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1A SUMMER TRAINING PROJECTREPORT(M.B.A.035)ONStock Exchange Online Share Trading AtLucknowForthe essential requirement of MBA 2nd / 3rd semester summer training for the partialfulfillment of the award of degree of Master of Business Administration.NAME OF SUPERVISOR : Mr. GUNJAN SONKER FACULTY NAME : RAKESH BAJPAIDESIGNATION : RELATIONSHIP MANAGER DESIGNATION : H.O.D.ORGANISATION : Nirmal Bang INSTITUTE : S.I.S.T.SUBMITTED BY :Name of Student : Avinash JaiswalCourse : M.B.A. 3rdsemester 2ndyearRoll No. : 1112170006Batch : 2011-13Session : 2012-13
2DECLEARATIONThe summer training program has been conducted for the partial fulfillment ofMBA program in Kanpur Summer Training programalso included a project work on "" Stock Exchange Online Share Trading At Nirmal Bang inLucknow City"and hereby authorize thatMr. Avinash Jaiswal to conduct his summer training Project under theSupervision of company guide Mr. Gunjan Sonkar (Relationship Manager) and the(Faculty of M.B.A). A final project report will have to be submitted to Nirmal Bang .. ...Mr. Gunjan SonkarRelationship ManagerNirmal Bang
3ACKNOWLEDGEMENT:I am neither a research expert nor a trend spotter; I am a management student with foundation ofmanagement principles and theories, who is curious about various sectors and its latest happenings.Definitely, I can‘t ignore the technology, with internet as the backbone and those search engines whichhelped me in building up this research project.To being with, I am obliged to Mr. KISHORE BANG and Mr. DILIP BANG (Managing Director‘sNirmal Bang Securities (PVT) Ltd).who allotted me this interesting topic and with out whose guidanceand constructive criticism this repot might have not been completed .I would like to thank Broker,Agents franchise owners and individuals. I appreciate for their cooperation and contributions for helpingme in making project factual and information.I would like to express my heart full gratitude to Mr. GUNJAN SONKER (Relationship Manager),NIRMAL BANG SECURITIES (PVT) LTD. Who helped me in sharpening my thinking by cheerfullyproviding challenging comments and questions. Without the individuals have provided, this projectwould have lost much of its refreshing realism. I‘m also thankful to the management & all employees ofNIRMAL BANG SECURITIES LTD.I also express my gratitude to Mr. (Director), Mr.(H.O.D) and ALL FACULTY MEMBERS OFMBA DEPARTMENT OF SUBHASH INSTITUTE OF SOFTWARE TECHNOLOGY who havebeen instrumental in making this report useful one.Lastly, I would like to thanks to the ALMIGHTY and my parents for their moral and financial supportand my colleagues with whom I shared my dad-to-day experiences and received lots off suggestions thatimproved my work quality.AVINASH JAISWALMBA
4PREFACEIn the economy for tightening Business nuts and bolt of any company industries or enterprises it isnecessary to measure it market position in a certain time interval with ever changing theories and theconcept of market.For this assessment we need the robust methodology of survey. Although surveys does not reveal theabsolute solution of any objectives, but it provides the inclination towards a good output.Nirmal Bang a good share trading company in Indian market. In this project we compare the future ofthis company. Find the awareness level, market potential of this company etc.The preparation of this report provides you great pleasure in releasing our work and market experiencesin few pages which shows overall and experienced knowledge and the practical approach about the styleof a professional and thing which we found various affecting to our marketing and product image.The project termed as ―stock Exchange & Online share Trading at Nirmal Bang” has made an effortto find out the issues concerning with the NIRMAL BANG SECURITIES PVT LTD.
5TABLE OF CONTENT:PART-ATitle page 1-1Certification from organizationCertification from project guideAcknowledgement 3-3Prefaces 4-4Executive summaryTopic 6-6Brief introduction 7-8Research methodology 10-10Finding & suggestion 11-11Industry profile 12-13Names of stock exchanges 15-15On line share trading in India 16-18Stock market 19-20Market participants 21-21History 22-23Importance of stock market 24-36
6PART-BCompany profile 37-43Products and services 44-51Taxation for Indian resident 52-54Demat services 55-58Mandatory document for account opening 59-65Investor‘s rights and obligation 66-71Terms and condition 72-83Internet trading agreement 84-98Services management of Nirmal Bang 99-101Research methodology 102-105Analysis 106-111Finding and recommendation 112-111Limitation 115-115Bibliography 116-116
8EXECUTIVE SUMMARY:TOPIC: “STOCK EXCHANGE & ONLINE SHARE TRADING AT NIRNAM BANG”The present repot is prepared for the partial of M.B.A and as a part of curriculum. The survey is anattempt to determine and ―STOCK EXCHANGE & ONLINE SHARE TRADING AT NIRMAL BANG SECURITIESPVT. Ltd.‖ To pursue research area are Lucknow was chosen where the survey conducted throughpersonnel interview.The data collection is an analyzed and some practical tools were applied to get inferences from thesurvey. The results are printed in the graphs and diagrams.The conclusion is that Nirmal Bang securities Pvt Ltd. In India in good condition.The research report has two sections in its first section company and industry profile is given, where assecond Research Methodology is given which includes samples design, analysis on sample andpresentation is in the form of diagram and charts.Finally some suggestions with respect to the survey for the future improvement is given to improve thesurvey because their competitors have also taken up the surveys.At the end of the report limitations, SWOT analysis, conclusion of the research and Appendix whichincludes questionnaire and the list of the city where the Sriram insight share brokers Ltd are running.Last there is Bibliography, FAQ, and Glossary that has the technical terms of the report.
9Objectives of study: To understand & analyze the marketing strategies and analyze onlineTrading of NIRMAL BANG. To improve the format of daily sales report (DSR) To get the Demat account opened of potential customers in favor of nirmal Bang. Analysis ofneed and satisfaction of distribution of financial services. To give a brief idea about the benefits available from Mutual Funds investment and idea oftypes of schemes available. To discuss about the market trends of Mutual Funds investment. To study some of the mutual funds schemes and analyze them observe the funds managementprocess of mutual funds. Explore the recent developments in the Mutual Funds in India. To give an idea about the regulations ofMutual Funds.
10RESEARCH METHODOLOGY:To achieve the objectives of studying the stock market data has been collected Research Methodology carried firthis study can be two types.RESEARCH DESIGNE: This research is description of the state of affairs, as it exists at present. So in thisresearch I used the description research.DATA SOURCES: In this research, I used primary data from the different brokers, agents, retailers andinvestors, and secondary data from Shriram insight Share Brokers Ltd.RESEARCH APPROACH: Depth study oft he investor‘s perception with respects to equityinvestments.RESEARCH INSTRUMENT: structured personal interview.TYPES OF QUESTIONS: open and close-ended question.SAMPLING: public interested in investing their savings.SAMPLE SIZE: 100
11SAMPLE PROCEDURE: Judgment samplings.CONTRACT METHOD: Personal Structured Interview.FINDING AND RECOMMENDATION:During my project analysis I was very keen to find some key areas which need to be taken care seriouslyin the future because these are causing dissatisfaction among distributors.Most of distribution felt dissatisfaction with there brokers but some of te disappointing areas are-1. More exposure: Most of distributors want some more exposure for them clients from their sharebroking companies. Nirmal Bang is now providing super exposure p to 15 of the margin (cashsegment) the step like this really creates satisfaction for the distributors.2. Brokerage problem: Some companies have very high brokerage chares which create differencesof market share of different companies and also dissatisfaction among distributors.3. Fewer offers: Most of companies lag behind in giving time to time offers in order to attract newcustomers.
13BOMBAY STOCK EXCHANGES:This stock exchanges, Mumbai, popularity known as ―BSE‖ was established in 1875 as ―The nativeshare and stock brokers associations‖, as a voluntary non-profit making association.It has an evolved over the years into its status as the premiere stock exchanges in the country. It may benoted that the stock exchanges the oldest one in Asia, even older than the Tokyo Stock Exchanges,which was founded in 1878.The exchanges, while providing an efficient and transparent market for trading in securities, upholds theinterests of the investors and ensures redressed of their grievances, whether against the companies or itsown members brokers.It also strives to educate and enlighten the investors by making available necessary informative inputsand conducting investor‘s education programmers.A governing board comprises of elected directors, 2SEBI nominees, 7 public representatives and anexecutive director is the apex body, which decides the policies and regulates the affairs of theexchanges.The executive director as the chief executive officer is responsible for the day today administration ofthe exchanges. The average daily turnover of the exchange during the year 2000-01 (April-March) wasRs 3984.19 crores and average numbers of daily trades 5.69 LakhsHowever the averages daily turnover of the exchanges during the year 2001-2002 has declined to Rs.1224.10 crores and number of average daily trades 5.69 Lakhs.The average daily turnover of the exchanges during the year 2001-2003 has declined and number ofaverage daily trades during the period is also decreased.
14The Ban on all deferral products like BLESS AND ALBM in the Indian capital markets by SEBI witheffect from July 2, 2001, abolition of account period settlements, introduction of compulsory rollingsettlements in all scripts trades on the exchanges.With effect from dec31, 2001 etc. have adversely impacted the liquidity and consequently there is aconsiderable decline in the daily turnover at the exchanges. The average daily turnover of the exchangespresent scenario is 110363 (Laces) and number of average daily trades 1057(laces).NATIONAL STOCK EXCHANGES:The NSE was incorporated is now 1992 with an equity capital of Rs 25 crores. The internationalsecurities consultancy (ISC) of Hong Kong has helped in setting up NSE.ISE has prepared the details business plans and installation of hardware and software system. Thepromotion for NSE were financial institutions, insurances companies, banks and SEBI capital marketsLtd, infrastructure leasing and financial services Ltd and stock holding corporation Ltd.It has been set up to strengthen the move towards professionalization of the capital market as well asprovide nation wide securities trading facilities to investors. NSE is not an exchange in the traditionalsense where broker own and manage the exchanges.A two tier administrative set up involving a company board and a governing aboard of the exchanges isenvisaged. NSE is a national market for shares PSU bonds, debentures and government securities sinceinfrastructure and trading facilities are provided.
15NAME OF THE STOCK EXCHANGE: Bombay stock exchange. Calcutta stock exchange. Ahmadabad share and stock brokers association. Delhi stock exchange association Ltd. Madras stock exchanges association Ltd. Indore stock brokers association Ltd. Bangalore stock exchanges. Hyderabad stock exchanges. Cochin stock exchanges. Pune stock exchanges. U.P stock exchanges. Ludhiana stock exchanges. Jaipur stock exchanges. Gawhati stock exchanges Ltd. Maghad stock exchanges Ltd. Vsdodard stock exchanges Ltd. Coimbatore stock exchanges Ltd. The Meerut stock exchanges. National stock exchanges. Mangalore stock exchanges Ltd, Patana. Bhuveneshwar stock exchange association. Over the counter exchange of India. Bombay saurastra kuth stock exchange Ltd.
17ONLINE SHARE TRADING IN INDIA:Now with HDFC, ICICI direct, share khan, Shriram insight and other brokers,Share trading in India has gone online. Starting at about 2 pct, online trading forms about pct in termsof volume (I think the figure is higher than 10 pct in the retail segment)Some of these have gone on to become the biggest‖ brokers‖ in India. It has opened the market to awhole segment of people. Earlier, investing in share was done by a limited few most of who applied inan IPO and stuck with till they wanted money.Now, not only online trading made life easier for these peoples, it has opened up investing and tradingto segment that never before participated in it. By my rough estimates during my experiences in Indiatech trading in India.Until the arrival brokerage in about 2000 or so, was like driving on Indian road. It was a familiar storyof might is right, big truck (brokers) ruled the market & there were potholes and pitfalls in the shape ofbad deliveries, dishonored contacts, fakes & what not.
18Unlike the highways which have remained out of the reach of the Aam admi, the share market haschanged. Somewhere in the nineties there was a whole move to make share electronics & fungible(like money notes, a share is a share. And move them to the dematerialized (demat) form.Slowly, from the physical world shares move to digital world at the NSDL. Then trading becameelectronic. First it was a few of the blue chips, then it was most of the blue chips and slowly it hastaken over most of the market.New issues are today, exclusively electronics. If digitization took care of the back end, it has alsomade life at the easy at the front end. In the physical delivery work, one had to talk to a broker whotold you the quotes.There was no way of knowing if the quote was right. There was no way of knowing if your trade wasmade, especially if you made a good call (Bad call, almost inevitably got made). The broker could saythat this was the best price I got and nobody would be wiser.You would not know if the share came from his account or form the market. You would not know if theshares were true for the small investors. Odd lots (which we inevitably awarded during splits, mergerswere as good as stock which would never got sold or the broker would purchase them at a price waybelow the market price.Industry about 70% of employees are have online active accounts, many of which were opened in theESOP era seems like a long while back), more than 80% of these investors are actives traders, thenumber of day traders are less.But a small chuck of these also dabbles in the future and options market. Besides this obvious segmentwhich is connected to the online would all days long from the cubicles, there are other segments whichhave shown interest in trading due to its case.Housewives retired professional and even small businessman. What was hitherto a male dominatesphere also has quite a fem women into trading. The regional stock exchange which were the way toroute trades in the olden days, are now almost defunct with BSE and NSE (NSE more than BSE)holdings way.
19Earlier investors were mostly from the bigger cities. With online trading, it has opened avenues forinvestors from the parts of the country with an internet connection.A few months ago, Business world (Registration/subscription regd.) India reported that: 46 pct of thetrades were done by the top 100 brokers in 1996-97. Today‘s it is about 66 pct. Going online via theseprofessional driven by technology is a great way to cut the uncertainties caused by the middleman out ofthe business of share trading and make lives easier for the investors.There will be more competition in this space as brokers try to take over accounts of other brokers. Morespecialized and personalized services will be in the offing as the market expands and as smaller brokerstry to survive and evolve into niche players.
20A stock market is a public market for the trading of company stock and derivatives at an agreed pricethese are securities listed on a stock as well as those only traded privately.The since of world stock market was estimated at about $36.6 trillions US at the beginning of October2008. The total world derivatives market has been estimated at about $791 trillion faceoff nominalvalue.11 times the size of the entire world economy. The value of the derivatives market, because it is stated interms of national values, cannot be directly compared to a stock or a fixed income security, whichtraditionally refers to an actual value.
