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![Until the arrival brokerage in about 2000 or so, was like driving on Indian road. It was a familiar story of might is right, big truck (brokers) ruled the market & there were potholes and pitfalls in the shape of bad deliveries, dishonored contacts, fakes & what not.Unlike the highways which have remained out of the reach of the Aam admi, the share market has changed. 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.<br />Slowly, from the physical world shares move to digital world at the NSDL. Then trading became electronic. First it was a few of the blue chips, then it was most of the blue chips and slowly it has taken over most of the market.<br />New issues are today, exclusively electronics. If digitization took care of the back end, it has also made life at the easy at the front end. In the physical delivery work, one had to talk to a broker who told you the quotes.<br />There was no way of knowing if the quote was right. There was no way of knowing if your trade was made, especially if you made a good call (Bad call, almost inevitably got made). The broker could say that this was the best price I got and nobody would be wiser.<br />You would not know if the share came from his account or form the market. You would not know if the shares were true for the small investors. Odd lots (which we inevitably awarded during splits, mergers were as good as stock which would never got sold or the broker would purchase them at a price way below the market price.<br />Industry about 70% of employees are have online active accounts, many of which were opened in the ESOP era seems like a long while back), more than 80% of these investors are actives traders, the number of day traders are less.<br />But a small chuck of these also dabbles in the future and options market. Besides this obvious segment which is connected to the online would all days long from the cubicles, there are other segments which have shown interest in trading due to its case.<br />Housewives retired professional and even small businessman. What was hitherto a male dominate sphere also has quite a fem women into trading. The regional stock exchange which were the way to route trades in the olden days, are now almost defunct with BSE and NSE (NSE more than BSE) holdings way.<br />Earlier investors were mostly from the bigger cities. With online trading, it has opened avenues for investors from the parts of the country with an internet connection.<br />A few months ago, Business world (Registration/subscription regd.) India reported that: 46 pct of the trades were done by the top 100 brokers in 1996-97. Today’s it is about 66 pct. Going online via these professional driven by technology is a great way to cut the uncertainties caused by the middleman out of the business of share trading and make lives easier for the investors.<br />There will be more competition in this space as brokers try to take over accounts of other brokers. More specialized and personalized services will be in the offing as the market expands and as smaller brokers try to survive and evolve into niche players.<br /> <br />A stock market is a public market for the trading of company stock and derivatives at an agreed price these are securities listed on a stock as well as those only traded privately.<br />The since of world stock market was estimated at about $36.6 trillions US at the beginning of October 2008. The total world derivatives market has been estimated at about $791 trillion faceoff nominal value.<br />11 times the size of the entire world economy. The value of the derivatives market, because it is stated in terms of national values, cannot be directly compared to a stock or a fixed income security, which traditionally refers to an actual value.<br />Moreover, the vast majority PF derivatives ‘cancels’ each other out (i.e., a derivatives ‘bet’ on an event occurring is offset by a comparable derivatives ‘bet’ on event not occurring).<br />Many such relatively illiquid securities are valued as market to model, rather than an actual market price. The stock are listed and traded on stock exchanges which are entities of an corporation of mutual organization specialized in the business of bringing buyers and sellers of the organization to a listing of stock and securities together.<br />The stock market in the united states in the united states includes the trading of all securities listed on the 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.<br />MARKET PARTICIPANTS:<br />A few decades ago, worldwide, buyers and sellers were individual’s investors, such as wealthy businessman, both long family histories (and emotional ties) to particular corporations.<br />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 funds investors groups, banks and various other financial institutions).<br />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’ investors, 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.<br />However, corporate governance (at least in the west) has been very much adversely affected by rise of (largely ‘absentee’) institutional ‘owners’<br />.<br />HISTORY:<br />Historian Fernando Braudel suggested that in Cairo in the 11th century, Muslim and Jewish merchant and already set up every form of trade association and had knowledge of many methods of financial dealings, disproving the belief that these were originally invented later by Italians.<br />In 12th century France the courratiers de changes were concerned with managing and regulation the debts of agricultural communities and behalf of the bank. Because these men also trade with debts, they could be called the first brokers.<br />A common misbelieve is that in late 13th century Bruges commodity traders gathered inside the house of a man called Van der Beurze, and in 1309 they became the “Bruges Beurse” institutionalizing what had been.<br />Until then, an informal meeting, but actually, the family Van der Beurze had a building in Antwerp where those gathering occurred; the Van der Beurze had Antwerp, as most of the merchants of that period.<br />As their primary place for trading. The idea quickly spread around Flanders and neighboring countries and “Beurzen” soon opened in Ghent and Amsterdam.<br />In the middle of the 13th century, Venetian market began to trade in government securities. In 1351 the Venetian government outlawed spreading rumors intended to lower the price of government securities during the 14th century.<br />This was only possible because these were independent city states not ruled by a duke but a council of influential citizens. The Dutch later started joint stock companies, which let shareholders invest in business venures and get a share of their profits or losses.<br />In 1602, the Dutch East India Company issued the first share on the Amsterdam stock exchange. It was the first company to issue stock and bonds.<br />The Amsterdam stock Exchange (ro Amsterdam Beurs) is also said to have been the first stock exchange to introduction continuous trade in the early 17th century.<br />The Dutch “pioneered short selling, option trading, debt-equity swaps, and merchant banking. Units trust and other speculative instrument, much as we know them” (Murray Sayle,”Japan Goes Dutch”, London Review of books XXIII.7, April 5, 2001).<br />There are now stock markets in virtually every developed and most developing economy, with the world’s biggest market being in the United stated, UK, Japan, China, Canada, Germany and France.<br />Importance Of Stock Market:<br />Function and purpose<br />The stock market is one of the most important sources for companies to raise money. This allows businesses to be publically traded or raised additionally capital for expansion by selling share of ownership of the company in a public market.<br />The liquidity that an exchange provides affords investors the ability to quickly and easily sell securities. This is an attractive feature of investing in stocks, compared to other less liquid investment such as real estates.<br />History has shown that the price of shares and other assets is an important part of the dynamic of economies activity, and can influence or be an indicator of social mood.<br />An economy where the stock market is on the rise is considered to be an up and coming economy.<br />In fact, the stock market is often considered the primary indicators of a country’s economics strength and development. Rising share prices, for instance, tend to be associated with increased business investment and vice versa.<br />Share prices also affect the wealth of household and their consumption.<br />Therefore, central banks tend to keep an eye on the control and behavior of the stock market and, in general, on the smooth operation of financial system functions. Financial stability is the raison d’être of central banks.<br />Exchanges also act as the clearinghouses for each transaction, meeting that they collect and deliver the shares, and guarantee payment to the seller of a securities. This eliminates the risk to an individual buyers or seller that the counterparty could default on the transaction.<br />The smooth functioning of all these activities facilities economies growth in that lower costs enterprise risks promote the production of goods and services as well as employment.<br /> In this way the financial system contribution to increased prosperity. An important aspect of modern markets, however, including the stock markets, is absolute discretion.<br />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.<br />This profit USA banker on Wall Street, as they reap large commissions from the placement, and the Chinese company which yields funds to invest in china.<br />Yet accrues no intrinsic value to the long-term stability of the American economy, rather just short-term profits to American business man and the Chinese; although, when foreign company has a presence in the new market, there can be benefits to the market’s citizens.<br />Conversely, there are very few large foreign corporation listed on the Toronto Stock exchange TSX, Canada’s largest stock exchange. This discretion has insulated Canada to some degree to worldwide financial condition.