ANGEL BROKING LTD.

SUMMER TRAINING PROJECT REPORT

ON

CONSUMER BEHAVIOUR REGARDING

SECURITIES MARKET AND COMMODITY
MARKET

SUBMITTED TO
Ms.RITIKA SINGLA

SUBMITTED BY
NUPUR TEWARI
MBA III SEM 2009-2011
Department of management
ShriRamswaroop Memorial College
of Engineering and Management

1
 ACKNOWLEGEMENT

A summer training project is an internal part of an MBA curriculum. It helps the

student to undergo a simulation test of what the student is going to face in this
futures job sphere and a taste of practicality. It helps the students to understand how
an organization works. The competitive atmosphere , the ups and downs in the cycle
of the organization, the enthusiasm of interacting with newer people and gaining
vast practical knowledge is what a summer trainee goes through during his/her
weeks in the organization.
My project in Angel Broking Ltd. is an experience worth sharing. The
summer training project has enhanced my managerial skills and made me apt to face
all the hurdles in my future.
The vast knowledge that I have gained in these 6 weeks in Angel
Broking Ltd., I have tried to put them down in this project report. I am really
thankful to Ms. RITIKA SINGLA and Angel Broking Ltd Lucknow. For constantly
mentoring my efforts and guiding me for making this project a success.
Last but not the least I consider myself proud to be a part of
ShriRamswaroop Memorial College of Engineering and Management and specially
would like to thanks for helping me with my summer training.
I am greatly indebted to all my family members and friends for their
support and encouragement.

2
 Preface

The report is all about the consumers behavior and their

awareness regarding securities market and commodity market.

Securities market is an economic institute within which take place sale and
purchase transactions of securities between subjects of economy on the base of
demand and supply. Also we can say that securities market is a system of
interconnection between all participants (professional and nonprofessional) that
provides effective conditions: to buy and sell securities,

• to attract new capital by means of issuance new security (securitization of

debt),
• to transfer real asset into financial asset,
• To invest money for short or long term periods with the aim of deriving profit.

Commodity markets are markets where raw or primary products are exchanged.
These raw commodities are traded on regulated commodities exchanges, in which
they are bought and sold in standardized contracts.

3
 CONTENTS

Page
S.No. Topic
No.
1 Introduction of Angel Broking 1-2
2 Key developments of Angel Broking 3
3 Management of Angel Broking 4-8
4 Potential competitors for Angel Broking 9-11
5 SWOT Analysis 12-13
6 Securities market 14-21
9 Bombay Stock Exchange 22-26
10 National Stock Exchange 2-32
11 Trading membership 33-36

12 Commodity markets 37-43

13 Multi Commodity Exchange 44-45
14 National Commodity & Derivatives Exchange Limited 46-48
15 Methodology 49
16 Objective and feedback 50
17 Findings and Data Analysis 51-67
18 Conclusion 68

19 Questionnaire 69-70
20 References 71

Angel Broking Limited

4
Angel Broking Limited is one of the leading and professionally managed stock
broking firm involved in quality services and research. Angel Broking Limited is a
corporate member of The Stock Excange, Mumbai.

The membership of the company with The Stock Exchange Mumbai was originally
in the name of Mukesh R. Gandhi, which was eventually turned into a corporate
membership in the name of Angel Broking Limited.

Angel Broking Limited is managed by Mr. Dinesh Thakkar and he is well

supported by Mr. Mukesh Gandhi, a fifteen years veteran in the market.

The group is well supported by a professional and qualified research team and
efficient operations and back office team, which comprises of highly dedicated and
qualified individuals. Angel has an in-house, state of art research department.

Angel believes in reaching out to the customer at the farthest end rather than by
reaching out to them. The company in its endeavour to give its client the best has
opened up several branches all over Mumbai, which are efficiently integrated with
the Head Office.

Angel Broking Limited is primarily into retail stock broking, with a customer base
of retail investors, which has been increasing at a compounded growth rate of
100% every year. The company has huge network sub-brokers in Mumbai and
other places outside Mumbai, registered with SEBI, who act as chanel partners for
the company. The company presently has a total staff strength of around 150
employees who are spread accordingly across the head office and all the branches.

Angel has empowered its physical presence throughout India through various
strategies which it has been adopting efficiently and effectively over a period of
time, like opening up of branches at various places, tie-ups with various agencies
and sales agents, buy-outs of smaller regional outfits and appointment of sub-
brokers and franchisees. Moreover Angel has been tapping and including high net-
worth and self-employed individuals it its vast array of clients.

5
Angel has always strived in the direction of delivering ultimate client satisfaction
and developing stronger bonds with its customers and chose partners. Angel has a
vision to introduce new and innovative products and services regularly. Moreover
Angel has been one among the pioneers to introduce the latest technological
innovations and integrate it efficiently within its business.

Angel Broking's tryst with excellence in customer relations began in 1987. It has
emerged as one of the most respected Stock-Broking and Wealth Management
Companies in India. With its unique retail-focused stock trading business model,
Angel is committed to providing ‘Real Value for Money’ to all its clients.

KEY DEVELOPMENTS FOR ANGEL BROKING LTD.

Angel Broking Ltd. to Invest INR 300 Million in Financial Year 2010

6
Angel Broking Ltd. Announced that it is planning to invest around INR 300
million this financial year for expanding its branch network. The company is
looking to invest around INR 250-300 million in this financial year for expanding
its network by 50 branches. The investment is in line with expansion strategy
which sees huge potential in the long term. Under its expansion plans, the company
would focus on few areas in the northern and southern regions including Punjab,
Haryana, New Delhi, Tamil Nadu and Karnataka. The firm is also eying to tap
semi-urban pockets which have huge investment potential.

Angel Broking In Talks To Raise Funds

Angel Broking Ltd. plans to finalize INR 2 billion – INR 2.5 billion fund raising
plans between December 2009 and March 2010. Dinesh Thakkar, Angel Broking’s
CMD said, “We are got active interest from the US and UK-based institutions. We
are open to diluting a significant stake.” He did not reveal the valuations, because
discussions were still in a preliminary stage.

Angel Broking Ltd. Announces Executive Appointments

Angel Broking Ltd. announced four key-appointments for its domestic operations.
Hitungshu Debnath has been appointed as the head of its distribution & wealth
management services while Mudit Kulshreshtha will take over as the head of
strategic business intelligence and advanced analytics initiatives. The company has
also named Adil Kasad as the Chief Financial Officer (CFO) and Santanu Syam as
head of retail operations across all business verticals.

[Angel Broking Ltd: BSE SEBI Regn No: INB 010996539 / CDSL Regn No: IN -
DP - CDSL - 234 - 2004 / PMS Regn Code: PM / INP000001546 Angel
Commodities Broking]

MANAGEMENT OF ANGEL BROKING

Mr. Dinesh Thakkar - Founder Chairman & Managing Director

7
The Angel Group of Companies was brought to life by Mr. Dinesh Thakkar. He
ventured into stock trading with an intention to raise capital for his own
independent enterprise. However, he recognised the opportunity offered by the
stock market to serve individual investors. Thus India’s first retail-focused stock-
broking house was established in 1987. Under his leadership, Angel became the
first broking house to embrace new technology for faster, more effective and
affordable services to retail investors.

Mr. Thakkar is valued for his understanding of the economy and the stock-market.
The print and electronic media often seek his views on the market trend as well as
investment strategies.

Mr. Lalit Thakkar - Director – Research

Mr. Lalit Thakkar is the motivating force behind Angel’s highly acclaimed
Research team. He’s been a part of the senior management team since the Angel
Group’s inception. His technical and fundamental outlook has provided impetus to
Angel’s market research team. Research-based & personalized advisory services
are Angel’s forte, and Mr. Lalit Thakkar has undoubtedly been the brain behind it.

When it comes to analyzing the market, Mr. Lalit Thakkar is truly a genius. His
hands-on experience and fundamental knowledge of the market can predict the
market trend early. His views on the market trend are often quoted in the print and
electronic media

Mr. Amit Majumdar - Chief Strategy Officer

8
A chartered Accountant by qualification, Mr. Amit Majumdar is a key member of
Angel’s strategic decision-making process. He has been with the group since
August 2004. He has handled several functions of the group like finance and
operations, to name a few. He has rich experience in finance, investment banking,
treasury, consultancy and advisory services.

Mr. Majumdar has led many successful initiatives for the group. Before joining the
Angel Group, Mr. Majumdar has been associated with Rabo India Finance, Ambit
Corporate Finance and Ernst & Young.