21Moreover, the vast majority PF derivatives ‗cancels‘ each other out (i.e., a derivatives ‗bet‘ on an eventoccurring is offset by a comparable derivatives ‗bet‘ on event not occurring).Many such relatively illiquid securities are valued as market to model, rather than an actual marketprice. The stock are listed and traded on stock exchanges which are entities of an corporation of mutualorganization specialized in the business of bringing buyers and sellers of the organization to a listing ofstock and securities together.The stock market in the united states in the united states includes the trading of all securities listed onthe NYSE Euro next, the NASDAQ, the Amex, as well as on the many regional exchanges, e.g.OTCBB and Pink sheets. European examples of stock exchanges included the London Stock Exchange,the Deutsche Borse.MARKET PARTICIPANTS:A few decades ago, worldwide, buyers and sellers were individual‘s investors, such as wealthybusinessman, both long family histories (and emotional ties) to particular corporations.Overtime, market have become more ―institutionalized‖ buyers and sellers are larger institutions (e.g.Pension funds, insurance companies , mutual funds, index funds, exchange traded funds, hedge fundsinvestors groups, banks and various other financial institutions).The rise of the institutional investors has brought with t some improvement in market operations. This,the government was responsible for ―fixed‖(and exorbitant) fees being markedly reduced for the ‗small‘
22investors, but only after the large institutions had managed to break the brokers‘ solid fronts on fees.(They then went to ‗negotiated‘ fees, but only for large institutions.However, corporate governance (at least in the west) has been very much adversely affected by rise of(largely ‗absentee‘) institutional ‗owners‘.HISTORY:Historian Fernando Braudel suggested that in Cairo in the 11thcentury, Muslim and Jewish merchantand already set up every form of trade association and had knowledge of many methods of financialdealings, disproving the belief that these were originally invented later by Italians.In 12thcentury France the courratiers de changes were concerned with managing and regulation thedebts of agricultural communities and behalf of the bank. Because these men also trade with debts, theycould be called the first brokers.
23A common misbelieve is that in late 13thcentury Bruges commodity traders gathered inside the house ofa man called Van der Beurze, and in 1309 they became the ―Bruges Beurse‖ institutionalizing what hadbeen.Until then, an informal meeting, but actually, the family Van der Beurze had a building in Antwerpwhere those gathering occurred; the Van der Beurze had Antwerp, as most of the merchants of thatperiod.As their primary place for trading. The idea quickly spread around Flanders and neighboring countriesand ―Beurzen‖ soon opened in Ghent and Amsterdam.In the middle of the 13thcentury, Venetian market began to trade in government securities. In 1351 theVenetian government outlawed spreading rumors intended to lower the price of government securitiesduring the 14thcentury.This was only possible because these were independent city states not ruled by a duke but a council ofinfluential citizens. The Dutch later started joint stock companies, which let shareholders invest inbusiness venures and get a share of their profits or losses.In 1602, the Dutch East India Company issued the first share on the Amsterdam stock exchange. It wasthe first company to issue stock and bonds.The Amsterdam stock Exchange (ro Amsterdam Beurs) is also said to have been the first stock exchangeto introduction continuous trade in the early 17thcentury.The Dutch ―pioneered short selling, option trading, debt-equity swaps, and merchant banking. Unitstrust and other speculative instrument, much as we know them‖ (Murray Sayle,‖Japan Goes Dutch‖,London Review of books XXIII.7, April 5, 2001).There are now stock markets in virtually every developed and most developing economy, with theworld‘s biggest market being in the United stated, UK, Japan, China, Canada, Germany and France.
24Importance Of Stock Market:Function and purposeThe stock market is one of the most important sources for companies to raise money. This allowsbusinesses to be publically traded or raised additionally capital for expansion by selling share ofownership of the company in a public market.
25The liquidity that an exchange provides affords investors the ability to quickly and easily sell securities.This is an attractive feature of investing in stocks, compared to other less liquid investment such as realestates.History has shown that the price of shares and other assets is an important part of the dynamic ofeconomies activity, and can influence or be an indicator of social mood.An economy where the stock market is on the rise is considered to be an up and coming economy.In fact, the stock market is often considered the primary indicators of a country‘s economics strengthand development. Rising share prices, for instance, tend to be associated with increased businessinvestment and vice versa.Share prices also affect the wealth of household and their consumption.Therefore, central banks tend to keep an eye on the control and behavior of the stock market and, ingeneral, on the smooth operation of financial system functions. Financial stability is the raison d‘être ofcentral banks.Exchanges also act as the clearinghouses for each transaction, meeting that they collect and deliver theshares, and guarantee payment to the seller of a securities. This eliminates the risk to an individualbuyers or seller that the counterparty could default on the transaction.The smooth functioning of all these activities facilities economies growth in that lower costs enterpriserisks promote the production of goods and services as well as employment.In this way the financial system contribution to increased prosperity. An important aspect of modernmarkets, however, including the stock markets, is absolute discretion.For example, in the USA stock we see more unrestrained acceptance of any firm than in similar markets.Such as, Chinese firms with no significant value to American society to just name one segment.
26This profit USA banker on Wall Street, as they reap large commissions from the placement, and theChinese company which yields funds to invest in china.Yet accrues no intrinsic value to the long-term stability of the American economy, rather just short-termprofits to American business man and the Chinese; although, when foreign company has a presence inthe new market, there can be benefits to the market‘s citizens.Conversely, there are very few large foreign corporation listed on the Toronto Stock exchange TSX,Canada‘s largest stock exchange. This discretion has insulated Canada to some degree to worldwidefinancial condition.In order for the stock markets to truly facilitate economy‘s growth via lower costs and betteremployment, great attention must be given to the foreign participants being allowed in. Relation of thestock market to the modern financial system.The financial system in most western countries has undergone a remarkable transformation. Onefeatures of this development is disintermediation. A portion of the funds involved in saving andfinancing bank lending and deposit operation.The general public‘s heightened interest in investing in the stock market, either directly or throughmutual funds, has been an important component of this process. Statistics show that in recent decadesshare have made up an increasingly large proportion of household‘s financial assets in many countries.In the 1970‘s, in Sweden, deposit account and other very liquid assets with little risk made up almost 60percent of households‘ financial wealth, compared to less than 20 percent in the 2000s.The major part of this adjustment in financial portfolio has directly to shares but a good deal now takethe form of various kinds of institutional investment for groups of individuals, e.g., pension funds,mutual funds, hedge funds, insurance investment of premiums, etc.The trend towards form of saving with a higher risk has been accentuated by new rules for most fundsand insurance, permitting a higher proportion of shares to bonds.
27Similar tendencies are to be found in other industrialized countries. In all developed economies system,such as the European Union, the United State, Japan and other developed nations, the trend has been thesame: saving has moved away from traditional (government insured) bank deposits to more riskysecurities of one sort or another.The Stock Market, Individual Investors, and Financial Risk:Riskier long-term saving required that an individual possess the ability to manage the associatedincreased risks. Stock prices fluctuated widely, in marked contrast to the stability of (governmentinsured) bank deposits or bonds.
28This something that could affect not only the individual investors or households, but also the economyon a large scale. The following deals with some of the risks of the financial sectors in general and thestock market in particular.This is certainly more important now that so many newcomers have entered the stock market, or haveacquired other ‗risky‘ investment (such as ‗investment‘ property, i.e., real estate and collectables.)With each passing year, the noise level in the stock market rises. Television commentators, financialwriters, analysis, and market strategies are all over taking each other to get investors ‗attention‘.At the same time, individual investors, immersed in chat rooms and message boards, are exchangingquestionable and often misleading tips.Yet, despite all this available information, investors find it increasingly difficult to profit. Stock pricesskyrocket with little reasons, then plummet just as quickly.And people who have turned to investing for their children‘s education and their own retirement becomefrightened. Sometimes there appears to be no rhyme or reason to the market, only folly.This is a quote from the prefaces to a published biography about the long-terms value oriented stockinvestors warren Buffett.The behavior of the stock market:From experiences we know that investors may ‗temporarily‘ move financial prices away from their longterms aggregate price ‗trend‘ (positive or up trends are referred to as bull markets: negative or downtrends are referred to as bear markets.)
29Over-reaction may occur so that excessive optimism (euphoria) may drive prices unduly high orexcessive pessimism may drive unduly low. New theoretical an empirical arguments have since been putforward against the notion that financial markets are ‗generally‘ efficient (i.e., in the sense that prices inthe aggregate tends to follow a Gaussian distribution.)(But this largely theoretic academic viewpoint- knows as ‗hard‘ EMH- also predicts that little or notrading should take place, contrary to fact, since prices are already at or near equilibrium, having pricedin all public knowledge.) The ‗hard‘ efficient-market hypothesis is sorely tested by such events as thestock market crash in 1987, when the Dow Jones index plummeted 22.6 percent—the largest-ever one-day fall in the United States.This events demonstrated that share prices can fall dramatically even though, to this day, it is impossibleto fix a generally agreed upon definite cause: a thorough search failed to detect any ‗reasonable‘development that might have accounted for the crash. (But note that such events are predicted to occurstrictly by chance, although very rarely.)It seems also to be the case more generally that many price movements (beyond that which are predictedto occur ‗randomly‘) are not occasioned by new information: a study of the fifty largest one-day shareprices movements in the United States in the post-war period seems to confirm this.However, a ‗soft‘ EMH has emerged which does not required that prices remain at or near equilibrium,but only that market participants not be able to systematically profits from any momentary market‗inefficiencies‘.Various explanation for such large and apparently non-random prices movement have beenpromulgated. For instance, some research has shown that change in estimated risks, and the use ofcertain strategies, such as stop-loss limit and value at Risk limits, theoretically could cause financialmarkets to overcorrect.But the best explanation seems to be that the distribution of stock market prices is non-Gaussian (inwhich case EMH, in any of its current forms, would not be strictly applicable.)Other research has shown that psychological factors may result in exaggerated (statically anomalous)stock prices movement (contrary to EMH which assumes such behaviors‘ cancel out‘).
30Psychological research has demonstrated that peoples are predisposed to ‗seeing‘ patterns, and often willperceive a pattern in what is, in fact, just noise, (something like seeing familiar shapes in clouds or inkblots.)In the present context this means that a succession of good new items about a company may leadinvestors to overreact positively (unjustifiably driving the prices up). A period of good returns alsoboosts the investor‘s self-confidence, reducing his (psychological) risk threshold.Another phenomenon—also from psychology—that works against an objective assessment is groupthinking. As social animal, it is now easy to stick to an opinion that differs markedly from that of amajority of the group.An example with which one may be familiar is the reluctance to enter a restaurant that is empty; peoplegenerally prefer to have their opinion validated by those of other in the group.In one paper the authors draw an analogy with gambling. In normal times the market behaves like agame of roulette; the probabilities are known and largely independent of the investment decision of thedifferent players.In times of market stress, however, the game becomes more like poker (herding behavior takes over).The players now must give heavy weight to the psychology of other investors and how they are likely toreact psychology.The stock market, as any other business, is quite unforgiving of amateurs. Inexperienced investors rarelyget the assistance and support they need.In the period running up to 1987 crash, less than 1 percent of the analysis recommendation had been tosell (and even during the 2000-2002 bear market, the average did not above 5%).In the run up to 2000, the media amplified the general euphoria, with reports of rapidly rising shareprices and the notion that large sums of money could be quickly earned in the so called In the run up to2000, the media amplified the general euphoria, with reports of rapidly rising share prices and the notionthat large sums of money could be quickly earned in the so called new economy stock market.
31(And later amplified the glom which descended during the 2000-2002 bear market, so that by summer of2002, prediction of a DOW average below 5000 were quite common).Irrational behavior:Sometimes the market seems to react irrationally to economic or financial news, even if that news islikely to have no real effect on the technical value of securities itself.
32But this may be more apparent than real, since often such has been anticipated, and a counter reactionmay occurs if the news is better (or worse) than expected.Therefore, the stock market may be swayed in either by press releases, rumors euphoria and mass panic;but generally only briefly, as more experienced investors (especially the hedge funds quickly rally totake advantage of even the slightest, momentary hysteria.Over the short-term, stock and other securities can be battered or buoyed by any number of fast market-changing events, making the stock market behavior difficult to predict. Emotion can drive prices up anddown, people are generally not as rational as they think, and the reasons for buying and selling aregenerally obscure.Behaviorists argue that investors often behave ‗irrationally‘ when making investment decision therebyincorrectly pricing securities. This causes market inefficiencies, which, in turn, are opportunities, tomake money.However, the whole notion of EMH is that these non-rational reactions to information cancel out,leaving the prices of stock determined. The Dow Jones industrial Average biggest gain in one day was936.42 points or 11 percent, this occurred on October 12, 2008.Crashes:Robert shiller‘s plot of the S&P composite Real prices, Earning, Dividends, and interest Rates, fromirrational exuberance, 2nd. In the prefaces to this edition, Shiller warns, ―The stock market has not come
33down to historical levels: the prices-earnings ratio as I defined it in his book is still, at this writing, in this mid-20s, far higher than the historical average…..people still place too much confidencein the market and have too strong a belief that paying attention to the gyration in their investment willsomeday make them rich, and so they do not make conservative preparation for possible bad outcomes.‖Price-Earnings ratios as predictors of twenty-year returns based upto the plot by Robert shiller. Thehorizontal axis shows the real price-earnings ratio of the S&P composite stock price index as computedin Irrational Exuberance (inflation adjusted price divided by the prior ten-year mean of inflation-adjusted earning).The vertical axis shows the geometric average real annual return on investing in the S&P compositestock prices index, reinvesting dividends, and selling twenty years-did do well when prices were lowrelative to earnings at the beginning of the ten years.Long-term investors would be well advised, individually, to lower their exposer to the stock marketwhen it is high, as it has been recently, and get into the market when it is low.‖Stock market crash:A stock market crash is often defined as a sharp dip in share prices of equities listed on the stockexchanges. In parallel with various economics factors, a reason for stock market crashes is also due topanic and investing public‘s loss of confidence. Often, stock market crashes end speculative economicsbubbles.There have been famous stock market crashes that have ended in the loss of billions of dollars andwealth destruction on a massive scale. An increasing number of people are involved in the stock market,especially since the social security and retirement plans are being increasingly privatized and linked tostocks and bonds and other elements of the market.There have been a number of famous stock market crashes like the Wall Street crashes of 1929, thestock market crash of 1973-4, the Black Monday of 1987, the Dot-com bubble of 2000, and the stockmarket crashes 2008.One of the most famous stock market crashes started October 24,1929 on Black Thursday. The DowJones industrial lost 50% during this stock market crash. It was the beginning of the Great depression.Another famous crash took place on October 19, 1987 --- Black Monday. On Black Monday itself, theDow Jones fell by 22.6% after completing a 5 year continuous roses in share prices. This event not onlyshook the USA, but quickly spread across the world.Thus, by the end of October, stock exchanges in Australia lost 41.8%, in Canada lost 22.5%,, in HongKong lost 45.8%, and in Great Britain lost 26.4%. The names, ―Black Monday‖ and ―Black Tuesday‖are also used for October 28-29, 1929.
