SUMMER INTERNSHIP PROJECT REPORT ON

“PORTFOLIO MANAGEMENT SERVICES”

AT
SHAREKHAN PVT LTD

A Project report submitted in partial fulfillment of Bachelor of Commerce

(Hons.) (B.COM(H))

Submitted to: Submitted by:

Ms. Aditi Joshi Kuldeep Verma
Assistant professor 01324588817
JAGANNATH INTERNATIONAL MANAGEMENT SCHOOL KALKAJI

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 ACKNOWLEDGEMENT

I am using this opportunity to express my gratitude to everyone who supported me throughout the
course of this internship. I am thankful for their aspiring guidance, invaluable constructive criticism
and friendly advice during the internship. I am sincerely grateful to them for sharing their truthful and
illuminating views on a number of issues related to the project.

I express my warm thanks to Mr. Deepak Rohilla for their support and guidance at Sharekhan
Limited and all the people who provided me with the facilities being required and conductive
conditions for my internship.

I would also like to thank my mentor Ms. Aditi Joshi for helping me and guiding me for the summer
internship project.

Kuldeep Verma

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 STUDENT’S UNDERTAKING

I hereby certify that this is my original work and it has not been submitted elsewhere.

KULDEEP VERMA

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 CERTIFICATE

I hereby certify that Kuldeep Verma has completed the project under my guidance on the
title “PORTFOLIO MANAGEMENT SERVICES AT SHAREKHAN LTD.”.

Name of Supervisor: Student Name:

Ms. Aditi Joshi Kuldeep Verma

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5
 CONTENTS
Description Page No.

Introduction to topic 9

Objectives 30

Literature review 32

Company Profile 35

Research Methodology 43

Analysis & Interpretation 47

Findings & Inferences 56

Limitations 58

Conclusion and Recommendations 60

Appendices 62

Bibliography 65

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 LIST OF TABLES
 Table 1- Investment preference
 Table 2- Basic purpose of investment
 Table 3- Most important factor at the time of investment
 Table 4- Feedback for which is better Investing in portfolio management service or mutual
fund
 Table 5- Feedback on Managing the portfolio
 Table 6- Feedback on portfolio management services use
 Table 7- Feedback on Portfolio type
 Table 8- Feedback on individuals experience of using portfolio management services of
Sharekhan Limited

LIST OF FIGURES
 Figure 1- Investment preference
 Figure 2- Basic purpose of investment
 Figure 3- Most important factor at the time of investment
 Figure 4- Feedback for which is better Investing in portfolio management service or mutual
fund
 Figure 5- Feedback on Managing the portfolio
 Figure 6- Feedback on portfolio management services use
 Figure 7- Feedback on Portfolio type
 Figure 8- Feedback on individuals experience of using portfolio management services of
Sharekhan Limited

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EXECUTIVE SUMMARY

The report gives an insight of the portfolio management services offered by Sharekhan Limited.
Portfolio Management Services (PMS) is fast gaining Investment Option for the High Networth
Individual (HNI). There is growing competition between brokerage firms in post reform India. For
investor it is always difficult to decide which brokerage firm to choose.
Sharekhan’s profile is also discussed. It shows the product mix of company audit’s direct competitors.
Share market is gaining significant grounds with the onset of booming Indian Economy.
The research design is analytical in nature. A questionnaire was prepared and distributed to Investors.
The investor’s profile is based on the results of a questionnaire that the Investors completed. The
Sample consists of 20 investors from various broker’s premises. The target customers were Investors
who are trading in the stock market.
In order to identify the effectiveness of Sharekhan PMS services this Research is carried throughout
the area of Delhi. At the time of investing money everyone look for the Risk factor involve in the
Investment option. The report also shows the investors preferences for investment.
The content of this project report was decided after a detailed survey of portfolio management
services. This report also discusses about financial planning and wealth management so as to
understand about the customer’s needs and wants with respect to market and how a client’s portfolio
can be designed and what factors a portfolio manager must consider for designing a portfolio.

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INTRODUCTION TO THE TOPIC

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INTRODUCTION TO THE TOPIC

The field of investment traditionally divided into security analysis and portfolio management. The
heart of security analysis is valuation of financial assets. Value in turn is the function of risk and
return. These two concepts are in the study of investment .Investment can be defined the commitment
of funds to one or more assets that will be held over for some future time period.
In today fast growing world many opportunities are available, so in order to move with changes and
grab the best opportunities in the field of investments a professional fund manager is necessary.
Therefore, in the present scenario the Portfolio Management Services (PMS) is fast gaining
importance as an investment alternative for the High Net worth Investors.
Portfolio Management Services (PMS) is an investment portfolio in stocks, fixed income, debt, cash,
structured products and other individual securities, managed by a professional money manager that
can potentially be tailored to meet specific investment objectives.
When you invest in PMS, you own individual securities unlike a mutual fund investor, who owns
units of the entire fund. You have the freedom and flexibility to tailor your portfolio to address
personal preferences and financial goals. Although portfolio managers may oversee hundreds of
portfolio, your account may be unique.
Investment Management Solution in PMS can be provided in the following ways:
i. Discretionary
ii. Non Discretionary
iii. Advisory

Discretionary: Under these services, the choice as well as the timings of the investment decisions rest
solely with the Portfolio Manager.
Non Discretionary: Under these services, the portfolio manager only suggests the investment ideas.
The choice as well as the timings of the investment decisions rest solely with the Investor.
However the execution of trade is done by the portfolio manager.
Advisory: Under these services, the portfolio manager only suggests the investment ideas.
The choice as well as the execution of the investment decisions rest solely with the Investor.
Rule 2, clause (d) of the SEBI (portfolio managers) Rules, 1993 defines the term “Portfolio” as “total
holding of securities belonging to any person”.
As a matter of fact, portfolio is combination of assets the outcomes of which cannot be defined with
certainty new assets could be physical assets, real estates, land, building, gold etc. or financial assets
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like stocks, equity, debenture, deposits etc.
Portfolio management refers to managing efficiently the investment in the securities held by
professional for others.
Merchant banker and the portfolio management with a view to ensure maximum return by such
investment with minimum risk of loss of return on the money invested in securities held by them for
their clients. The aim Portfolio management is to achieve the maximum return from a portfolio, which
has been delegated to be managed by manger or financial institution.
There are lots of organization in the market on the lookout for the people like you who need their
portfolios managed for them .They have trained and skilled talent will work on your money to make it
do more for you.
Therefore, if any investors still insist on managing their own portfolio, then ensure you build
discipline into their investment. Work out their strategy and stand by it.