<br />In order for the stock markets to truly facilitate economy’s growth via lower costs and better employment, great attention must be given to the foreign participants being allowed in. Relation of the stock market to the modern financial system. <br />The financial system in most western countries has undergone a remarkable transformation. One features of this development is disintermediation. A portion of the funds involved in saving and financing bank lending and deposit operation.<br />The general public’s heightened interest in investing in the stock market, either directly or through mutual funds, has been an important component of this process. Statistics show that in recent decades share have made up an increasingly large proportion of household’s financial assets in many countries. <br />In the 1970’s, in Sweden, deposit account and other very liquid assets with little risk made up almost 60 percent of households’ financial wealth, compared to less than 20 percent in the 2000s.<br />The major part of this adjustment in financial portfolio has directly to shares but a good deal now take the form of various kinds of institutional investment for groups of individuals, e.g., pension funds, mutual funds, hedge funds, insurance investment of premiums, etc.<br />The trend towards form of saving with a higher risk has been accentuated by new rules for most funds and insurance, permitting a higher proportion of shares to bonds.<br />Similar tendencies are to be found in other industrialized countries. In all developed economies system, such as the European Union, the United State, Japan and other developed nations, the trend has been the same: saving has moved away from traditional (government insured) bank deposits to more risky securities of one sort or another.<br />The Stock Market, Individual Investors, and Financial Risk:<br />Riskier long-term saving required that an individual possess the ability to manage the associated increased risks. Stock prices fluctuated widely, in marked contrast to the stability of (government insured) bank deposits or bonds.<br />This something that could affect not only the individual investors or households, but also the economy on a large scale. The following deals with some of the risks of the financial sectors in general and the stock market in particular.<br />This is certainly more important now that so many newcomers have entered the stock market, or have acquired other ‘risky’ investment (such as ‘investment’ property, i.e., real estate and collectables.)<br />With each passing year, the noise level in the stock market rises. Television commentators, financial writers, analysis, and market strategies are all over taking each other to get investors ‘attention’.<br />At the same time, individual investors, immersed in chat rooms and message boards, are exchanging questionable and often misleading tips.<br />Yet, despite all this available information, investors find it increasingly difficult to profit. Stock prices skyrocket with little reasons, then plummet just as quickly.<br />And people who have turned to investing for their children’s education and their own retirement become frightened. Sometimes there appears to be no rhyme or reason to the market, only folly.<br />This is a quote from the prefaces to a published biography about the long-terms value oriented stock investors warren Buffett.<br />The behavior of the stock market:<br />From experiences we know that investors may ‘temporarily’ move financial prices away from their long terms aggregate price ‘trend’ (positive or up trends are referred to as bull markets: negative or down trends are referred to as bear markets.)<br />Over-reaction may occur so that excessive optimism (euphoria) may drive prices unduly high or excessive pessimism may drive unduly low. New theoretical an empirical arguments have since been put forward against the notion that financial markets are ‘generally’ efficient (i.e., in the sense that prices in the aggregate tends to follow a Gaussian distribution.)<br />(But this largely theoretic academic viewpoint- knows as ‘hard’ EMH- also predicts that little or no trading should take place, contrary to fact, since prices are already at or near equilibrium, having priced in all public knowledge.) The ‘hard’ efficient-market hypothesis is sorely tested by such events as the stock market crash in 1987, when the Dow Jones index plummeted 22.6 percent—the largest-ever one-day fall in the United States.<br />This events demonstrated that share prices can fall dramatically even though, to this day, it is impossible to fix a generally agreed upon definite cause: a thorough search failed to detect any ‘reasonable’ development that might have accounted for the crash. (But note that such events are predicted to occur strictly by chance, although very rarely.)<br />It seems also to be the case more generally that many price movements (beyond that which are predicted to occur ‘randomly’) are not occasioned by new information: a study of the fifty largest one-day share prices movements in the United States in the post-war period seems to confirm this.<br />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’.<br />Various explanation for such large and apparently non-random prices movement have been promulgated. For instance, some research has shown that change in estimated risks, and the use of certain strategies, such as stop-loss limit and value at Risk limits, theoretically could cause financial markets to overcorrect.<br />But the best explanation seems to be that the distribution of stock market prices is non-Gaussian (in which case EMH, in any of its current forms, would not be strictly applicable.)<br />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’).<br />Psychological research has demonstrated that peoples are predisposed to ‘seeing’ patterns, and often will perceive a pattern in what is, in fact, just noise, (something like seeing familiar shapes in clouds or ink blots.) <br />In the present context this means that a succession of good new items about a company may lead investors to overreact positively (unjustifiably driving the prices up). A period of good returns also boosts the investor’s self-confidence, reducing his (psychological) risk threshold.<br />Another phenomenon—also from psychology—that works against an objective assessment is group thinking. As social animal, it is now easy to stick to an opinion that differs markedly from that of a majority of the group.<br />An example with which one may be familiar is the reluctance to enter a restaurant that is empty; people generally prefer to have their opinion validated by those of other in the group.<br />In one paper the authors draw an analogy with gambling. In normal times the market behaves like a game of roulette; the probabilities are known and largely independent of the investment decision of the different players.<br />In times of market stress, however, the game becomes more like poker (herding behavior takes over). The players now must give heavy weight to the psychology of other investors and how they are likely to react psychology.<br />The stock market, as any other business, is quite unforgiving of amateurs. Inexperienced investors rarely get the assistance and support they need.<br />In the period running up to 1987 crash, less than 1 percent of the analysis recommendation had been to sell (and even during the 2000-2002 bear market, the average did not above 5%).<br />In the run up to 2000, the media amplified the general euphoria, with reports of rapidly rising share prices and the notion that large sums of money could be quickly earned in the so called In the run up to 2000, the media amplified the general euphoria, with reports of rapidly rising share prices and the notion that large sums of money could be quickly earned in the so called new economy stock market.<br />(And later amplified the glom which descended during the 2000-2002 bear market, so that by summer of 2002, prediction of a DOW average below 5000 were quite common).<br />Irrational behavior:<br />Sometimes the market seems to react irrationally to economic or financial news, even if that news is likely to have no real effect on the technical value of securities itself.<br />But this may be more apparent than real, since often such has been anticipated, and a counter reaction may occurs if the news is better (or worse) than expected.<br />Therefore, the stock market may be swayed in either by press releases, rumors euphoria and mass panic; but generally only briefly, as more experienced investors (especially the hedge funds quickly rally to take advantage of even the slightest, momentary hysteria.<br />Over the short-term, stock and other securities can be battered or buoyed by any number of fast market-changing events, making the stock market behavior difficult to predict. Emotion can drive prices up and down, people are generally not as rational as they think, and the reasons for buying and selling are generally obscure. <br />Behaviorists argue that investors often behave ‘irrationally’ when making investment decision thereby incorrectly pricing securities. This causes market inefficiencies, which, in turn, are opportunities, to make money.<br />However, the whole notion of EMH is that these non-rational reactions to information cancel out, leaving the prices of stock determined. The Dow Jones industrial Average biggest gain in one day was 936.42 points or 11 percent, this occurred on October 12, 2008.<br />Crashes:<br />Robert shiller’s plot of the S&P composite Real prices, Earning, Dividends, and interest Rates, from irrational exuberance, 2nd. In the prefaces to this edition, Shiller warns, “The stock market has not come down to historical levels: the prices-earnings ratio as I defined it in his book is still, at this writing [2005], in this mid-20s, far higher than the historical average…..people still place too much confidence in the market and have too strong a belief that paying attention to the gyration in their investment will someday make them rich, and so they do not make conservative preparation for possible bad outcomes.”