34This followed terrible Thursday –the starting day of the stock market crash in 1929. The crash in 1987raised some puzzles—main news and events did not predict the catastrophe and visible reasons for thecollapse were not identified.This event raised question about many important assumptions of modern economics, namely, the theoryof rational human conduct, the theory of market equilibrium and the hypothesis of market efficiency.For some time after the crash, trading in stock exchanges worldwide was halted, since the exchangescomputers did not perform well owing to enormous quantity of trades being received at one time.This halt in trading allowed the Federal Reserve System and central banks of other countries to takemeasures to control the spreading of worldwide financial crisis.In the United State the SEC introduction several new measures of control into the stock market in anattempt to prevent a re-occurrence of the events of Black Monday.Computer systems were upgrades in the stock exchanges to handle larger trading volumes in a moreaccurate and controlled manner. The SEC modified the margin requirement in an attempt to lower thevolatility of common stocks, stock option and the futures markets.The New York Stock Exchanges and the Chicago Mercantile Exchange introduction the concept of acircuit breaker. The circuit breaker halts trading if the Dow declines a prescribed number of points for aprescribed amount of time.New York Stock Exchange (NYSE) circuit breakers.Stock market indexThe movement of the prices in a market or sections of a market are captured in price indicescalled stock market indices, of which there are many, e.g., S&P, the FTSE and the Euro nextindices.
35Such indices are usually market capitalization weighted, with the weight reflecting thecontribution of the stock of the index are reviewed frequently to include/exclude stocks in orderto reflects to reflects the changing business environment.Leveraged strategiesStock that a traders does not actually own may be traded suing short selling; margin buying maybe used to purchase stock with borrowed funds; or, derivatives may be used to control largeblocks of stock for a much smaller of amount of money than would be required by outrightpurchases or sale.Short sellingIn short selling, the traders borrow stock (usually from his brokerage which holds it‘s client‘sshares or its own share on account to lend to short sellers) then sells it on the market, hoping forthe price to all.The trader eventually buys back the stock, making money if the price fell in the meantime orlosing money if it rose; exiting a short position by buying back the stock is called ―covering ashort position‖.This strategy may also be used by unscrupulous traders to artificially lower the price of a stock.Hence most markets either prevent short selling or place restriction on when and how a short salecan occur.The practice of naked shorting is illegal in most (but not all) stock markets.Margin buying:In margin buying, trader borrows money (at interest)to buy a stock and hopes for it to rise. Mostindustrialized countries have regulation that requires that if the borrowing is based on collateral
36from other stock the trader owns outright, it can be a maximum of a certain percentage of thoseother stocks‘ value.In the United State, the margin requirements have been 50% for many years (that is, if you wantto make a $100 investment, you need to put up$500, and there is often a maintenance marginbelow the $500).A margin call is made if the total value of the investor‘s account cannot support the loss of thetrade.(Upon a decline in the value of the margined securities additional funds may be requires tomaintain the account‘s equity, and with or wit out the margined securities or any others withinthe account may be sold by the brokers to protect its loan position. This investors is responsiblefor any shortfall following such forced sale).Regulation of margin requirement (by the Federal Reserve) was implemented after the crash of1929. Before that, speculators typically only needed to put up a little as 10% (or even less) of thetotal investment represented by the stocks purchased.Other rules may include the prohibition of free-riding: putting in an order to buy stocks withoutpaying initially (there is normally a three-day grace period for delivery of the stock.)But then selling them (before the three-days are up) and using part of the proceeds to make theoriginal payment (assuming that the value of the stocks has not declined in the interim).New issuance:Global issuance of equity and equity-related instrument totaled $505 billion in 2004, a 29.8%increase over the $389 billion raised in 2003. Initial public offer (IPOs) by US issuers increased221% with 233offering that raised $45 billion, and IPOs in Europe, Middle East and Africa(EMEA) increased by 333% from $9 billion to $39 billion.Investment strategies:One of the many thing people always want to know about the stock market is, ―How do I knowmoney investing?‖ There are many different approaches; two basic methods are classified aseither fundamental analysis or technical analysis.
37Fundamental analysis refers to analyzing companies by their financial statements founds in SECFiling, business trends, general economic conditions, etc.Technical analysis studies prices action in market through the use of charts and quantitativetechniques to attempt to forecast prices trends regardless of the company‘s financial prospects.One examples of a technical strategy is the Trend following method, used by John W Henry andrisk control and diversification.Additional, many choose to invent via the index method. One holds a weight or unweightportfolio consisting of the entire stock market or some segment of the stock market (such as theS&P 500 or Wilshire 5000).The principle aim of this strategy is to maximize diversification, minimize taxes from toofrequent trading and ride the general trend of the stock market (which, in the U.S, has averagednearly 10% year, compounded annually, since World War II).Taxation:According to much national or state legislation, large arrays of fiscal obligation are taxed forcapital gains. Taxes are charged by the state over the transactions, dividends and capital gains onthe stock market, in particular in the stock market.However, these fiscal obligations may vary from jurisdiction to jurisdiction because, amongother reasons, it could be assumed that taxation is already incorporated into the stock pricesthrough the different taxes companies pay to the state, or that tax free stock market operationsare useful to boost economic growth.
39Founded in 1986 by Sri Nirmal Bang Group is recognized as one of the largest retail brokinghouses in India, providing an array of financial products and services.Our retail and institutional clients have access to product such as equities, derivatives,commodities, currency derivatives, mutual fund, IPOs, insurance, depository services and PMS.Throughout our history, we have fostered one overriding purpose each client with personalservices and quality work by adhering to the principal, we have grown to become a successful aswell-respect firm of highly qualified professional.The group is headed by Mr. Dilip Bang and Mr. Kishore Bang who bring forward industryexpertise, insight and most important, create an environment of unmatched to client.We are registered members of the Bombay Stock Exchanges limited (BSE), National StockExchanges of India limited (NSE), Multi Commodity Exchanges of India limited (MCX),national commodity & Derivatives Exchanges limited (NCDEX), National Multi CommodityExchanges of India limited (NMCE) and MCX stock Exchange limited and also depositoryparticipants of NSDL and CDSL.MISSION:“To work together with integrity and make customer feel valued.”Vision:“TO CREATE VALUABLE RELATIONSHIPS AND PROVIDE THE BEST FINANCIALSERVICES MOST PROFESSIONAL.”Core value:“RESPECT OUR COLLEAGAUES AND THE BUSINESS ITSELF.WHY CHOOSE US?CLIENT FOCUS
40Client relationship from the core of our business. We value each client, no matter what size, as along-term relationship. And we seek to provide unmatched services to each client and place himas a partner at the center of everything we do.From the very beginning of the relationship, we work closely with every client to identify hisfinancial goals and risk tolerance levels and leverage our strength of the product offering,research and financial strength to help achieve his goals. In the process, we become anprofessional partners, creating opportunity, adding value and transform vision into reality.Diverse services offeringIn addition to traditional broking services, we are also equipped to handle commodity tradingfacility as well as currency derivatives and have access to a wide range of financial services likeIPOs, mutual funds and insurance.Timely servicesIn an increasingly competitive environment, clients today require personalized solution andgreater flexibility and responsiveness than ever before. Our professionals are always ‗on call‘.We provide them services throughout the year and not just at the end of the year. We believesuch service is essentials for delivering solution and constructive relationship.Able teamWe have developed a strong and enduring team by recruiting from leading graduate andpostgraduate universities and promoting from within. Our team work together to providesuperior results to our client. At the same time, each of our clients is assigned a specific teammember who ‗owner‘ the relationship, providing continuity, responsiveness and a point of easyaccess to the firm.Culture
41We strive to maintain standards at all times and lay emphasis on honesty, integrityand confidentiality. We speak and act to ensure transparency at all levels and ineverything we do.Financial strengthThe strength of our balance sheet is such that it gives greater confidence to all ourretail and institutional clients in detail with us. The financial strength of the grouphelps in future building the network and infrastructure to cater to the larger market.INFRASTURUCTURE:We believe or best infrastructure gives a significant advantage allowing us to provide efficient,transparent and qualitative services. Our technology supports everything from executive trades andmanaging our investors of stocks to communicating up-to-the-second information to our clients andmonitoring for compliance.Client interface:We have trading terminal (both direct and indirect), online monitoring, control terminal (administrationterminals) and back office support terminal (settlement terminal) across all location and centers.We have India‘s best single screen Multi Exchanges Trading Software platform. Our entire centers acrossthe country are connected through our own network, leased ISDN lines and LAN network, MPLS andinternet.The high-end IBM serves with sophisticated security features that we use caters to trading points acrossthe country. This also gives u rte advantage of scalability in terms of location and size of our plannedoperations. We provide telephonic and chat support for technical and functional issues of branches,franchises and all our clients.Our websites www.nirmalbang.com is comprehensive and provides online feeds, net trading andprovides online feed, net trading portfolio tracking tool. Investors also have access to a wide range offinancial news, information and various research reports facilitating quick decision-making.Our online trading portal at www.nirmalbang.com is equipped with facilities like all segmentbroadcasts, multi-features graphs, online payment gateways and automatic password mailer utility forbetter security. It user-friendly navigation allows easy viewing of trading accounts, depository accountsand research reports, which are linked to the trading platform.The website also has a provision for creating portfolios and monitoring them on a regular basis. Our‗wealth trackers‘ module helps investors in getting ready updates n their investment so that they canknow the changing trends of the markets and the impact of the same on their portfolio.
42Back office:For back office operations, we use the lidha Didha system of Apex Soft cell Pvt. Ltd. This is one of thetop most back office software in the industry. It has the capacity to process over one lakh traders in afive minute frame.Our operation teams has an easy-to-navigate client login system, which is used to generate activityreports, short-terms and long-term tax reports, holding and portfolio valuation reports as well as tradingto delivery activity reports.We also have the requisite infrastructure needed to handles STP, upload and download and downloadinformation to or from exchanges, bank and depositories, support units to ensure delivery notes, billsand ledgers of trading accounts and cash management services for efficient and effective fundmanagement within the group.Internal control:Compliance and internal control play a major role in determining business strategies as well as day-to-day operation of the group. A well-equipped risk management department ensures that the delinquencyrates are minimal, while efficient risk management software provides online MTM margin data tobranches and franchisees. Our efficient back-up system and software have been developed specially forbranches and channel partners with a capacity to handle numerous transactions. Our online positionmonitoring system ensures better risk management and surveillance from our head office as well asbranches and franchises. Our people from them cornerstone of the business and their expertise andmotivation delivery of exceptional solution and services to all our clients.Experienced professional:Our teams of professional consist of individual with significant experience in securities trading, marketstructure, trading technology and portfolio management. They have a strong experience in tradeexecution and understanding of order flow dynamics. This combined with technical analysis of marketmomentum, help our clients to determine the price at which they buy and /or sell.We believe, we are the first choice for our clients because we among the very best at trade executivesolution and assets management services. At Nirmal bang, each and every professional is focused onturning the initial trade or investment into a collaborative, person-to-person relationship that keepsdelivering true added value.
43Research Expertise:Our research team is headed by two senior research analysts who have more than 15 years of experiencein this field.Our team of experienced fundamental research and technical analysts provide reports on industries,sectors, companies and individual stocks. Our research reports are backed by in-depth research andanalysis of emerging as well as current market trends. Besides, our research analysts also appear onleading business news channel where they share their insights on the market.Nirmal Bang Group‘s business strives the largest number of common people. Consider these: Equity*/commodity/ currency*/mutual fund/IPO/PMS/insurance/DP products.Management philosophy:Nirmal Bang Group‘s business ventures are highly successful due to our Management philosophy.Features of this include total empowerment of its employee, decentralized decision-making process andfreedom of action. Most of all, the Group views every employee as a potential partner in business.Group Companies has also been instrumental in creating innumerable indirect jobs in the communitiesthey serve.About Nirmal Bang:Nirmal Bang Securities Pvt Ltd. is the stock-Broking arm of the Rs. 7,500 crore (approx) Nirmal Bang.With over 450 branches, 8000 employees (approx), 28 lakh investors, Nirmal Bang, with evolved into apremier financial supermarket providing a host of services including stock-broking, distribution ofinvestment products, properly, property development, industrial investment, risk management, insuranceproducts and consumer finance.Human Resources:Human resources is the key to any services sectors industry. We have a strong and vibrant workforce inevery field or our activity, be it research, system, accounts, marketing or networking.
44With the manpower strength of over 1100 employees, the Company is managed by a highly motivated,qualified & talented team of professional qualified CA‘s, MBA,s, Engineers, etc with proven trackrecords.Technology:Stock-broking being a process intensive activity, issues such as speed, accuracy, round-the-clock systemavailability and system securities are of paramount importance and technology forms the backbones ofthe business.This is why Nirmal Bang is technology driven. We boast of state-of-the-art technology and an in-houseteam of highly competent software and networking engineers who constantly review system andprocedures to ensure operational efficiency.All our branches are connected through Wide Area Network (WAN) and are served by a centralizedback office processing system, which enables clients to obtain up to date information online at the clickof a button.Customer Focus:Despite a rapidly expanding client base and a dizzying increase in transaction volumes, each client atNirmal Bang is special. We specialize in building long term relationship with our customers byproviding them with the four things they desire most, viz., speed,, convenience, reliability andpersonalized services.Our continuous strive to provide best services to our clients, results in receipt of not a single ArbitrationAward against the company since its inception.
46A. WIDE OPTION WHILE TRADING:A product for every need:Nirmal Bang is the most comprehensive website, which allows you to invest in shares, mutualfunds, derivatives (Future and Option) and other financial products. Simply put, we offer youproducts for every investment need of yours.Trading in shares:Nirmal Bang offers you various options while trading in shares.Cash trading:This is a delivery based system, which is generally done with the information of taking deliveryof shares or monies.Margin Trading:You can also do an intra-settlement trading up to 3 to 4 times your available funds, where in youtake long buy/short sell position in stocks with in the intention of squaring off the position withinthe same day settlement cycle.In margin trading, you take buy/sell position in stocks(s) with the intention of acquiring off theposition within the same settlement cycle. If, during the course of the settlement cycle, he pricemoves in your favor (rises in case you have a buy position or falls in case you have a sellposition), you make profit. In case you have the option to take/give delivery of buy/sell positionrespectively if you have sufficient cash/securities to do so.Normally to buy shares, you have to place (ensure availability of limit) 100% of the order value,while to sell shares, you need to have shares in your Demat account. However, margins areblocked only to safeguard any adverse price movement. At present, you have to place 33.33% ofthe order value as margin. With margin trading, you can leverage on your trading limit by takingbuy/sell positions much more than what you could have taken in cash segment. However, therisk profile of your transaction goes up.