MYTHS ABOUT PMS

There are two most common myths found about Portfolio Management Services (PMS) which we
found among most of the Investors. They are as follows.
Myth No. 1: “PMS and Mutual Fund are Similar as the investment option”- As in the Finance
Basket both the PMS and Mutual Fund are used for minimizing risk and maximize the profit of the
Investors. The objectives are similar as in both the product but they are different from each other in
certain aspects. They are as follows.
Management Side
In PMS, it’s ongoing personalized access to professional money management services. Whereas, in
Mutual fund gives personalize access to money.
Customization
In PMS, Portfolio can be tailored to address each investor's specific needs. Whereas in Mutual Fund
Portfolio structured to meet the fund's stated investment objectives.
Ownership
In PMS, Investors directly own the individual securities in their portfolio, allowing for tax
management flexibility, whereas in Mutual Fund Shareholders own shares of the fund and cannot
influence buy and sell decisions or control their exposure to incurring tax liabilities.
Liquidity
In PMS, managers may hold cash; they are not required to hold cash to meet redemptions, whereas,

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Mutual funds generally hold some cash to meet redemptions.
Minimums
PMS generally gives higher minimum investments than mutual funds. Generally, minimum ranges
from: Rs. 1 Crore + for Equity Options Rs. 5 Crore + for Fixed Income Options Rs. 20 Lacs + for
Structured Products, whereas in Mutual Fund Provide ongoing, personalized access to professional
money management services.

Flexibility
PMS is generally more flexible than mutual funds. The Portfolio Manager may move to 100% cash if
it required. The Portfolio Manager may take his own time in building up the portfolio. The Portfolio
Manager can also manage a portfolio with disproportionate allocation to select compelling
opportunities whereas, in Mutual Fund comparatively less flexible.

Myth No. 2: “PMS is more Risk free than other Financial Instrument” - In Financial Market
Risk factor is common in all the financial products, but yes it is true that Risk Factor vary from each
other due to its nature. All investments involve a certain amount of risk, including the possible

erosion of the principal amount invested, which varies depending on the security selected. For
example, investments in small and mid-sized companies tend to involve more risk than investments in
larger companies.

INTRODUCTION TO STOCK EXCHANGE

The emergence of stock market can be traced back to 1830. In Bombay, business passed in the shares
of banks like the commercial bank, the chartered mercantile bank, the chartered bank, the oriental
bank and the old bank of Bombay and shares of cotton presses. In Calcutta, Englishman reported the
quotations of 4%, 5%, and 6% loans of East India Company as well as the shares of the bank of
Bengal in 1836. This list was a further broadened in 1839 when the Calcutta newspaper printed the
quotations of banks like union bank and Agra bank. It also quoted the prices of business ventures like
the Bengal bonded warehouse, the Docking Company and the storm tug company.
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Between 1840 and 1850, only half a dozen brokers existed for the limited business. But during the
share mania of 1860-65, the number of brokers increased considerably. By 1860, the number of
brokers was about 60 and during the exciting period of the American Civil war, their number
increased to about 200 to 250. The end of American Civil war brought disillusionment and many

Failures and the brokers decreased in number and prosperity. It was in those troublesome times
between 1868 and 1875 that brokers organized an informal association and finally as recited in the
Indenture constituting the “Articles of Association of the Exchange”.

On or about 9th day of July,1875, a few native brokers doing brokerage business in shares and stocks
resolved upon forming in Bombay an association for protecting the character, status and interest of
native share and stock brokers and providing a hall or building for the use of the Members of such
association.

As a meeting held in the broker’ Hall on the 5th day of February, 1887, it was resolved to execute a
formal deal of association and to constitute the first managing committee and to appoint the first
trustees. Accordingly, the Articles of Association of the Exchange and the Stock
Exchange was formally established in Bombay on 3rd day of December, 1887. The Association is
now known as “The Stock Exchange”.

The entrance fee for new member was Re.1 and there were 318 members on the list, when the
exchange was constituted. The numbers of members increased to 333 in 1896, 362 in 1916and 478 in
1920 and the entrance fee was raised to Rs.5 in 1877, Rs.1000 in 1896, Rs.2500 in 1916 and Rs.
48,000 in 1920. At present there are 23 recognized stock exchanges with about 6000 stock brokers.
Organization structure of stock exchange varies.

14 stock exchanges are organized as public limited companies, 6 as companies limited by guarantee
and 3 are non-profit voluntary organization. Of the total of 23, only 9 stock exchanges have been
permanent recognition. Others have to seek recognition on annual basis.
These exchange do not work of its own, rather, these are run by some persons and with the help of
some persons and institution. All these are down as functionaries on stock exchange. These are:

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 i. Stockbrokers
ii. Sub-broker
iii. Market makers
iv. Portfolio consultants etc.

1. Stockbrokers:
Stock brokers are the members of stock exchanges. These are the persons who buy, sell or deal in
securities. A certificate of registration from SEBI is mandatory to act as a broker. SEBI can impose
certain conditions while granting the certificate of registrations. It is obligatory for the person to abide
by the rules, regulations and the buy-law. Stock brokers are commission broker, floor broker,
arbitrageur etc.

2. Sub-broker:
A sub-broker acts as agent of stock broker. He is not a member of a stock exchange. He assists the
investors in buying, selling or dealing in securities through stockbroker. The broker and sub-broker
should enter into an agreement in which obligations of both should be specified. Sub-broker must be
registered SEBI for a dealing in securities. For getting registered with SEBI, he must fulfill certain
rules and regulation.

3. Market Makers:
Market maker is a designated specialist in the specified securities. They make both bid and offer at the
same time. A market maker has to abide by bye-laws, rules regulations of the concerned stock
exchange. He is exempt from the margin requirements. As per the listing requirements, a company
where the paid-up capital is Rs. 3 Crore but not more than Rs. 5 core and having a commercial
operation for less than 2 years should appoint a market maker at the time of issue of securities.

4. Portfolio Consultants:
A combination of securities such as stocks, bonds and money market instruments is collectively called
as portfolio. Whereas the portfolio consultants are the persons, firms or companies who advise, direct
or undertake the management or administration of securities or funds on behalf of their clients.

Traditionally stock trading is done through stock brokers, personally or through telephones.
As number of people trading in stock market increase enormously in last few years, some issues like
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location constrains, busy phone lines, miss communication etc start growing in stock broker offices.
Information technology (Stock Market Software) helps stock brokers in solving these problems with
Online Stock Trading.

Online Stock Market Trading is an internet based stock trading facility. Investor can trade shares
through a website without any manual intervention from Stock Broker.

There are two different type of trading environments available for online equity trading.

1. Installable software based Stock Trading Terminals

This trading environment requires software to be installed on investor’s computer. This software is
provided by the stock broker. This software requires high speed internet connection. These kind of
trading terminals are used by high volume intraday equity traders.

2.Web (Internet) based trading application

This kind of trading environment doesn't require any additional software installation. They are like
other internet websites which investor can access from around the world through normal internet
connection.

Stock exchanges are like market places, where stockbrokers buy and sell securities for individuals or
institutions. As per the SCRA (Securities Contracts Regulation Act) 1956, the definition of securities
includes shares, bonds, stocks, debentures, government securities, derivatives of securities, units of
collective investment scheme (CIS) etc. The securities market has two interdependent segments: the
primary and secondary market.

The primary market is the channel for creation of new securities issued by public limited companies
or by government agencies. New securities issued in the primary market are traded in the secondary
market.

The secondary market operates through the over-the-counter (OTC) market and the exchange trade
market.

Advantages of Stocks Trading

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1. Better returns
Actively trading stocks can produce better overall returns than simply buying and holding.

2. Huge Choice
There are thousands of stocks listed on markets around the world. There is always a stock whose price
is moving - it’s just a matter of finding them.
3. Familiarity
The most traded stocks are in the largest companies that most of us have heard of and understand -
Microsoft, IBM, and Cisco etc.