Mr. Sachinn Joshi - Executive Director & CFO

Mr. Sachinn R Joshi brings with him over 19 years of experience handling
strategic positions in Business Operations & Finance. He also has hands-on
experience in Resource Raising, Strategic Planning, Business Restructuring, Public
Listing (Local/ International), etc

A Chartered & a Cost Accountant by qualification, Sachinn is also a post graduate

in Law and has completed a one year Certificate Program (BLP II) from IIM
(Kolkatta). He has been associated with reputed firms such as Navneet Group of
Companies, Lupin Laboratories Ltd and Infrastructure Leasing & Financial
Services Ltd. (IL&FS). His last assignment which spanned over 11 years was with
IL&FS Investsmart Group where he worked in various capacities such as Chief
Financial Officer, Executive Director- Finance & Operations and Chief Operating
Officer

9
Mr. Vinay Agrawal - Executive Director – Equity Broking

Mr. Vinay Agrawal leads the Equity Broking business at Angel, which comprises
Business Development, Operations, Product Development and E-broking initiative.
He is actively involved in exploring new ways to adopt technology for business
enhancement.
A Chartered Accountant by qualification, Mr. Agrawal began his career with the
Angel Group as Finance and Operations Consultant, and since then he’s quickly
climbed up the corporate ladder.

Mr. Nikhil Daxini - Executive Director - Sales and Marketing

With an MBA in finance, Mr. Nikhil Daxini has been instrumental in introducing
the concept of professional marketing of broking services at Angel. His area of
focus is Business Development, Risk Management and Operations.Mr. Daxini has
immense experience in the marketing of financial products and services. He has
been associated with HDFC Bank Ltd. in the past.

Mr. Mudit Kulshreshtha - Executive Director - Business Intelligence &

Analytics

10
Mr. Mudit Kulshreshtha heads the advance analytics and strategic business
intelligence division at Angel. With a Bachelor’s degree in Engineering and PhD in
Economics, Mr. Mudit Kulshreshtha has more than 12 years experience in the field
of strategy and business consulting.

He has been associated with reputed consulting firms like Deloitte Consulting
India, Ernst and Young, Arthur Andersen and WNS Global. He has advised several
big clients in the U.S. and U.K. He is also a known speaker at public seminars and
conferences organised by CII, NASSCOM, Indian School of Business and IIT.

Mr. Santanu Syam - Executive Director - Operations

Mr. Syam brings with him over 18 years of experience in the field of Transaction
Banking, Wholesale Banking, Treasury Banking, Consumer Banking and CBS. He
started his career with ANZ Grindlays Bank and he was also associated with
Standard Chartered Bank in India as Director Transactional Banking.

Mr. Syam followed up his Engineering degree with an MBA. He has also attended
Banking & Technology seminars organised by SCB Singapore, BSE India & Euro
Finance.

Mr. Ketan Shah - Associate Director - Information Technology

11
IT is a strategic function at Angel. And Mr. Ketan Shah is involved in the
designing of Angel’s IT policies and Strategies. Mr. Shah leads all IT-related
activities from planning and budgeting to implementation and maintenance.

Mr. Shah has over 18 years of industry experience. He has been involved in
various aspects of Business Operations in his previous assignments.

Ms. Pinky Kothari - Associate Director - Sales And Marketing

Ms. Pinky Kothari is responsible for development and expansion of the Angel
Group’s business in Southern India. She started her career at Angel as Business
Development Executive. She was then appointed the head of Surat Branch and the
South Gujarat region, before assuming the role of Associate Director.

A qualified Company Secretary and an MBA in Finance, Ms. Kothari has vast
experience in business development in the financial services industry.

12
Other broking firms:
Many times new investor or trader gets confusion for open a D Mat and trading
Account in Broking house. Many of Broking House promises to you for better
service but clients get problem due to trading session in theirs Broker house firm.
Here we are giving list of India’s top 10 Broking House on base of survey of
investor and trader of many cities. In their views following Broking Houses gives
best and reliable services

ICICI direct.com, India Infoline, Kotak Securities Ltd., Share Khan, Indiabulls,
Motilal Oswal, Bajaj Capital, SMC, Angel Broking , Reliance Money

POTENTIAL COMPETITORS FOR ANGEL BROKING

Sharekhan
Share khan is the retail broking arm of SSKI, an organization with more than eight
decades of trust & credibility in the stock market. It is India's leading retail
financial Services Company with We have over 250 share shops across 115 cities
in India. While our size and strong balance sheet allow us to provide you with
varied products and services at very attractive prices, our over 750 Client
Relationship Managers are dedicated to serving your unique needs.Sharekhan is
lead by a highly regarded management team that has invested crores of rupees into
a world class Infrastructure that provides our clients with real-time service & 24/7
access to all information and products.. This powerful technology complemented
by our knowledgeable and customer focused Relationship Managers. We are
Creating a world of Smart Investor.Sharekhan offers a full range of financial
services and products ranging from Equities to Derivatives enhance your wealth
and hence, achieve your financial goals.Sharekhan' Client Relationship
Managers are available to you to help with your financial planning and investment
needs. To provide the highest possible quality of service, Sharekhan provides full
access to all our products and services through multi-channels.

13
Kotak Securities Ltd.

Kotak Securities (KS) is India's leading securities broking firm. KS has a strong
presence in retail as well as institutional segments. It caters to the needs of high net
worth individuals, foreign and Indian institutional investors in Indian equities. KS
has a comprehensive research cell with sectoral analysts covering all the major
areas of the Indian economy.

Indiabulls
Indiabulls Financial Services Limited was incorporated on January 10,
2000 as M/s Orbis Infotech Private Limited at New Delhi under the
Companies Act, 1956 with Registration No. 55 - 103183. The name of
Company was changed to M/s. Indiabulls Financial Services Private
Limited on March 16, 2001 due to change in the main objects of the
Company from Infotech business to Investment & Financial Services business. It
became a Public Limited Company on February 27, 2004 and the name of
Company was changed to. Indiabulls Financial Services Limited. Capital Partners,
L.P., R R Capital Partners L.P., and Infinity Technology Trustee Pvt. Ltd. and has
developed significant relationships with large commercial banks such as Citibank,
HDFC Bank, Union Bank, ICICI Bank, ABN Amro Bank, Standard Chartered
Bank, Lord Krishna Bank and IL&FS.

Reliance Money
Reliance money is one of India’s leading private sector financial services
companies, and ranks among the top 10 among the broking houses , in terms of net
worth, Reliance money has interests in asset management and mutual funds, stock
broking, life and general insurance, proprietary investments , private equity and
other activities in financial services

14
Motilal Oswal
The Issuer was incorporated under the Companies Act as Motilal Oswal
Financial Services Limited vide Certificate of Incorporation No. 11- 53397
dated May 18, 2005 issued by the ROC and received the certificate of
commencement of business on June 3, 2005.
The Issuer, along with its Subsidiaries, offers a diversified range
of financial products and services such as retail wealth management including
commodities broking, portfolio management services and institutional broking,
investment banking services, and venture capital management and advisory.

Bajaj Capital

1964 :- Bajaj Capital sets up its first 'Investment Centre' in New Delhi to guide
individual investors on where, when & how to invest. India's first Mutual Fund,
Unit Trust(UTI) of India is incorporated in the same year

1966:- Bajaj Capital expands its product range & includes all UTI schemes and
Government saving schemes in addition to Company Fixed Deposits.

1975:- Bajaj Capital starts offering ‘need based’ investment advice to investors
which would later be christened as ‘Financial Planning’ in the investment world

1991:- SBI issues ‘India Development Bonds’ for NRIs. Bajaj Capital becomes the
top mobiliser with collections over US $ 20 million.

1995:- IDBI & ICICI start issuing their series of Bonds for retail investors. Bajaj
Capital is Co-manager in all these offerings & rank constantly among top 5
mobilisers, on all India basis.

1999:- Bajaj Capital starts marketing Life & General Insurance Products of LIC &
GIC (through associate firm) in anticipation of opening up of the Insurance Sector.
Bajaj Capital achieves milestone of becoming top ‘Pension Scheme’ seller in India
& launches marketing of Health insurance schemes of GIC.

15
 SWOT Analysis

A company has two types of environment:-

Internal Environment Analysis

Strength and Weakness is the internal environment of the company. Clearly the
business has to correct all its weakness and it should not gloat about its strengths.
Sometimes business does poorly not because its department lacks the strength but
because they do not work together as a team eg. Customers, employees etc.