47Margin PLUS Trading:Through Margin PLUS you can do an intra-settlement trading up to 10 times your availablefunds, where in you take long buy/sell position in stock with the intention of squaring off theposition within the same day‘s settlement cycle. Margin PLUS will give a much higher leveragein your limits.Margin PLUS is an order placement feature where you can take a position at market price andalso place a cover order for the position specifying the SLTP and the limit price. This willminimize the loss cover at the time of taking the position itself. There by it gives a clear view ofmaximum downside involved in a particular position at a particular price, Nirmal Bang won‘tlevy a normal margin ranging from 21% to 50%. It would block he maximum loss whichcustomer can suffer.Spot Trading:This facility can be used only for selling you is demat stocks which already exist in you‘re demataccount. When you are looking at an immediate liquidity option, ‗cash on spot‘ may work thebest for you, on selling shares through ―cash on spot‖, money is certified to your bank a/c thesame evening & not on the exchange payout date.BTST:Buy today sell tomorrow (BTST) is a facility that allows you sell shares even on 1stand 2nddayafter the buying order date, without you having to Waite for the receipt of shares into your demataccount.Call N Trade:Call N Trade allow you call on a local number in your city & trade on the telephone through ourcustomer services Executive.Trading in NSE/BSE: through Nirmal Bang you can trade on NSE and BSE.
48Market order:This is an order to buy sell securities at the best price obtainable in the market at the time it ismatched by the exchange. Therefore, change of its getting executed are better. In case of marketorder for NSE, all market order placed which are not executive fully; it becomes a limit order forthe balance quantity at the last traded price.Market Order in BSE: Explanation:Market order can be placed only during market hours (i.e., when the Exchanges is open for trading).You could trade by placing market orders during market hours that allows you to trade at the bestobtainable price in the market at the time of execution of the order.Limit Order:Limit Order is an order to buy or sell securities in which you specify the maximum price per unit in caseof a buy order and the minimum price per unit in case of sell order. The actual transaction can be at aprice more favorable than the price specified.Allow you to place a buy/sell order at a price defined by you. The execution can happen at a price morefavorable than the price, which is defined by you, limit orders can be placed by you during holidays &non market hours too.Online confirmation of Order and trade:You get online confirmation of orders and trades- the status of any order is updated on real-time basis inthe Order Book. As soon as you place your order they are validated by the system and sent to theexchange for execution. The entire process is fully automation and there are no manual interventions.
49GTC, GTD and IOC Order:A Good Till cancelled (GTC) order remains in the system until the trading members cancels it.However, the system cancels this order if it is not trade within a number of days parameterized by theExchanges. A Good Till Days/Date (GTD) order allows the user to specify the number of days/date tillwhich the order should stay in the system if not executed. The maximum number of days for which theGTC/GTD order can remain in the system is notified by the exchange from time to time after which theday/date on which the order is placed and inclusive of holidays. An immediate or cancel (IOC) orderallows the user to buy or sell a security as soon as the order is released into the system, falling which theorder is cancelled from the system. Partial match is possible for the order and the unmatched portion ofthe order is cancelled immediately.Disclose Quantity (DQ) Order:Normally, the order quantity is disclosed in full to the market. An order with a disclosed quantity (DQ)condition/attribute allows the trading members to disclose only a part of the order quantity to the market.For example, an order of 1000 with a disclosed quantity condition of 200 will mean that 200 is displacedto the market at a time. After this traded, another 200 is automatically released soon till the full order isexecuted. DQ (Disclosed Quantity) should not be less that 10% of the order quantity and at the sametime should not be greater than or equal to the order quantity.Stop Loss Order:A stop loss order allows the client to place an order which gets activated only when the market price ofthe relevant securities reached or crosses a threshold price specified by the investors in the form of‗stock loss trigger price‘. When a stop loss trigger price (SLTP) is specified in a limit order, the orderbecomes one which is conditional on the market price of the stock crossing the specified SLTP. Theorder remains passive (i.e. not eligible for execution) till the condition is satisfied. Once the last tradedprice of the stock reached or surpasses the SLTP, the order becomes activated (i.e. eligible for executionby being taken up in the matching process of the exchange) and then on behave like a normal limitorder. It is used as a tool to limit the maximum loss on a position.Stop Loss by Order:‗A‘ short sell reliance shares at Rs. 325 in experience that the price will fall. However, in the event theprice rises above his buy price ‗A‘ would like to limit sell order specifying a stock loss trigger price Rs.305 and a limit price of Rs. 300. The stop loss trigger prices price has to be between the limit prices an
50trade price at the time of placing the stop loss order. Once the last trade price touches or crosses Rs. 305,the orders get converted into a limit sell order at RS. 300.2: Trade in derivatives:Future:Through Nirmal Bang you can now trade in index and stock futures on the NSE in future trading, youtake buy/sell position in index or stock (S) contract having a longer contract period of upto 3 month.Trading in FUTURE is simple if, during the course of the contract life, the price moves in favor (i.e.rises in case you have a by position or sell in case you have a sell position), you make a perfect.Presently only selected stock, which meet the certain liquidity and volume, have been enabled for futuretrading.Calculate index and now your margin are tools to help you in calculating your margin requirement andalso the index & stock price movement.Option:An option is a contract, which gives buyer the right to buy or sell shares at a specific prices, on a beforea specific date. For this, the buyer has to pay to the seller some money, which is called premium. Thereis now obligation on the buyer to complete the transaction if the price is not favorable to him.To take the buy/sell position on index/stock option, you have to place certain % of order value asmargin. With option trading, you can leverage on your trading limit buy taken buy/sell position muchmore that what you could have taken in cash segment.The buyer of a call option has the right but not the obligation to purchase the underlying asset at thespecified strike price buy paying a premium whereas the seller of the call has the obligation of sellingthe underlying asset at the specified strike price.The buyer of a put option as the right but not the obligation to sell the underlying asset at the specifiedstrike price paying a premium whereas the seller of the put has the obligation of buying the underlyingthe asset at the specified price. Buy paying lesser amount of premium, you can create position orderoption and take advantage of more trading opportunities.
51Switch:To suit your changing needs you may wish to shift monies between different schemes. You can switchyour monies online form one schemes to another in the some fund family without any hassles.Systematic investment plans (SIP)SIP allows you to invest a certain some of money over a period of time periodically. Just fill ininvestment amount, the period of investment and the frequency of investing and submit. We will do therest for you automatically investing periodically for you.Systematic withdrawal plan:This allows you to withdraw or certain some money over up period of time periodically.Transfer-in: we can convert to existing mutual funds into electronic more through a transfer-in request.3: IPOS and BONDS Online:You can also invest in initial public offers (IPO‘s) and bonds online without going through the hassles offilling any application form/paperwork.Get –in-depth analysis for new IPO‘s issue (initial public offering) which are about to hit the market andanalysis on these. IPO calendar, recent IPO listing, prospectus/offer document, and IPO analysis are fewof the features, which helps you keep, keep on talk of the IPO markets.
52Taxation of Indian Resident:The below mentioned FAQs are restricted to tax implication of the resident investors only.Q: Buy and sell securities; do I have to play tax on these transactions?Yes, you are liable to play tax on his transaction: on the difference between the price at which you selland the price at which you acquired it. You can also claim deduction for expenses incurred thesesecurities along with cost of buying these securities. Further if these securities are held or along termbefore selling them, your cost of acquisition can be increased by the indexations, which reduce yourcapital gains, indexation benefits, is not available on debenture and bonds. In case these securities areheld as stock-in-trade i.e. if you are in the business of buying and selling securities. The profit and lossfrom purchase and sell of securities will be taxed under the head ―profit of gains of business orprofession‖.Q: what is the nature of income under which transaction in securities will be taxed?Profit and loss from purchase and sales of securities will be taxed under the head of income from―capital gains‖, provided such securities are held as investment by you. In case these securities a newheld as stock-in-trade.i.e. If you are in the business of buying and selling securities under the head―profit or gains of business or profession‖.Capital gain/loss:Capital gain/loss means any profit or loss arising from transfer of a capital asset affected in the previousyear.Capital Assets:Capital asset means property of any kind held by an assesses, whether or not connected with hisbusiness or profession, but does not include 1:stock-in-trade, 2: personal effect such as jewelers,furniture, motor car held for personal use. 3: 61/2% Gold Bonds. 1980. 4: 7% Gold Bonds. 5: NationalDefiance Gold Bonds 1999. 6. Gold deposit Bond under the gold deposit scheme, 1999 notified by thecentral government.
53Transfer of a capital asset:Transfer includes sale, exchanges or relinquishment of the asset of the extinguishment on any right therein or compulsory acquisition thereof under any low. In a case where as asset is converted by the owneror treated by him, is also treated as transfer. However, the following specific transaction are notregarded as transfer e.g. (a) any distribution of capital assets on total or partial partition of an HUF (a)any transfer of a capital under a gift or will or an irrevocable trust expect share, debenture or warrantsallotted to employee under approved EFOP scheme,(b) Issue of share by resulting of amalgamated company in lieu of shares held in the demerged oramalgamating company (providing in case of amalgamation, amalgamation company in Indiancompany)(c) any transfer by way of conversion of bonds or debentures of a company into shares or debentures ofthat company in case of (a) and (b) above, if the resulting owner sells the capital asst subsequently, thecost of acquisition shall be deemed to be the cost at which the capital asset was acquire by the previousowner. In case of demerger, it shall be the portion of the cost which bears to the total cost the sameproportion as the net-book value of the assets transferred in the demerged bears to the net worth of thedemerged company immediately before demerged. The cost of acquisition of the original shares wouldstand reduced correspondingly.Short term Asset:Capital is divided as long term and short term with reference to the period of holding of the asset by you.The period of holding computed from the date acquisition to the date immediately preceding its sale. Ifthe shares, unit os specific mutual fund u/s 10(23D) or any other listed securities are held by you for lessthan 12 months then such shares/ units or listed securities would be treated as short term assets. In allother cases, the asset is required to hold for 36 month so as to quality for long term capital gain.Long Term Asset:If the shares, unit of specified mutual fund u/s 10(23D) or any other listed security are held by you formore then 12 month then such share/units or listed security would be treated as long term asset.Example:You purchase 1000 shares of ACC on 10.6.2005 for Rs 1, 10,000/-You were allotted 1000 shares as bonus on 11.8.2005
54You sold these shares on 12.8.2006 for Rs 1, 30,000/-Calculation of long term capital gain would be as follows:Amount in RsSale consideration 1, 30,000Cost of 1000 shares purchased on 10.6.2000 110000*406/389 (indexation benefits) 1, 14,807Cost of one thousand bonus shares nilLong term capital 15, 193
55DEMAT SERVICESCompany offeringNirmal Bang is a registered member (Depository participant) of CDSL.In this system, physical security holding are converted into electronic (or in other words, dematerialized)holdings.Why NIRAML BANG Demat Account? Demat A/C free open. Demat access through internet and phone. Portfolio valuation on the account statements. Online execution of transactions at branches. Special rates for stock market intermediaries and sub brokers. Transaction update from back-office four times a day.Transfer of shares and settlementsTransfer and settlements have never been easy as it under the depository system. All that is required isan instruction slip from you. If you are selling securities then it has to be a delivery instruction slip. Ifyou are purchasing securities it has to be a receipt instruction slip or standing instruction for credit.Receipt of Corporate BenefitsEven securities establishment like bonus and right can be credit to your Demat account electronically.All you have to do is choose the right option in the share application from. Crash benefits like dividendand interest will, however be forward to you directly and not through the depository.Holding & Transaction StatementsWe provide statements of holding cum transaction every month at Zero cost.
56Dematerialization of sharesAt you request we arrange to convert your physical holding into electronic from. To do this wouldrequire to open an account with CDSL through us called ―Beneficiary Account‖ in the name and style inwhich the shares are held and lodge the share certificates with us accompanied by a dematerializedrequest from, separate for each scrip.You are required to only make sure that CDSL has admitted that scrip for dematerialization. An uptodate list will be provided to you which will be constantly updated.RematerializationYou have the option to convert your electronic shares back to physical shares.Pledge-HypothecationYou can also avail against your electronic shares. This process is also much faster than in the case ofphysical shares.
59MANADATORY DOCUMENT:-1. PROOF FO IDENTITY (For individual /Karta / Sole proprietor / Authorized person (s) forPartnership, corporate and Trust)Photocopy of PAN card1. PROOF OF ADDRESS (For individual / Karta / Sole proprietor / Authorized person (s) forPartnerships, Corporate and Trust)Photocopy of any one of the following:Passport, Voter ID Card, Driving license, Bank Passbook, Rent Agreement, Ration Card, CurrentTelephone Bill, Current Electric Bill, Flat Maintenance Bill, and Certificate Issued by employerregistered under MAPIN, Insurance Policy.2. BANK AND DP PROOF:I. Letter from client‘s banker certifying the account number and the period from which the accounts inoperation as per prescribed format.II. Copy of a pas book / bank statement containing name of the clientIII. Copy of current transaction statement / holding statement / certification by DP containing the nameof DP and client3. PROOF OF INCOME AND ASSETS:I. Copy of the salary of the constituent for the last monthII. Income tax statement for the last 2 financial yearsIII. Assets liability statementIV. Copy of the values certificate in case of immovable property4. FOR MINORS:In additional to the abovementioned documents, the following documents would also be required forminors.I. Birth certificate of Minor.
605. ADDITIONAL DOCUMENTS FOR NON-INDIVIUALS:I. Copy of the balance sheet for the last 2 financial years (copies of annual balance sheet to besubmitted every years)II. Copy of latest share holding pattern including list of all those holding more than 5% in the sharecapital of the company, duly certified by the company secretary/ whole time Director/MD. (copyof updated shareholding patterns to be submitted every year)III. Copies of the memorandum and articles of association in case of a company / body corporate orpartnership deed in case of a partnership firmIV. Copy of the Resolution of Board of Directors‘ approving participation in equity / derivatives/debts trading and naming authorized persons for dealing in securities.V. Photographs of partners/whole time directors, individual promoters holding 5% or more, eitherdirectly or indirectly, in the shareholding of the company and of persons authorized to deal insecurities.VI. Net worth certified by Chartered accountant.VII. Declaration on letterhead of firm as per prescribed format for sole proprietorship and partnershipFirms.1. BASIC RISKS INVOLVED IN TRADING ON THE STOCK EXCHANGE(EQUITY AND OTHER INSTRUMENT)1.1 Of higher volatility:Volatility refers to the dynamic changes in price that securities undergo when trading activitycontinues on the Stock Exchanges. Generally, higher the volatility of a security/contract, greateris its price swings.There may be normally greater volatility in thinly traded securities/contracts than in activesecurities/contracts. As a resultOf volatility, your order may only be partially executed or not executed at all.Or the price at which your order got executed may be substantially different from the last tradedprice or changes substantially thereafter, resulting in notional or real losses.