Disadvantages of Stocks Trading

1. Leverage
With a margined account the maximum amount of leverage available for stock trading is usually 4:1.
Meaning a $25,000 could trade up to $100,000 of stock. This is pretty low compared to Forex trading
or futures trading.

2. Pattern Day Trader Rules

It requires at least $25,000 to be held in a trading account if the trader completes more than 4 trades in
a 5 day period. No such rule applies to Forex trading or futures trading.

3. Uptick Rule on Short Selling

A trader must wait until a stock price ticks up before they can short sell it. Again there are no such
rules in Forex trading or futures trading where going short are as easy as going long.

4. Need to Borrow Stock to Short

Stocks are physical commodities and if a trader wishes to go short then the broker must have
arrangements in place to borrow that stock from a shareholder until the trader closes their position.
This limits the opportunities available for short selling. Contrast this to futures trading where selling is
as easy as buying.

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PORTFOLIO MANGEMNT SERVICES (PMS)

Fig1 Portfolio Management

Portfolio (finance) means a collection of investments held by an institution or a private individual.

Holding a portfolio is often part of an investment and risk-limiting strategy called diversification. By
owning several assets, certain types of risk (in particular specific risk) can be reduced. There are also
portfolios which are aimed at taking high risks – these are called concentrated portfolios.

Investment management is the professional management of various securities (shares, bonds etc) and
other assets (e.g. real estate), to meet specified investment goals for the benefit of the investors.
Investors may be institutions (insurance companies, pension funds, corporations etc.) or private
investors (both directly via investment contracts and more commonly via collective investment
schemes e.g. mutual funds).

The term asset management is often used to refer to the investment management of collective
investments, whilst the more generic fund management may refer to all forms of institutional
investment as well as investment management for private investors. Investment managers who
specialize in advisory or discretionary management on behalf of (normally wealthy) private investors
may often refer to their services as wealth management or portfolio management often within the
context of so-called "private banking".

The provision of 'investment management services' includes elements of financial analysis, asset
selection, stock selection, plan implementation and ongoing monitoring of investments. Outside of the
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financial industry, the term "investment management" is often applied to investments other than
financial instruments. Investments are often meant to include projects, brands, patents and many
things other than stocks and bonds. Even in this case, the term implies that rigorous financial and
economic analysis methods are used.

Need of PMS
As in the current scenario the effectiveness of PMS is required. As the PMS gives investors
periodically review their asset allocation across different assets as the portfolio can get skewed over a
period of time. This can be largely due to appreciation / depreciation in the value of the investments.

As the financial goals are diverse, the investment choices also need to be different to meet those
needs. No single investment is likely to meet all the needs, so one should keep some money in bank
deposits and / liquid funds to meet any urgent need for cash and keep the balance in other investment
products/ schemes that would maximize the return and minimize the risk. Investment allocation can
also change depending on one’s risk-return profile.

Objective of PMS
These are the following objective which is full filled by Portfolio Management Services.
1. Safety of Fund: -
The investment should be preserved, not be lost, and should remain in the returnable position in cash
or kind.

2. Marketability: -
The investment made in securities should be marketable that means, the securities must be listed and
traded in stock exchange so as to avoid difficulty in their encashment.

3. Liquidity: -
The portfolio must consist of such securities, which could be en-cashed without any difficulty or
involvement of time to meet urgent need for funds. Marketability ensures liquidity to the portfolio.

4. Reasonable return: -
The investment should earn a reasonable return to upkeep the declining value of money and be

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compatible with opportunity cost of the money in terms of current income in the form of interest or
dividend.

5. Appreciation in Capital: -
The money invested in portfolio should grow and result into capital gains.

PORTFOLIO CONSTRUCTION
The Portfolio Construction of Rational investors wish to maximize the returns on their funds for a
given level of risk. All investments possess varying degrees of risk. Returns come in the form of
income, such as interest or dividends, or through growth in capital values (i.e. capital gains).

The portfolio construction process can be broadly characterized as comprising the following steps:

1.Setting objectives.
The first step in building a portfolio is to determine the main objectives of the fund given the
constraints (i.e. tax and liquidity requirements) that may apply. Each investor has different objectives,
time horizons and attitude towards risk. Pension funds have long-term obligations and, as a result,
invest for the long term. Their objective may be to maximize total returns in excess of the inflation
rate. A charity might wish to generate the highest level of income whilst maintaining the value of its
capital received from bequests. An individual may have certain liabilities and wish to match them at a
future date. Assessing a client’s risk tolerance can be difficult. The concepts of efficient portfolios and
diversification must also be considered when setting up the investment objectives.

2. Defining Policy.
Once the objectives have been set, a suitable investment policy must be established. The standard
procedure is for the money manager to ask clients to select their preferred mix of assets, for example
equities and bonds, to provide an idea of the normal mix desired. Clients are then asked to specify
limits or maximum and minimum amounts they will allow to be invested in the different assets
available. The main asset classes are cash, equities, gilts/bonds and other debt instruments,
derivatives, property and overseas assets. Alternative investments, such as private equity, are also
growing in popularity, and will be discussed in a later chapter. Attaining the optimal asset mix over

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time is one of the key factors of successful investing.

3. Applying portfolio strategy.

At either end of the portfolio management spectrum of strategies are active and passive strategies. An
active strategy involves predicting trends and changing expectations about the likely future
performance of the various asset classes and actively dealing in and out of investments to seek a better
performance. For example, will the fund invest primarily in companies with large market
capitalizations, in shares of companies expected to generate high growth rates, or in companies whose
valuations are low? A passive strategy usually involves buying securities to match a preselected
market index. Alternatively, a portfolio can be set up to match the investor’s choice of tailor-made
index. Passive strategies rely on diversification to reduce risk. Outperformance versus the chosen
index is not expected. This strategy requires minimum input from the portfolio manager.

4. Asset selections.
Once the strategy is decided, the fund manager must select individual assets in which to invest.
Usually a systematic procedure known as an investment process is established, which sets guidelines
or criteria for asset selection. Active strategies require that the fund managers apply analytical skills
and judgment for asset selection in order to identify undervalued assets and to try to generate superior
performance.

5. Performance assessments.
In order to assess the success of the fund manager, the performance of the fund is periodically
measured against a pre-agreed benchmark – perhaps a suitable stock exchange index or against a
group of similar portfolios (peer group comparison). The portfolio construction process is
continuously iterative, reflecting changes internally and externally. For example, expected movements
in exchange rates may make overseas investment more attractive, leading to changes in asset
allocation. Or, if many large-scale investors simultaneously decide to switch from passive to more
active strategies, pressure will be put on the fund managers to offer more active funds. Poor
performance of a fund may lead to modifications in individual asset holdings or, as an extreme
measure; the manager of the fund may be changed altogether.

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Types of assets
The structure of a portfolio will depend ultimately on the investor’s objectives and on the asset
selection decision reached. The portfolio structure takes into account a range of factors, including the
investor’s time horizon, attitude to risk, liquidity requirements, tax position and availability of
investments. The main asset classes are cash, bonds and other fixed income securities, equities,
derivatives, property and overseas assets.