External Environment Analysis

In general, a business has to monitor key macro environment forces (demographic

economies, social, cultural etc) and significant macro environmental factors
(customers, competitors, distributors, suppliers etc) that affect its ability to earn
profits. For development management needs to identify the associated
opportunities and threats. Eg. social, technological, economical, political etc.

A four environmental influences can be described as follows

• A strength is an inherent capacity that an organization can use to gain

strategic advantage.
• A weakness is an inherent limitation or constraints, which creates strategic
disadvantage.
• An opportunity is a favorable condition in the organization’s environment
that enables it to consolidate and strength in its position
• A threat is an unfavorable condition in the organization’s environment that
creates a risk for cause damage to the organization.

16
 Strength:-
• Strong brand image
• It is giving good services
• Good market reputation.
• Strong work force.

Weakness:-
• Lack of advertisement in mass media
• Lack of customer feedback.

Opportunity:-
• Huge market potential

Threats:-
• Better scheme by its competitor
• Existence of other companies.

17
 Securities market

Securities market is an economic institute within which take place sale and
purchase transactions of securities between subjects of economy on the base of
demand and supply. Also we can say that securities market is a system of
interconnection between all participants (professional and nonprofessional) that
provides effective conditions: to buy and sell securities,

• to attract new capital by means of issuance new security (securitization of

debt),
• to transfer real asset into financial asset,
• to invest money for short or long term periods with the aim of deriving
profit.

Functions of securities market

The common market functions of securities market:

• commercial function (to derive profit from operation on this market)

• Price determination (Demand and Supply balancing, the continuous process
of prices movements guarantees to state correct price for each security (So, the
market corrects mispriced securities)
• Informative function (market provides all participants with market
information about participants and traded instruments)
• Regulation function (securities market creates the rules of trade, contention
(споры) regulation, priorities determination)

Specific functions of the securities market

• Transfer of ownership (securities markets transfer existing stocks and bonds

from owners who no longer desire to maintain their investments to buyers who
wish to increase those specific investments. There is no net change in the number
of securities in existence, for there is only a transfer of ownership. The role of
securities market is to facilitate this transfer of ownership. This transfer of
securities is extremely important, for securities holders know that a secondary
market exists in which they may sell their securities holdings. The ease with which
securities may be sold and converted into cash increases the willingness of people
to hold stocks and bonds and thus increases the ability of firms to issue securities)

18
• Insurance (hedging) of operations though securities market (options, futures,
…)

Levels of securities market

Primary market

The primary market is that part of the capital markets that deals with the issue of
new securities. Companies, governments or public sector institutions can obtain
funding through the sale of a new stock or bond issue. This is typically done
through a syndicate of securities dealers. The process of selling new issues to
investors is called underwriting. In the case of a new stock issue, this sale is an
initial public offering (IPO). Dealers earn a commission that is built into the price
of the security offering, though it can be found in the prospectus. Primary markets
create long term instruments through which corporate entities borrow from capital
market.

Features of primary markets are:

• This is the market for new long term equity capital. The primary market is
the market where the securities are sold for the first time. Therefore it is also called
the new issue market (NIM).
• In a primary issue, the securities are issued by the company directly to
investors.
• The company receives the money and issues new security certificates to the
investors.
• Primary issues are used by companies for the purpose of setting up new
business or for expanding or modernizing the existing business.
• The primary market performs the crucial function of facilitating capital
formation in the economy.
• The new issue market does not include certain other sources of new long
term external finance, such as loans from financial institutions. Borrowers in the
new issue market may be raising capital for converting private capital into public
capital; this is known as "going public."
• The financial assets sold can only be redeemed by the original holder.

Methods of issuing securities in the primary market are:

• Initial public offering;

• Rights issue (for existing companies);
• Preferential issue.

19
Secondary Market

The secondary market, also known as the aftermarket, is the financial market
where previously issued securities and financial instruments such as stock, bonds,
options, and futures are bought and sold. The term "secondary market" is also used
to refer to the market for any used goods or assets, or an alternative use for an
existing product or asset where the customer base is the second market (for
example, corn has been traditionally used primarily for food production and
feedstock, but a "second" or "third" market has developed for use in ethanol
production). Stock exchange and over the counter markets.

With primary issuances of securities or financial instruments, or the primary

market, investors purchase these securities directly from issuers such as
corporations issuing shares in an IPO or private placement, or directly from the
federal government in the case of treasuries. After the initial issuance, investors
can purchase from other investors in the secondary market.

The secondary market for a variety of assets can vary from loans to stocks, from
fragmented to centralized, and from illiquid to very liquid. The major stock
exchanges are the most visible example of liquid secondary markets - in this case,
for stocks of publicly traded companies. Exchanges such as the New York Stock
Exchange, NASDAQ and the American Stock Exchange provide a centralized,
liquid secondary market for the investors who own stocks that trade on those
exchanges. Most bonds and structured products trade “over the counter,” or by
phoning the bond desk of one’s broker-dealer. Loans sometimes trade online using
a Loan Exchange.

Over-the-counter market

Over-the-counter (OTC) or off-exchange trading is to trade financial

instruments such as stocks, bonds, commodities or derivatives directly between
two parties. It is contrasted with exchange trading, which occurs via facilities
constructed for the purpose of trading (i.e., exchanges), such as futures exchanges
or stock exchanges. In the U.S., over-the-counter trading in stock is carried out by
market makers that make markets in OTCBB and Pink Sheets securities using
inter-dealer quotation services such as Pink Quote (operated by Pink OTC
Markets) and the OTC Bulletin Board (OTCBB). OTC stocks are not usually listed
nor traded on any stock exchanges, though exchange listed stocks can be traded
OTC on the third market. Although stocks quoted on the OTCBB must comply
with U.S. Securities and Exchange Commission (SEC) reporting requirements,
other OTC stocks, such as those stocks categorized as Pink Sheets securities, have
no reporting requirements, while those stocks categorized as OTCQX have met

20
alternative disclosure guidelines through Pink OTC Markets. An over-the-counter
contract is a bilateral contract in which two parties agree on how a particular trade
or agreement is to be settled in the future. It is usually from an investment bank to
its clients directly. Forwards and swaps are prime examples of such contracts. It is
mostly done via the computer or the telephone. For derivatives, these agreements
are usually governed by an International Swaps and Derivatives Association
agreement.

This segment of the OTC market is occasionally referred to as the "Fourth

Market."

The NYMEX has created a clearing mechanism for a slate of commonly traded
OTC energy derivatives which allows counterparties of many bilateral OTC
transactions to mutually agree to transfer the trade to ClearPort, the exchange's
clearing house, thus eliminating credit and performance risk of the initial OTC
transaction counterparts.

Main financial instruments

Bond, Promissory note, Cheque – a security contains requirement to make full

payment to the bearer of cheque , Certificate of deposit, Bill of Lading (a Bill of
Lading is a “document evidencing the receipt of goods for shipment issued by a
person engaged in the business of transporting or forwarding goods." ), Stock.

Promissory note

A promissory note, referred to as a note payable in accounting, or commonly as

just a "note", is a contract where one party (the maker or issuer) makes an
unconditional promise in writing to pay a sum of money to the other (the payee),
either at a fixed or determinable future time or on demand of the payee, under
specific terms. They differ from IOUs in that they contain a specific promise to
pay, rather than simply acknowledging that a debt exists.

Certificate of deposit

A certificate of deposit or CD is a time deposit, a financial product commonly

offered to consumers by banks, thrift institutions, and credit unions. CDs are
similar to savings accounts in that they are insured and thus virtually risk-free; they
are "money in the bank" (CDs are insured by the FDIC for banks or by the NCUA
for credit unions). They are different from savings accounts in that the CD has a
specific, fixed term (often three months, six months, or one to five years), and,

21
usually, a fixed interest rate. It is intended that the CD be held until maturity, at
which time the money may be withdrawn together with the accrued interest.

Bond

Bond - an issued security establishing its holder's right to receive from the issuer of
the bond, within the time period specified therein,

• its nominal value

• and the interest fixed therein on this value or other property equivalent.

The bond may provide for other property rights of its holder, where this is not
contrary to legislation.

Bill of lading

A bill of lading (sometimes referred to as a BOL,or B/L) is a document issued by a

carrier to a shipper, acknowledging that specified goods have been received on
board as cargo for conveyance to a named place for delivery to the consignee who
is usually identified. A thorough bill of lading involves the use of at least two
different modes of transport from road, rail, air, and sea. The term derives from the
verb "to lade" which means to load a cargo onto a ship or other form of
transportation.