611.2 Risk of lower liquidity:Liquidity refers to the ability of market participants to buy and or sell securities/ contractsexpeditiously at a competitive price and with minimal price difference.Generally, it is assumed that more the number or order available in a market, greater is theliquidity.Liquidity is important because with greater liquidity, it is easier for investors to buy and/or sellsecurities/ contracts swiftly and with minimal price difference, and as a result, investors are morelikely to pay or receive a competitive price for securities/contracts purchased or sold.There may be a risk of lower liquidity in some securities/contracts as compared to activesecurities/contracts. As a result, your order may only be partially executed, or may be executedwith relatively greater price difference or may not be executed at all.1.2 Buying/Selling without intention of giving and or taking delivery of a securities, as part of a daytrading strategy, may also result into losses, because in such a situation, stock may have to besold/purchased at a low/high prices, compared to the executed price levels, so as not to have anyobligation to delivery/receive a security.1.3 Risks of wider spreads:Spread refers to the difference in best buy prices and the best sell prices. It represents thedifferential between the prices of buying a securities and immediately selling it or vice versa.Lower liquidity and higher volatility may result in wider than normal spreads for loss liquid orilliquid securities/contracts. This is turn will hamper better price formation.1.4 Risk-reducing orders:Most exchanges have a facility for investors to place ―limit orders‖, ―stop loss orders‖ etc‖. Theplacing of such orders (e.g., ―stop loss‖ limit orders) which are intended to limit losses to certainamount may not be effective many a time because rapid movement in market conditions maymake it impossible to execute such orders..1.4.1 A ―market‖ order will be executed promptly, subject to available of orders on opposite side,without regard to price and that, while the customer may receive a prompt of a ―market‖ order,the execution may be at available prices of outstanding orders, which satisfy the order quantity,on price time priority. It may be understood that these prices may be significantly different fromthe last traded prices or the best prices in that security.1.4.2 A ―limit‖ order will be executed only at the time ―limit‖ price specified for the order or a betterprice. However, while the customer receives prices protection, there is a possibility that the ordermay not be executed at all.
621.4.3 A stop loss order is generally placed ―away‖ from the current price of a stock / contract, and suchorder gets activated if and when stock/contract reaches, or trades through, the stop price.Sell stop order are entered ordinarily below the current price, and buy stop orders are enteredordinarily above the current price. When the stock reaches the pre-determined price, or tradesthrough such price, the stop loss order convert to a market/limit order and is executed at the limitorder.There is no assurance therefore that the limit order will be executable since a stock/contract mightpenetrate the pre-determined price, in which case, the risk of such order not getting executedarises, just as with a regular limit order.1.5 Risk of New Announcements:Issuers make news announcements that may impact the prices of the securities/contracts. Theseannouncements may occur during trading, and when combined with lower liquidity and higher volatility,may suddenly cause an unexpected positive or negative movement in the price of the security/contracts.1.6 Risk of Rumors:Rumors about companies at times float in the market through word of mouth, newspapers, websites ornews agencies, etc. the investors should be wary of and should desist from acting on rumors.1.7 System Risk:High volume trading will frequently occur at the market opening and before market close. Such highvolume may also occur at any point in the day. These may cause delays in order execution orconfirmation.a.7.1 During periods of volatility, on account of market participants continuously modifying theirorder quantity or prices or placing fresh orders, there may be delays in order execution and itsconfirmation.a.7.2 Under certain market condition, it may be difficult or impossible to liquidate a position in themarket at a reasonable price or at all, when there are no outstanding order either on the buy sideor the sell side, or if trading is halted in a security due to any action on account of unusualtrading activity or stock hitting circuit or for any other reason.
63a.8 system/network congestion:Trading on NSE/BSE is in electronic mode, based on satellite/leased line based communication,combination of technology and computer system to placed and route orders.Thus, there exist a possibility of communication failure or system problem or slow or delay responsefrom system or trading halt, or nay such other problem/glitch whereby not being able to establish accessto the trading system/network.Which may be beyond the control of and may result in delay in processing or not processing buy or sellorders either in part or in full?You are cautioned to note that although these problems may be temporary in nature, but when you haveoutstanding open position or unexecuted orders, these represent a risk because of your obligations tosettle all executed transactions.As far as Future and option segment is concerned, please note and get yourself acquainted with thefollowing additional features:-a.9 Effect of “Leverage” or “Gearing”The amount of margin is small relative to the value of the derivatives contracts so the transactions are‗leveraged‘ or ‗geared‘. Derivatives trading, which is conducted with a relatively small amount ofmargin, provides the possibility of great profit or loss in comparison with the principal investmentamount.But transactions in derivatives carry a high degree of risk. You should therefore completely understandthe following segments before actually trading in derivatives trading and also trade with caution whiletaking into account one‘s circumstances, financial resources, etc.If the price moves against you, you may lose a part of our whole margin equivalent to the principalinvestment amount in a relatively short period of time. Moreover, the loss may exceed the originalmargin amount.A. Future trading involves daily settlement of all positions. Every day the open positions are markedto market based on closing level of the index has moved against you, you will be required todeposit the amount of loss (national) resulting from such movement.B. This margin will have to be paid within a stipulated time frame, generally before commencementof trading next dat.
64C. If you fail to deposit the additional margin by the deadline or if an outstanding debt occurs inyour account, the broker/member may liquidate a part of or the whole position or substitutesecurities. In this case, you will be liable for any losses incurred due to such close-outs.D. Under certain market condition, an investor may find it difficult or impossible to executetransactions. For example, this situation can occur due to factors such as illiquidity i.e. whenthere are insufficient bids or offers or suspension of trading due to price limit or circuit breakersetc.E. In order to maintain market stability, the following steps may be adopted: changes in the marginrate increase in the cash margin rate or others. These new measures may also be applied to theexisting open interests. In such conditions, you will be required to put up additional margins orreduce your options.F. You must ask your broker to provide the full details of the derivatives contracts you plan to tradei.e. the contracts specifications and the associated obligations.2.0. Risk of Option Holders:1. An option holder run the risk of losing the entire amount paid for the option in a relatively shortperiod of time. This risk reflects the nature of an option as a wasting asset which becomesworthless when it expires.2. An option holder who neither sells his option in the secondary market nor exercises it prior to itsexpiration will necessary lose his entire investment in the option. If the price of the underlyingdoes not change in the anticipated direction before the option expires to an extent sufficient tocover the cost of the option, the investors may lose all or a significant part of his investment inthe option.3. The exchange may impose exercise restrictions and have absolute authority to restrict theexercise of option at certain times in specified circumstances.2.1 Risk of Option Writers:
65If the price movement of the underlying is not the anticipated direction, the option writers run the risksof losing substantial amount.INVESTOR’S RIGHTS AND OBLIGATIONS:From the trade date upto five trading days. Where trade on the websites, do not tally with the detailmentioned in the contract note, immediately get in touch with the investors grievances cell of NSE/BSE.2.1.1 Ensure that payment/delivery of securities against is given to the concerned members within oneworking day prior to the date of pay-in-announced by NSE/BSE or it‘s clearing corporation/clearingHouse.Payments should be made only by account payee cheque in favors of the firm/company of the tradingmembers and a receipt or acknowledgement towards what such payment is made be obtained from themember.Delivery of securities is made to the pool account of the members rather than to the beneficiary accountof the members.2.1.2 In case pay-out of money and /or securities is not received on the next working day after datepay-out announced by NSE/BSE or its clearing corporation/clearing House.Please follow-up with the concerned members for its release. In case pay-put is not released as abovefrom the members within five working days, ensure that you lodge a complaint immediately with theinvestors‘ Grievance cell of NSE/BSE.2.1.3 Every member is required to send a complete ‗statement of Accounts‘, for both funds andsecurities settlement to each of its constituents, at such periodicity as may be prescribed by time to time.You should report errors, if any, in the statement immediately, but not later than 30 calendar days ofreceipt thereof, to the members. In case the error is not rectified or there is a dispute, ensure that yourefer such matter to the investors Grievance cell of NSE/BSE, without delaying.
662.1.4 In case of a complaint against a members/registered sub-broker, you should address the complaintto the office as may be specified by NSE/BSE from time to time.2.1.5 In case where a member surrenders his membership, NSE/BSE gives a public notice invitingclaim, if any from investors. In case of a claim, relating to ―transaction executed on the trading system‖of NSE/BSE, ensure that you lodge a claim with NSE/BSE/NSCCL clearing House within the stipulatedpeople and with the supporting documents.2.1.6 In case where a member is expelled from trading membership or declared a defaulter, NSE/BSEgives a public notice inviting claims, if any, from investors. In case of claim, relating to ―transactionexecuted on the trading system‖ of NSE/BSE, ensure that you lodge a claim with NSE/BSE within thestipulated period and with the supporting documents.2.1.7 Claims against a defaulter/expelled member found to be valid as prescribed in the relevantRules/Bye-laws and the scheme under the Investors‘ Protection Fund (IPF) may be payable first out ofthe amount vested in committee for settlement of claims against Defaulters, on pro-rata basis if theamount is inadequate.The balance amount of claims, if any, to a maximum amount of Rs.10 lakh per investors claim, perdefaulter/expelled members may be payable subject to such claims being found payable under thescheme of the IPF.3. GENERAL:3.1 Commission and Other ChargesBefore you begin to trade, you should obtain a clear explanation of all commission, fees and othercharges for which you will be liable. These charges will affect your net profit (if any) or increase yourloss.3.2 Deposited Cash and Property
67You should familiarize yourself with the protections accorded to the money or other property youdeposit particularly in the event of a firm insolvency or bankruptcy.The extent to which you may recover your money or property may be governed by specific legislationor local rules. In some jurisdiction, property which has been specifically identifiable as your as yourown will be pro-rated in the same manner as cash for purpose of distribution in the event of a shortfall.In case of nay dispute with the member, the same shall be subject to arbitration as per thebyelaws/regulation of the exchange.3.3 For right and obligation of the clients, please refer to Annexure-1 enclosed with this document.3.4 The terms ‗constituent‘ shall mean and include a client, a customer or an investor, who dealswith a members for the purpose of acquiring and/or selling of securities through the mechanismprovided by NSE/BSE.3.5 The terms ‗members‘ shall mean and include a trading members, a broken or a stock broker, whohas been admitted as such by NSE/BSE and who holds a registration certificates as a stockbroker from SEBI.Capital Market Segment:1. Order Entry & Execution:The order placed by the clients over the phone or orally from the office would be entered into thetrading system and after due surveillance would be transmitted to concerned Exchangeinstantaneously within a few seconds.But some orders at the discretion of Shriram Insight Share Brokers Ltd. (SISBL) may be subject tomanual review and clearances which may cause delay in processing the order or rejection of theorder.The client agrees that placing an order, including a market order does not guarantee execution of theorder. It is understood by the client that with respect to market order, the order will be executed at aprice which may be different from the price at which the securities is traded when their order wasentered into system.The client are required to take confirmation of their order immediately or at least once a day either inperson or over telephone which would be deemed to have the same effect as given in person.The order placed by the clients would be their own investment decisions and the clients will not holdSISBL or any of its employees or associates, liable for any losses incurred by them.
68This extends to any decisions made by the client on the basis of any information that may be madeavailable on the website of SISBL.However SISBL shall not be liable for failure of the system or for any loss,Damage or other costs arising in way out of:a) Telecom network or system failures including failure of ancillary or associated system which formsor does not form or does not form part of trading workstation installation, or fluctuation of power,or other environmental conditions: orb) Act of god, fir, flood, war, act of violence, or any other similar occurrence: orc) Any incidental, special or consequential damages including without limitation of loss or profit.1A. Cancellation or Modification of Orders:The execution or order cancellation or modification is not guaranteed. Cancellation of orders is possibleonly if the original remains pending at the exchanges. Unless otherwise specified by SISBL, any ordernot executed at the end of the day shall stand cancelled.2. Sufficient Margin Maintenance for Placing Orders:The clients have to maintain sufficient margin before placing the order. The requirement of margin willbe intimated by SISBL from time to time depending on the market condition, rules framed by theconcerned Exchanges or SEBI, and assessment of the client by SISBL.This information would be communicated to the client orally or over the phone or in writing anddecision of SISBL would be final in his regard. The margin would vary from 0% to 100% of the openposition of the client.Open position would mean all pending orders and transaction, both purchase and sale, of the clientwhich are either unpaid or undelivered, respectively.However, the client would be responsible for all of their orders including any order which exceeds thelimit available based on their available margin.The client should on a regular basis enquire about the margin requirement to ensure smooth transaction.SISBL may require the client to immediately deposit funds or collateral into their account prior to anyapplicable settlement date in order to assure due performance of their open contractual commitments.
69If the clients does not provide the additional collateral, the client hereby understands and knowledge thatSISBL has the right to sell any or all the securities and other properties available with it and can cancelany or all open orders and/or closes any or all outstanding to raise the required margin.The client will be liable to bear any loss arising out of the same. Clients have to pay margin for the openposition they may have at any point of time in the following manners:a. Margin in the form of money deposit (Cash Margin)b. Margin in the form of specified securities to be calculated at a specified percentage of value of thesecurities depending on the scrip as specified by SISBL from time to time. All deliveries againstmargin are to be made by transferring the share from the declared DP account of the client to thedesignated beneficiary account of SISBL:For NSE cash segment-1203840000009946For NSE F&O segment-1203840000132265c. Margin in the form of FD (as specified by SISB)3. Payment from client against purchase of securities:Payment for purchase of securities has to be made by account payee cheque only from the declaredbank a/c of the client only favoring ‗Shriram Insight Share Brokers Ltd‘By T+ 1stday but not later than the due date for playing of funds to the concerned exchanges andnot to nay employee or purported representatives of SISBL. The client shall not make any paymentsof SISBL through any third party account or an account of any other client SISBL.It is understood by the client that date on which clear funds are available in the bank account ofSISBL would be treated as the date of having received the payment although a receipt may beissued at an earlier date for the cheque given by the client.Therefore, the clients are required to give the cheque sufficiently in advance so that the amount iscredited in SISBL account before the due date. SISBL would present the cheques in normal clearingand would not be responsible for any delay due to clearing in the banking system.The client further undertakes that in case he fails to make payment of consideration to SISBL inrespect of any one or more securities purchased by him before the pay in date notified by theexchange from time to time.SISBL can sell the securities at any time on the exchanges not later than the fifth trading dayreckoned from the date of pay-in.
