneur with varied

business interests in Dubai and India spread across Petrochemicals,
Oil Trading, Telecom, Agriculture, Hospitality, and Construction.

He also owns and operates Oil Tankers in Dubai. Mr. Joy currently
serves as the Managing Director of Fringford Estates Ltd and is also
a Director with Hill Track Construction Pvt. Ltd, Arun Hospitalities
Ltd, and Arun Agro Farms India Pvt. Ltd.
  DR.SAMUEL GEORGE

Dr.Samuel George who is a doctor and an entrepreneur, also

runs a clinic named "City Clinic" in Abudhabi since the 1970's.
Having completed his Bachelors in Medicine from the Calcultta
Medical College, Dr. George commenced his career in government
service and then subsequently moved to Abu Dhabi in the 1970s.

 PRADEEP KUMAR C

Mr. Pradeep Kumar C. is a leading Textile exporter of Kerala

who has an experience of 20 years in this field and has been successful
in expanding his business activities to foreign locations as well.

2.12 SERVICES OFFERED

Online trading

Hedge Equities has a large network of branches with online

terminals of NSE and BSE in the capital market and Derivative
segments. Through their dedicated phones and expert dealers at
various offices, the clients are assured of prompt order execution.

Internet Trading

Hedge Equities also offers internet trading through their site.

This enables one to trade through the internet from anywhere in the
world. The dedicated IT systems have ensured quality service in less
time and more speed, thereby making internet broking hassle-free.
Using the EASIEST facility provided by NSDL, the clients of Hedge
Equities can transfer the shares sold by them, online, without delivery
instruction slips. Moreover, digitally signed contract notes can be sent
to clients through E-mail.

Depository Services

Hedge offers trading in the futures and options segment of the

National Stock Exchange (NSE).Through the present derivative
trading, by paying a small margin on the futures segment and a small
premium in the options segment, an investor can take a short term view
on the market for up to a three months’ perspective. In the case of
options, if the trade goes in the opposite direction the maximum loss
will be limited only to the premium paid.

Knowledge Centre

Knowledge centre activities are aimed at providing systematic

and structured services mainly to new investors and also to young
aspirants aiming for a career in financial markets. The centre has three
functional areas. They are:

 The publication division,

 The training centre and
 Wealth management advisory service, which provides
complete investment solutions through knowledge-
based personalized services.

Equity Research

The research department is broadly divided into two divisions-

Fundamental Analysis Group (FAG) and Technical Analysis Group
(TAG).

The Fundamental analysts are entrusted with the responsibility

of continuously scanning the entire economy and presenting
information that is valuable to the clients for making profitable
investments.

The Technical Analysis Group predicts the market movements

in advance using complex analytical methods including Elliot Wave
Theory. They are equipped with cutting-edge technologies, for
technical charting, which assist them to predict both upside and
downside movements efficiently.

Portfolio Management Services (PMS)

 Hedge equity is a SEBI-approved portfolio manager and offers
discretionary and non-discretionary schemes to its clients. The
portfolio management team keeps track of the markets on a daily basis.
They also look into other technicalities pertaining to shares like
dividends, rights, bonus, buy-back, Mergers and Acquisitions.

Commodity Trading

In commodities trading, trading is done in futures like gold,

silver, crude oil, rubber etc. which takes place during extended trading
hours (10 am to 11 pm) unlike stock trading.

Mutual Funds, Bonds etc

Hedge Equities also offers a wide range of Mutual funds and

bonds that are currently available in the market. It also keeps its clients
informed about the top mutual fund gainers/losers, latest NAVs,
scheme profiles, forthcoming issues, etc. through its website.

Currency Trading

Currency derivatives are contracts between the sellers and

buyers, whose values are to be derived from the underlying assets i.e.
the currency amounts. These are basically risk management tools used
for hedging risks and acting as insurance against unforeseen and
unpredictable movements in the currency and interest rates.
 Currency derivatives serve the purpose of financial risk
management encompassing various market risks. In currency trading,
an upfront premium is payable for buying a derivative.