A bill of lading can be used as a traded object. The standard short form bill of
lading is evidence of the contract of carriage of goods and it serves a number of
purposes:

• It is evidence that a valid contract of carriage, or a chartering contract,

exists, and it may incorporate the full terms of the contract between the consignor
and the carrier by reference (i.e. the short form simply refers to the main contract
as an existing document, whereas the long form of a bill of lading (connaissement
intégral) issued by the carrier sets out all the terms of the contract of carriage);
• It is a receipt signed by the carrier confirming whether goods matching the
contract description have been received in good condition (a bill will be described
as clean if the goods have been received on board in apparent good condition and
stowed ready for transport); and
• It is also a document of transfer, being freely transferable but not a
negotiable instrument in the legal sense, i.e. it governs all the legal aspects of
physical carriage, and, like a cheque or other negotiable instrument, it may be
endorsed affecting ownership of the goods actually being carried. This matches
everyday experience in that the contract a person might make with a commercial

22
carrier like FedEx for mostly airway parcels, is separate from any contract for the
sale of the goods to be carried, however it binds the carrier to its terms,
irrespectively of who the actual holder of the B/L, and owner of the goods, may be
at a specific moment.

Stocks (Shares)

Common shares

Common Shares represent ownership in a company and a claim (dividends) on a

portion of profits. Investors get one vote per share to elect the board members, who
oversee the major decisions made by management.Over the long term, common
stock, by means of capital growth, yields higher returns than almost every other
investment. This higher return comes at a cost since common stocks entail the most
risk. If a company goes bankrupt and liquidates, the common shareholders will not
receive money until the creditors, bondholders, and preferred shareholders are
paid.

Preferred Stock

Preferred Stock represents some degree of ownership in a company but usually

doesn't come with the same voting rights. (This may vary depending on the
company.) With preferred shares investors are usually guaranteed a fixed dividend
forever. This is different than common stock, which has variable dividends that are
never guaranteed. Another advantage is that in the event of liquidation preferred
shareholders are paid off before the common shareholder (but still after debt
holders). Preferred stock may also be callable, meaning that the company has the
option to purchase the shares from shareholders at anytime for any reason (usually
for a premium). Some people consider preferred stock to be more like debt than
equity. A good way to think of these kinds of shares is to see them as being in
between bonds and common shares.

23
Professional participants

Professional participants in the securities market - legal persons, including credit

organizations, and also citizens registered as business persons who conduct the
following types of activity:

• Brokerage shall be deemed performance of civil-law transactions with

securities as agent or commission agent acting under a contract of agency or
commission, and also under a power (letter) of attorney for the performance of
such transactions in the absence of indication of the powers of agent or
commission agent in the contract.

• Dealer activity shall be deemed performance of transactions in the purchase

and sale of securities in one's own name and for one's own account through the
public announcement of the prices of purchase and/or sale of certain securities,
with an obligation of the purchase and/or sale of these securities at the prices
announced by the person pursuing such activity.

• Activity in the management of securities shall be deemed performance by

a legal person or individual business person, in his own name, for a remuneration,
during a stated period, of trust management of the following conveyed into his
possession and belonging to another person, in the interests of this person or of
third parties designated by this person:

1)securities;

2)monies intended for investment in securities;

3)monies and securities received in the process of securities management.

• Clearing activity shall be deemed activity in determining mutual obligations

(collection, collation and correction of information on security deals and

preparation of bookkeeping documents thereon) and in offsetting these obligations

in deliveries of securities

24
• Depositary activity shall be deemed the rendering of services in the
safekeeping of certificates of securities and/or recording and transfer of rights to
securities

• Activity in the keeping of a register of owners of securities shall be deemed

collection, fixing, processing, storage and provision of data constituting a system
of keeping the register of security owners

• Provision of services directly promoting conclusion of civil-law transactions

with securities between participants in the securities market shall be deemed
activity in the arrangement of trading on the securities market.

25
 Bombay Stock Exchange

The Bombay Stock Exchange is the oldest stock exchange in Asia and has the
third largest number of listed companies in the world, with 4900 listed as of Feb
2010. It is located at Dalal Street, Mumbai, India. On Feb, 2010, the equity market
capitalization of the companies listed on the BSE was US$1.28 trillion, making it
the largest stock exchange in South Asia and the 12th largest in the world

With over 4900 Indian companies listed & over 7700 scrips on the stock exchange,
it has a significant trading volume. The BSE SENSEX (Sensitive index), also
called the "BSE 30", is a widely used market index in India and Asia. Though
many other exchanges exist, BSE and the National Stock Exchange of India
account for most of the trading in shares in India.

The hours of operation for the BSE quoted above are stated in terms of the local
time (i.e. GMT +5:30) in Mumbai (Bombay), India. BSE's normal trading sessions
are on all days of the week except Saturdays, Sundays and holidays declared by the
Exchange in advance

History

The Bombay Stock Exchange is known as the oldest exchange in Asia. It traces its
history to the 1850s, when 4 Gujarati and 1 Parsi stockbroker would gather under
banyan trees in front of Mumbai's Town Hall. The location of these meetings
changed many times, as the number of brokers constantly increased. The group
eventually moved to Dalal Street in 1874 and in 1875 became an official
organization known as 'The Native Share & Stock Brokers Association'. In 1956,
the BSE became the first stock exchange to be recognized by the Indian
Government under the Securities Contracts Regulation Act. The Bombay Stock
Exchange developed the BSE Sensex in 1986, giving the BSE a means to measure
overall performance of the exchange. In 2000 the BSE used this index to open its
derivatives market, trading Sensex futures contracts. The development of Sensex

26
options along with equity derivatives followed in 2001 and 2002, expanding the
BSE's trading platform. Historically an open outcry floor trading exchange, the
Bombay Stock Exchange switched to an electronic trading system in 1995. It took
the exchange only fifty days to make this transition. This automated, screen-based
trading platform called BSE On-line trading (BOLT) currently has a capacity of 80
lakh orders per day. The BSE has also introduced the world's first centralized
exchange-based internet trading system, BSEWEBx.co.in to enable investors
anywhere in the world to trade on the BSE platform.

Timeline

Following is the timeline on the rise and rise of the Sensex through Indian stock
market history.

1830's Business on corporate stocks and shares in Bank and Cotton presses started
in Bombay.

1860-1865 Cotton price bubble as a result of the American Civil War

1870 - 90's Sharp increase in share prices of jute industries followed by a boom in
tea stocks and coal

1978-79 Base year of Sensex, defined to be 100.

1986 Sensex first compiled[6] using a market Capitalization-Weighted methodology

for 30 component stocks representing well-established companies across key
sectors.

30 October 2006 The Sensex on October 30, 2006 crossed the magical figure of
13,000 and closed at 13,024.26 points, up 117.45 points or 0.9%. It took 135 days
for the Sensex to move from 12,000 to 13,000 and 123 days to move from 12,500
to 13,000.

5 December 2006 The Sensex on December 5, 2006 crossed the 14,000-mark to

touch 14,028 points. It took 36 days for the Sensex to move from 13,000 to the
14,000 mark.

6 July 2007 The Sensex on July 6, 2007 crossed the magical figure of 15,000 to
touch 15,005 points in afternoon trade. It took seven months for the Sensex to
move from 14,000 to 15,000 points.

27
19 September 2007 The Sensex scaled yet another milestone during early morning
trade on September 19, 2007. Within minutes after trading began, the Sensex
crossed 16,000, rising by 450 points from the previous close. The 30-share
Bombay Stock Exchange's sensitive index took 53 days to reach 16,000 from
15,000. Nifty also touched a new high at 4659, up 113 points.

The Sensex finally ended with a gain of 654 points at 16,323. The NSE Nifty
gained 186 points to close at 4,732.

26 September 2007 The Sensex scaled yet another height during early morning
trade on September 26, 2007. Within minutes after trading began, the Sensex
crossed the 17,000-mark . Some profit taking towards the end, saw the index slip
into red to 16,887 - down 187 points from the day's high. The Sensex ended with a
gain of 22 points at 16,921.