Cash and cash instruments

Cash can be invested over any desired period, to generate interest income, in a range of highly liquid
or easily redeemable instruments, from simple bank deposits, negotiable certificates of deposits,
commercial paper (short term corporate debt) and Treasury bills (short term government debt) to
money market funds, which actively manage cash resources across a range of domestic and foreign
markets. Cash is normally held over the short term pending use elsewhere (perhaps for paying claims
by a non-life insurance company or for paying pensions), but may be held over the longer term as
well. Returns on cash are driven by the general demand for funds in an economy, interest rates, and
the expected rate of inflation. A portfolio will normally maintain at least a small proportion of its
funds in cash in order to take advantage of buying opportunities.

Bonds
Bonds are debt instruments on which the issuer (the borrower) agrees to make interest payments at
periodic intervals over the life of the bond – this can be for two to thirty years or, sometimes, in
perpetuity. Interest payments can be fixed or variable, the latter being linked to prevailing levels of
interest rates. Bond markets are international and have grown rapidly over recent years. The bond
markets are highly liquid, with many issuers of similar standing, including governments (sovereigns)
and state-guaranteed organizations. Corporate bonds are bonds that are issued by companies. To assist
investors and to help in the efficient pricing of bond issues, many bond issues are given ratings by
specialist agencies such as Standard & Poor’s and Moody’s. The highest investment grade is AAA,
going all the way down to D, which is graded as in default. Depending on expected movements in
future interest rates, the capital values of bonds fluctuate daily, providing investors with the potential
for capital gains or losses. Future interest rates are driven by the likely demand/ supply of money in
an economy, future inflation rates, political events and interest rates elsewhere in world markets.
Investors with short-term horizons and liquidity requirements may choose to invest in bonds because

21
of their relatively higher return than cash and their prospects for possible capital appreciation. Long-
term investors, such as pension funds, may acquire bonds for the higher income and may hold them
until redemption – for perhaps seven or fifteen years. Because of the greater risk, long bonds (over ten
years to maturity) tend to be more volatile in price than medium- and short-term bonds, and have a
higher yield.

Equities
Equity consists of shares in a company representing the capital originally provided by shareholders.
An ordinary shareholder owns a proportional share of the company and an ordinary share carries the
residual risk and rewards after all liabilities and costs have been paid. Ordinary shares carry the right
to receive income in the form of dividends (once declared out of distributable profits) and any residual
claim on the company’s assets once its liabilities have been paid in full. Preference shares are another
type of share capital. They differ from ordinary shares in that the dividend on a preference share is
usually fixed at some amount and does not change. Also, preference shares usually do not carry
voting rights and, in the event of firm failure, preference shareholders are paid before ordinary
shareholders. Returns from investing in equities are generated in the form of dividend income and
capital gain arising from the ultimate sale of the shares. The level of dividends may vary from year to
year, reflecting the changing profitability of a company. Similarly, the market price of a share will
change from day to day to reflect all relevant available information. Although not guaranteed, equity
prices generally rise over time, reflecting general economic growth, and have been found over the
long term to generate growing levels of income in excess of the rate of inflation. Granted, there may
be periods of time, even years, when equity prices trend downwards – usually during recessionary
times. The overall long-term prospect, however, for capital appreciation makes equities an attractive
investment proposition for major institutional investors.

Derivatives
Derivative instruments are financial assets that are derived from existing primary assets as opposed to
being issued by a company or government entity. The two most popular derivatives are futures and
options. The extent to which a fund may incorporate derivatives products in the fund will be specified
in the fund rules and, depending on the type of fund established for the client and depending on the
client, may not be allowable at all.

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A futures contract is an agreement in the form of a standardized contract between two counterparties
to exchange an asset at a fixed price and date in the future. The underlying asset of the futures
contract can be a commodity or a financial security. Each contract specifies the type and amount of
the asset to be exchanged, and where it is to be delivered (usually one of a few approved locations for
that particular asset). Futures contracts can be set up for the delivery of cocoa, steel, oil or coffee.
Likewise, financial futures contracts can specify the delivery of foreign currency or a range of
government bonds. The buyer of a futures contract takes a ‘long position’, and will make a profit if
the value of the contract rises after the purchase. The seller of the futures contract takes a ‘short
position’ and will, in turn, make a profit if the price of the futures contract falls. When the futures
contract expires, the seller of the contract is required to deliver the underlying asset to the buyer of the
contract. Regarding financial futures contracts, however, in the vast majority of cases no physical
delivery of the underlying asset takes place as many contracts are cash settled or closed out with the
offsetting position before the expiry date.

An option contract is an agreement that gives the owner the right, but not obligation, to buy or sell
(depending on the type of option) a certain asset for a specified period of time. A call option gives the
holder the right to buy the asset. A put option gives the holder the right to sell the asset. European
options can be exercised only on the options’ expiry date. US options can be exercised at any time
before the contract’s maturity date. Option contracts on stocks or stock indices are particularly
popular. Buying an option involves paying a premium; selling an option involves receiving the
premium. Options have the potential for large gains or losses, and are considered to be high-risk
instruments. Sometimes, however, option contracts are used to reduce risk. For example, fund
managers can use a call option to reduce risk when they own an asset. Only very specific funds are
allowed to hold options.

Property
Property investment can be made either directly by buying properties, or indirectly by buying shares
in listed property companies. Only major institutional investors with long-term time horizons and no
liquidity pressures tend to make direct property investments. These institutions purchase freehold and
leasehold properties as part of a property portfolio held for the long term, perhaps twenty or more
years. Property sectors of interest would include prime, quality, well-located commercial office and
shop properties, modern industrial warehouses and estates, hotels, farmland and woodland. Returns

23
are generated from annual rents and any capital gains on realization. These investments are often
highly illiquid.

Risk and Risk Aversion

Portfolio theory also assumes that investors are basically risk averse, meaning that, given a choice
between two assets with equal rates of return they will select the asset with lower level of risk.
For example, they purchased various type of insurance including life insurance, Health insurance and
car insurance. The Combination of risk preference and risk aversion can be explained by an attitude
toward risk that depends on the amount of money involved.
A discussion of portfolio or fund management must include some thought given to the concept of risk.
Any portfolio that is being developed will have certain risk constraints specified in the fund rules,
very often to cater to a particular segment of investor who possesses a particular level of risk appetite.
It is, therefore, important to spend some time discussing the basic theories of quantifying the level of
risk in an investment, and to attempt to explain the way in which market values of investments are
determined

Definition of Risk
Although there is a difference in the specific definitions of risk and uncertainty, for our purpose and in
most financial literature the two terms are used interchangeably. In fact, one way to define risk is the
uncertainty of future outcomes. An alternative definition might be the probability of an adverse
outcome.
Composite risks involve the different risk as explained below:-

(1). Interest rate risk: -

It occurs due to variability cause in return by changes in level of interest rate. In long runs all interest
rate move up or downwards. These changes affect the value of security. RBI, in India, is the
monitoring authority which will affect the interest rate. Any upward revision in interest rate affects
fixed income security, which carry old lower rate of interest and thus declining market value. Thus it
establishes an inverse relationship in the prize of security.

24
 TYPES RISK EXTENT
Cash equivalent Less vulnerable to interest rate risk

Long term Bond More vulnerable to interest rate risk.