<br />Price-Earnings ratios as predictors of twenty-year returns based upto the plot by Robert shiller. The horizontal axis shows the real price-earnings ratio of the S&P composite stock price index as computed in Irrational Exuberance (inflation adjusted price divided by the prior ten-year mean of inflation-adjusted earning).<br />The vertical axis shows the geometric average real annual return on investing in the S&P composite stock prices index, reinvesting dividends, and selling twenty years-did do well when prices were low relative to earnings at the beginning of the ten years.<br />Long-term investors would be well advised, individually, to lower their exposer to the stock market when it is high, as it has been recently, and get into the market when it is low.”<br /> <br />Stock market crash:<br /> A stock market crash is often defined as a sharp dip in share prices of equities listed on the stock exchanges. In parallel with various economics factors, a reason for stock market crashes is also due to panic and investing public’s loss of confidence. Often, stock market crashes end speculative economics bubbles.<br />There have been famous stock market crashes that have ended in the loss of billions of dollars and wealth destruction on a massive scale. An increasing number of people are involved in the stock market, especially since the social security and retirement plans are being increasingly privatized and linked to stocks and bonds and other elements of the market.<br />There have been a number of famous stock market crashes like the Wall Street crashes of 1929, the stock market crash of 1973-4, the Black Monday of 1987, the Dot-com bubble of 2000, and the stock market crashes 2008.<br />One of the most famous stock market crashes started October 24,1929 on Black Thursday. The Dow Jones industrial lost 50% during this stock market crash. It was the beginning of the Great depression.<br />Another famous crash took place on October 19, 1987 --- Black Monday. On Black Monday itself, the Dow Jones fell by 22.6% after completing a 5 year continuous roses in share prices. This event not only shook the USA, but quickly spread across the world.<br />Thus, by the end of October, stock exchanges in Australia lost 41.8%, in Canada lost 22.5%,, in Hong Kong lost 45.8%, and in Great Britain lost 26.4%. The names, “Black Monday” and “Black Tuesday” are also used for October 28-29, 1929.<br /> This followed terrible Thursday –the starting day of the stock market crash in 1929. The crash in 1987 raised some puzzles—main news and events did not predict the catastrophe and visible reasons for the collapse were not identified.<br />This event raised question about many important assumptions of modern economics, namely, the theory of rational human conduct, the theory of market equilibrium and the hypothesis of market efficiency.<br />For some time after the crash, trading in stock exchanges worldwide was halted, since the exchanges computers did not perform well owing to enormous quantity of trades being received at one time.<br />This halt in trading allowed the Federal Reserve System and central banks of other countries to take measures to control the spreading of worldwide financial crisis.<br />In the United State the SEC introduction several new measures of control into the stock market in an attempt to prevent a re-occurrence of the events of Black Monday.<br />Computer systems were upgrades in the stock exchanges to handle larger trading volumes in a more accurate and controlled manner. The SEC modified the margin requirement in an attempt to lower the volatility of common stocks, stock option and the futures markets.<br />The New York Stock Exchanges and the Chicago Mercantile Exchange introduction the concept of a circuit breaker. The circuit breaker halts trading if the Dow declines a prescribed number of points for a prescribed amount of time.<br />New York Stock Exchange (NYSE) circuit breakers.](https://image.slidesharecdn.com/summertrainingprojectreportmba-110825000724-phpapp02/85/Summer-training-project-report-mba-39-320.jpg)
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Summer training project report mba
This document provides a summary of a stock trading project report on Nirmal Bang Securities Pvt Ltd, an online stock trading company in India. 1) It outlines the objectives of studying Nirmal Bang's marketing strategies and online trading platform, as well as improving various aspects of their services. 2) The research methodology section describes using primary data collection through interviews with brokers, agents and investors, as well as secondary data. 100 samples were obtained through judgement sampling. 3) The findings note areas for improvement like increasing exposure for distributors' clients, reducing high brokerage charges, and providing more promotional offers to attract new customers.
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Summer training project report mba
- 1. SUMMER TRAINING PROJECTREPORT<br />ON<br />Stock Exchange Online Share Trading At Nirmal Bang<br />Prepared and presented to<br />UNDER THE GUIDANCE OF<br />COMPANY’S GUIDE NAME:FACULTY NAME:<br />Mr. GUNJAN SONKER<br />RELATIONSHIP MANAGER<br />BY<br />SAURABH KUMAR<br />Roll no: 1071470022<br />Kanpur Institute of Management Studies<br />Unnao<br />ACKNOWLEDGEMENT:<br />I am neither a research expert nor a trend spotter; I am a management student with foundation of management principles and theories, who is curious about various sectors and its latest happenings.<br />Definitely, I can’t ignore the technology, with internet as the backbone and those search engines which helped me in building up this research project.<br />To being with, I am obliged to Mr. KISHORE BANG and Mr. DILIP BANG (Managing Director’s Nirmal Bang Securities (PVT) Ltd).who allotted me this interesting topic and with out whose guidance and 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 helping me in making project factual and information.<br />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 cheerfully providing challenging comments and questions. Without the individuals have provided, this project would have lost much of its refreshing realism. I’m also thankful to the management & all employees of NIRMAL BANG SECURITIES LTD.<br />I also express my gratitude to Mr. (Director), Mr.(H.O.D) and ALL FACULTY MEMBERS OF MBA DEPARTMENT OF KANPUR INSTITUTE OF MANAGEMENT STUDIES, UNNAO who have been instrumental in making this report useful one.<br />Lastly, I would like to thanks to the ALMIGHTY and my parents for their moral and financial support and my colleagues with whom I shared my dad-to-day experiences and received lots off suggestions that improved my work quality.<br />SAURABH KUMAR<br />MBA<br />PREFACES:<br />In the economy for tightening Business nuts and bolt of any company industries or enterprises it is necessary to measure it market position in a certain time interval with ever changing theories and the concept of market.<br /> For this assessment we need the robust methodology of survey. Although surveys does not reveal the absolute solution of any objectives, but it provides the inclination towards a good output.<br />Nirmal Bang a good share trading company in Indian market. In this project we compare the future of this company. Find the awareness level, market potential of this company etc.<br />The preparation of this report provides you great pleasure in releasing our work and market experiences in few pages which shows overall and experienced knowledge and the practical approach about the style of a professional and thing which we found various affecting to our marketing and product image.<br />The project termed as “stock Exchange & Online share Trading at Nirmal Bang” has made an effort to find out the issues concerning with the NIRMAL BANG SECURITIES PVT LTD.<br />TABLE OF CONTENT:<br />Title page1-1<br />Certification from organization<br />Certification from project guide<br />Acknowledgement 2-2<br />Prefaces3-3<br />Executive summary<br /> Topic6-6<br /> Brief introduction7-8<br /> Research methodology9-9<br /> Finding & suggestion10-10<br />Industry profile & company profile11-13<br /> Names of stock exchanges14-15<br />On line share trading in India16-18<br />Stock market19-20<br />Market participants21-21<br />History22-23<br />Importance of stock market24-36<br />Company profile37-43<br />Products and services44-51<br />Taxation for Indian resident52-54<br />Demat services55-58<br />Mandatory document for account opening59-65<br />Investor’s rights and obligation66-71<br />Terms and condition72-83<br />Internet trading agreement84-98<br />Services management of Nirmal Bang99-101<br />Research methodology102-105<br />Analysis106-111<br />Finding and recommendation112-111<br />Limitation115-115<br />Bibliography116-116<br /> <br />EXECUTIVE SUMMARY:<br />TOPIC: “STOCK EXCHANGE & ONLINE SHARE TRADING AT NIRNAM BANG”<br />The present repot is prepared for the partial of M.B.A and as a part of curriculum. The survey is an attempt to determine and “STOCK EXCHANGE & ONLINE SHARE TRADING AT NIRMAL BANG SECURITIES PVT. Ltd.” To pursue research area are Lucknow was chosen where the survey conducted through personnel interview.<br />The data collection is an analyzed and some practical tools were applied to get inferences from the survey. The results are printed in the graphs and diagrams.<br />The conclusion is that Nirmal Bang securities Pvt Ltd. In India in good condition.<br />The research report has two sections in its first section company and industry profile is given, where as second Research Methodology is given which includes samples design, analysis on sample and presentation is in the form of diagram and charts.<br />Finally some suggestions with respect to the survey for the future improvement is given to improve the survey because their competitors have also taken up the surveys.<br />At the end of the report limitations, SWOT analysis, conclusion of the research and Appendix which includes questionnaire and the list of the city where the Sriram insight share brokers Ltd are running. Last there is Bibliography, FAQ, and Glossary that has the technical terms of the report.<br />Objectives of study:<br />To understand & analyze the marketing strategies and analyze online
- 2. Trading of NIRMALBANG.