9 October 2007 The BSE Sensex crossed the 18,000-mark on October 9, 2007. It
took just 8 days to cross 18,000 points from the 17,000 mark. The index zoomed to
a new all-time intra-day high of 18,327. It finally gained 789 points to close at an
all-time high of 18,280. The market set several new records including the biggest
single day gain of 789 points at close, as well as the largest intra-day gains of 993
points in absolute term backed by frenzied buying after the news of the UPA and
Left meeting on October 22 put an end to the worries of an impending election.

15 October 2007 The Sensex crossed the 19,000-mark backed by revival of funds-
based buying in blue chip stocks in metal, capital goods and refinery sectors. The
index gained the last 1,000 points in just four trading days. The index touched a
fresh all-time intra-day high of 19,096, and finally ended with a smart gain of 640
points at 19,059.The Nifty gained 242 points to close at 5,670.

29 October 2007 The Sensex crossed the 20,000 mark on the back of aggressive
buying by funds ahead of the US Federal Reserve meeting. The index took only 10
trading days to gain 1,000 points after the index crossed the 19,000-mark on
October 15. The major drivers of today's rally were index heavyweights Larsen and
Toubro, Reliance Industries, ICICI Bank, HDFC Bank and SBI among others. The
30-share index spurted in the last five minutes of trade to fly-past the crucial level
and scaled a new intra-day peak at 20,024.87 points before ending at its fresh
closing high of 19,977.67, a gain of 734.50 points. The NSE Nifty rose to a record
high 5,922.50 points before ending at 5,905.90, showing a hefty gain of 203.60
points.

8 January 2008 The sensex peaks. It crossed the 21,000 mark in intra-day trading
after 49 trading sessions. This was backed by high market confidence of increased

28
FII investment and strong corporate results for the third quarter. However, it later
fell back due to profit booking.

13 June 2008 The sensex closed below 15,200 mark, Indian market suffer with
major downfall from January 21, 2008

25 June 2008 The sensex touched an intra day low of 13,731 during the early
trades, then pulled back and ended up at 14,220 amidst a negative sentiment
generated on the Reserve Bank of India hiking CRR by 50 bps. FII outflow
continued in this week.

2 July 2008 The sensex hit an intra day low of 12,822.70 on July 2, 2008. This is
the lowest that it has ever been in the past year. Six months ago, on January 10,
2008, the market had hit an all time high of 21206.70. This is a bad time for the
Indian markets, although Reliance and Infosys continue to lead the way with
mostly positive results. Bloomberg lists them as the top two gainers for the Sensex,
closely followed by ICICI Bank and ITC Ltd.

6 October 2008 The sensex closed at 11801.70 hitting the lowest in the past 2
years.

10 October 2008 The Sensex today closed at 10527,800.51 points down from the
previous day having seen an intraday fall of as large as 1063 points. Thus, this
week turned out to be the week with largest percentage fall in the SenseX

18 May 2009 After the result of 15th Indian general election Sensex gained
2110.79 points from the previous close of 12173.42, a record one-day gain. In the
opening trade itself the Sensex evinced a 15% gain over the previous close which
led to a two-hour suspension in trading. After trading resumed, the Sensex surged
again, leading to a full day suspension of trading.

BSE indices

For the premier stock exchange that pioneered the securities transaction business in
India, over a century of experience is a proud achievement. A lot has changed
since 1875 when 318 persons by paying a then princely amount of Re. 1, became
members of what today is called Bombay Stock Exchange Limited (BSE).

Over the decades, the stock market in the country has passed through good and bad
periods. The journey in the 20th century has not been an easy one. Till the decade
of eighties, there was no measure or scale that could precisely measure the various
ups and downs in the Indian stock market. BSE, in 1986, came out with a Stock

29
Index-SENSEX- that subsequently became the barometer of the Indian stock
market.

The launch of SENSEX in 1986 was later followed up in January 1989 by

introduction of BSE National Index (Base: 1983-84 = 100). It comprised 100
stocks listed at five major stock exchanges in India - Mumbai, Calcutta, Delhi,
Ahmedabad and Madras. The BSE National Index was renamed BSE-100 Index
from October 14, 1996 and since then, it is being calculated taking into
consideration only the prices of stocks listed at BSE. BSE launched the dollar-
linked version of BSE-100 index on May 22, 2006.

With a view to provide a better representation of the increasing number of listed

companies, larger market capitalization and the new industry sectors, BSE
launched on 27th May, 1994 two new index series viz., the 'BSE-200' and the
'DOLLEX-200'. Since then, BSE has come a long way in attuning itself to the
varied needs of investors and market participants. In order to fulfill the need for
still broader, segment-specific and sector-specific indices, BSE has continuously
been increasing the range of its indices. BSE-500 Index and 5 sectoral indices were
launched in 1999. In 2001, BSE launched BSE-PSU Index, DOLLEX-30 and the
country's first free-float based index - the BSE TECk Index. Over the years, BSE
shifted all its indices to the free-float methodology (except BSE-PSU index).

BSE disseminates information on the Price-Earnings Ratio, the Price to Book

Value Ratio and the Dividend Yield Percentage on day-to-day basis of all its major
indices.

The values of all BSE indices are updated on real time basis during market hours
and displayed through the BOLT system, BSE website and news wire agencies.

All BSE Indices are reviewed periodically by the BSE Index Committee. This
Committee which comprises eminent independent finance professionals frames the
broad policy guidelines for the development and maintenance of all BSE indices.
The BSE Index Cell carries out the day-to-day maintenance of all indices and
conducts research on development of new indices.

30
 National Stock Exchange

The National Stock Exchange (NSE)) is a stock exchange located at Mumbai,

India. It is the largest stock exchange in India in terms of daily turnover and
number of trades, for both equities and derivative trading.. NSE has a market
capitalization of around Rs 47,01,923 crore (7 August 2009) and is expected to
become the biggest stock exchange in India in terms of market capitalization by
2009 end. Though a number of other exchanges exist, NSE and the Bombay Stock
Exchange are the two most significant stock exchanges in India, and between them
are responsible for the vast majority of share transactions. The NSE's key index is
the S&P CNX Nifty, known as the Nifty, an index of fifty major stocks weighted
by market capitalisation.

NSE is mutually-owned by a set of leading financial institutions, banks, insurance

companies and other financial intermediaries in India but its ownership and
management operate as separate entities. There are at least 2 foreign investors
NYSE Euronext and Goldman Sachs who have taken a stake in the NSE. As of
2006, the NSE VSAT terminals, 2799 in total, cover more than 1500 cities across
India In October 2007, the equity market capitalization of the companies listed on
the NSE was US$ 1.46 trillion, making it the second largest stock exchange in
South Asia. NSE is the third largest Stock Exchange in the world in terms of the
number of trades in equities. It is the second fastest growing stock exchange in the
world with a recorded growth of 16.6%

Origins

The National Stock Exchange of India was promoted by leading Financial

institutions at the behest of the Government of India, and was incorporated in
November 1992 as a tax-paying company. In April 1993, it was recognized as a
stock exchange under the Securities Contracts (Regulation) Act, 1956. NSE
commenced operations in the Wholesale Debt Market (WDM) segment in June

31
1994. The Capital market (Equities) segment of the NSE commenced operations in
November 1994, while operations in the Derivatives segment commenced in June
2000.

Innovations

NSE has remained in the forefront of modernization of India's capital and financial
markets, and its pioneering efforts include:

• Being the first national, anonymous, electronic limit order book (LOB)
exchange to trade securities in India. Since the success of the NSE, existent market
and new market structures have followed the "NSE" model.
• Setting up the first clearing corporation "National Securities Clearing
Corporation Ltd." in India. NSCCL was a landmark in providing innovation on all
spot equity market (and later, derivatives market) trades in India.
• Co-promoting and setting up of National Securities Depository Limited, first
depository in India..
• Setting up of S&P CNX Nifty.
• NSE pioneered commencement of Internet Trading in February 2000, which
led to the wide popularization of the NSE in the broker community.
• Being the first exchange that, in 1996, proposed exchange traded derivatives,
particularly on an equity index, in India. After four years of policy and regulatory
debate and formulation, the NSE was permitted to start trading equity derivatives
• Being the first and the only exchange to trade GOLD ETFs (exchange traded
funds) in India.
• NSE has also launched the NSE-CNBC-TV18 media centre in association
with CNBC-TV18.
• NSE.IT Limited, setup in 1999 , is a 100% subsidiary of the National Stock
Exchange of India. A Vertical Specialist Enterprise, NSE.IT offers end-to-end
Information Technology (IT) products, solutions and services.