70Otherwise SISBL shall have the power to pledge the shares with scheduled Banks and/or nonbanking finance companies to realize the money and meet the Pay-in obligations to the concernedexchanges.4. Delivery to client of securities Purchased By Them:Securities purchased by the client will be delivered to the DP account of the client (as specified inthe registration from the by the client) by SISBL only if all the money, on any account, due fromthe client till date of delivery is realized in full.Part delivery of securities based on part payment will not be allowed. Any error in giving the detailsregarding default DP account will be clients‘ responsibility and he will not hold SISBL responsiblefor any loss due to transfer of shares into the account as mentioned above.The instruction for delivery to client account will be issued within time schedule specified by theconcerned Exchanges, prevalent at the time. If the delivery could not be made on the due date, dueto nonpayment of dues from the client then the delivery will be made within seven days of paymentof the dues.But, nonpayment for dues date may result in sale of such purchased securities at the cost andpenalty of the client. In case the securities are unpaid on the pay-out date, same will betaken/transferred into the designated beneficiary account of SISBL to avoid SEBI pool penaltycharges.5. Delivery from Clients of securities Sold By Them:A. Dematerialized shares:The client should instruct his depository participants, sufficiently in advance, to transfer shares into thepool account of SISBL preferably on the same day.i.e. trading day itself or latest before 9 am. On the respective settlement day as specified by the exchangeand shall not cause delivery of shares of SISBL through any third party account or an account of anyclient of SISBL.All third parties against pay-in obligations have to be honored by transferring the shares from thedeclared DP account of the client to pool account of SISBL.For NSE cash segment-for NSE pay inNSDL POOL-CMBP-IN 563399 (28836274/IN 301250)
71CDSL A/C -1203840000000067For BSE cash segment principal A/C-1203840000000033B. Redelivery from purchase of earlier settlement:If a client has purchased some securities in an settlement and has not taken delivery of the same/thesecurities have remained undelivered to him/her and if he/she sells the same in the current settlementthen the shares purchased in earlier settlements, the receipt of the same may be used to meet pay-inobligation for current settlement.The clients are cautioned that execution of a purchase order does not guarantee delivery of share whichmay fail in case of short delivery from the concerned Exchanges or the selling party.In all such cases clients are required to take a clear confirmation from SISBL about the delivery status ofearlier purchases before proceeding with the sale of securities. SISBL will not be responsible for anylosses if a short delivery takes places due to such short receipt in the earlier settlement.C. Auction of securities:If the client fails to make delivery of deliverable shares as per the pay-in schedule of Exchanges thenthe securities will be auctioned as per the rules of the concerned exchanges or as per Inter Auctionrules mentioned in point 8, wherever is applicable.Consequently client will be responsible for any resulting losses and all associated costs includingpenalty as specified in point 10 a.
72TERMS AND CONDITIONS:VOLUNTARY DOCUMENTS NO. 1a) In case the open position is either squared neither off nor converted to delivery by client withinthe stipulated time.b) In case the marks to market loss on the open position has reached the stipulated percentage ofthe margin or reduce the Mark to Market loss.In all other cases where the margin or securities placed by the client fails sort of the requirement orwhere the limit given to the client has been breached or the client has defaulted on his existingobligation.Client agrees that although the auto square off trigger point is predefined subsequent to whichSISBL could exercise its discretion to carry out the square off within a reasonable period of timeand the client agrees to bear the loss based on actual executed prices.8. Inter client auction:In case, in any settlement, where both the purchase and sale position for any scrip are limited betweentwo or more of our i.e. SISBL‗s clients only, such that the net position to the concerned Exchanges inthat settlement and for that scrip is ―NIL‖.In such a situation if there is any short delivery then the resultant auction position will be inter clientsince both the legs i.e. the party delivery short and the corresponding purchaser are both SISBL‘sclients.For determining the auction price, in this situation, the highest of the following prices will beconsidered, the guiding principal being ―purchaser should not loose‖a) The concerned Exchanges Weighted Average price (WAP) for that particular scrip in thatparticular auction settlement, taken from the concerned Exchange Download.
73b) Highest purchase price plus 1.00% delivery brokerage, paid for by the purchaser(s) who havenot been delivered the shares due to corresponding short delivery for that scrip in that particularsettlement.c) In case WAP is not available, then auction day high prices and trading day high prices arecompared with the highest purchaser price as mentioned in (b) above, and the highest is takenas auction price.It may be noted to the above auction price, a penalty @ 1.99% will be levied in pursuance to clause10(a) of the terms and conditions.As started above, inter-client auction trades envisage debiting the client delivering short with the auctionamount and crediting the corresponding purchaser with the equal amount, no brokerage being chargedfor a auction trades.Hence debit/credit notes are issued for inter-client auction trades.Auction contracts notes will not be issued for inter-client auction trades because they are not trades intrue sense of the term, but merely involves debiting and crediting the respective client accounts.9. Square Off Open Position:The client agrees that SISBL would have the discretion to square off the position of the client in thefollowing circumstances:10. Charges:10. a. BROKERAGE, COMMISSION AND FEES:i) The client agrees to pay the member brokerage, commission, fees, service tax and the other taxes andtransaction expenses as they exist from time to time and as they apply to the Client‘s Account andtransactions and to the services that the Members renders to the client.The client also agrees that he member may deduct and appropriate any of the aforesaid amounts fromany amount payable by the members to the client.
74ii) A schedule of the current brokerage, fees and commissions, applicable services and other taxes andother transaction expenses shall be provided by the Member on the Member‘s Web site, and the clientagrees to keep himself updated in respect thereof.10. b. FAILURE TO FIVE DELIVERIES OF SECURITIES:A delayed delivery charge will be levied on the valued of securities delivered short. The charge will be@ 1.00% on the auctioned value subject to minimum of Rs. 10.00.10. c. FAILURE TO PAY FUNDS:A penalty will be levied at a certain percentage at the discretion of SISBL with maximum rate of @ .1%per day on the amount defaulted from the date when the payment is due till the day.When the payment is received either by squaring off the position or by the selling of securities lyingwith SISBL or when the funds are actually paid the client. For the purpose of ascertaining amountdefaulted, any credit in cash margin a/c (only) will also be considered.11. Reserve Bank of India Guidelines (RBI)The client is aware that as per the RBI guidelines Non Resident Indians (NRIs) and persons of IndianOrigin (PIOs) are allowed to invest in the secondary capital markets in India through the portfolioinvestment scheme (PIS).These investments are governed and monitored on daily basis by the Reserve Bank of India. Onreaching the aggregate ceiling limit as fixed by RBI from time to time, the RBI advices all designatedbank branches to stop purchases on behalf of their NRIs/PIOs clients.The clients hereby agrees to keep abreast of the ceiling limits on investments as published by RBI andauthorizes SISBL to reserve the transaction immediately on his behalf if such transaction breaches theceiling limit.12. Authorization for On-Going Account:
75The client agrees that he is desirous or regular trading transaction through SISBL on an ongoing basis.The client thus authorizes SISBL to adjust/withhold his funds and/or securities payout from theconcerned Exchanges with future funds and/or securities pay-in obligation that the client may havetowards SISBL before transferring the funds and /or securities to his account.It is understood that no interest will be payable to the client on the amount or securities so retained bySISBL.13. Severability:In the event of nay provisions of this agreement being held to be or becoming invalid, unenforceable orillegal for any reason, such invalidity, non-enforceability or illegality shall attach only to such provisionor condition and his agreement shall remain otherwise in full apart from the said provision.Which will be deemed deleted? The validity of the remaining provisions and conditions shall not beaffected thereby and this agreement shall be carried out as if any such invalid or unenforceable provisionor condition was not contained herein.14. Amendment & suspension:a. The client understands and agrees that SISBL may suspend or discontinue its services in part or in itsentirety and change the terms of services (including the terms on SISBL‘s Web Site) or this agreementat any time and from time to time, without prior notice, and the same shall bind the client.b. Without prejudice to the generality of the aforesaid, may suspend or terminated the serviceswithout prior notice to the client if the client has breached any terms or conditions.Or if SISBL learns of the death, disability, bankruptcy or lack of legal capacity of the client, or where in theperception of SISBL, the continuation of the services could increase the risk of SISBL.6. Payment to client against sale of securities: (i.e. payout of funds) proceeds of the sale cannot be paid toclient until securities have been delivered to the concerned Exchanges Clearing House and payout offund is received from the concerned Exchanges.This precautionary measure is taken by SISBL to avoid inconvenience sometimes caused due to shortdelivery of shares. It is agreed by the client that he/she is aware of the different pay out dates ofdifferent types of settlement cycles followed by the concerned Exchanges time scheduled,, prevalent atthe time.The client agrees and authorized SISBL to act at its discretion of merging balances kept under variousaccount of different segments such as margin and settlement account of one exchange/segment tonullify the debit in any other account of the client of another exchange/segment held with SISBLwithout taking any further instruction from the client.
76SISBL shall only make payment to client after adjusting the credit standing in his account in one stockexchange with, if any, debit standing in his account under another exchanges.7. Confirmations, statements, notices and other communications: the client are required to collect thecontract note within 24 hours from the office of SISBL and if it is not collected within 24 hours then itwill be deemed as received and confirmed by the client.Further SISBL reserves the right to send the uncollected contracts notes to the client‘s declared addressthrough U.C.P/ courier/any other means of post and the resultant postal charges will be debited to theclient‘s settlement account.The client understand that it is their responsibility to review upon first receipt all confirmation,settlement, notices and other communication contained therein and shall be binding upon the clientunless client do not object in writing within 24 hours of receiving such document(s).7A. Issue of Digital Signed Contract Notes in Electronic Mode:The client understand that contract note will be deemed to have been delivered and acknowledged bythe client when it is sent to e-mail id as specified by the client in the contract details window of theKYC.For this purpose record available in the electronic mode in back up of the approved software of thetrading members will be deemed to be conclusive evidence of the dispatch and confirmation and nofurther proof will be required.Further, the contract notes in electronic mode would be made available in the member‘s website in asecured way, which can be viewed by client by entering their respective password.The client understands that all information contained therein shall be binding upon the client, if theclient does not objects in writing within 24 hours of the sending of the contract note in the electronicmode by the broker.Further, the client understands that such contracts being sent electronically will have ―DigitalSignature‖ the term having the meaning as given in (i) www.sebi.gov.in, (ii) www.nseindia.com, (iii)www.bseindia.com.7B. wherever the ECNS have not been delivered to client or has been rejected (bouncing of mails) bythe e-mail ID if the client, SISBL shall send a physical contract note to the client within the stipulatedtime under the extant regulations of SEBI/stock Exchanges and maintain the proof of delivery of suchphysical contract note at the cost client.Derivatives Segment:
7715. Additional Terms & Conditions Governing Derivatives Segmenti. In this segment, margin computations is done by the Exchanges through an online positionmonitoring and margining system called SPAN (Standard Portfolio Analysis Risk)ii. Margin percentage may differ from stock to stock depending on the risk involved in the stockwhich depends upon liquidity and volatility of the respective stock besides the general marketconditions. Margin percentage can be changed during the life of the contract depending on thevolatility in the market.iii. The client shall be required to pay an initial margin upfront on or before creating a position inany derivatives contract and further the client should provide additional margin money whencalled upon to do so as required in respect of position taken by him in this segment SISBL hasthe right to reject orders if the required margin has not been deposited.iv. The client shall pay the daily mark to market loss for all my/our position in index and individualstock future contracts and pay the final settlement loss on expiry of the index and individualstock futures contracts/index contracts as the case may be as charged by NSCCL to SISBL by9.00a.m. Next day.v. The client shall pay the daily premium payable for all my/our open positions in index andindividual stock options contracts as charged by NSCCL to SISBL before execution of thecontracts.vi. The client shall pay the interim as well as final exercise settlement value for all my/our shortposition on individual stock options contract which has been assigned against him, as chargedby NSCCL o SISBL by end of next day.vii. SISBL is authorized to retain with them the MTM profit, daily premium receivable, interimexercise settlement value receivable on futures and options contracts and settle the same onmonthly basis or on demand by the client after deducting dues, if any.viii. If the client have been are may become unable to meet, satisfy, discharge or fulfill anyobligation or liability or commitment or nay part thereof, then SISBL may at any time thereafterand without giving any notice to the client can buy, sell or close out any part or all of the futureand option contracts held in his account with SISBL.
78Any or all such incidental expenses incurred by SISBL in this regards will be reimbursed by the client.If the clients after fulfilling his margin requirement fails to meet his/her uncrystallised M2M loss eitherin part if full then the company will charge penalty at appropriate rate for meeting the uncrystallisedM2M pay-in on behalf of the client to the exchange.ix. If the client takes position in any securities that has entered the prohibited range (for MWPLviolation i.e. Market wise position limit violation) and a s a result of which any penalty isimposed on SISBL by the concerned exchange, then the same will be liable to be recoveredfrom the client.15a. Futuresi.) Futures‘ trading involves settlement of all positions. Every day the open positions are marked tomarket based on the closing level of the index and the individual stock price. If the index or theindividual stock prices have moved against the client, he will be required to deposit the amountof loss (national) resulting from such movements within the stipulated time periods.ii.) In the futures Market following settlement obligation are to be full filled.Brokerage- Any transaction entered into will attract brokerage which will be debited from theclients account at the end of the day.Profit & loss on squared off position.Profit & loss on end of day (EOD) MTM on open positionService tax on Brokerage, turnover Tax and securities Transaction Tax.iii.) All future obligations are settled by the exchange on T+1 basis15B. Options:i.) The following settlement obligations are to be full filled in the options segment-Brokerage – Any transaction entered into will attract brokerage which will be debited fromthe clients account at the end of the day.Premium payableOr receivableProfit on exerciseLoss on assignmentService tax on Brokerage, turn over tax and securities Transaction Tax.