- 3. To improve theformat of daily sales report (DSR)
- 4. To get theDemat account opened of potential customers in favor of nirmal Bang. Analysis of need and satisfaction of distribution of financial services.
- 5. To givea brief idea about the benefits available from Mutual Funds investment and idea of types of schemes available.
- 6. To discuss aboutthe market trends of Mutual Funds investment.
- 7. To study someof the mutual funds schemes and analyze them observe the funds management process of mutual funds.
- 8. Explore the recentdevelopments in the Mutual Funds in India. To give an idea about the regulations of Mutual Funds.RESEARCH METHODOLOGY:<br />To achieve the objectives of studying the stock market data has been collected Research Methodology carried fir this study can be two types.<br />RESEARCH DESIGNE: This research is description of the state of affairs, as it exists at present. So in this research I used the description research.<br />DATA SOURCES: In this research, I used primary data from the different brokers, agents, retailers and investors, and secondary data from Shriram insight Share Brokers Ltd. <br />RESEARCH APPROACH: Depth study oft he investor’s perception with respects to equity investments.<br />RESEARCH INSTRUMENT: structured personal interview.<br />TYPES OF QUESTIONS: open and close-ended question.<br />SAMPLING: public interested in investing their savings.<br />SAMPLE SIZE: 100<br /> SAMPLE PROCEDURE: Judgment samplings.<br />CONTRACT METHOD: Personal Structured Interview.<br />FINDING AND RECOMMENDATION:<br />During my project analysis I was very keen to find some key areas which need to be taken care seriously in the future because these are causing dissatisfaction among distributors.<br />Most of distribution felt dissatisfaction with there brokers but some of te disappointing areas are-<br />More exposure: Most of distributors want some more exposure for them clients from their share broking companies. Nirmal Bang is now providing super exposure p to 15 of the margin (cash segment) the step like this really creates satisfaction for the distributors.
- 9. Brokerage problem: Somecompanies have very high brokerage chares which create differences of market share of different companies and also dissatisfaction among distributors.
- 10. Fewer offers: Mostof companies lag behind in giving time to time offers in order to attract new customers. BOMBAY STOCK EXCHANGES:<br />This stock exchanges, Mumbai, popularity known as “BSE” was established in 1875 as “The native share and stock brokers associations”, as a voluntary non-profit making association.<br />It has an evolved over the years into its status as the premiere stock exchanges in the country. It may be noted that the stock exchanges the oldest one in Asia, even older than the Tokyo Stock Exchanges, which was founded in 1878.<br />The exchanges, while providing an efficient and transparent market for trading in securities, upholds the interests of the investors and ensures redressed of their grievances, whether against the companies or its own members brokers.<br />It also strives to educate and enlighten the investors by making available necessary informative inputs and conducting investor’s education programmers.<br />A governing board comprises of elected directors, 2SEBI nominees, 7 public representatives and an executive director is the apex body, which decides the policies and regulates the affairs of the exchanges.<br />The executive director as the chief executive officer is responsible for the day today administration of the exchanges. The average daily turnover of the exchange during the year 2000-01 (April-March) was Rs 3984.19 crores and average numbers of daily trades 5.69 Lakhs<br />However the averages daily turnover of the exchanges during the year 2001-2002 has declined to Rs. 1224.10 crores and number of average daily trades 5.69 Lakhs.<br />The average daily turnover of the exchanges during the year 2001-2003 has declined and number of average daily trades during the period is also decreased.<br />The Ban on all deferral products like BLESS AND ALBM in the Indian capital markets by SEBI with effect from July 2, 2001, abolition of account period settlements, introduction of compulsory rolling settlements in all scripts trades on the exchanges.<br />With effect from dec31, 2001 etc. have adversely impacted the liquidity and consequently there is a considerable decline in the daily turnover at the exchanges. The average daily turnover of the exchanges present scenario is 110363 (Laces) and number of average daily trades 1057(laces).<br />NATIONAL STOCK EXCHANGES:<br />The NSE was incorporated is now 1992 with an equity capital of Rs 25 crores. The international securities consultancy (ISC) of Hong Kong has helped in setting up NSE.<br />ISE has prepared the details business plans and installation of hardware and software system. The promotion for NSE were financial institutions, insurances companies, banks and SEBI capital markets Ltd, infrastructure leasing and financial services Ltd and stock holding corporation Ltd.<br />It has been set up to strengthen the move towards professionalization of the capital market as well as provide nation wide securities trading facilities to investors. NSE is not an exchange in the traditional sense where broker own and manage the exchanges.<br /> A two tier administrative set up involving a company board and a governing aboard of the exchanges is envisaged. NSE is a national market for shares PSU bonds, debentures and government securities since infrastructure and trading facilities are provided.<br />NAME OF THE STOCK EXCHANGE:<br />Bombay stock exchange.
- 11.
- 12. Ahmadabad share andstock brokers association.
- 13. Delhi stock exchangeassociation Ltd.
- 14. Madras stock exchangesassociation Ltd.
- 15. Indore stock brokersassociation Ltd.
- 16.
- 17.
- 18.
- 19.
- 20.
- 21.
- 22.
- 23.
- 24.
- 25.
- 26.
- 27. The Meerut stockexchanges.
- 28.
- 29. Mangalore stock exchangesLtd, Patana.
- 30. Bhuveneshwar stock exchangeassociation.
- 31. Over the counterexchange of India.
- 32. Bombay saurastra kuthstock exchange Ltd.
- 33.
- 34. ONLINE SHARE TRADINGIN INDIA:
- 35. Now with HDFC,ICICI direct, share khan, Shriram insight and other brokers,
- 36. Share trading inIndia has gone online. Starting at about 2 pct, online trading forms about pct in terms of volume (I think the figure is higher than 10 pct in the retail segment)
- 37. Some of thesehave gone on to become the biggest” brokers” in India. It has opened the market to a whole segment of people. Earlier, investing in share was done by a limited few most of who applied in an IPO and stuck with till they wanted money.
- 38. Now, not onlyonline trading made life easier for these peoples, it has opened up investing and trading to segment that never before participated in it. By my rough estimates during my experiences in India tech trading in India.