Currency futures bring in more transparency and efficiency in

price discovery, eliminate counterparty credit risk, provide access to
all types of market participants and offer standardized products.

Hedge School of Applied Economics

Hedge School of Applied Economics is a knowledge initiative

of Hedge Equities, which was set up with the sole objective of
moulding highly competent investment professionals in the state. It is
actually a company in itself which is floated by Hedge Equities with
the parent holding 100 percent stake. It offers a set of structured
courses and various activities which enables students and aspirant
investors to build a better career in the financial industry and take
informed investment decisions.
2.13 ORGANISATION STRUCTURE

BOARD OF DIRECTORS

EXECUTIVE DIRECTOR

MEMBER MARKET
SYSTEMS LEGAL SETTLEMENT LISTING FINANCE
-SHIP -ING
BUSINESS VERTICALS
HEDGE WEALTH MANAGEMENT SERVICES

SERVICES OFFERED:

 PORTFOLIO ADVISORY SERVICES

Portfolio Advisory Services is a value-added service offered

to the clients.
They provide the following services to their Portfolio
Advisory Services clients
 A dedicated Wealth Advisory Desk that is equipped to
answer each of their queries and unique needs
 Assessment of their risk profiles and assistance in
constructing / balancing an investment portfolio that matches their
individual risk appetite.
 Access to high quality research and investment strategies
Under these services, the Wealth Management Service desk
can only suggest investment ideas that match the assessed risk-reward
profile agreed for the investor. The choice as well as the execution of
the investment decisions rest solely with the Investor. No fee is
charged for this service.

 PORTFOLIO MANAGEMENT SERVICES

 Portfolio Management Service (PMS) is a product offering
that caters to the investment needs and objectives of a certain investor
class.

The portfolios are designed and offered solely based on

identifying the risk profile of the customer. The investments in these
portfolios are tailored to their risk-reward profile. The portfolio invests
in equities, debt instruments, gold ETF’s, and other structured
products and is managed by competent portfolio managers. The
securities are held in an investor’s own depository account and this
enables the investor to monitor and view the securities. Regular
performance reports and research notes are also provided to the
investors in the respective portfolios.

They currently offer three different portfolios to the customers

 Hedge Conservative Portfolio

 Hedge Moderate Portfolio
 Hedge Aggressive Portfolio

 MUTUAL FUND ADVISORY SERVICES

Hedge Wealth Management Services can help a person choose

the mutual fund schemes that best suit his/her requirements. They also
provide advices on redemptions, switch of units, etc according to
variable market conditions.

The online mutual fund purchase terminals have made the

purchase and redemption of mutual funds much easier. The mutual
fund units can be held in the client’s demat account. This allows faster
purchase & settlement process and facilitates online viewing of his/her
mutual fund holdings.

At Hedge, the investors are given the option to invest either in

lump-sum investment or through a Systematic Investment Plan (SIP)
in Mutual Funds.

HEDGE SCHOOL OF APPLIED ECONOMICS (HSAE)

Hedge School of Applied Economics is a knowledge initiative

from Hedge Equities to provide a platform for imparting the
importance of asset creation and its management as well as to
encourage the development of entrepreneurship among the youth.
Hedge School of Applied Economics (HSAE) is the first ever
educational venture dedicated to creating a class of high-end
investment professionals across India.

The programs are designed for students, financial professionals and

aspirant investors.
 HEDGE FINANCE

Hedge Finance which is a subsidiary of Hedge Equities,

focuses on an under tapped segment – Securities. The company
provides loans to customers against financial instruments like equities,
bonds and debentures. The company

HEDGE COMMODITIES

Hedge Commodities Ltd, formed in 2008 as a fully owned

subsidiary of Hedge Equities, provides to its clients in the
Commodities market segment. Hedge Commodities Ltd offers
services in Commodity Futures market.