79ii.) For options contracts in case a client has a sell position, the contract may be assigned to him i.e.the underlying will have to be bought in case of PUT and sold in case of call. However sinceoptions are currently cash settled, the client would have to pay or receive the money.iii.) The assignment process in initiated and completely decided by the exchanges on a random basis.Hence it is not necessary that the assignment will take place even if the position is in- the money.16. Additional Conditions In Relation To Electronic Ordersa) The client confirms that from time to time he would continue to read and understand the exchangeprovisions and the terms and conditions in relation to electronic orders to be placed through SSBL‘sWeb Site.b) The client will be entitled to a User Name, password or other identification or security code (bywhatever name called) which will enable him to enable him to access SISBL‘s system or servicesthrough SISBL‘s web site for availing of the services.c) The clients is aware that SISBL‘s system itself randomly generates the Initial password, encryptsand passes on the password to the client, and that SISBL is not aware of the same. The clients agreeand understand to immediately change his initial password upon receipt thereof. The client is awarethat subsequent passwords also are not know or available to SISBL.d) The client shall lo off from the Nirmal Bang.com services at any time the client is not accessing orusing the Nirmal bang.com services and any liability incurred to the client as a consequence to theclient not logging off the services shall be borne solely by the client.e)f) The client shall be responsible for keeping the username and password confidential and secure andshall be solely responsible for all orders entered and transactions done by any person whosoeverthrough SISBL‘s system using the client‘s username, and passwords whether or not such personswas authorized to do so.g) If the client is unable to change his password by reasons of his having forgotten his passwords orhis password or his password having been un authorized changed by some other persons or for anyother reasons then the client shall immediately request SISBL in writing to discontinue his oldpassword. SISBL‘s system shall generate a new password for the client which shall becommunicated to the client.
80h) At no point in time shall SISBL be liable for any loss, whether national or actual, that may besuffered by the client on account of the misuse of the password and the client shall be liable andresponsible for the same.i) SISBL shall not be deemed to have received an order unless and until it has actually received theorder in the order-receiving module of SISBL‘s system. The client shall not be entitled to presumethat any order transmitted by the client has been received by SISBL until SISBL ha confirmedreceipt of such order. However, due to technical or other factors, an order which has been receivedby SISBL may not be immediately confirmed to the client.17. Prohibitory Clause:SISBL should not be held responsible for any incorrect information supplied by the client during thetime of registration. The client is thus requested to take adequate care in providing correct detailsunder all heads viz. bank account details, e-mail address etc.In the registration form. Any subsequently change in the information provided by the client shouldbe intimated to SISBL by the client through written submission only. SISBL does not operatethrough any sub broker or authorized person or franchise anywhere in India.18. Termination of Agreement:In addition to the termination clauses in stock Broker-client Agreement, the client shall not beentitled to terminate this agreement so long as any amount is payable or securities are delivery by theclient to SISBL and it may not be possible for SISBL to give advance notice of such termination orsuspension to the client.Client‘s signature:
81INTERNET TRADING AGREEMENTIN ADDITION TO THE STOCK BROKER AND CLIENT AGREEMENT, RISKDISCLOSUE DOCUMENT & TERMS AND CONDITIONS THE FURTHERCLAUSES FOR INERNET TRADING ARE AS FOLLOWS:-THE PARTIES HERE TO AGREE AS UNDER:1. DEFINATION & INTERPRETATION:In this agreement, unless repugnant to the context or meaning thereof,(1) Words and expressions defined in Basic’s in our websites nirmal bang.com shall have themeaning assigned thereto in Basis’s and(2) The principal of interpretation set out in Basic’s shall apply to his agreement.2. AGREEMENT TO PROVIDE AND AVAIL OF THE MEMBER’S SERVICES:2.1. on and subject to the terms and conditions of this Agreement, the exchange provision, theterms of the Member‘s Web Sites and the terms of the contract/contract note to be issued bythe Member‘s to the client:(i) The members agrees to provide the Member‘s Services to the Client, and(ii) The client agrees to avail of the Member‘s Services.2.2 Based on the Account Application submitted by the client, the members may open a clientaccount in the name of the client. This agreement shall become effective only upon the membersopening such client Account.
82The client is aware and agrees that the mere execution and/or acceptance of his Agreement by theMembers opening such client account.2.3 The client is aware of and agrees that in the course of transaction on the Exchanges the Memberwill be acting as an agent of the client, unless otherwise disclosed by the members to the client.2.4 The client hereby authorized the members to take all such steps on the client‘s behalf as may berequired or advisable in the member‘s opinion for compliance with the exchanges provision or anyother law or provisions.Or to complete or settle any transaction entered into through or with the members or executed bythe members on behalf of the client. However, nothing herein shall oblige the members to take suchsteps.2.5 Now with standing anything stated elsewhere in this agreement, the members may at any timein its sole discretion, prohibit or restrict the client‘s access to the use of the member‘s Web Site orServices and the client‘s ability to trade, without any prior notice and without assigning any reasonswhat‘s ever.2.6 The members and the client shall be bounded by the provision of the exchange on which theconcerned transaction is affected.3. USER NAME AND PASSWORD3.1 The client acknowledge that he is fully aware of and understands the risks associated with availingof a services for routing over the internet or the telephone including the risk of misuse and unauthorizeduse of his username, password by a third party and the risk of a person hacking into the client‘s accounton the Member‘s system and unauthorized routing orders on behalf of the client through the system.3.2 The client accepts full responsibility for the monitoring and safeguarding of the client‘s account andagrees that he shall be fully liable and responsible for any and all un authorized use and misuse of hispassword, username, and also for any and all acts done by any person through the member‘s system onthe client‘s username in any manner whatsoever.3.3 The client is also aware that he has the option of not availing such facility/services. However, beingfully aware of all risks, the client desires the convenience of such facility of transmitting orders andinstructions over the internet and telephone and has therefore opted for such facility of his own freechoice and is willing and agreeable to bear all associated risks, responsible and liability.
833.4 The client shall ensure that he is the only authorize user of the username, password. The membershall be entitled to presume that any order or instructions entered or communicated using the client‘susername.Password is the client‘s own order or instruction that of the client‘s duly authorized representative. Theclient will be fully responsible and liable for, and will pay or reimburse to the members as aconsequences of access and /or use of the expenses incurred by the member‘s system or services by anythird party using the client‘s account, member‘s system or services by any third party using the client‘susername, password.3.5 Without prejudice to the provisions of the aforesaid clause, the client shall immediately notify themember in writing with full details if:a) He discovered or suspects unauthorized access through his username, password.b) He notices discrepancies that might be attributable to unauthorized access.c) He forgets his password.d) He discovers a security flaw in the member‘s system, ore) He does not, on the same day as the receipt or execution of an order by the member; receive amessage from the members indicating that the order has been received or, executed;f) He does not receive a confirmation of an execution; or receives confirmation of an order and /orexecution which he did not place; or receives inaccurate information in client‘s account balances,securities positions or transaction history.3.6 In any of the above events specified in clause.3.7 The client shall immediately change his password. However, if the client is unable to change hispassword by person of his having forgotten his password or his password having beenunauthorized changed by some other person. Or for any other reason than the client shallimmediately request the members in writing to discontinue his old password; and thereupon themembers shall cause the member‘s system to discontinue the use of the client‘s old password andthe member‘s system shall generate a new password for the client which shall be communicated tothe client. At no profit in time shall the members be liable for any loss, whether notional or actual,that may be suffered by the client on account of the misuse of the password and the client shall beliable and responsible for the same.
843.8 The client agrees that orders, instruction and other communication given or made over thetelephone may be recorded by the member. The client also agrees that such recording and themember‘s recorders of any orders, instruction and communications given or made by the client orthe member by electronic mail, fax or other electronic means shall be admissible as evidence andshall be final and binding evidence of the same.3.9 The client agrees to provide information relating to customers relating to customer useridentification and such other information as may be required while placing orders on thetelephone to determine the identity of the client.VOLUNATRY DOCUMENTS NO. 24 ORDERS ROUTING AN EXECUTION:4.1 The client shall transmit his order to the members only in the following manner:I. The manner (if any) as the members may permit (including through branches that the membersmay specify for this purpose)II. Through the internet over the member‘s website:III. Over telephone4.2 As a prediction for execution of a purchase order, the members may in its sole discretion:i. Required the client, at the time of order placement by the client, an available funds balance in theclient‘s account with the member for the full value of the order plus any Brokerage, service tax,transaction charges, associated costs and such mark-up as the members any determine: and/orii. Require the amount of margin prescribed by the members to be available in the client‘s marginaccount if nay, with the members;4.3 As a prediction for execution of a sale order, the members may in its sole discretion:
85i. Require the client, at the time of order placement by the client to maintain an available stockbalance in the member‘s own depository account, and also maintain funds required for margin, ifany, determined by the members in the client‘s account with the members; and/orii. Require the amount of cash margin prescribed by the members to be available in the client‘smargin account, if, any, with the members.4.4 The members shall be entitled to offset the purchase price of a purchase order/transaction againstthe proceeds of a sale transaction executed by the client through the member, and vice versa.4.5 Unless the members otherwise determines, all orders for purchase, sale or other dealings insecurities and other instruction routed through the member‘s system via client‘s username shall bedeemed to have been given by the client.4.6 The member shall not be deemed to have received an order unless and until it has actuallyreceived the order in the order receiving module of the member‘s system.The client shall not be entitled to presume that any order transmitted by the client has beenreceived by the member until the member has confirmed receipt of such order.However, due to technical or other factors, an order which has been received by the members maynot be immediately confirmed to the client. Such client in confirmation shall not entitle the clientto presume that eh order has not been received by the members and the principle mentioned in thefirst sentence of this clause shall apply.4.7 The client shall be allowed to trade only during Trading hours.4.8 All order received by the member through the system may be executed in good faith and shall bevalid until separately cancelled in accordance with the provisions of this agreement.4.9 The client agrees to ensure that all orders and instructions which the member receives from theclient are absolutely clear and unambiguous; and the client agrees that if any instruction ororders or any details therefore are not absolutely clear and unambiguous, the member, itsemployee or authorized representative shall be entitled to interpret the same as per its/hisunderstanding and such understanding and interpretation shall be treated as final.4.10 The members may from time to time in its discretion impose and vary limits on the order andtrades which the client can be place and enter into through the member‘s system (includingexposure limits, turnover limits, limits as to the number, value and/or kind of securities in
86respect of which orders can be placed, the companies in respect of whose securities orders canbe placed, etc.).The members may choose not to intimate the client of the limits and any variation thereof. Theclient is aware and agrees that he members may need to urgently vary the limit or impose newlimits or prohibit or restricts the client‘s ability to place orders or trade in securities through themembers on the basis of the member‘s risk perception and other factors considered relevant bythe members, and the members may not inform the client of the same.The client agrees that the members shall not be responsible of liable for the client‘s inability toplace any order or enter into any transaction on account of nay such variation, imposition,restriction or prohibition.4.11 The members shall have the right to refuse to accept the whole or a part of any orders orinstruction from the client and/or refuse to execute the whole or a part of any accepted ordersor instruction without providing any reasons therefore.In particular, the members may refuse to accept or execute the whole or a part of any order orinstruction:-I. Based on the member‘s risk perception: orII. In respect of which the client requires regulatory approval, even if theClient has sought and obtained the required regulation approvals;4.12 The clients shall be responsible for obtained and complying with all applicable legal andregulation approval in respects of the client‘s order‘s, instructions and transactions at the defaultin research thereof.4.13 The members may in its discretion at any time allow or disallow margin trading by the client.5. CONFIRMATIONS:5.1 The client shall bring any errors or other discrepancy in any report, account, confirmation orcontracts note of executed trades (including execution prices, scrip‘s or quantities) to the member‘snotice in writing, via electronic mail or fax.Within 24 hours from the time of receipt of the first notice. In all causes, the members shall have theright to accept or reject the client‘s objection.
875.2 There may be a delay in the members receiving the reports of transaction status from the Exchanges.Accordingly, the members may forward to the client late reports in respect of such transaction that werepreviously unreported to him.Or were incorrectly reported to him as being expired, cancelled, or executed. The client shall not holdthe members responsible for nay losses suffered by the clients on account of nay late reports/statementsor nay errors in reports/statements computed by or received from the exchanges.6. REPRESENTED AND WARRANTIES OF THE CLIENT:6.1 All actions required to be taken to ensure compliance of all the transactions which the client mayenter into pursuant to his agreement with all applicable laws shall be completed by the client prior tosuch transaction being entered into.6.2 The client shall abide by the exchange provisions and the terms of the member‘s Website in forcefrom time to time.6.3 Any instruction given by an authorized representative of the client to the members (or to themember‘s representative) shall be binding on the client.7. REPRESENTATIVE AND WARRANTIES OF THE MEMBERS:The member represents and warrants to the client that, whatever such approval is required, the member‘ssystem has been approved by the Exchanges.8. OTHER DATA:8.1 The client understand that the exchanges and any other suppliers of data asserts a proprietaryinterest in all of the market and other data it furnishes, directly, through the members or otherwise.The client understands that the Exchanges, such suppliers and the members do not guarantee thetimeliness, sequence, accuracy or completeness of the data or nay other information, or anymessages disseminated by it.
88Neither the members nor the Exchanges nor such suppliers shall be liable in any way for incorrect,misleading, incomplete or out-dated data ro information and, if the client acts on the same, he shalldo so at his own risk and cost.8.2 The client shall not furnish market information provided by the Exchange or the members toany other persons or entire for consideration or otherwise and in the event the client usessuch information he shall do so at his own risk and cost.8.3 The client is authorized to use, at the client‘s risk, materials which are made available by themember‘s services for the client‘s own need only, and the client is not authorized to resell orpermit access to any such material or to make copies of any such materials for sale or supplyto or use by others. The client will not delete copyright or other intellectual property rightsnotices from any such materials.9. REEMBURSEMENT:9.1 The members does not warrant that the service will be uninterrupted or error free. The member‘sservice is provided without warranties of any kind, either express or implied, including, withoutlimitation, those of uninterrupted availability, merchantability or fitness for a particular purpose.9.2 The client agrees that under no circumstances, including negligence, shall the member‘s services orsystem be liable for any direct, indirect, incidental, specialOr consequential damages including, but not limited to lost profit, trading losses, loss of opportunity ordamages that result from interruption, delay or loss of the use of the services or out of any breach of anywarranty even if the members has been advised of the possibility of such damages.9.3 The client agrees to reimburse to the members any and all claims, liability, costs, and expenses(including but not limited to lawyer‘s fees and penalties or cost imposed by any Exchange0 andproceedings arising from or in relation to the clients breach of nay provision of this agreement or naythird party‘s right arising out of the services rendered by the members pursuant to this agreement or anyother wrongful act on the part of the client.9.4 Certain securities any grant the holder thereof valuable rights that may expire unless the holder takesaction. The client shall be responsible for knowing the rights and terms of all securities in his accountsand the members shall not be obligations to notify the client of nay upcoming expirations or redemptiondates.