32
Markets

Currently, NSE has the following major segments of the capital market:

• Equity
• Futures and Options
• Retail Debt Market
• Wholesale Debt Market
• Currency futures
• MUTUAL FUND
• STOCKS LENDING & BROWING

August 2008 Currency derivatives were introduced in India with the launch of
Currency Futures in USD INR by NSE. Currently it has also launched currency
futures in EURO, POUND & YEN. Interest Rate Futures was introduced for the
first time in India by NSE on 31st August 2009, exactly after one year of the
launch of Currency Futures.

NSE became the first stock exchange to get approval for Interest rate futures as
recommended by SEBI-RBI committee, on 31 August,2009, a futures contract
based on 7% 10 Year GOI bond (NOTIONAL) was launched with quarterly
maturities.

Hours

NSE's normal trading sessions are conducted from 9:00 am India Time to 3:30 pm
India Time on all days of the week except Saturdays, Sundays and Official
Holidays declared by the Exchange (or by the Government of India) in advance.
The exchange, in association with BSE (Bombay Stock Exchange Ltd.), is thinking
of revising its timings from 9.00 am India Time to 5.00 pm India Time.

There were System Testing going on and opinions, suggestions or feedback on the
New Proposed Timings are being invited from the brokers across India. And
finally on Nov 18, 2009 regulator decided to drop their ambitious goal of longest
Asia Trading Hours due to strong opposition from its members.

On Dec 16, 2009, NSE announced that it would pre-pone the market opening at
9am from Dec 18, 2009. So NSE trading hours will be from 9:00 am till 3:30 pm
India Time.

33
However, on Dec 17, 2009, after strong protests from brokers, the Exchange
decided to postpone the change in trading hours till Jan 04, 2010.

NSE new market timing from Jan 04, 2010 is 9:00 am till 3:30 pm India Time.

NSE MileStones

• November 1992 Incorporation

• April 1993 Recognition as a stock exchange
• May 1993 Formulation of business plan
• June 1994 Wholesale Debt Market segment goes live
• November 1994 Capital Market (Equities) segment goes live
• March 1995 Establishment of Investor Grievance Cell
• April 1995 Establishment of NSCCL, the first Clearing Corporation
• June 1995 Introduction of centralised insurance cover for all trading
members
• July 1995 Establishment of Investor Protection Fund
• October 1995 Became largest stock exchange in the country
• April 1996 Commencement of clearing and settlement by NSCCL
• April 1996 Launch of S&P CNX Nifty
• June 1996 Establishment of Settlement Guarantee Fund
• November 1996 Setting up of National Securities Depository Limited, first
depository in India, co-promoted by NSE
• November 1996 Best IT Usage award by Computer Society of India
• December 1996 Commencement of trading/settlement in dematerialised
securities
• December 1996 Dataquest award for Top IT User
• December 1996 Launch of CNX Nifty Junior
• February 1997 Regional clearing facility goes live
• November 1997 Best IT Usage award by Computer Society of India
• May 1998 Promotion of joint venture, India Index Services & Products
Limited (IISL)
• May 1998 Launch of NSE's Web-site: www.nse.co.in
• July 1998 Launch of NSE's Certification Programme in Financial Market
• August 1998 CYBER CORPORATE OF THE YEAR 1998 award
• February 1999 Launch of Automated Lending and Borrowing Mechanism
• April 1999 CHIP Web Award by CHIP magazine
• October 1999 Setting up of NSE.IT
• January 2000 Launch of NSE Research Initiative

34
• February 2000 Commencement of Internet Trading
• June 2000 Commencement of Derivatives Trading (Index Futures)
• September 2000 Launch of 'Zero Coupon Yield Curve'
• November 2000 Launch of Broker Plaza by Dotex International, a joint
venture between NSE.IT Ltd. and i-flex Solutions Ltd.
• December 2000 Commencement of WAP trading
• June 2001 Commencement of trading in Index Options
• July 2001 Commencement of trading in Options on Individual Securities
• November 2001 Commencement of trading in Futures on Individual
Securities
• December 2001 Launch of NSE VaR for Government Securities
• January 2002 Launch of Exchange Traded Funds (ETFs)
• May 2002 NSE wins the Wharton-Infosys Business Transformation Award
in the Organization-wide Transformation category
• October 2002 Launch of NSE Government Securities Index
• January 2003 Commencement of trading in Retail Debt Market
• June 2003 Launch of Interest Rate Futures
• August 2003 Launch of Futures & options in CNXIT Index
• June 2004 Launch of STP Interoperability
• August 2004 Launch of NSE’s electronic interface for listed companies
• March 2005 ‘India Innovation Award’ by EMPI Business School, New
Delhi
• June 2005 Launch of Futures & options in BANK Nifty Index
• December 2006 'Derivative Exchange of the Year', by Asia Risk magazine
• January 2007 Launch of NSE – CNBC TV 18 media centre
• March 2007 NSE, CRISIL announce launch of IndiaBondWatch.com
• June 2007 NSE launches derivatives on Nifty Junior & CNX 100
• October 2007 NSE launches derivatives on Nifty Midcap 50
• January 2008 Introduction of Mini Nifty derivative contracts on 1st January
2008
• March 2008 Introduction of long term option contracts on S&P CNX Nifty
Index
• April 2008 Launch of India VIX
• April 2008 Launch of Securities Lending & Borrowing Scheme
• August 2008 Launch of Currency Derivatives
• August 2009 Launch of Interest Rate Futures
• November 2009 Launch of Mutual Fund Service System
• December 2009 Commencement of settlement of corporate bonds
• February 2010 Launch of Currency Futures on additional currency pairs

35
Certifications

NSE also conducts online examination and awards certification, under its
programmes of NSE's Certification in Financial Markets (NCFM). Currently,
certifications are available in 19 modules, covering different sectors of financial
and capital markets. Branches of the NSE are located throughout India.

[ A Very Small Aperture Terminal (VSAT), is a two-way satellite ground station

or a stabilized maritime Vsat antenna with a dish antenna that is smaller than 3
meters. The majority of VSAT antennas range from 75 cm to 1.2 m. Data rates
typically range from 56 Kbit/s up to 4 Mbit/s. VSATs access satellites in
geosynchronous orbit to relay data from small remote earth stations (terminals) to
other terminals (in mesh configurations) or master earth station "hubs" (in star
configurations).]

36
 TRADING MEMBERSHIP

STOCK BROKERS
A broker is an intermediary who arranges to buy and sell securities on
behalf of clients (the buyer and the seller).
According to Rule2 (e) of SEBI (Stock Brokers and Sub-Brokers) Rules,
1992, a stockbroker means a member of a recognized stock exchange. No
stockbroker is allowed to buy, sell or deal in securities, unless he or she holds a
certificate of certificate of registration granted by SEBI. A stockbroker applies for
registration to SEBI through a stock exchange or stock exchanges of which he or
she is admitted as a member. SEBI may grant a certificate to a stock-broker [as per
SEBI (Stock Brokers ad Sub-Brokers) Rules, 1992] subject to the conditions that:

a) he holds the membership of any stock exchange;

b) he shall abide by the rules , regulations and bye-laws of the stock exchange
or stock exchanges of which he is a member;
c) prior permission of SEBI to continue to buy, sell or deal in securities in any
stock exchange;
d) he shall pay the amount of fees for registration in the prescribed manner; and
e) he shall take adequate steps for redressal of grievances of the investors
within one month of the date of the receipt of the complaint and keep SEBI
informed about about the number, nature and other particulars of the complaints.

While considering the application of an entity for grant of registration as a stock

broker, SEBI shall take into account the following namely, whether the stock
broker applicant-

a) is eligible to be admitted as a member as a member of a stock exchange;

b) has the necessary infrastructure like adequate office space, equipment and
manpower to effectively discharge his activities;
c) has any past experience in the business of buying, selling or dealing in
securities;
d) Is being subjected to any disciplinary proceedings under the rules,
regulations and bye-laws of a stock exchange with respect to his business as a

37
stock-broker involving either himself or any of his partners, directors or
employees.