- 39. Until the arrivalbrokerage in about 2000 or so, was like driving on Indian road. It was a familiar story of might is right, big truck (brokers) ruled the market & there were potholes and pitfalls in the shape of bad deliveries, dishonored contacts, fakes & what not.Unlike the highways which have remained out of the reach of the Aam admi, the share market has changed. 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.<br />Slowly, from the physical world shares move to digital world at the NSDL. Then trading became electronic. First it was a few of the blue chips, then it was most of the blue chips and slowly it has taken over most of the market.<br />New issues are today, exclusively electronics. If digitization took care of the back end, it has also made life at the easy at the front end. In the physical delivery work, one had to talk to a broker who told you the quotes.<br />There was no way of knowing if the quote was right. There was no way of knowing if your trade was made, especially if you made a good call (Bad call, almost inevitably got made). The broker could say that this was the best price I got and nobody would be wiser.<br />You would not know if the share came from his account or form the market. You would not know if the shares were true for the small investors. Odd lots (which we inevitably awarded during splits, mergers were as good as stock which would never got sold or the broker would purchase them at a price way below the market price.<br />Industry about 70% of employees are have online active accounts, many of which were opened in the ESOP era seems like a long while back), more than 80% of these investors are actives traders, the number of day traders are less.<br />But a small chuck of these also dabbles in the future and options market. Besides this obvious segment which is connected to the online would all days long from the cubicles, there are other segments which have shown interest in trading due to its case.<br />Housewives retired professional and even small businessman. What was hitherto a male dominate sphere also has quite a fem women into trading. The regional stock exchange which were the way to route trades in the olden days, are now almost defunct with BSE and NSE (NSE more than BSE) holdings way.<br />Earlier investors were mostly from the bigger cities. With online trading, it has opened avenues for investors from the parts of the country with an internet connection.<br />A few months ago, Business world (Registration/subscription regd.) India reported that: 46 pct of the trades were done by the top 100 brokers in 1996-97. Today’s it is about 66 pct. Going online via these professional driven by technology is a great way to cut the uncertainties caused by the middleman out of the business of share trading and make lives easier for the investors.<br />There will be more competition in this space as brokers try to take over accounts of other brokers. More specialized and personalized services will be in the offing as the market expands and as smaller brokers try to survive and evolve into niche players.<br /> <br />A stock market is a public market for the trading of company stock and derivatives at an agreed price these are securities listed on a stock as well as those only traded privately.<br />The since of world stock market was estimated at about $36.6 trillions US at the beginning of October 2008. The total world derivatives market has been estimated at about $791 trillion faceoff nominal value.<br />11 times the size of the entire world economy. The value of the derivatives market, because it is stated in terms of national values, cannot be directly compared to a stock or a fixed income security, which traditionally refers to an actual value.<br />Moreover, the vast majority PF derivatives ‘cancels’ each other out (i.e., a derivatives ‘bet’ on an event occurring is offset by a comparable derivatives ‘bet’ on event not occurring).<br />Many such relatively illiquid securities are valued as market to model, rather than an actual market price. The stock are listed and traded on stock exchanges which are entities of an corporation of mutual organization specialized in the business of bringing buyers and sellers of the organization to a listing of stock and securities together.<br />The stock market in the united states in the united states includes the trading of all securities listed on the 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.<br />MARKET PARTICIPANTS:<br />A few decades ago, worldwide, buyers and sellers were individual’s investors, such as wealthy businessman, both long family histories (and emotional ties) to particular corporations.<br />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 funds investors groups, banks and various other financial institutions).<br />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’ investors, 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.<br />However, corporate governance (at least in the west) has been very much adversely affected by rise of (largely ‘absentee’) institutional ‘owners’<br />.<br />HISTORY:<br />Historian Fernando Braudel suggested that in Cairo in the 11th century, Muslim and Jewish merchant and already set up every form of trade association and had knowledge of many methods of financial dealings, disproving the belief that these were originally invented later by Italians.<br />In 12th century France the courratiers de changes were concerned with managing and regulation the debts of agricultural communities and behalf of the bank. Because these men also trade with debts, they could be called the first brokers.<br />A common misbelieve is that in late 13th century Bruges commodity traders gathered inside the house of a man called Van der Beurze, and in 1309 they became the “Bruges Beurse” institutionalizing what had been.<br />Until then, an informal meeting, but actually, the family Van der Beurze had a building in Antwerp where those gathering occurred; the Van der Beurze had Antwerp, as most of the merchants of that period.<br />As their primary place for trading. The idea quickly spread around Flanders and neighboring countries and “Beurzen” soon opened in Ghent and Amsterdam.<br />In the middle of the 13th century, Venetian market began to trade in government securities. In 1351 the Venetian government outlawed spreading rumors intended to lower the price of government securities during the 14th century.<br />This was only possible because these were independent city states not ruled by a duke but a council of influential citizens. The Dutch later started joint stock companies, which let shareholders invest in business venures and get a share of their profits or losses.<br />In 1602, the Dutch East India Company issued the first share on the Amsterdam stock exchange. It was the first company to issue stock and bonds.<br />The Amsterdam stock Exchange (ro Amsterdam Beurs) is also said to have been the first stock exchange to introduction continuous trade in the early 17th century.<br />The Dutch “pioneered short selling, option trading, debt-equity swaps, and merchant banking. Units trust and other speculative instrument, much as we know them” (Murray Sayle,”Japan Goes Dutch”, London Review of books XXIII.7, April 5, 2001).<br />There are now stock markets in virtually every developed and most developing economy, with the world’s biggest market being in the United stated, UK, Japan, China, Canada, Germany and France.<br />Importance Of Stock Market:<br />Function and purpose<br />The stock market is one of the most important sources for companies to raise money. This allows businesses to be publically traded or raised additionally capital for expansion by selling share of ownership of the company in a public market.<br />The liquidity that an exchange provides affords investors the ability to quickly and easily sell securities. This is an attractive feature of investing in stocks, compared to other less liquid investment such as real estates.<br />History has shown that the price of shares and other assets is an important part of the dynamic of economies activity, and can influence or be an indicator of social mood.<br />An economy where the stock market is on the rise is considered to be an up and coming economy.<br />In fact, the stock market is often considered the primary indicators of a country’s economics strength and development. Rising share prices, for instance, tend to be associated with increased business investment and vice versa.<br />Share prices also affect the wealth of household and their consumption.<br />Therefore, central banks tend to keep an eye on the control and behavior of the stock market and, in general, on the smooth operation of financial system functions. Financial stability is the raison d’être of central banks.<br />Exchanges also act as the clearinghouses for each transaction, meeting that they collect and deliver the shares, and guarantee payment to the seller of a securities. This eliminates the risk to an individual buyers or seller that the counterparty could default on the transaction.<br />The smooth functioning of all these activities facilities economies growth in that lower costs enterprise risks promote the production of goods and services as well as employment.<br /> In this way the financial system contribution to increased prosperity. An important aspect of modern markets, however, including the stock markets, is absolute discretion.<br />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.<br />This profit USA banker on Wall Street, as they reap large commissions from the placement, and the Chinese company which yields funds to invest in china.<br />Yet accrues no intrinsic value to the long-term stability of the American economy, rather just short-term profits to American business man and the Chinese; although, when foreign company has a presence in the new market, there can be benefits to the market’s citizens.<br />Conversely, there are very few large foreign corporation listed on the Toronto Stock exchange TSX, Canada’s largest stock exchange. This discretion has insulated Canada to some degree to worldwide financial condition.<br />In order for the stock markets to truly facilitate economy’s growth via lower costs and better employment, great attention must be given to the foreign participants being allowed in. Relation of the stock market to the modern financial system. <br />The financial system in most western countries has undergone a remarkable transformation. One features of this development is disintermediation. A portion of the funds involved in saving and financing bank lending and deposit operation.<br />The general public’s heightened interest in investing in the stock market, either directly or through mutual funds, has been an important component of this process. Statistics show that in recent decades share have made up an increasingly large proportion of household’s financial assets in many countries. <br />In the 1970’s, in Sweden, deposit account and other very liquid assets with little risk made up almost 60 percent of households’ financial wealth, compared to less than 20 percent in the 2000s.<br />The major part of this adjustment in financial portfolio has directly to shares but a good deal now take the form of various kinds of institutional investment for groups of individuals, e.g., pension funds, mutual funds, hedge funds, insurance investment of premiums, etc.<br />The trend towards form of saving with a higher risk has been accentuated by new rules for most funds and insurance, permitting a higher proportion of shares to bonds.<br />Similar tendencies are to be found in other industrialized countries. In all developed economies system, such as the European Union, the United State, Japan and other developed nations, the trend has been the same: saving has moved away from traditional (government insured) bank deposits to more risky securities of one sort or another.<br />The Stock Market, Individual Investors, and Financial Risk:<br />Riskier long-term saving required that an individual possess the ability to manage the associated increased risks. Stock prices fluctuated widely, in marked contrast to the stability of (government insured) bank deposits or bonds.