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EXECUTIVE SUMMARY

The main objective of project is to know the saving & investment behavior pattern of consumer.

I also tried to know the Risk taking behavior of consumer i.e. how much they can take risk on

their investment. In which type of product they feel comfortable to invest, their Growth

e pectation and future investment plans. The project includes introduction of various products

including mutual funds, e!uity and types of investments. "y project also includes portfolio

management is all about how to manage an investor#s portfolio in mutual fund, how to diversify

the investments into different schemes of funds, to manage client#s portfolio efficiently we first

need to understand the industry, current economic condition of the economy, investor#s behavior,

their objective, risk apatite. This project report has helped me to analy$e the customer#s portfolio

and %ortfolio management in which, it emphasis on the study of different product and services

in respect to the risk and return involved in it.

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OBJECTIVE OF THE PROJECT:

The objectives of the project are mainly'

(nalysis of current investment strategies adopted by the different age group and different

income group.

)asic acceptance of investment instrument towards the investors.

*ind out the potential customer and their needs.

)asic trends of investment in the market.

Primary Objective

The main objective of this study is doing an In'depth analysis of various investment products and

services like Insurance, "+T+( *+- , deposits, wealth advisory services. /ther objective is

to know the saving and investment behavior of people, t heir Risk taking attitude on investment

and their future plans of investment.

Sec!"#ary !bjective

To understand the portfolio management process in various %roducts like "utual *und

To know the effects of political, economical, social and technological factors on various

products in India.

0valuating fund performance

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RESEARCH METHO&O$O'Y

Primary #ata:

4onducting field survey based on the investment strategies taken by the small investors and

the instrument they prefer to invest. To fulfill the particular I have done field survey in about

567 people. The entire project is designed like this1 '

*ormation of !uestionnaire depending upon the investor mind set and the need.

%utting strong emphasis on the !uestionnaire that respondent must fill the !uestionnaire.

*or that I restrict my !uestions to twelve. Thus it becomes short and time saving.

I visited the malls area in "umbai and some of my relatives and friends. (s a result I got

a mi ed response

(fter gathering the entire data sheet I have put it in the e cel sheet and started analy$ing.

Sec!"#ary C!((ecti!" !) #ata

2ources of the data collection will be,

Internet

8arious maga$ines9bulletins

-ews papers

Related books

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I%TRO&UCTIO% OF PORTFO$IO MA%A'EME%T

MEA%I%' OF PORTFO$IO:

:( portfolio is a collection of securities, since it is really desirable to invest the entire funds of

individual or an institution or a single security It is essential that every security be viewed in a

portfolio conte t. Thus it seems logical that the e pected return of the portfolio. %ortfolio

(nalysis considers future risk and return in holding various blends of individual securities.

I%TRO&UCTIO% OF PORTFO$IO MA%A'EME%T:

%ortfolio "anagement refers to the management of portfolios for others by professional

investment managers it refers to the management of an individual investor#s portfolio by

professionally !ualified person ranging from merchant banker to specified portfolio company.

MEA%I%' OF PORTFO$IO MA%A'EME%T

%ortfolio is a collection of asset.

The asset may be physical or financial like 2hares )onds, ebentures, and %reference

2hares etc.

The individual investor or a fund manager would not like to put all his money in the

shares of one company, for that would amount to great risk.

"ain objective is to ma imi$e portfolio return and at the same time minimi$ing the

portfolio risk by diversification.

%ortfolio management is the management of various financial assets, which comprise the

portfolio.

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(ccording to 2ecurities and 0 change )oard of India ;%ortfolio manager< Rules, 5==>? :

portfolio means the total holding of securities belonging to any person?

esigning portfolios to suit investor re!uirement often involves making several

projections regarding the future, based on the current information.

3hen the actual situation is at variance from the projections portfolio composition needs

to be changed.

/ne of the key inputs in portfolio building is the risk bearing ability of the investor.

%ortfolio management can be having institutional, for e ample, +nit Trust, "utual

*unds, %ension %rovident and Insurance *unds, Investment 4ompanies and non'

Investment 4ompanies. Institutional e.g. individual, @indu undivided families,

-on'investment 4ompany#s etc.

( professional, who manages other people#s or institution#s investment portfolio with the

object of profitability, growth and risk minimi$ation, is known as a portfolio manager.

The portfolio manager performs the job of security analyst. In case of medium and large

si$ed organi$ation, job function of portfolio manager and security analyst are separate.