SUB- BROKERS

The trading members of the Exchange may appoint sub-brokers to

act as agents of the concerned trading member for assisting the investors in buying,
selling or dealing in securities. The sub-brokers would be affiliated to the trading
members and are required to be registered with SEBI. A sub-broker would be
allowed to be associated with only one trading member of the Exchange.
Trading members desirous of appointing sub-brokers are required to
submit the following documents to the Membership Department of the Exchange:

• Copy of sub-broker – broker agreement duly certified by the

trading members
• Application form for registration as s sub-broker with Securities
and Exchange Board of India(Form B)
• Recommendation letter to be given by the trading member with
whom the sub-broker is affiliated(Form C)

The detailed scheme relating to the registration of sub-brokers is provided in

the following circulars:

Circular No. Download No. Date

60 NSE/MEM/275 12-Jun-1997
63 NSE/MEM/282 25-Jun-1997
69 NSE/MEM/311 23-Jul-1997
168 NSE/MEM/108 19-Jun-2000

The trading member concerned shall be responsible to ensure the settlement of all
deals entered into by trading member even though the orders in respect of the deals
may have originated from its sub-broker.

The sub-broker will be required to adhere to NSE’s ‘know your clients’

requirements. The important documents relating to dealing through a sub-broker
are given below:
• Individual client registration client registration application form
• Non – individual client registration application form

38
• Sub – broker client agreement
• Purchase / Sale Note issued by Sub-brokers acting for constituents.

BROKER-CLIENTS RELATIONS

The following helps in establishing the broker client relations and these are
• Know Your Client
• Unique Client Code
• Margins from the Clients
• Execution of Orders
• Contract Note
• Payments/Delivery of securities to the Clients
• Brokerage
• Segregation of Bank Accounts
• Segregation of Demat(Beneficiary ) Accounts

SUB-BROKER-CLIENTS RELATIONS

The following helps in establishing the broker client relations and these are
• Sub-broker
• Registration
• Relationship with clients/role
• Contract notes
• Securities/Funds
• Sub-brokerage

CODE OF ADVERTISEMENT

Trading Members of the Exchange while issuing advertisements in the media

have to comply with the Code of Advertisement prescribed by the exchange.
Trading members not complying with the Code of Advertisement may have to
face disciplinary proceedings. The Code of Advertisement is as under:
1. The term advertisement as referred in this code shall have the following
meaning: Advertisement means and includes any document, pamphlets, circulars,
brochures, notice or any research reports, material published, or designed for use in
a newspaper ,magazine or other periodical, radio, television, telephone

39
directories(other than routine listings) or other public media, whether in print or
audio visual form.
2. The trading member should designate and authorize a person to ensure the
correctness of the information given in any advertisement.
3. The trading member issuing any such advertisement should inform the name
of such authorized person to the Exchange.
4. The advertisement should be related to the nature of services that the trading
member can offer. If the trading member is engaged in any other business then any
advertisement if permissible for such business should not indicate the name of the
Trading member as a member of the Exchange.
5. The advertisement should be written in clear language and should not be
such which may prejudice interest of the investors in general.
6. The advertisement should not contain any confusing, misleading or
offensive information.
7. It should be free from inaccuracies.
8. The advertisement should not contain a recommendation regarding purchase
or sale of any particular share or security of any company. It should not make any
promise including guaranteeing of any return to the investing public.
9. The material should not contain anything which is otherwise prohibited.
10. The advertisement shall contain:
a) Name and / or his logo, code of National stock Exchange
membership.
b) Registration Number allotted by the Securities and Exchange
Board of India.
11. The advertisement may be issued individually or jointly with other Trading
members provided that the trading member shall not allow its name to be
advertisement or caused to be published in the advertisement of the other trading
members, unless such advertisement is issued by it.
12. In the event of suspension of any trading member by the exchange, the
trading members so suspended shall not issue any advertisement either singly or
jointly with any other trading member, during the period of suspension.
13. In the event of any proceeding/action initiated against a Trading member by
a regulatory body other than National Stock Exchange , National Stock Exchange
reserves the right to direct the trading member to refrain from issuing any
advertisement for such a period as it may deem fit.
14. National Stock Exchange reserves the right to call for the advertisement
and /or such other information / explanation as it may require, after the publication
of the said advertisement. National Stock Exchange shall have cease and desist
powers in this behalf.

40
 Commodity markets

Commodity markets are markets where raw or primary products are exchanged.
These raw commodities are traded on regulated commodities exchanges, in which
they are bought and sold in standardized contracts.

This article focuses on the history and current debates regarding global commodity
markets. It covers physical product (food, metals, electricity) markets but not the
ways that services, including those of governments, nor investment, nor debt, can
be seen as a commodity. Articles on reinsurance markets, stock markets, bond
markets and currency markets cover those concerns separately and in more depth.
One focus of this article is the relationship between simple commodity money and
the more complex instruments offered in the commodity markets.

History

The modern commodity markets have their roots in the trading of agricultural
products. While wheat and corn, cattle and pigs, were widely traded using standard
instruments in the 19th century in the United States, other basic foodstuffs such as
soybeans were only added quite recently in most markets.[citation needed] For a
commodity market to be established, there must be very broad consensus on the
variations in the product that make it acceptable for one purpose or another.

The economic impact of the development of commodity markets is hard to

overestimate. Through the 19th century "the exchanges became effective
spokesmen for, and innovators of, improvements in transportation, warehousing,
and financing, which paved the way to expanded interstate and international
trade."[citation needed]

Early history of commodity markets

Historically, dating from ancient Sumerian use of sheep or goats, other peoples
using pigs, rare seashells, or other items as commodity money, people have sought
ways to standardize and trade contracts in the delivery of such items, to render
trade itself more smooth and predictable.

Commodity money and commodity markets in a crude early form are believed to
have originated in Sumer where small baked clay tokens in the shape of sheep or

41
goats were used in trade. Sealed in clay vessels with a certain number of such
tokens, with that number written on the outside, they represented a promise to
deliver that number. This made them a form of commodity money - more than an
I.O.U. but less than a guarantee by a nation-state or bank. However, they were also
known to contain promises of time and date of delivery - this made them like a
modern futures contract. Regardless of the details, it was only possible to verify the
number of tokens inside by shaking the vessel or by breaking it, at which point the
number or terms written on the outside became subject to doubt. Eventually the
tokens disappeared, but the contracts remained on flat tablets. This represented the
first system of commodity accounting.

However, the commodity status of living things is always subject to doubt - it was
hard to validate the health or existence of sheep or goats. Excuses for non-delivery
were not unknown, and there are recovered Sumerian letters that complain of
sickly goats, sheep that had already been fleeced, etc.

If a seller's reputation was good, individual backers or bankers could decide to take
the risk of clearing a trade. The observation that trust is always required between
markets participants later led to credit money. But until relatively modern times,
communication and credit were primitive.

Classical civilizations built complex global markets trading gold or silver for
spices, cloth, wood and weapons, most of which had standards of quality and
timeliness. Considering the many hazards of climate, piracy, theft and abuse of
military fiat by rulers of kingdoms along the trade routes, it was a major focus of
these civilizations to keep markets open and trading in these scarce commodities.
Reputation and clearing became central concerns, and the states which could
handle them most effectively became very powerful empires, trusted by many
peoples to manage and mediate trade and commerce.

Size of the market

The trading of commodities consists of direct physical trading and derivatives

trading. The commodities markets have seen an upturn in the volume of trading in
recent years. In the five years up to 2007, the value of global physical exports of
commodities increased by 17% while the notional value outstanding of commodity
OTC (over the counter) derivatives increased more than 500% and commodity
derivative trading on exchanges more than 200%.[citation needed]

The notional value outstanding of banks’ OTC commodities’ derivatives contracts

increased 27% in 2007 to $9.0 trillion. OTC trading accounts for the majority of
trading in gold and silver. Overall, precious metals accounted for 8% of OTC

42
commodities derivatives trading in 2007, down from their 55% share a decade
earlier as trading in energy derivatives rose.

Global physical and derivative trading of commodities on exchanges increased

more than a third in 2007 to reach 1,684 million contracts. Agricultural contracts
trading grew by 32% in 2007, energy 29% and industrial metals by 30%. Precious
metals trading grew by 3%, with higher volume in New York being partially offset
by declining volume in Tokyo. Over 40% of commodities trading on exchanges
was conducted on US exchanges and a quarter in China. Trading on exchanges in
China and India has gained in importance in recent years due to their emergence as
significant commodities consumers and producers.

Recent Trends in Commodities

The 2008 global boom in commodity prices - for everything from coal to corn –
was fueled by heated demand from the likes of China and India, plus unbridled
speculation in forward markets. That bubble popped in the closing months of 2008
across the board. As a result, farmers are expected to face a sharp drop in crop
prices, after years of record revenue. Other commodities, such as steel, are also
expected to tumble due to lower demand. This will be a rare positive for
manufacturing industries, which will experience a drop in some input costs, partly
offsetting the decline in downstream demand.