<br />This something that could affect not only the individual investors or households, but also the economy on a large scale. The following deals with some of the risks of the financial sectors in general and the stock market in particular.<br />This is certainly more important now that so many newcomers have entered the stock market, or have acquired other ‘risky’ investment (such as ‘investment’ property, i.e., real estate and collectables.)<br />With each passing year, the noise level in the stock market rises. Television commentators, financial writers, analysis, and market strategies are all over taking each other to get investors ‘attention’.<br />At the same time, individual investors, immersed in chat rooms and message boards, are exchanging questionable and often misleading tips.<br />Yet, despite all this available information, investors find it increasingly difficult to profit. Stock prices skyrocket with little reasons, then plummet just as quickly.<br />And people who have turned to investing for their children’s education and their own retirement become frightened. Sometimes there appears to be no rhyme or reason to the market, only folly.<br />This is a quote from the prefaces to a published biography about the long-terms value oriented stock investors warren Buffett.<br />The behavior of the stock market:<br />From experiences we know that investors may ‘temporarily’ move financial prices away from their long terms aggregate price ‘trend’ (positive or up trends are referred to as bull markets: negative or down trends are referred to as bear markets.)<br />Over-reaction may occur so that excessive optimism (euphoria) may drive prices unduly high or excessive pessimism may drive unduly low. New theoretical an empirical arguments have since been put forward against the notion that financial markets are ‘generally’ efficient (i.e., in the sense that prices in the aggregate tends to follow a Gaussian distribution.)<br />(But this largely theoretic academic viewpoint- knows as ‘hard’ EMH- also predicts that little or no trading should take place, contrary to fact, since prices are already at or near equilibrium, having priced in all public knowledge.) The ‘hard’ efficient-market hypothesis is sorely tested by such events as the stock market crash in 1987, when the Dow Jones index plummeted 22.6 percent—the largest-ever one-day fall in the United States.<br />This events demonstrated that share prices can fall dramatically even though, to this day, it is impossible to fix a generally agreed upon definite cause: a thorough search failed to detect any ‘reasonable’ development that might have accounted for the crash. (But note that such events are predicted to occur strictly by chance, although very rarely.)<br />It seems also to be the case more generally that many price movements (beyond that which are predicted to occur ‘randomly’) are not occasioned by new information: a study of the fifty largest one-day share prices movements in the United States in the post-war period seems to confirm this.<br />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’.<br />Various explanation for such large and apparently non-random prices movement have been promulgated. For instance, some research has shown that change in estimated risks, and the use of certain strategies, such as stop-loss limit and value at Risk limits, theoretically could cause financial markets to overcorrect.<br />But the best explanation seems to be that the distribution of stock market prices is non-Gaussian (in which case EMH, in any of its current forms, would not be strictly applicable.)<br />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’).<br />Psychological research has demonstrated that peoples are predisposed to ‘seeing’ patterns, and often will perceive a pattern in what is, in fact, just noise, (something like seeing familiar shapes in clouds or ink blots.) <br />In the present context this means that a succession of good new items about a company may lead investors to overreact positively (unjustifiably driving the prices up). A period of good returns also boosts the investor’s self-confidence, reducing his (psychological) risk threshold.<br />Another phenomenon—also from psychology—that works against an objective assessment is group thinking. As social animal, it is now easy to stick to an opinion that differs markedly from that of a majority of the group.<br />An example with which one may be familiar is the reluctance to enter a restaurant that is empty; people generally prefer to have their opinion validated by those of other in the group.<br />In one paper the authors draw an analogy with gambling. In normal times the market behaves like a game of roulette; the probabilities are known and largely independent of the investment decision of the different players.<br />In times of market stress, however, the game becomes more like poker (herding behavior takes over). The players now must give heavy weight to the psychology of other investors and how they are likely to react psychology.<br />The stock market, as any other business, is quite unforgiving of amateurs. Inexperienced investors rarely get the assistance and support they need.<br />In the period running up to 1987 crash, less than 1 percent of the analysis recommendation had been to sell (and even during the 2000-2002 bear market, the average did not above 5%).<br />In the run up to 2000, the media amplified the general euphoria, with reports of rapidly rising share prices and the notion that large sums of money could be quickly earned in the so called In the run up to 2000, the media amplified the general euphoria, with reports of rapidly rising share prices and the notion that large sums of money could be quickly earned in the so called new economy stock market.<br />(And later amplified the glom which descended during the 2000-2002 bear market, so that by summer of 2002, prediction of a DOW average below 5000 were quite common).<br />Irrational behavior:<br />Sometimes the market seems to react irrationally to economic or financial news, even if that news is likely to have no real effect on the technical value of securities itself.<br />But this may be more apparent than real, since often such has been anticipated, and a counter reaction may occurs if the news is better (or worse) than expected.<br />Therefore, the stock market may be swayed in either by press releases, rumors euphoria and mass panic; but generally only briefly, as more experienced investors (especially the hedge funds quickly rally to take advantage of even the slightest, momentary hysteria.<br />Over the short-term, stock and other securities can be battered or buoyed by any number of fast market-changing events, making the stock market behavior difficult to predict. Emotion can drive prices up and down, people are generally not as rational as they think, and the reasons for buying and selling are generally obscure. <br />Behaviorists argue that investors often behave ‘irrationally’ when making investment decision thereby incorrectly pricing securities. This causes market inefficiencies, which, in turn, are opportunities, to make money.<br />However, the whole notion of EMH is that these non-rational reactions to information cancel out, leaving the prices of stock determined. The Dow Jones industrial Average biggest gain in one day was 936.42 points or 11 percent, this occurred on October 12, 2008.<br />Crashes:<br />Robert shiller’s plot of the S&P composite Real prices, Earning, Dividends, and interest Rates, from irrational exuberance, 2nd. In the prefaces to this edition, Shiller warns, “The stock market has not come down to historical levels: the prices-earnings ratio as I defined it in his book is still, at this writing [2005], in this mid-20s, far higher than the historical average…..people still place too much confidence in the market and have too strong a belief that paying attention to the gyration in their investment will someday make them rich, and so they do not make conservative preparation for possible bad outcomes.”<br />Price-Earnings ratios as predictors of twenty-year returns based upto the plot by Robert shiller. The horizontal axis shows the real price-earnings ratio of the S&P composite stock price index as computed in Irrational Exuberance (inflation adjusted price divided by the prior ten-year mean of inflation-adjusted earning).<br />The vertical axis shows the geometric average real annual return on investing in the S&P composite stock prices index, reinvesting dividends, and selling twenty years-did do well when prices were low relative to earnings at the beginning of the ten years.<br />Long-term investors would be well advised, individually, to lower their exposer to the stock market when it is high, as it has been recently, and get into the market when it is low.”<br /> <br />Stock market crash:<br /> A stock market crash is often defined as a sharp dip in share prices of equities listed on the stock exchanges. In parallel with various economics factors, a reason for stock market crashes is also due to panic and investing public’s loss of confidence. Often, stock market crashes end speculative economics bubbles.<br />There have been famous stock market crashes that have ended in the loss of billions of dollars and wealth destruction on a massive scale. An increasing number of people are involved in the stock market, especially since the social security and retirement plans are being increasingly privatized and linked to stocks and bonds and other elements of the market.<br />There have been a number of famous stock market crashes like the Wall Street crashes of 1929, the stock market crash of 1973-4, the Black Monday of 1987, the Dot-com bubble of 2000, and the stock market crashes 2008.<br />One of the most famous stock market crashes started October 24,1929 on Black Thursday. The Dow Jones industrial lost 50% during this stock market crash. It was the beginning of the Great depression.<br />Another famous crash took place on October 19, 1987 --- Black Monday. On Black Monday itself, the Dow Jones fell by 22.6% after completing a 5 year continuous roses in share prices. This event not only shook the USA, but quickly spread across the world.<br />Thus, by the end of October, stock exchanges in Australia lost 41.8%, in Canada lost 22.5%,, in Hong Kong lost 45.8%, and in Great Britain lost 26.4%. The names, “Black Monday” and “Black Tuesday” are also used for October 28-29, 1929.<br /> This followed terrible Thursday –the starting day of the stock market crash in 1929. The crash in 1987 raised some puzzles—main news and events did not predict the catastrophe and visible reasons for the collapse were not identified.<br />This event raised question about many important assumptions of modern economics, namely, the theory of rational human conduct, the theory of market equilibrium and the hypothesis of market efficiency.<br />For some time after the crash, trading in stock exchanges worldwide was halted, since the exchanges computers did not perform well owing to enormous quantity of trades being received at one time.<br />This halt in trading allowed the Federal Reserve System and central banks of other countries to take measures to control the spreading of worldwide financial crisis.<br />In the United State the SEC introduction several new measures of control into the stock market in an attempt to prevent a re-occurrence of the events of Black Monday.<br />Computer systems were upgrades in the stock exchanges to handle larger trading volumes in a more accurate and controlled manner. The SEC modified the margin requirement in an attempt to lower the volatility of common stocks, stock option and the futures markets.<br />The New York Stock Exchanges and the Chicago Mercantile Exchange introduction the concept of a circuit breaker. The circuit breaker halts trading if the Dow declines a prescribed number of points for a prescribed amount of time.<br />New York Stock Exchange (NYSE) circuit breakers.