%ortfolios are built to suit the return e pectations and the risk appetite of the investor.

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%reference shares

Government securities and bonds

/ther debt instruments

+nder variable income securities1

0!uity 2hares

"oney market securities like treasury bills commercial paper etc.

( portfolio manager has to decide up on the mi of securities on the basis of contract with the

client and objectives of portfolio.

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FU%CTIO%S OF PORTFO$IO MA%A'EME%T

The basic purpose of portfolio management is to ma imi$e yield and minimi$e risk. 0very

investor is risk averse. In order to diversify the risk by investing into various securities following

functions are re!uired to be performed.

The functions undertaken by the portfolio management are as follows1

To frame the investment strategy and select an investment mi to achieve the desired

investment objective?

To provide a balanced portfolio which not only can hedge against the inflation but can

also optimi$e returns with the associated degree of risk?

To make timely buying and selling of securities?

To ma imi$e the after'ta return by investing in various ta es saving investment

instruments.

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*HY PEOP$E I%VEST+

Investors do invest in different instrument to simplify their lifestyle and to make certain goals in

future life. "ost investors invest for the long term to fulfill the inflation and for the capital

appreciation. )y and large the investors have typical re!uirement to fill, and those are1'

Ca,ita( ,re ervati!":

The chance of losing some capital has been a primary need. This is perhaps the strongest need

among investors in India, who have suffered regularly due to failures of the financial system.

*ea(t- .e"erati!":

This is largely a factor of investment performance, including both short'term performance of an

investment and long'term performance of a portfolio. 3ealth accumulation is the ultimate

measure of the success of an investment decision.

$i)e C!ver:

"any investors look for investments that offer good return with ade!uate life cover to manage

the situations in case of any eventualities. Recent days investors do invest in the endowment

policies and + I%s.

Ta/ avi". :

egitimate reduction in the amount of ta payable is an important part of the Indian psyche.

0very rupee saved in ta es goes towards wealth accumulation.

I"c!me:

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This refers to money distributed at intervals by an investment, which are usually used by the

investor for meeting regular e penses. "ostly daily traders invest for income.

F0t0re U"certai"ty:

-o one has seen the future so every person personally save money for any contingencies. %eople

invest in short term for this. There must be an easy cash withdraw for the contingencies.

Ea e !) 1it-#ra1a(:

This refers to the ability to invest long term but withdraw funds when desired. This is strongly

linked to a sense of ownership. It is normally triggered by a need to spend capital, change

investments or cater to changes in other needs.

Beat i")(ati!":

Inflation is a major player in the economy. It reduced the valuation of rupee. Investors do in vest

to maintain the buying capacity of them.

Retireme"t ,(a""i".:

"ost of the service person do invest to get return after the vesting period, for that the investment

such a manner that the returns comes at the time of retirement.

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%EE& FOR PORTFO$IO MA%A'EME%T:

%ortfolio "anagement is a process encompassing many activities of investment in assets and

securities. It is a dynamic and fle ible concept and involves regular and systematic analysis,

judgment and action. The objective of this service is to help the unknown and investors with the

e pertise of professionals in investment portfolio management. It involves construction of a

portfolio based upon the investor#s objectives, constrains, preference for risk and returns and ta

liability. The portfolio is reviewed and adjusted from time to time in tune with the market

conditions. The evaluation of portfolio is to be one in terms of targets set for risk and returns.

The changes in the portfolio are to be effected to meet the changing condition. %ortfolio

construction refers to the allocation of surplus funds in hand among a variety of financial assets

open for investment. %ortfolio theory concerns itself with the principles governing such

allocation.

The modern view of investment is oriented more go towards the assembly of proper combination

of individual securities to form investment portfolio. ( combination of securities held together

will give a beneficial result if they grouped in a manner to secure higher returns after taking into

consideration the risk elements. The modern theory is the view that by different regions, in

different industries or those producing different types of product lines. "odern theory believes in

the perspective of combination of securities under constraints of risk and returns.

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IMPORTA%CE OF PORTFO$IO MA%A'EME%T

In the past one'decade, significant changes have taken place in the investment climate in India.

%ortfolio management is becoming a rapidly growing area

serving a broad array of investors' both individual and institutional'with investment portfolios

ranging in asset si$e from thousands to cores of rupees. It is becoming important because of the

following reasons1

0mergence of institutional investing on behalf of individuals. ( number of financial

institutions, mutual funds, and other agencies are undertaking the task of investing money

of small investors, on their behalf.