(2) Purchasing power risk:

It is known as inflation risk also. This risk emanates from the very fact that inflation affects the
purchasing power adversely. Purchasing power risk is more in inflationary times in bonds and fixed
income securities. It is desirable to invest in such securities during deflationary period or a period of
decelerating inflation. Purchasing power risk is less in flexible income securities like equity shares or
common stuffs where rise in dividend income offset increase in the rate of inflation and provide
advantage of capital gains.

(3) Business risk:

Business risk emanates from sale and purchase of securities affected by business cycles, technological
change etc. Business cycle affects all the type of securities viz. there is cheerful movement in boom
due to bullish trend in stock prizes where as bearish trend in depression brings downfall in the prizes
of all types of securities. Flexible income securities are nearly affected than fix rate securities during
depression due to decline n the market prize.

(4) Financial risk:

Financial risk emanates from the changes in the capital structure of the company. It is also known as
leveraged risk and expressed in term of debt equity ratio. Excess of debts against equity in the capital
structure indicates the company to be highly geared or highly levered. Although leveraged company’s
earnings per share (EPS) are more but dependence on borrowing exposes it to the risk of winding up.
For, its inability to the honor its commitments towards the creditors are most important.

Portfolio Diversification

25
There are several different factors that cause risk or lead to variability in returns on an individual
investment. Factors that may influence risk in any given investment vehicle include uncertainty of
income, interest rates, inflation, exchange rates, tax rates, the state of the economy, default risk and
liquidity risk (the risk of not being able to sell on the investment). In addition, an investor will assess
the risk of a given investment (portfolio) within the context of other types of investments that may
already be owned, i.e. stakes in pension funds, life insurance policies with savings components, and
property.
One way to control portfolio risk is via diversification, whereby investments are made in a wide
variety of assets so that the exposure to the risk of any particular security is limited. This concept is
based on the old adage ‘do not put all your eggs in one basket’. If an investor owns shares in only one
company, that investment will fluctuate depending on the factors influencing that company. If that
company goes bankrupt, the investor might lose 100 per cent of the investment. If, however, the
investor owns shares in several companies in different sectors, then the likelihood of all of those
companies going bankrupt simultaneously is greatly diminished. Thus, diversification reduces risk.
Although bankruptcy risk has been considered here, the same principle applies to other forms of risk.

TECHNIQUES OF PORTFOLIO MANAGEMENT

Various types of portfolio require different techniques to be adopted to achieve the desired objectives.
Some of the techniques followed in India by portfolio managers are summarized below.

(1). Equity portfolio-

Equity portfolio is affected by internal and external factors:

(a) Internal factors –

Pertain to the inner working of the particular company of which equity shares are held. These factors
generally include:

(1) Market value of shares

(2) Book value of shares
(3) Price earnings ratio (P/E ratio)
26
(4) Dividend payout ratio

(b) External factors –

(1) Government policies

(2) Norms prescribed by institutions
(3) Business environment
(4) Trade cycles

(2). Equity stock analysis –

The basic objective behind the analysis is to determine the probable future – value of the shares of the
concerned company. It is carried out primarily fewer than two ways. :

(a) Earnings per share

(b) Price earnings ratio

(A)Trend of earning: -

 A higher price-earnings ratio discount expected profit growth. Conversely, a downward trend
in earning results in a low price-earnings ratio to discount anticipated decrease in profits, price
and dividend. Rising EPS causes appreciation in price of shares, which benefits investors in
lower tax brackets? Such investors have not pay tax or to give lower rate tax on capital gains.
 Many institutional investor like stability and growth and support high EPS.

 Growth of EPS is diluted when a company finances internally its expansion program and
offers new stock.
 EPS increase rapidly and result in higher P/E ratio when a company finances its expansion
program from internal sources and borrowings without offering new stock.

(B) Quality of reported earning: -

27
Quality of reported earnings affects P/E ratio. The factors that affect the quality of reported earnings
are as under:

 Depreciation allowances: -
Larger (Non Cash) deduction for depreciation provides more funds to company to finance
profitable expansion schemes internally. This builds up future earning power of company.

 Research and development outlets: -

There is higher P/E ratio for a company, which carries R&D programs. R&D enhances profit
earning strength of the company through increased future sales.

 Inventory and other non-recurring type of profit: -

Low cost inventory may be sold at higher price due to inflationary conditions among profit
but such profit may not always occur and hence low P/E ratio.

(C) Dividend policy: -

Dividend policy is significant in affecting P/E ratio. With higher dividend ratio, equity price goes up
and thus raises P/E ratio. Dividend rates are raised to push in share prices up. Dividend cover is
calculated to find out the time the dividend is protected, In terms of earnings. It is calculated as under:

Dividend Cover = EPS / Dividend per Share

(D) Investors demand: -

Demand from institutional investors for equity also enhances the P/E ratio.

(3) Quality of management: -

Investors decide about the ability and caliber of management and hold and dispose of equity academy.
P/E ratio is more where a company is managed by reputed entrepreneurs with good past records of
management performance.

Types of Portfolios
28
The different types of Portfolio which is carried by any Fund Manager to maximize profit and
minimize losses are different as per their objectives. They are as follows.

Aggressive Portfolio:
Objective: Growth. This strategy might be appropriate for investors who seek High growth and who
can tolerate wide fluctuations in market values, over the short term.

Growth Portfolio:
Objective: Growth. This strategy might be appropriate for investors who have a preference for growth
and who can withstand significant fluctuations in market value.

Balanced Portfolio:
Objective: Capital appreciation and income. This strategy might be appropriate for investors who
want the potential for capital appreciation and some growth, and who can withstand moderate
fluctuations in market values

Conservative Portfolio:
Objective: Income and capital appreciation. This strategy may be appropriate for investors who want
to preserve their capital and minimize fluctuations in market value.

29
OBJECTIVES

30
OBJECTIVES

OBJECTIVES OF THE STUDY:

 To study the competitive position of Sharekhan Limited portfolio management services in

Competitive Market.
 To determine whether people are satisfied with Sharekhan portfolio services & Management
System or not.
 To understand the difficulties faced by persons while using portfolio management services.

31
LITERATURE REVIEW

32
LITERATURE REVIEW

Doorasamy Mishelle, (2017) conducted this research on "Product Portfolio Management Best
Practices For New Product Development: A Review Of Models". The survival of any industrial
organization depends on whether producing goods or services hinge on how innovative they have
become in managing their product portfolio to craft new products that changes with the ever-changing
tastes and needs of their customers. This study delves in to the models and theories that drive product
portfolio management practices in a way that they support the successes of new product development.
Our review is based on selected studies at the frontier of product management, summarized, and
compared based on author’s experiences, subsisting models, and theories with the results purely based
on qualitative rather than quantitative approaches. The essence is to explore possible new theory or
model in this field of research. New product is no doubt vital for the going concern of an organization
to be guaranteed. Businesses are expected to innovate and develop new products to the ever-changing
taste and needs of their customers. There are existing models for new products development;
prominent among this is the Cooper’s stage-gate process. Beyond new product development is the
ability to manage the product line to make them meet the goal of the development, making product
portfolio management inevitable.