- 40.
- 41. Themovement of the prices in a market or sections of a market are captured in price indices called stock market indices, of which there are many, e.g., S&P, the FTSE and the Euro next indices.
- 42. Such indices areusually market capitalization weighted, with the weight reflecting the contribution of the stock of the index are reviewed frequently to include/exclude stocks in order to reflects to reflects the changing business environment.
- 43.
- 44. Stock that atraders does not actually own may be traded suing short selling; margin buying may be used to purchase stock with borrowed funds; or, derivatives may be used to control large blocks of stock for a much smaller of amount of money than would be required by outright purchases or sale.
- 45.
- 46. In short selling,the traders borrow stock (usually from his brokerage which holds it’s client’s shares or its own share on account to lend to short sellers) then sells it on the market, hoping for the price to all.
- 47. The trader eventuallybuys back the stock, making money if the price fell in the meantime or losing money if it rose; exiting a short position by buying back the stock is called “covering a short position”.
- 48. This strategy mayalso be used by unscrupulous traders to artificially lower the price of a stock. Hence most markets either prevent short selling or place restriction on when and how a short sale can occur.
- 49. The practice ofnaked shorting is illegal in most (but not all) stock markets.\
- 50.
- 51. In margin buying,trader borrows money (at interest)to buy a stock and hopes for it to rise. Most industrialized countries have regulation that requires that if the borrowing is based on collateral from other stock the trader owns outright, it can be a maximum of a certain percentage of those other stocks’ value.
- 52. In the UnitedState, the margin requirements have been 50% for many years (that is, if you want to make a $100 investment, you need to put up$500, and there is often a maintenance margin below the $500).
- 53. A margin callis made if the total value of the investor’s account cannot support the loss of the trade.
- 54. (Upon a declinein the value of the margined securities additional funds may be requires to maintain the account’s equity, and with or wit out the margined securities or any others within the account may be sold by the brokers to protect its loan position. This investors is responsible for any shortfall following such forced sale).
- 55. Regulation of marginrequirement (by the Federal Reserve) was implemented after the crash of 1929. Before that, speculators typically only needed to put up a little as 10% (or even less) of the total investment represented by the stocks purchased.
- 56. Other rules mayinclude the prohibition of free-riding: putting in an order to buy stocks without paying initially (there is normally a three-day grace period for delivery of the stock.)
- 57. But then sellingthem (before the three-days are up) and using part of the proceeds to make the original payment (assuming that the value of the stocks has not declined in the interim).
- 58.
- 59. Global issuance ofequity and equity-related instrument totaled $505 billion in 2004, a 29.8% increase over the $389 billion raised in 2003. Initial public offer (IPOs) by US issuers increased 221% with 233offering that raised $45 billion, and IPOs in Europe, Middle East and Africa (EMEA) increased by 333% from $9 billion to $39 billion.
- 60.
- 61. One of themany thing people always want to know about the stock market is, “How do I know money investing?” There are many different approaches; two basic methods are classified as either fundamental analysis or technical analysis.
- 62. Fundamental analysis refersto analyzing companies by their financial statements founds in SEC Filing, business trends, general economic conditions, etc.
- 63. Technical analysis studiesprices action in market through the use of charts and quantitative techniques to attempt to forecast prices trends regardless of the company’s financial prospects.
- 64. One examples ofa technical strategy is the Trend following method, used by John W Henry and risk control and diversification.
- 65. Additional, many chooseto invent via the index method. One holds a weight or unweight portfolio consisting of the entire stock market or some segment of the stock market (such as the S&P 500 or Wilshire 5000).
- 66. The principle aimof this strategy is to maximize diversification, minimize taxes from too frequent trading and ride the general trend of the stock market (which, in the U.S, has averaged nearly 10% year, compounded annually, since World War II).
- 67.
- 68. According to muchnational or state legislation, large arrays of fiscal obligation are taxed for capital gains. Taxes are charged by the state over the transactions, dividends and capital gains on the stock market, in particular in the stock market.
- 69. However, these fiscalobligations may vary from jurisdiction to jurisdiction because, among other reasons, it could be assumed that taxation is already incorporated into the stock prices through the different taxes companies pay to the state, or that tax free stock market operations are useful to boost economic growth.
- 70. ABOUT NIRMAL BANGGROUP:
- 71. Founded in1986 by Sri Nirmal Bang Group is recognized as one of the largest retail broking houses in India, providing an array of financial products and services.
- 72. Our retail andinstitutional clients have access to product such as equities, derivatives, commodities, currency derivatives, mutual fund, IPOs, insurance, depository services and PMS.
- 73. Throughout our history,we have fostered one overriding purpose each client with personal services and quality work by adhering to the principal, we have grown to become a successful as well-respect firm of highly qualified professional.
- 74. The group isheaded by Mr. Dilip Bang and Mr. Kishore Bang who bring forward industry expertise, insight and most important, create an environment of unmatched to client.
- 75. We are registeredmembers of the Bombay Stock Exchanges limited (BSE), National Stock Exchanges of India limited (NSE), Multi Commodity Exchanges of India limited (MCX), national commodity & Derivatives Exchanges limited (NCDEX), National Multi Commodity Exchanges of India limited (NMCE) and MCX stock Exchange limited and also depository participants of NSDL and CDSL.
- 76.
- 77. “To work togetherwith integrity and make customer feel valued.”
- 78.
- 79. “TO CREATE VALUABLERELATIONSHIPS AND PROVIDE THE BEST FINANCIAL SERVICES MOST PROFESSIONAL.”