Growth in the number and the si$e of invisible fundsAa large part of household savings is

being directed towards financial assets.

Increased market volatility' risk and return parameters of financial assets are

continuously changing because of fre!uent changes in governments industrial and fiscal

policies, economic uncertainty and instability.

Greater use of computers for processing mass of data.

%rofessionali$ation of the field and increase use of analytical methods ;e.g. !uantitative

techni!ues< in the investment decision'making, and

arger direct and indirect costs of errors or shortfalls in meeting portfolio objectives'

increased competition and greater scrutiny by investors.

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A&VA%TA'ES OF PORTFO$IO MA%A'EME%T

Individuals will benefits immensely by taking portfolio management services for the following

reason1 '

3hatever may be the status of the capital market? over the long period capital markets

have given an e cellent return when compared to other forms of investment. The return

from bank deposits, units etc., is much less than from stock market.

The Indian stock markets are very complicated. Though there are thousands of companies

that are listed only a few hundred, which have the necessary li!uidity. It is impossible for

any individual wishing to invest and sit down and analyses all these intricacies of the

market unless he does nothing else.

0ven if an investor is able to visuali$e the market, it is difficult to investor to trade in all

the major e changes of India, look after his deliveries and payments. This is further

complicated by the volatile nature of our markets, which demands constant reshuffling of

port

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PORTFO$IO MA%A'EME%T PROCESS

Investors like to invest through the instinct and want to gain profit from the market by investing.

@owever, while financial institutions are undoubtedly a part of the process of investing. (s

investors, it is not surprising that we focus so much of our energy and efforts on investment

philosophies and strategies, and so little on the investment process.

STEPS I%VO$VE& I% I%VESTME%T P$A%%I%'

Investment is not only prediction it has its own reasons behind every up and down in the market.

2o it is has its own theory to move in particular directions. To get in to the market investors must

go through the following process.

A"a(y i a"# ,r!)i(i". !) t-e i" tr0me"t 1

The first step is performing a -eed (nalysis check. The re!uirements and e pectations of the

investor should be met by the instrument. uring the profiling investor should consider their age,

their profession, the number of dependents, and their income. )y doing this check, the risk

profile of the investor should be designed.

Eva(0ati". t-e a(ter"ative 1

The ne t step would be revaluating the needs. /ther investment instruments and options should

be analy$ed. The risk'return profile of investment products is evaluated in this step. 0very

investment product varies according to its return potential and riskiness. Investment products

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giving a high rate of return are generally risky and volatile. The products giving a lower rate of

return usually are less risky.

A"a(y2e t-e Pr!)i(e 1

The ne t step would be analy$e the risk'return profile of the investor on to the investment

portfolio. The investment instruments are matched with the risk'return profile of the investor. (ll

the investment alternatives that offer e pected rate of return are evaluate for consideration.

Pre,ari". a" O,tim0m P!rt)!(i! 1

Then according to the risk appetite and return pattern an optimum portfolio is designed for the

investor. The basket of investment instrument selected in the previous step are given due

weightage and appropriate amount of money is invested in each of the investment avenue so as

to get ma imum return with minimum possible risk.

C!" i te"t M!"it!ri". 1

*inally a continuous watch on the portfolio is e tremely important. *undamental analysis of the

investment products done in the previous stages would only help in selecting the right product

but the right time of entry or e it from a particular stream is evaluated by doing a technical

analysis. *or this professional portfolio management is a must.

16

(nalysis and profiling of

the instrument

0valuating the

alternatives

Investment %lanningInvestment %lanning

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17

(nalyse the

%rofile

%reparing an

/ptimum

%ortfolio

4onsistent

"onitoring

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P!rt)!(i! ma"a.eme"t i a c!m,(e/ activity3 1-ic- may be br!4e" #!1" i"t!

t-e )!((!1i". te, :

S,eci)icati!" !) i"ve tme"t !bjective a"# c!" trai"t :

The typical objectives sought by an investor are current income, capital appreciation,

safety, fi ed returns on principal investment.

C-!ice !) a et mi/:

The most important decision in portfolio management is the asset mi decision. This is

concerned with the proportions of :2tock or :+nits of mutual fund or :)ond in the

portfolio. The appropriate mi of 2tock and )onds will depend upon the risk tolerance

and investment hori$on of the investor.