With membership in all major national level exchanges,

Hedge Commodities provides services to a wide-range of clients,
which includes investors, hedgers, arbitragers and traders /
speculators. The clientele belongs to different segments of the market,
including producers, manufacturers or end users, with exposure to
international, non agricultural commodities and agricultural
commodities.
 HEDGE OHARI

Hedge Ohari is a monthly finance magazine that aims at

providing its readers comprehensive knowledge and a basic
understanding of the various aspects of financial planning as well as
the entire spectrum of investment and wealth creation methods, viz.
stock market, mutual fund, real estate, gold, bonds, banking and so on.
The magazine’s content includes articles, features and interviews
about the diverse areas related to finance and business. The
magazine’s contents are divided into sections such as industry,
business management, agriculture, education, automobile, brand
equity, success mantras, insurance, lifestyle, gadgets, and cinema.

KINSHIP

Kinship is a comprehensive stock market research by Hedge

Equities that is made available for subscription. The research is done
by a panel of researchers on Hedge Equities research desk. There are
more than 150 report categories that caters to almost all types of
market players on the trading platform.

FUNCTIONAL DEPARTMENTS

 CLIENT RELATION DEPARTMENT

This department, also known as the front office, assists the

client or customer to open an account in Hedge Equities.. A client has
to open two types of accounts to trade and own securities in the NSE
& BSE.

 FINANCE DEPARTMENT

This is a department to organize the financial activities and is

created under the direct control of the board of directors. The Finance
manager decides the major financial policy methods. Lower level
managers delegate the other routine activities.

 MARKETING DEPARTMENT

The major functions of marketing department are:

a) Business Associate Development: The company takes up

the marketing activities of the various branches. It encourages better
relations in its branches and is responsible for the development of
various marketing strategies.

b) Brand promotion: An important function of marketing

department is to promote the name of the company. Hedge equities do
it through different promotional activities.

c) Investment promotion: Through its investment promotions,

the marketing department tries to capture as many investors as
possible to encourage them to invest, since they form the most
important part of the clientele of Hedge equities.

d) Delivery promotion: Intraday trading is not always

profitable and might involve a high risk. Hence Hedge Equities
promotes delivery, where the shares are kept to be sold for a later date
after analyzing the profitability factors.

 SYSTEMS DEPARTMENT

The systems department plays a fundamental role in the

routine operations of the company. The clients are provided with the
facilities of Internet trading through the systems department. The
department directly maintains the optic fibre cables and high
bandwidth connections from the Hedge Equities office to the ISP, a
dedicated server and back-up ISDN connections. The two software
namely, ODIN (Open Dealers Integrated Network) and NEAT
(National Exchange for Automated Trading) are used for the purpose
of trading.

 HUMAN RESOURCE DEPARTMENT

Human resource management is defined as asset of practices,

policies and programmes designed to maximize both personal and
organizational goals. The following are some of the main duties of the
Human Resource department at Hedge Equities:

a) Training & Induction

The selected employees undergo a, three days continuous,

induction. The employees are given training with all the departments
of Hedge equities, during this period. There are classroom induction
sessions as well.
 b) Wages and Salary Administration

The wages and salaries of the employees are fixed and granted
by the HR department only with the consent of the finance department.

c) Performance appraisal

The Human Resources department has the authority of

granting promotions and transfers to the employees as well as taking
disciplinary actions when needed.

D) Grievance Handling

The grievances of the employees are received only through the

respective department heads. The HR department then takes
appropriate measures as per the rules and regulations of the company.

 TRADING DEPARTMENT

The department deals with the trading related activities of the

company. Trading refers to the buying & selling of shares. This is the
most important department of the organization. There are two types of
trading. They are:

A ) Online Trading

Each computer of the department is termed as trading

terminal. Each terminal, that is assigned with NCFM certified dealers,
who is in charge of each portal, does the trade according to the client
request. The terminal is managed by either NEAT (National Exchange
for Automated Trading) software or ODIN (Open Dealers Integrated
Network) software. The clients also place orders through written
requests or through the telephone, which are then placed by the
dealers.

B ) Internet Trading

The internet trading is a facility that is provided by the

company to enable the client to trade the securities at his convenience.
The order is placed by the client himself. He can also make changes
such as changing the price, cancellation of the order, etc. before the
trade is done.