Arto Tolonen & Hanna Kropsu-Vehkapera & Harri Haapasalo (2013) conducted this research on
"Product Portfolio Management: Current Challenges and Preconditions". The main objective of
this study is to clarify the current challenges relating to Product Portfolio Management (PPM). Also,
any preconditions for active PPM in terms of concepts, processes, tools, KPIs and governance models
are analyzed. Design/methodology/approach: Current state analysis of product portfolio management
practices are based on both, a thorough literature review and several case companies. Case companies
represent many business areas such as HW, SW, services and even combinations of them, solution
providers. Findings: The role of PPM is not to be a follower of activities caused by customers,
product development, sales, deliver and care organizations, and processes. The primary role of PPM
should be active management of current product portfolio, over product life cycle, instead of merely
focusing on new product development. Product portfolio management as a concept and process is not
that well understood and in place like other business processes. Research limitations: The limitations

33
of this study include analyzing a limited number of companies. Also, the experience of the analyzed
companies varies from only few years to a relatively long history. Practical implications: The
implications of this study include the potential preconditions of clarifying the role of product portfolio
management. The findings can aid business managers in understanding the PPM as an entity that has
a role in managing products and portfolios based on strategic and financial targets over product
lifecycles. Originality/value: This study approaches PPM from a more comprehensive viewpoint than
the traditional NPD focused PPM that is mainly covered by the existing literature. A company’s
future portfolio is seen as a sum of the existing product portfolio and the products created via NPD.
Existing product portfolio is also expanded by possible products introduced by joint ventures. This
article questions whether PPM ought to be considered equally as a business process, similarly as
product, sales, delivery and care processes.

Chris Storey & Paul Harborne, (2012) conducted this research on "Project portfolio management
in financial services: aligning systems and climate". While a number of studies have analysed
portfolio management in goods firms, few have focused on the processes and practices within service
firms. This research project investigated the attitudes, approach and practices geared towards project
portfolio management (PPM) in UK-based financial service firms. An exploratory research approach
is undertaken via in-depth interviews with key informants in 24 leading financial service companies.
Data was also collected on the tools employed for PPM and the performance of the project portfolio.
The results revealed considerable variation in the approach and effectiveness of PPM. There were
clearly unresolved problems with PPM including PPM not being within the company's strategic
context; firms being focused on managing project risk rather than building a balanced portfolio; a lack
of understanding of project interdependencies and firms' reluctance to cancel projects once they have
started.

34
COMPANY PROFILE

35
COMPANY PROFILE

ABOUT SHAREKHAN LIMITED

Sharekhan is one of the leading retail brokerage of Citi Venture which is running successfully since
1922 in the country. Earlier it was the retail broking arm of the Mumbai-based SSKI Group, which
has over eight decades of experience in the stock broking business. Share khan offers its customers a
wide range of equity related services including trade execution on BSE, NSE, Derivatives, depository
services, online trading, investment advice etc.

Earlier with a legacy of more than 80 years in the stock markets, the SSKI group ventured into
institutional broking and corporate finance 18 years ago. SSKI is one of the leading players in
institutional broking and corporate finance activities. SSKI holds a sizeable portion of the market in
each of these segments. SSKI’s institutional broking arm accounts for 7% of the market for Foreign
Institutional portfolio investment and 5% of all Domestic Institutional portfolio investment in the
country.

It has 60 institutional clients spread over India, Far East, UK and US. Foreign Institutional Investors
generate about 65% of the organization’s revenue, with a daily turnover of over US$ 2 million. The
content-rich and research oriented portal has stood out among its contemporaries because of its
steadfast dedication to offering customers best-of-breed technology and superior market information.
The objective has been to let customers make informed decisions and to simplify the process of
investing in stocks

Slogan : Your Guide to The Financial Jungle.

Fig2 Sharekhan slogan

36
Vision

To be the best retail brokering Brand in the retail business of stock market.

Mission

To educate and empower the individual investor to make better investment

decisions through quality advice and superior service.
Sharekhan is infact-

• Among the top 3 branded retail service providers

• No. 1 player in online business
• Largest network of branded broking outlets in the country serving more than 7,
00,000 clients.

REASON TO CHOOSE SHAREKHAN LIMITED

 Experience
 Technology
 Convenience

 Customer Service

 Investment Advice

SHAREKHAN LIMITED’S MANAGEMENT TEAM

 Dinesh Murikya : Owner of the company

 Tarun Shah : CEO of the company

37
  Shankar Vailaya : Director (Operations)

 Jaideep Arora : Director (Products & Technology)

 Pathik Gandotra : Head of Research

Organization Structure
● Registered with NSE and BSE for capital market, futures and options and currency segments
and CDSL and NSDL for depository services.
● A full-service stock broking firm providing online services right from online account opening
to trading and investments.
● Created India’s best online trading platforms: Website (www.sharekhan.com), Trade Tiger
(the ultimate desktop trading software), Sharekhan App (available for Android and iOS
devices) and Sharekhan Mini (a low bandwidth website especially for mobile browsers)
● A strong brick-and-mortar network with over 2600 outlets in 575+ cities
● Research-based financial advice on all asset classes to suit all investing and trading styles
● Dedicated Education and training courses for investors and traders in association with Online
Trading Academy.

Product Mix

1. Trade Tiger
If you believe in trading like a professional, experience the power of a broker's terminal with
our advanced online desktop trading platform – Trade Tiger.
What's more, navigation around the software is a piece of cake which gives you more time to
formulate winning trading strategies. Plus, with Trade Tiger you can trade easily in multiple
segments from a single platform, gain access to advanced trading tools like Trade from Excel
and Heat Map, and obtain real-time market feeds without any hiccups. Experience Trade Tiger
now to take your trading to the next level.

38
 Features

● Fast and Reliable Feeds

● Access to Research Calls
● Multiple Exchange Platform
● Free Online Trading

2. Sharekhan Website

Investing can be fun and engaging, that too at the click of a button with the Sharekhan website

Features:
● Explore the all new website
The new Sharekhan website is revamped to help you trade efficiently. Watch the demo to find
the new features and locate your sections.
● My Portfolio
My Portfolio gives a detailed & a comprehensive view of your investments. Watch the demo
to find out the new features of My Portfolio.
● Check all the Reports
Check various Reports to check the capital gains for tax calculation purposes in a better way
and all other reports related to orders and open and closed financial positions

3. Sharekhan App
The new Sharekhan App is user friendly and has been redesigned keeping user’s requirements
in mind. Along with its fresh new look, it also offers extensive features for both traders and
investors alike. Now, you can initiate trade easily, keep track of your stocks and manage
portfolio, all in one place. Sharekhan would surely become your preferred trading and
investment app for the features mentioned below.