F!rm0(ati!" !) ,!rt)!(i! trate.y:

/nce the certain asset mi has been chosen an appropriate portfolio strategy has to be

decided out. Two broad portfolio choices are available. (n active portfolio management1

it strive to earn superior risk adjusted returns by resorting to market timing, or sector

rotation or security selection or some combination of these. ( passive portfolio

management involves holding a broadly diversified portfolio and maintaining a pre'

determined level of risk e posure.

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MO&ER% PORTFO$IO THEORY

Ri 4 a"# Ret0r" i" a ,!rt)!(i! c!"te/t

+sually the investment is not in single stock but in a combination of stocks that is called a

:portfolio . A ,!rt)!(i! i #e)i"e# a 5mi/e# ba. !) ec0ritie 67 This is best understood by

taking the e ample of :"utual *unds . Bou must have heard of :mutual funds in India, like

*ranklin Templeton "utual *unds, (llian$ "utual *unds, +nit Trust of India, Codak "ahindra

"utual *und etc. These funds invest in1

ifferent industries ;also called sectors years

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A..re ive I"ve t!r 1

(ggressive investors commonly do most of their investments in the stock market, which

is an increased risk. They also tend to invest in business ventures and real estate at high

risk. *or e ample, if an aggressive investor puts his money into a larger building, then

invests more money to renovate the property are in danger. They e pect to be able to

apartments for more money than the rent flats currently for sale are worth it A 3hole or

the property for a profit on their original investment. In some cases this has worked well

and not in others. There is a risk. (ggressive investors tend to concentrate on e!uity

investments such as individual stocks and mutual funds. They are open to more risk,

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willing to see large short term swings in market performance on an annuali$ed basis.

They aim for large growth in the market, often above what the long term market

performance has shown. They are also seeking !uick growth in their portfolio, and some

are even called M ay Traders.M The recommendation for this investor is to have a

minimum timeframe of 56 years before they will need their principal investment, to allow

for variations in the market to average out. The average rates of return that an aggressive

investor e pects to see is between 5E'5HF, a few percentage points above the long term

stock market average.

VARIOUS I%VESTME%T OPTIO%S

2avings form an important part of the economy of any nation. 3ith the saving invested in

various options available to the people, the money acts as the driver for growth of the country.

There are basically two kinds of investments. /ne that gives returns at fi ed rate and other where

the rate of return is depending upon the certain factors of the economy.

Fi/e# Ret0r" O,ti!"

%ost office monthly income scheme

%ublic provident fund

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)ank fi ed deposits

Government securities or gilts

R)I ta able bonds

4ompany fi ed deposits

Infrastructure bonds

)onds

Variab(e Ret0r" O,ti!"

"utual *unds

2hare and 2tock market

%rimary invested in e!uity ;I%/ years.

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B!"# :

( bond is just an organi$ationDs I/+? i.e., a promise to repay a sum of money at a certain interest

rate and over a certain period of time. In other words, a bond is a debt instrument. /ther

common terms for these debt instruments are notes and debentures. "ost bonds pay a fi ed rate

of interest for a fi ed period of time.

&i))ere"t ty,e !) b!"#

In general there are few types of bonds available in the market to buy, like?

'!ver"me"t b!"# 1

These bonds are issued by the government to raise money from the public.

Bi(( : ebts securities maturing in less than one year.

%!te : ebt securities maturing in one to ten years.

B!"# : ebt securities maturing in more than ten years.

Mar4etab(e ec0ritie )r!m t-e I"#ia" .!ver"me"t A known collectively as Treasuries

and are as Treasury bonds, Treasury notes and Treasury bills.

M0"ici,a( B!"# :

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"unicipal bonds, known as :munis , are the ne t progression in term of risk. The major

advantage in munis is that the returns are free from 2tate9central ta . ocal government some

time makes their debt non'ta able for residents, thus making some municipal bonds completely

ta free. )ecause of the ta 'savings yield in munis is lower than the ta able bonds.

C!r,!rate b!"# :

( company can issue bonds just as it can issue stock. Generally, a short term corporate bond is

less than five years? intermediate is five to twelve years, and long term is over 5E years.

4orporate bonds are characteri$ed by higher yields because there is a higher risk of a company

defaulting than a government. The company#s credit !uality is most important1 the higher the

credit !uality, lower the interest rate the investor receives. )ondholders are not owners of the

corporation. )ut if the company gets in financial trouble and needs to dissolve, bondholders must

be paid off in full before stockholders get anything.