 DELIVERY & DEPOSITORY DEPARTMENT

Delivery refers to the shares that are bought on a particular day

but are not sold on that day itself. Instead, the shares are held for an
appreciation in the value and then traded on a future date. Deliver
instruction slip is a slip the client fills and gives the dealer regarding
the purchase of the share. Depository is a facility that transfers
ownership of securities in electronic mode on behalf of its members.
The two procedures to move the shares are namely,

a) Power of attorney

This is a written document which the client signs at the time

of opening a trading account and depository participant account.
Hedge Equities Ltd acquires the power to transact the clients stocks
without pay-in slips, once the client gives the power of attorney to the
company.

b) EASIEST

‘Electronic Access to Securities Information and Execution of

Secured Transaction’ or EASIEST is a secured internet enabled
service. This is a facility through which the clients can give delivery
instructions via internet. EASIEST is a facility provided by CDSL.

The activities related with the depository department.

Depository function

Dematerialization

Pledging

 EQUITY RESEARCH DEPARTMENT

The main function of this department is to study the details

regarding the share or security and to make forecasts regarding the
future performance of the company. The two approaches followed in
the department to do the same, are:

a) Fundamental analysis : Fundamental analysis attempts to

measure a security's intrinsic value by examining related economic
and financial factors, which can be both qualitative and quantitative in
nature. Fundamental analysts study anything that can affect the
security's value, including macroeconomic factors (e.g., economy and
industry conditions) and microeconomic factors (e.g., financial
conditions and company management). The end goal of fundamental
analysis is to produce a quantitative value that an investor can compare
with a security's current price, thus indicating whether the security is
undervalued or overvalued.

b) Technical Analysis : Technical analysis of stocks and trends is the

study of historical market data, including price and volume. Using
both behavioural economics and quantitative analysis, technical
analysts aim to use past performance to predict future market
behaviour. The two most common forms of technical analysis are
chart patterns and technical (statistical) indicators.
 CONCLUSION

From the study that was conducted, it can be concluded that

even though the level of awareness among people regarding mutual
funds is high, most of them are reluctant to invest in them because they
lack a general understanding about the product. Generally, investors
who have invested in mutual funds consider mutual funds to be
associated with only a moderate risk. The main motive behind
investing in mutual funds has been seen to be regarding an expectation
of high returns especially through growth schemes. Since, more and
more banks are coming up with innovative varieties of schemes that
meet the specific objectives of the investors; people consider banks as
the best and most reliable channel of investment.

People belonging to the middle income group are reluctant to

invest in corporate securities because of limited resources and also
because the fate of their savings completely depends on the fate of the
few units they can afford to hold. But by investing in mutual funds,
they are assured of low risk, steady return, liquidity and capital
appreciations. Mutual funds also play the role of financial
intermediation wherein they provide a convenient and effective link
between savings and investment by investing the pooled savings in
industrial securities. In addition, they are useful in securing profitable
investment avenues abroad for domestic savings. As a result, mutual
funds have proved to be a great solution to most of the savers and
investors.

BIBLIOGRAPHY

 www.businessstandard.com
 www.thehindubusinessline.com
 www.amfiindia.com
 www.investopedia.com
 www.moneycontrol.com
www.economictimes.com
 RECOMMENDATIONS

 The study shows that people are hesitant to invest in mutual

funds due to lack of knowledge about the product. Steps should be
undertaken to create awareness among the investors about mutual
funds and the benefits of investing in it.

 Since advertisements have been seen as a major source of

information for the investors from the study and because its reach to
the masses is extensive, innovative and creative use of this channel to
impart more knowledge regarding mutual funds can be made.

 SIP is an innovative and a relatively new concept. Hence,

many investors are not aware about it and prefer to invest in the
traditional way, i.e. in lump sum. Therefore, banks and financial
advisers should familiarise their clients to SIP. This might encourage
more investors to invest in mutual funds especially those who belong
to the lower income groups.