- 80.
- 81. “RESPECT OUR COLLEAGAUESAND THE BUSINESS ITSELF.
- 82.
- 83.
- 84. Client relationship fromthe core of our business. We value each client, no matter what size, as a long-term relationship. And we seek to provide unmatched services to each client and place him as a partner at the center of everything we do.
- 85. From the verybeginning of the relationship, we work closely with every client to identify his financial goals and risk tolerance levels and leverage our strength of the product offering, research and financial strength to help achieve his goals. In the process, we become an professional partners, creating opportunity, adding value and transform vision into reality.
- 86.
- 87. In addition totraditional broking services, we are also equipped to handle commodity trading facility as well as currency derivatives and have access to a wide range of financial services like IPOs, mutual funds and insurance.Timely services<br />In an increasingly competitive environment, clients today require personalized solution and greater flexibility and responsiveness than ever before. Our professionals are always ‘on call’. We provide them services throughout the year and not just at the end of the year. We believe such service is essentials for delivering solution and constructive relationship.
- 88.
- 89. We have developeda strong and enduring team by recruiting from leading graduate and postgraduate universities and promoting from within. Our team work together to provide superior results to our client. At the same time, each of our clients is assigned a specific team member who ‘owner’ the relationship, providing continuity, responsiveness and a point of easy access to the firm.
- 90.
- 91. We strive tomaintain standards at all times and lay emphasis on honesty, integrity and confidentiality. We speak and act to ensure transparency at all levels and in everything we do.
- 92.
- 93. The strength ofour balance sheet is such that it gives greater confidence to all our retail and institutional clients in detail with us. The financial strength of the group helps in future building the network and infrastructure to cater to the larger market.
- 94. INFRASTURUCTURE:We believe orbest infrastructure gives a significant advantage allowing us to provide efficient, transparent and qualitative services. Our technology supports everything from executive trades and managing our investors of stocks to communicating up-to-the-second information to our clients and monitoring for compliance.<br />Client interface:
- 95. We have tradingterminal (both direct and indirect), online monitoring, control terminal (administration terminals) and back office support terminal (settlement terminal) across all location and centers.
- 96. We have India’sbest single screen Multi Exchanges Trading Software platform. Our entire centers across the country are connected through our own network, leased ISDN lines and LAN network, MPLS and internet.
- 97. Thehigh-end IBM serves with sophisticated security features that we use caters to trading points across the country. This also gives u rte advantage of scalability in terms of location and size of our planned operations. We provide telephonic and chat support for technical and functional issues of branches, franchises and all our clients.Our websites www.nirmalbang.com is comprehensive and provides online feeds, net trading and provides online feed, net trading portfolio tracking tool. Investors also have access to a wide range of financial news, information and various research reports facilitating quick decision-making.<br /> Our online trading portal at www.nirmalbang.com is equipped with facilities like all segment broadcasts, multi-features graphs, online payment gateways and automatic password mailer utility for better security. It user-friendly navigation allows easy viewing of trading accounts, depository accounts and research reports, which are linked to the trading platform. <br /> The website also has a provision for creating portfolios and monitoring them on a regular basis. Our ‘wealth trackers’ module helps investors in getting ready updates n their investment so that they can know the changing trends of the markets and the impact of the same on their portfolio.<br />Back office:
- 98. For back officeoperations, we use the lidha Didha system of Apex Soft cell Pvt. Ltd. This is one of the top most back office software in the industry. It has the capacity to process over one lakh traders in a five minute frame.
- 99. Our operation teamshas an easy-to-navigate client login system, which is used to generate activity reports, short-terms and long-term tax reports, holding and portfolio valuation reports as well as trading to delivery activity reports.We also have the requisite infrastructure needed to handles STP, upload and download and download information to or from exchanges, bank and depositories, support units to ensure delivery notes, bills and ledgers of trading accounts and cash management services for efficient and effective fund management within the group.<br />Internal control:<br />Compliance and internal control play a major role in determining business strategies as well as day-to-day operation of the group. A well-equipped risk management department ensures that the delinquency rates are minimal, while efficient risk management software provides online MTM margin data to branches and franchisees. Our efficient back-up system and software have been developed specially for branches and channel partners with a capacity to handle numerous transactions. Our online position monitoring system ensures better risk management and surveillance from our head office as well as branches and franchises. Our people from them cornerstone of the business and their expertise and motivation delivery of exceptional solution and services to all our clients.<br />Experienced professional:<br />Our teams of professional consist of individual with significant experience in securities trading, market structure, trading technology and portfolio management. They have a strong experience in trade execution and understanding of order flow dynamics. This combined with technical analysis of market momentum, help our clients to determine the price at which they buy and /or sell.<br />We believe, we are the first choice for our clients because we among the very best at trade executive solution and assets management services. At Nirmal bang, each and every professional is focused on turning the initial trade or investment into a collaborative, person-to-person relationship that keeps delivering true added value.<br />Research Expertise:<br />Our research team is headed by two senior research analysts who have more than 15 years of experience in this field.<br />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 and analysis of emerging as well as current market trends. Besides, our research analysts also appear on leading business news channel where they share their insights on the market.<br />Nirmal Bang Group’s business strives the largest number of common people. Consider these: Equity* /commodity/ currency*/mutual fund/IPO/PMS/insurance/DP products.<br />Management philosophy:<br /> 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 and freedom 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 communities they serve.<br />About Nirmal Bang:<br />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 a premier financial supermarket providing a host of services including stock-broking, distribution of investment products, properly, property development, industrial investment, risk management, insurance products and consumer finance.<br /> Human Resources:<br />Human resources is the key to any services sectors industry. We have a strong and vibrant workforce in every field or our activity, be it research, system, accounts, marketing or networking.<br />With the manpower strength of over 1100 employees, the Company is managed by a highly motivated, qualified & talented team of professional qualified CA’s, MBA,s, Engineers, etc with proven track records.<br />Technology:<br />Stock-broking being a process intensive activity, issues such as speed, accuracy, round-the-clock system availability and system securities are of paramount importance and technology forms the backbones of the business.<br />This is why Nirmal Bang is technology driven. We boast of state-of-the-art technology and an in-house team of highly competent software and networking engineers who constantly review system and procedures to ensure operational efficiency.<br />All our branches are connected through Wide Area Network (WAN) and are served by a centralized back office processing system, which enables clients to obtain up to date information online at the click of a button.<br />Customer Focus:<br />Despite a rapidly expanding client base and a dizzying increase in transaction volumes, each client at Nirmal Bang is special. We specialize in building long term relationship with our customers by providing them with the four things they desire most, viz., speed,, convenience, reliability and personalized services.<br />Our continuous strive to provide best services to our clients, results in receipt of not a single Arbitration Award against the company since its inception.<br />
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- 101. A product forevery need:
- 102. Nirmal Bang isthe most comprehensive website, which allows you to invest in shares, mutual funds, derivatives (Future and Option) and other financial products. Simply put, we offer you products for every investment need of yours.
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- 104. Nirmal Bang offersyou various options while trading in shares.
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- 106. This is adelivery based system, which is generally done with the information of taking delivery of shares or monies.
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- 108. You can alsodo an intra-settlement trading up to 3 to 4 times your available funds, where in you take long buy/short sell position in stocks with in the intention of squaring off the position within the same day settlement cycle.
- 109. In margin trading,you take buy/sell position in stocks(s) with the intention of acquiring off the position within the same settlement cycle. If, during the course of the settlement cycle, he price moves in your favor (rises in case you have a buy position or falls in case you have a sell position), you make profit. In case you have the option to take/give delivery of buy/sell position respectively if you have sufficient cash/securities to do so.