=er! c!0,!" B!"# :

This is a type of bond that make no coupon payments but instead is issued at a considerable

discount to par value. *or e ample, let us say, a $ero coupon bond with a Rs. 5,777 par value and

57 years to maturity is trading at Rs. K77? then investor would be paying Rs.K77 today that will

worth Rs. 5,777 after 57 years.

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Variab(e Ret0r" O,ti!"

M0t0a( F0"# :

( mutual fund is a company that pools the money of many investors to invest in a variety of

different securities. Investment may be in stocks, bonds, debentures, money market or

combination of these. These securities are professionally managed on the behalf of investor, by

the fund manager.

The investor can make money from a mutual fund in three ways1

Income is earned from dividends on stocks and internet on bonds. ( fund pays out nearly

all of the income it receives over the year to fund owners in the form of a distribution.

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If the fund sells securities that have increased in price, the fund has a capital gain. "ost

funds also pass on these gains to investors in a distribution.

If fund holdings increase in price but are not sold by the fund manager, the fundDs shares

increase in price. Bou can then sell your mutual fund shares for a profit. *unds will also

usually give you a choice either to receive a check for distributions or to reinvest the

earnings and get more shares.

S-are a"# t-e St!c4 Mar4et:

(n e!uity share is a certificate or a book entry that represents the single unit of ownership in a

company or its business. They are sold either directly by the company or they can be ac!uired

through broker from the stock market. )y purchasing a share of a company, an individual gets an

ownership rights, right to vote and share in the company#s future profits and losses.

Primary Mar4et I"ve tme"t i" E;0ity 8IPO9

The primary market is a place where the new offerings by companies are made as an Initial

%ublic /ffering ;I%/< I%/#s are offering made by the company for the first time in the market.

2uch offers to the public can be at par or can be at premium.

Sec!"#ary Mar4et I"ve tme"t i" E;0ity:

The stock e change is a place where buyers and sellers meet to trade in shares in an organi$ed

manner. There are at present EK recogni$ed stock e changes in the country and are governed by

security board of India ;20)I

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&erivative3 F0t0re a"# O,ti!" :

erivative is a contract9 product that has no independent value i.e. it derives its value from the

underlying assets. +nderlying assets can be securities, commodities, bullion, currency, livestock

or anything else. Through the use of derivative product, an investor can transfer the price by

locking in asset prices.

'!(#:

/f late, an inverse relationship between the dollar and gold has been in India. The lower the

dollar goes, the higher is the gold prices. 3hy does this happenN The dollar is the international

currency with nothing besides gold to challenge it. )esides being a commodity, gold is a

universally accepted form of money. India is a net importer of gold. The domestic production is

almost negligible and India is the highest consumer of gold in the world.

Rea( e tate:

Investment in real estate or property is a good long term investment for well'heeled investors

with a huge amount of money. epending on the total resources at your disposal, you can invest

a part of it in property.

F!rei." E/c-a".e A et :

Till Oanuary E77H, Indian residents# investors were not allowed by our e change control rules to

invest in foreign e change assets. Recently, the reserve bank of India has allowed residents to

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invest overseas to the e tent of an e!uivalent of +2 P E6,777 per year. -ow investor from India

can take advantage of any attractive investment opportunity overseas.

&ATA A%AYSIS

1. I"ve t!r> a.e

5 '>7

>5'H7

H5'67

Q67

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*ig1 istribution of age groups in the sample

E/,(a"ati!":

The above pie chart shows that the sample of 567 is predominantly consist of respondents of the

age groups of 5 '>7 years and >5'H7 years. This reveals that most of the investors are them who

are started their career recently or working for 57'56 years. This also shows that the age group of

greater than 67 years is very less interested in investment.

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2. Occ0,ati!":

2ervice

)usiness

2elf 0mployed

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*ig1 istribution of occupation throughout the sample

E/,(a"ati!":

This graph shows that the respondents are mostly from the service class ;K5F< and business

person consists of only > F of respondents. 2elf employed are very less in numbers.

3. *-at i y!0r m!"t-(y i"c!me+

E,67,777

E,67,777 A 6,77,777

6,77,777' ,67,777

,67,777 A 57,77,777

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Q 57,77,777

*ig1 istribution of sample annual income wise

E/,(a"ati!":

In the sample the income group of E,67,777 to 6,77,777 Rs is dominating. It reveals that this

income group were the major respondent in the survey. The second major income group is the

,67,777 to 57,77,777. "ost investors are from the income group of E,67,777 to 6,77,777and

,67,777 to 57,77,777 which is enthusiastic for the companies as the potential customers are

from the medium investor and the bid investors.