App Features:
● Navigate easily across the app with user friendly design
● Stay updated with global and domestic market info
● Save the effort of typing user id and password again & again by perpetual login feature
39
 ● Trade, view charts & detailed quote, add to market watch& virtual portfolio directly from
scrip search page
● Introduction to powerful multi exchange streaming market watch with enhanced details about
scrips and contracts

Features for Traders:

● Trade smart with enhanced live charts (Line, Candlestick, Bar, Area)
● Trade in advanced orders (Bracket Order) and track the orders in enhanced report section
● Extensive and in–depth analysis using advanced charts and studies like Candle Stick,
Retracement Line, Bollinger Band, RSI, Moving Average etc
● Search for your favourite stock easily with Advanced Future & Option search

Features for Investors:

● Track your investments with newly introduced portfolio
● Enhanced global markets to keep you update about market news around the world
● Stay informed with the latest market news & updates
● Get access to domestic market news, top gainer, top loser, top traded volume, top traded
turnover, 52 week high, 52 week low

4. Sharekhan Mini
Sharekhan Mini is designed for mobile phone users and users who want to access Sharekhan on low
bandwidth.
Sharekhan Mini is low bandwidth website, which works both on smart-phone as well as on a basic 2G
phone. Anyone who has a basic phone and 2G network can trade through Sharekhan Mini without any
hassle.
Sharekhan Mini is packed with amazing features, some of which are mentioned below:
● Track as well as trade in all segments with multi exchange streaming watch list
● Trade seamlessly in NSECURR & MCXCURR and also invest in Mutual Fund
● Track Equity and MF portfolio on the go
● Access charts for scrips in NSE and BSE segments
● Get updates on Sharekhan Research calls and latest news
● Stay updated with information of global indices as well as domestic markets
● Single touch access to Market Watch, Order page, Charts and Futures & Options
40
 ● Keep an eye on your favorite stocks through watch list
● View all Call & Put contracts for a particular scrip with the help of Option Chain
● Know your contract information like Span Margin, Greeks etc. with help of Span Calculator
● Transfer funds securely from Bank to Trading A/c, MF A/c, IPO A/c & vice versa

5. Dial N Trade
Free with your Sharekhan Trading Account, the Dial-N-Trade service enables you to place
orders for buying and selling shares, futures & options and currencies through your telephone.
All you have to do is dial any one of our dedicated numbers (1-800-270-7050 or 1-800-22-
7050 or 30307600), enter your TPIN number (which is provided at the time of opening your
account) and on authentication, you'll be given an option to select either Equity or Currency
segment. Then, you'll be directed to a telebroker who will place the orders on your behalf.

Features:
● A quick and secure 3-step process to place your orders. Just enter your phone ID and TPIN
and select the segment you want from our varied offering [1 for Equity; 2 for Currency]
● Availability of all Sharekhan research advice on all segments:
○ Intraday
○ Momentum Call
○ Smart Chart Calls
○ Fundamental Calls
● Facility to discuss and understand trends and factors affecting the markets
● Guidance and education on market concepts
● Pan-India accessibility
● No limit on calls made for trading
● Complete recording infrastructure for all calls
● 2 toll-free numbers

6. Pattern Finder
Sharekhan brings you Pattern Finder - a tool that analyzes stocks and indices, extracts
profitable opportunities from them and delivers the information piping hot to you

How Does it Work?

41
 ● Scans stocks in all supported markets every night, based on standards of Technical Analysis
● Throws up charts, patterns and forecasts prices
● Delivers this information, via SMS and email alerts, before the market opens the next day

7. PMS- Wealth Optimizer

The Wealth Optimizer PMS focuses on enhancing your wealth over long term. The goal is to
outperform the market by generating superior returns. This is suitable for long term investors looking
to create an outperforming portfolio to generate superior returns over the general market.
The Indian equity market presents an excellent opportunity for long-term investors. Sharekhan offers
you solutions to meet your financial objectives. Wealth Optimizer is a portfolio management product
that involves enhancing wealth over the long term. The goal is not only to outperform the market but
also to generate superior returns.

Strategy:
● To identify undervalued growth stocks on the investment day
● Automated decision making system performs fundamental analysis and assigns a fair value to
each stock on the basis of reported financial performance
● Stocks with higher scope to grow are selected

How The Product Works

● Fundamental analysis is performed on more than 5,000 companies
● Stocks with sound fundamentals are picked, subject to strategy conditions
● Top 10 stocks are selected each day based on the maximum scope to grow
● No particular sector forms more than 20% of the client’s portfolio

42
 RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

The research design refers to the overall strategy that you choose to integrate the different
components of the study in a coherent and logical way, thereby, ensuring you will effectively address
the research problem; it constitutes the blueprint for the collection, measurement, and analysis of data.

43
Data collection

Data collection is the process of gathering and measuring information on targeted variables in an
established systematic fashion, which then enables one to answer relevant questions and evaluate
outcomes.

Primary data

Primary data is information that you collect specifically for the purpose of your research project. An
advantage of primary data is that it is specifically tailored to your research needs. A disadvantage is
that it is expensive to obtain.

Primary sources:

The data required for study are collected from:

● Questionnaire

A set of printed or written questions with a choice of answers, devised for the purposes of a survey or
statistical study.

● Visual and Audio Materials

Visual materials such as maps, photographs, prints, graphic arts, and original art forms can provide
insights into how people viewed and/or were viewed the world in which they existed.

Advantages of primary data collection

Is gathered first hand, following careful operationalization of variables and using carefully chosen
procedures.
Might be considered to be more trustworthy, in that they have greater validity than secondary data.

Secondary source

In contrast, a secondary source of information is one that was created later by someone who did not
experience first-hand or participate in the events or conditions you're researching. For the purposes of
a historical research project, secondary sources are generally scholarly books and articles.

The data collected from secondary data are:

44
 ● Internet, websites
● Case studies
● Books
● Journal
● Magazines

Advantages of secondary data

The first advantage of using secondary data (SD) has always been the saving of time.
Accessibility. In the past, SD was often confined to libraries or particular institutions.

Exploratory and Descriptive research

The research is primarily both exploratory and descriptive in nature. The sources of information are
both primary and secondary. The secondary data has been taken by referring to various magazines,
internal sources and internet to get the figures required for the research purposes. The objective of the
exploratory research is to gain insights and ideas. The objective of the descriptive research study is
typically concerned with determining the frequency with something occurs.

SAMPLING PROCESS
It is very true that to do the research with the whole universe. As we know that it is feasible to go to
population survey because of the n number of customers and their scattered location. So for this
purpose sample size has to be determined well in advance and selection of sample also must be
scientific so that it represents the whole universe.
So far as our research is concerned, we have taken sample size of 20 respondents. We have selected
Income Earners with saving to invest in Delhi.

SAMPLING TECHNIQUE
Initially a rough draft was prepared, a pilot study was done to check the accuracy of the questionnaire
and certain changes were done to prepare the final questionnaire to make it more judgemental.

RESEARCH PROCESS IN THIS PROJECT/STUDY

45
 RESEARCH TYPE : Exploratory and Descriptive
 DATA COLLECTION : Primary Data and Secondary data
 SAMPLE SIZE: 20 (Random)
 REASEARCH AREA: SHAREKHAN, New Delhi
 RESEARCH TOOLS: Pie Chart
 TOOLS OF ANALYSIS: Percentage

46
ANALYSIS AND INTERPRETATION

47
ANALYSIS AND INTERPRETATION

1.What kind of investment you prefer most?

Table 1
No. of Percentage
Response respondents %
Equity 8 40
Mutual Funds 6 30
Insurance 4 20
Derivatives 2 10

Figure 1

No. of respondents

Equity
Mutual Funds
Insurance
Derivatives

Interpretation:
According to this survey we find that 30% of the investors are inclined towards Mutual Funds and
40% of the investors prefer Equity and 20% of the investors prefer Insurance and 10% of the investors
prefer Derivatives.

48
 2. What is the basic purpose of your Investments?