89Or take any other action on the Client‘s behalf, except as required by law and applicable Exchangesprovision. The client shall also be responsible for knowing about organizations related to securities,which the client holds including, but not limited to, stock splits.If, due to a reorganization or book keeping or data entry error, the client sells more securities than heactually owns or different securities from what he actually owns, then the members shall not beresponsible for any losses the client may incur by reason thereof.9.5 The members shall not be liable for any error or delay in, or omission from, any data, information, ormessage on the members on the member‘s Websites; or(ii) Delayed, interrupted or improper transmission or delivery of nay data, information or message; ornay loss or damage arising from or occasioned by the above.10 NOTICES:10.1 Any notices or other communication to be given by any part to the other in connection with thisagreement shall be in writing and shall be deemed duly served if delivered personally or sent byfacsimile transmission or by prepaid registered post or by e-mail to the addressee at the address or (asthe case may be), the e-mail or facsimile number (if any), of that party set opposite its name below.To the member at name of the person concerned:HEAD OFFICE:-38-B/39, khatau building, 2ndfloor, Alkesh dinesh moby marg fort,Mumbai.SMS ‗BANG‘ TO 54646E-MAIL: email@example.comContact at: 022-30272323www.nirmalbang.comTo the client: (at the address, fax number or e-mail address stated in the schedule); or at such otheraddress, facsimile number or email address as the party to be served may have notified the other inaccordance with the provision of this clause.
9010.2 Notwithstanding anything stated above, communication relating to orders, margin,maintenance calls and other similar matters by the members to the client may becommunicated orally.11. ASSIGNMENT:The client shall not assign any right and obligation here under without obtaining themember‘s prior written consent.12. WAIVER:12.1 No forbearance, relaxation or inaction by any party at any time to require the performance of anyprovision of this agreement shall in any way affect , diminish, or prejudice the right of such party torequire the performance of that .Or any other provision of this agreement or be considered to be a waiver of any right, unless speciallyagreed in writing.Except as specially permitted in his agreement, no provision of this agreement can be, nor be deemed tobe, waived, altered, modified or amended unless agreed to in writing and signed by an unauthorizedofficer of the member.No waiver of any single breach or default under this agreement shall be deemed a waiver of any otherbreach or default.Do’s And Don’ts For Investors For Trading In Stock MarketPLEASEDon’ts1) Don‘t deal with unregistered brokers/sub-brokers, intermediaries.2) Don‘t fall prey to promise of guaranteed returns.
913) Don‘t get misled by companies showing approvals/registered from government agencies as theapproval could be for certain other and not for the securities you are buying.4) Investors are advised not to indulge in any market manipulation of price of any scrip through theirtrading activity.5) Don‘t leave the custody of your delivery instruction slip (DIS) book in the hands of nayintermediary/broker.6) Don‘t get carried away with onslaught of advertisement about the financial performance ofcompanies in print and/or electronic media.7) Don‘t blindly follow media reports on corporate developments, as they could be misleading.8) Don‘t blindly imitate investment decisions of others who may have profited from their investmentdecisions.9) Don‘t share any sort of trading related password with anybody else.10) Don‘t overwrite, misspell any data or not to provide any wrong information when you fill-up yourKYC.11) Don‘t meet your PAY-IN through CASH or don‘t issue any cheque in favors of any employee ofNirmal Bang security PVT Ltd. always issue cheque in favor of Nirmal Bang security PVT Ltd.12) Don‘t participate in any synchronization Trade.13) Don‘t hand over signed delivery instruction slip (DIS) or cheques or any other documents to anypersons including staff of Nirmal Bang securities PVT ltd.14) Nirmal Bang securities PVT Ltd., will not held responsible for nay financial loss arising fromviolation of the said instruction.15) Avoid off-market transaction of securities especially to third party.
9216) POA is not compulsory for execution of PAY-IN.17) Don‘t forget to cheque or scrutinize your Transaction details and holding statements received byyou on a regular interval. In case of any unauthorized transaction, inform your DP.PLEASEDO’S1) Know your risk: it is critical to understand where you stand and where you want to be, what leveland amount to investment are you comfortable with, regardless of what market experts tell you.Therefore, take some time to evaluate your risk-bearing capacity. This is a golden rule that shouldbe applied at all times.2) Always deal with the market intermediaries registered with the securities and Exchanges Board ofIndia (SEBI)/stock exchanges. Know the rules regulation, byelaws and circulars issued by stockexchanges/SEBI before investing in this market.3) Please carry out due diligence before registering as client with any intermediary. Further, investorsand requested to carefully read and understand the contents stated in the risk Discloser document,Members-client agreement which from part of investors registration for dealing through brokers inthe stock market.4) Before signing please read and understand all the point of KYC‘S5) Always update your correspondent address, bank account details.6) Give clear and unambiguous instruction to your broker/agent/depository participants7) You will be sole responsible for your internet password; hence do not share your login ID &password with anybody, since all the transaction will be deemed to be done by you only.8) Always insist on duly signed contracts notes from your brokers. In case of doubt of thetransactions, verify the genuineness of the same on the exchanges website:http://www.bseindia.com, http://www.nseindia.com9) Check all the related information like trade details, electronic contract note, margin call, etc inyour email ID as discloser by you in KYC.
9310) Always pay your margin call in Future & option segment and maintain required margin in cashsegment. In case of any shortfall or inadequate margin in your account, Nirmal Bang security PVTLtd, would have the discretion to square off the position of the client.11) Always collect money receipt from the broker after every payment.12) Always settle the through the normal banking channels with the market intermediaries.13) Settle your dues on any payment to the brokers would be from your declared bank account only.14) Investors should ensure delivery of due securities/payments of money to the broker immediatelyupon getting the contract note for sale/purchase and in any case, before the prescribed pay-in day.15) Be cautious about stocks,, which show a sudden spurt in price or trading activity, especially lowprice stocks.16) Please be informed that there are no guaranteed returns on investment in stock markets.17) You should read and understand the utility of power of attorney (POA) for meeting the pay-inbefore signing the same.18) Please note that DI slip is like a cheque book keeps it under safe custody.19) Any correction, overwriting, cancellation on the instruction slip made should be countered signedby you.20) Please be aware at the time of writing the ISIN, quantity, spelling of the scrip/scrip on deliveryinstruction slip (DIS) correctly.21) Joint holder of demat account should sign jointly on delivery instruction slip (DIS).22) Please strike out the unused blank places of multiple instructions on the delivery instruction slip(DIS) at the time of delivery DI slip to any personnel.23) Check the delivery instruction slip (DIS) numbers are pre-printed and your account number(BOID) is pre-stamped.24) To open and operate your demat account, copy of PAN card of all account holders is to besubmitted to the DP along with original PAN card, for verification.
9425) The demat account has a nomination facility and it is advisable to appoint a nominee to facilitateyou‘re your heirs in obtaining the securities in your demat account, on completion of the necessaryprocedures.26) In case of sale of shares, the delivery of shares has to be done prior to the pay in sate for therelevant settlement and issues DIS from your own DEMAT account.27) In order to receive all the credit coming to your demat account automatically, you can give one-time, standing instruction to your DP.28) Registered for CDSL‘S SMART (SMS Alerts related to Transactions) facility. If any unauthorizeddebit is noticed, the BOND should immediately in for CDSL and the Main DP in writing. An emailmay be sent CDSL at. firstname.lastname@example.org) Registered for CDSL‘s internet based facility ―easl‖ to monitor your demat account yourself.Contacts your DP or visit CDSL‘s websites: www.cdslindia.com for details.30) If you have any quarries or have any confusion please contacts our email@example.com phone no. (0522-3060071-079)Disclaimer:The above information has been assembled and after compilation presented with a general idea of thesubject for the investor. This is not containing or interprets any Acts, circulars, rules, regulation andguidelines.All these points are neither part of advertisement of solicitation nor a legal advice from Nirmal Bangsecurities PVT Ltd. the investors should invest in this segment after proper knowledge or guidance froma qualified professional.This is not a message for improvement of broker client relationship. Any action you choose to take inthe market is totally your own responsibility. The broker will not be liable for any, direct, consequentialor incidental damages or loss arising out of the use of this information.This information is neither an offer to sell on solicitation to buy of the securities from the market.I hereby confirm having read and understood the above mentioned matters.Undersigned.1) Gap between customer expectation and management perception:
95Management does not always correctly perceive what customer want. For intense in Nirmal Bang acustomer is expecting that he can buy share after deposited require check but he has to wait for 3days and same happen with demand draft.2) Gap between management perception and services quality: Management might correctly perceivecustomer‘s want but not set a performance standard. Like a form of an account should passed awayfrom the all stages of processing but it mostly takes time of 10 days.3) Gap between services quality specification and services quality: personnel might be poorly trained,or incapable or unwilling to meet the standard or they may be held to conflicting standards, such astaking time to listen to customers and services them fast. That is happen in Nirmal Bang4) Gap between services delivery and external communication: Customers‘ expectations are affectedby statement made by company representative and ads.5) Gap between perceived services and expected services: This gap occurs when the customermisperceives the service quality. A client may be perceived wrongly like a infrastructure of NirmalBang but this will solved in new office of Nirmal Bang.What a customer expect from the company:1. Wide range of services under one roof.2. 24 hours and ease to access.3. Personalized attention.What company offers to it customers?1. Extensive product range.2. Enhance customer through relationship managers.3. Understand local market dynamic.4. Expanding geographical and online presence.5. Provide a wide array of services such as brokerage, depositary services, mutual fund and equitydistribution, commodities trading and customer‘s loans.6. Offer innovation products such as power Nirmal Bang signature client account.7. Improve customer education through in-house equality research.8. Improve interface and customer experiences through research.9. Improve customer‘s interface and customer experience through technology.
9610. Continually invest and quality of systems.11. Improved speed and quality of services12. Enhance data mining to improve risk management processes.
97RESEACRH METHODOLOGYThe research specifies the information required to address needed issues, designs the methods forcollecting information, manages and implements the data collection process analyzes and communicatesthe finding and their implications.The research methodology implemented in this research repot primarily consists of personal interviewswith those very investors in Lucknow city who invest through the life insurance companies in Lucknowcities.Research objectives: To understand and analyze the market strategies of Nirmal Bang. To understand and analyze online trading at Nirmal Bang. To improve the format of DSR (Daily Sales Report). To get the Demat account opened of potential customers in favor of Shriram insight. Analysis ofneed and specialization of distribution of financial services. To give a brief idea about the benefits available from Mutual Funds investment. To give an idea of the types of schemes available. To discuss about the market trends of Mutual Funds investment. To study some of the mutual fund schemes and analyze them observe the fund managementprocess of mutual funds. Explore the recent development in the mutual in India. To give an idea about the regulation of Mutual Funds.Research Design: Descriptive Research Design.Data Collection: primary and secondary.Data Collection Instrument: questionnaire and personal interview.Sampling Design: Judgment sampling.
98Sampling size: 100Proposed Analysis Technique: graphs and chartsDESCRIPTIVE OF RESEARCH METHODOLOGYResearch Design: Descriptive Research Design.Descriptive research includes surveys and fact-finding enquires of different kinds. The major purpose ofdescriptive research is description of the state of affairs as it exists at present. I have to move around thecity and asked the people that whether they invests in the life insurances companies or not. If they investthen I asked them further questions related to my research work mention in the questionnaire.Data Collection: primary and SecondaryPrimary Data was collected with the help of interviews conducted to the general public, to those onlyin Lucknow city who invest in Life insurance by the help of a Life Insurance firm. I asked them abouttheir Life insurance firms and tried to know that whether they are satisfied with it or not.Secondary Data was collected from the firm‘s database to know how many customers is there in aparticular in life Insurance Company the Lucknow city. Since the name, addresses and contract numberof the customers were not available in the internet, therefore an attempt was made to know all thesedetails from the Life Insurance itself.Data Collection Instrument: Questionnaire and personal interview.Questionnaire: questionnaire is formal set of questions prepared to collect the required information.This is one of the most effective and popular techniques used in surveys. A structured questionnaire wasconstructed containing all perceptions about the different Life Insurance Companies can be made quiteeasily. The questionnaire can also reveal that which Life Insurance Companies in Lucknow city is morepopular and which fir is not popular among the investors in the Lucknow city.
99Personal Interviews:Personal interviews were taken only from those people in the Lucky now city who invests in securitiesthrough Life Insurance Companies they were asked questions related to this research work and thatmentions in questionnaire.Sampling Design: Judgment SamplingSample size: 100Proposed Analysis Technique:Graphs and chart
106FINDING & RECOMMENDATIONDuring my project analysis I was very keen to find some keys areas which need to be taken careseriously in the future these are causing dissatisfaction among distributors.Most of distributors felt dissatisfaction with their brokers but some of the disappointing areas are-1. More exposure: Most of distributors want some more exposure for them clients from their sharebroking companies. Nirmal Bang is now providing super exposure p to 15 of the margin (cashsegment) the step like this really creates satisfaction for the distributors.2. Brokerage problem: Some companies have very high brokerage chares which create differencesof market share of different companies and also dissatisfaction among distributors.3. Fewer offers: Most of companies lag behind in giving time to time offers in order to attract newcustomers.Recommendation for the concerned companies:1. Mass reach- The new and different offers should be communicated to the large value ofpotential inventors so that the offers can hit the target.
1072. Full information- The companies should reveal all the information regarding any scheme sothat investors can feel free to invest.3. All risks should be communicated by distributors of financial services- It isvery important for distributors to make the customers aware about all the risks involved and hecould not blame for any loss to the company.4. Misconceptions- There are many misconceptions in the mind of common people that Mutualfunds, online share trading etc. are only for ‗big ones‘ & they can‘t enter in this field and if theywill enter they will suffer losses so, by giving example of active investors variousmisconceptions should be removed.5. Simple procedure-many potential investors are computer illiterate so they never try theirhand free.6. Target rural areas also- many potential investors are also trust in rural areas. They cometo cities (like in Lucknow) for various works. There should some special offers to attract them inshare trading.7. Employees should be trained- It is very necessary for the employees to give an effectivedemo to the client about the use of various services of share broking etc. many times they fail tomake the offer understandable to the client, this is the drawback to be overcome.8. Some offers for women should be introduced to get a new share of market.
108LIMITATIONS: The time constraint was one of the major problems. The study of limited to the different schemes available under the mutual funds selected. The study is limited to selected mutual fund schemes The lack of information sources for the analysis part.