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4. Y!0r &i ,! ab(e I"c!me i" t-e m!"t-+

6777

6777' 57,777

57,777' 56,777

56,777'E7,777

QE7,777

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*ig1 istribution of disposable income

E/,(a"ati!":

The pie shows that the major respondents have a disposable income of 6,777 to 57,777 Rs per

month which is good enough money for an investor who is investing regularly for the longer

term. It also depicts that investors who has a disposable income of more than E7,777 Rs is 596th

of the sample. This reveals company got a fair enough data base of high amount investors.

5. *-at ,erce"ta.e !) y!0r m!"t-(y i"c!me #! y!0 ave+

ess than E6F

)etween E6F and 67F

)etween 65F and 6F

"ore than 6F

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*ig1 istribution of monthly income saved by the sample

E/,(a"ati!":

-ow above diagram shows that ue to inflation or other reasons saving capacity of people has

reduced drastically. (lmost H surveyed people saves ess than E6F and KE people saves

between E6F and 67F of their monthly income. 2till we have many investors whose saving is

very high, so there is vast scope to convert their saving in investments.

6. &0ri". t-e "e/t )ive year 3 y!0r m!"t-(y i"c!me 1i(( m! t (i4e(y:

ecline

Remain about the same

Increase slightly

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Increase significantly

*ig1 -e t five years the monthly income of investor will likely

E/,(a"ati!":

This shows that due to @igh economic growth and good scope of industriali$ation employee

growth has increased tremendously that#s why most of the surveyed people thinks that their

salary would increase significantly or slightly.

7. I" 1-ic- !) t-e )!((!1i". )!rm #! y!0 ave m!"ey 8 e(ect a(( t-at a,,(y9

* #s9R

"utual *und

%*9%%*

50

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ife Insurance

irect 0!uity

Real estate

Gold

/ther

*ig1 istribution to save the money by the sample.

E/,(a"ati!":

The data gives the information that most of the surveyed persons prefer to invest in * #s99R .

They don#t feel safe to go for risky but high return investment. )ut there is also huge ratio of

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investment in Gold and "utual *und, this shows that there is also huge scope in 8ariable return

options.

8. *-ic- !) t-e )!((!1i". i"ve tme"t 1!0(# y!0 )ee( m! t c!m)!rtab(e 1it- ta4i". i"t!

c!" i#erati!" t-e ri 4 ret0r" tra#e !))+

0!uity securities of established companies

"i of e!uity securities and government bonds

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Government bonds

*ig1 istribution of investment that investor feel comfortable.

E/,(a"ati!":

(bove diagram shows that E surveyed people wants to invest in 0!uity securities of established

companies, which is highest of all. This shows that most of the people are (ggressive investor

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and ready to take risk for high return. (lmost KE people out of 567 want to invest in "i of both

0!uity and )onds. They wants moderate return with moderate risk.

9. *-at i y!0r )ir t ,ri!rity )!r i"ve tme"t )!c0

4apital %reservation

*uture +ncertainty

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investors focus would be the main criteria where he wants to invest in. depending up on the

response I have found out that 5 F people invest to secure for *uture +ncertainties and 5=F

fight against inflation and do invest for only 4apital %reservation. /nly =F people focus on their

retirement time and invest for vesting period.

10. I" -!1 ma"y year 1!0(# y!0 1a"t t! 1it-#ra1 y!0r i"ve tme"t

> years

> A 6 years

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*ig1 Risk tolerance ability

E/,(a"ati!":

The research showed that the most investors are risk averse and goo for the moderate risk. HEF

investors are in this category. This is good news for the market that only EEF of investors are

with low risk apetite. The low risk apetite investor mostly invested in the fi ed return

instruments. F investors have very high and E=F investors have high risk profile, they usually

invest in the stocks and mutual fund, where the risk is high and the returns are also high in

proportion.