Table 2

RESPONSE NO. OF PERCENTAGE

(%)
RESPONDETS
Liquidity 6 30
Returns 4 20
Tax benefits 2 10
Risk covering 2 10
Capital appreciation 3 15
Others 3 15

Figure 2

NO. OF RESPONDENTS

15% Liquidity
Returns
30%
Tax benefits
Risk covering
15%
Capital appreciation
Others

10%
20%
10%

Interpretation:
According to this survey we find that 30% people are interested in liquidity, 20% people in returns,
10% people in tax benefits and risk covering and 15% people in capital appreciation and others.

49
 3. What is the most important factor you consider at the time of Investment?
Table 3

RESPONSE NO OF PERCENTAGE
RESPONDENTS (%)
Risk 4 20
Return 6 30
Both 10 50

Figure 3

NO. OF RESPONDENTS

20%
Risk
Return
Both
50%

30%

Interpretation:
As the above analysis gives the clear idea that most of the Investors considered the market factor as
around 20% for Risk and 30% Return, but most important common things in all are that they are even
ready for taking both Risk and Return in around 65% investor.

4.“Investing in PMS is far safer than Investing in Mutual Fund”. Do you agree?
50
 Table 4

RESPONSE NO. OF PERCENTAGE

RESPONDENTS (%)
Yes 13 65
No 7 35

Figure 4

NO. OF RESPONDENTS

35% Yes
No

65%

Interpretation
In the above graphs it’s clear that 65% of respondent feel that investing their money in PMS is far
safer than Investing in Mutual fund and rest 35% feel that investing their money in Mutual Fund
Scheme are far safer than Investing in PMS.

51
 5.How do you manage your Portfolio?

Table 5

RESPONSE NO. OF PERCENTAGE

RESPONDENTS (%)
Self 11 55
Depends on 9 45
the company

Figure 5

NO. OF RESPONDENTS

Self
Depends on the company
45%
55%

Interpretation
About 55% of the respondents say they themselves manage their portfolio and 45% of the respondents
say they depends on the security company for portfolio.

52
 6.Are you using Portfolio Management services (PMS) of Sharekhan?

Table 6

RESPONSE NO. OF PERCENTAGE

RESPONDENTS (%)
Self 12 60
Depends on 8 40
the company

Figure 6

NO. OF RESPONDENTS

Yes
40% No

60%

Interpretation:
According to this survey we find that 60% people are using portfolio management services of
Sharekhan and rest 40% people are using portfolio management services from somewhere else.

53
 7.Which Portfolio Type you preferred?

Table 7

RESPONSE NO. OF PERCENTAGE

RESPONDENTS (%)
Equity 8 40
Debt 5 25
Balanced 7 35

Figure 7

NO. OF RESPONDENTS

Equity
35%
40% Debt
Balanced

25%

Interpretation:
According to this survey we find that 40% investor likes to go for Equity Portfolio and 35% with
Balanced Portfolio, whereas around 25% investor like to go for Debt Portfolio.

54
8. How was your experience about Portfolio Management services (PMS) of
Sharekhan Limited?

Table 8

RESPONSE NO. OF PERCENTAGE

(%)
RESPONDENTS
Earned 11 55
Faced loss 6 30
No profit no loss 3 15

Figure 8

NO. OF RESPONDENTS

15%

Earned
Faced loss
No profit no loss
55%
30%

Interpretation:
According to this survey we find that 55% of the Investor earned, whereas around 30% have to suffer
losses in the market. Similarly 15% of the respondents are there in Breakeven Point (BEP), where no
loss and no profit.

55
FINDINGS & INFERENCES

56
FINDINGS AND INFERENCES

1. Fluctuations are more in secondary market than any other market.

2. There are more speculators than investors.

3. Information plays a vital role in the secondary market.

4. Risk and Return both been considered by the Investors at the time of Investment.

5. Most of the Investors feels that PMS is less risky than Mutual Funds.

6. Most of the investors are using Sharekhan portfolio management services.

7. Investors prefers equity Portfolio over Balanceed Portfolio and Debt Portfolio

8. Most of the investors prefers to manage their portfolio themselves rather than depending on
the company

9. Investor have the good and the bad experience with the Sharekhan PMS services. Most of the
investors earned through Sharekhan PMS product.

57
LIMITATIONS

58
LIMITATIONS OF THE STUDY

Though the present study aims to achieve the earlier-mentioned objectives in full earnest and
accuracy, it was hampered due to certain limitations. Some the limitations of this study may be
summarized as follows:

 As only Delhi was dealt in the survey so it does not represent the view of the total Indian
market.

 The sample size was restricted with 20 respondents.

 There may be biasness in information by market participant.

59
CONCLUSION AND RECOMMENDATION

60
CONCLUSION

 Sharekhan Ltd has better Portfolio Management services than Other Companies
 It keeps its process more transparent.
 It gives more returns to its investors.
 Its charges are less than other portfolio Management Services
 It provides daily updates about the stocks information.
 Investors are looking for those investment options where they get maximum returns with less
returns.
 Market is becoming complex & it means that the individual investor will not have the time to
play stock game on his own.
 People are not so much ware aware about the Investment option available in the Market.

RECOMMENDATIONS

 The company should also organize seminars and similar activities to enhance the knowledge
of prospective and existing customers, so that they feel more comfortable while investing in
the stock market.
 Investors must feel safe about their money invested.
 Investors accounts must be more transparent as compared to other companies.
 Sharekhan limited must try to promote more its Portfolio Management Services through
Advertisements.
 Sharekhan needs to improve its Customer Services

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APPENDICES

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QUESTIONNAIRE

Name……………………….
Gender………..
Occupation……………

1. What kind of investment you prefer most?

(a) Equity (b) Mutual Funds
(c) Insurance (d) Derivatives

2. What is the basic purpose of your Investments?

A) Liquidity B) Return C) Tax Benefits D) Risk Covering
E) Capital Appreciation F) Others

3. What is the most important factor you consider at the time of Investment?
A) Risk B) Return C) Both

4. “Investing in PMS is far safer than Investing in Mutual Fund”. Do you agree?
A) Yes B) No

5. How do you manage your Portfolio?

A) Self B) Depends on the company for portfolio

6. Are you using Portfolio Management services (PMS) of Sharekhan?

A) Yes B) No

7. Which Portfolio Type you preferred?

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 A) Equity B) Debt C) Balanced

8. How was your experience about Portfolio Management services (PMS) of Sharekhan
Limited?
A) Earned B) Faced Loss C) No profit No loss

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BIBLIOGRAPHY

65
BIBLIOGRAPHY

Books:

Foundation of portfolio management: Mischelle Doorasamy, Foundations of Management, Volume 9,

Issue 1, 2017

Journals:
International Journal of Entrepreneurship and Innovation Management: Chris Storey & Paul
Harborne(IJEIM), Vol. 16, 2012
Diversity, Technology, and Innovation for Operational Competitiveness: Arto Tolonen & Hanna
Kropsu-Vehkapera & Harri Haapasalo, Department of Industrial Engineering and Management, 2013

Websites:

❖ www.economictimes.com

❖ www.moneycontrol.com

❖ www.bseindia.com

❖ www.nseindia.com

❖ www.investopedia.com

❖ www.sharekhan.com

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