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12. H!1 m0c- time ca" y!0 acce,t "e.ative ret0r"+

-ever accept negative return

/nce in > years

/nce in 6 years

/nce in years

4an fluctuate in long run

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*ig1 Risk bear acceptability

E/,(a"ati!":

Investor#s negative return acceptability shows how he9she can accept the market up'downs

positively. If they really take it to the account then the can sustain in the market for the longer

time. In the above pie chart S-ever accept return# shows the group with low risk appetite where

as Sonce in > years# & Sonce in 6 years# represents the group with moderate risk appetite. Sonce

in years# & Scan fluctuate in long run# represents the group with high or very high risk appetite.

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Though this is not applied to all, as risk assumption is different for every other person. @ere,

>KF investors need always positive returns or assured return, whereas >7F of investors can have

a moderate risk bearing appetite. (nd rest >HF investors can bear the high risk.

FI%&I%'S:

It clearly shows that the age group of 5 '>7 years has the most disposable income per

month because most of them are single. "ore the age grows the disposable income reduced

may be because the family e penses and the living e penses increased.

The age group of 5 '>7 years are highly invested in the mutual funds and share "arket

whereas >5'H7 years age group is also invested in all the instrument but they are !uite

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heavily invested in the real estate sectors whereas more than 67 years age group are most

invested in the * & R)I bonds.

Risk tolerance is the major concern in the investment market. If the risk is high then return

e pected is high for the investors. (ge is also considered for the risk tolerance. It is

e pected that the lower the age group risk tolerance is high

"ost of the respondents are in the >'6 years group. They remain invested for the a full

cycle of bear turn and bull turn. The age group of >5'H7 years are likely to remain invested

in K'= years.

The age group of 5 '>7 has higher acceptability of negative returns whereas the age group

of >5'67 has lower acceptability of negative returns whereas the age group of more than 67

years can accept negative returns.

2ervice category are likely to invest in the *i ed eposits and "utual *unds because fi ed

deposits gives fi ed rate of return whereas mutual funds is risk diversified. )usiness class

is more attracted towards the 2hares and real estate because they have the lum sum amount

to invest in the single time. *or the 2elf employed category, they are mostly invested in the

*i ed eposits and Insurance sector.

In the 2ervice category the investment focus is the ta savings, whereas for the )usiness

class 4apital preservation and *uture +ncertainty playes a big role in their investment

planning.

2elf employed category cannot accept negative return. In 2ervice category most investors

are risk averse, but few of them are now started to invest in the riskier profile so negative

acceptability is present. *or the business class, they are mostly invested in shares & mutual

funds, as results they responded S/nce in > years# and S4an fluctuate in long term#. The

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investor who want to stay for > years are the short term players, whereas the long term

players can accept ups & downs in their investment for the higher return.

RECOMME%&ATIO%

The age group of 5 '>7 can be a great potential investors for the company as has high

risk profile, more disposable income, and the time hori$on is perfect >'6 years. "utual

*unds can also be offered as they have high risk profile. 4ompany should take initiative

to get emat account of these customers.

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isposable Income )racket of Rs.56,777'Rs.E7,777 are the strong contenders for

investing their money and these people have invested in real estate, insurance and fi ed

deposits. "oreover there is mi ed preferences for their investments thus proper

segmentation of the sample should be done accordingly marketing strategies should be

adopted.

CO%C$USIO%

(s the market is doing well, current prices of various stocks have increased when compared to

purchase prices. Therefore, investor will get positive returns.

2ince the term :returns from an investment refers to the benefits that an investor receives from

that particulars investment, hence we can infer that portfolio is generating more returns when

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their own. @owever, it can be said that the future of portfolio management is bright in years to

come.

BIBI$O'RAPHY:

2ecurity (nalysis & %ortfolio "anagement by %R(2(--( 4@(- R(, Tata "cGrawhill publishers.

*inancial management ;-inth edition< by I " %andey.

2ecurity analysis and %ortfolio management by Ritu (huja.

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*EBO'RAPHY:

1117b"r ec0ritie 7c!m

1117" ei"#ia7c!m

1117i"ve t!,e#ia7c!m

1117b ei"#ia7c!m

1117ec!"!mictime 7c!m

1117 ebi7.!v7i"

1117m!"eyc!"tr!(7c!m

69

http://www.bnrsecurities.com/http://www.nseindia.com/http://www.investopedia.com/http://www.bseindia.com/http://www.economictimes.com/http://www.sebi.gov.in/http://www.moneycontrol.com/http://www.bnrsecurities.com/http://www.nseindia.com/http://www.investopedia.com/http://www.bseindia.com/http://www.economictimes.com/http://www.sebi.gov.in/http://www.moneycontrol.com/

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