Spot trading

Spot trading is any transaction where delivery either takes place immediately, or
with a minimum lag between the trade and delivery due to technical constraints.
Spot trading normally involves visual inspection of the commodity or a sample of
the commodity, and is carried out in markets such as wholesale markets.
Commodity markets, on the other hand, require the existence of agreed standards
so that trades can be made without visual inspection.

Forward contracts

A forward contract is an agreement between two parties to exchange at some fixed

future date a given quantity of a commodity for a price defined today. The fixed
price today is known as the forward price.

Futures contracts

A futures contract has the same general features as a forward contract but is
transacted through a futures exchange.

43
Commodity and futures contracts are based on what’s termed forward contracts.
Early on these forward contracts — agreements to buy now, pay and deliver later
— were used as a way of getting products from producer to the consumer. These
typically were only for food and agricultural products. Forward contracts have
evolved and have been standardized into what we know today as futures contracts.
Although more complex today, early forward contracts for example, were used for
rice in seventeenth century Japan. Modern forward, or futures agreements, began
in Chicago in the 1840s, with the appearance of the railroads. Chicago, being
centrally located, emerged as the hub between Midwestern farmers and producers
and the east coast consumer population centers.

Hedging

Hedging, a common (and sometimes mandatory) practice of farming cooperatives,

insures against a poor harvest by purchasing futures contracts in the same
commodity. If the cooperative has significantly less of its product to sell due to
weather or insects, it makes up for that loss with a profit on the markets, since the
overall supply of the crop is short everywhere that suffered the same conditions.

Whole developing nations may be especially vulnerable, and even their currency
tends to be tied to the price of those particular commodity items until it manages to
be a fully developed nation. For example, one could see the nominally fiat money
of Cuba as being tied to sugar prices[citation needed], since a lack of hard currency
paying for sugar means less foreign goods per peso in Cuba itself. In effect, Cuba
needs a hedge against a drop in sugar prices, if it wishes to maintain a stable
quality of life for its citizens

Delivery and condition guarantees

In addition, delivery day, method of settlement and delivery point must all be
specified. Typically, trading must end two (or more) business days prior to the
delivery day, so that the routing of the shipment can be finalized via ship or rail,
and payment can be settled when the contract arrives at any delivery point.

Standardization

U.S. soybean futures, for example, are of standard grade if they are "GMO or a
mixture of GMO and Non-GMO No. 2 yellow soybeans of Indiana, Ohio and
Michigan origin produced in the U.S.A. (Non-screened, stored in silo)," and of
deliverable grade if they are "GMO or a mixture of GMO and Non-GMO No. 2

44
yellow soybeans of Iowa, Illinois and Wisconsin origin produced in the U.S.A.
(Non-screened, stored in silo)." Note the distinction between states, and the need to
clearly mention their status as GMO (Genetically Modified Organism) which
makes them unacceptable to most organic food buyers.

Similar specifications apply for cotton, orange juice, cocoa, sugar, wheat, corn,
barley, pork bellies, milk, feedstuffs, fruits, vegetables, other grains, other beans,
hay, other livestock, meats, poultry, eggs, or any other commodity which is so
traded.

Regulation of commodity markets

Cotton, kilowatt-hours of electricity, board feet of wood, long distance minutes,

royalty payments due on artists' works, and other products and services have been
traded on markets of varying scale, with varying degrees of success

Generally, commodities' spot and forward prices are solely dependent on the
financial return of the instrument, and do not factor into the price any societal
costs, e.g. smog, pollution, water contamination, etc. Nonetheless, new markets
and instruments have been created in order to address the external costs of using
these commodities such as man-made global warming, deforestation, and general
pollution. For instance, many utilities now trade regularly on the emissions
markets, buying and selling renewable emissions credits and emissions allowances
in order to offset the output of their generation facilities. While many have
criticized this as a band-aid solution, others point out that the utility industry is the
first to publicly address its external costs. Many industries, including the tech
industry and auto industry, have done nothing of the sort.

In the United States, the principal regulator of commodity and futures markets is
the Commodity Futures Trading Commission.

Proliferation of contracts, terms, and derivatives

However, if there are two or more standards of risk or quality, as there seem to be
for electricity or soybeans, it is relatively easy to establish two different contracts
to trade in the more and less desirable deliverable separately. If the consumer
acceptance and liability problems can be solved, the product can be made
interchangeable, and trading in such units can begin.

Since the detailed concerns of industrial and consumer markets vary widely, so do
the contracts, and "grades" tend to vary significantly from country to country. A

45
proliferation of contract units, terms, and futures contracts have evolved, combined
into an extremely sophisticated range of financial instruments.

These are more than one-to-one representations of units of a given type of

commodity, and represent more than simple futures contracts for future deliveries.
These serve a variety of purposes from simple gambling to price insurance.

Oil

Building on the infrastructure and credit and settlement networks established for
food and precious metals, many such markets have proliferated drastically in the
late 20th century. Oil was the first form of energy so widely traded, and the
fluctuations in the oil markets are of particular political interest.

Some commodity market speculation is directly related to the stability of certain

states, e.g. during the Persian Gulf War, speculation on the survival of the regime
of Saddam Hussein in Iraq. Similar political stability concerns have from time to
time driven the price of oil.

The oil market is an exception. Most markets are not so tied to the politics of
volatile regions - even natural gas tends to be more stable, as it is not traded across
oceans by tanker as extensively.

Commodity markets and protectionism

Developing countries (democratic or not) have been moved to harden their

currencies, accept IMF rules, join the WTO, and submit to a broad regime of
reforms that amount to a hedge against being isolated. China's entry into the WTO
signaled the end of truly isolated nations entirely managing their own currency and
affairs. The need for stable currency and predictable clearing and rules-based
handling of trade disputes, has led to global trade hegemony - many nations
hedging on a global scale against each other's anticipated protectionism, were they
to fail to join the WTO.

There are signs, however, that this regime is far from perfect. U.S. trade sanctions
against Canadian softwood lumber (within NAFTA) and foreign steel (except for

46
NAFTA partners Canada and Mexico) in 2002 signaled a shift in policy towards a
tougher regime perhaps more driven by political concerns - jobs, industrial policy,
even sustainable forestry and logging practices.

Largest commodities exchanges

Exchange Country
New York Mercantile Exchange USA
Tokyo Commodity Exchange Japan
NYSE Euronext EU
Dalian Commodity Exchange China
Multi Commodity Exchange India

47
 Multi Commodity Exchange

Multi Commodity Exchange (MCX) is an independent commodity exchange

based in India. It was established in 2003 and is based in Mumbai. The turnover of
the exchange for the period Apr-Dec 2008 was INR 32 Trillion [1]. MCX offers
futures trading in Agricultural Commodities, Bullion, Ferrous & Non-ferrous
metals, Pulses, Oils & Oilseeds, Energy, Plantations, Spices and other soft
commodities.

MCX has also setup in joint venture the National Spot Exchange a purely
agricultural commodity exchange and National Bulk Handling Corporation
(NBHC) which provides bulk storage and handling of agricultural products.

It is now regulated by forward market commission.

• MCX is India's No. 1 commodity exchange with 84% Market share in

2008($0.84 trillion)
• The exchange's competitor is National Commodity & Derivatives Exchange
Ltd
• Globally, MCX ranks no. 1 in silver, no. 2 in natural gas, no. 3 in crude oil
and gold in futures trading
• The crude volume touched 23.49 Miliion barrels on January 3, 2009
• The highest traded item is gold with an average monthly turnover of Rs 1.42
Trillion ($29 Billion).
• MCX has 10 strategic alliances with leading commodity exchange across the
globe
• The average daily turnover of MCX is about US$ 2.4 billion
• MCX now reaches out to about 500 cities in India with the help of about
10,000 trading terminals

48
• MCX COMDEX is India's first and only composite commodity futures price
index

METAL BULLION
Aluminium, Copper, Lead, Nickel, Sponge
Gold, Gold HNI, Gold M, i-gold, Silver, Silver
Iron, Steel Long (Bhavnagar), Steel Long
HNI, Silver M
(Govindgarh), Steel Flat, Tin, Zinc
FIBER ENERGY
Brent Crude Oil, Crude Oil, Furnace Oil, Natural
Cotton L Staple, Cotton M Staple, Cotton S
Gas, M. E. Sour Crude Oil, ATF, Electricity,
Staple, Cotton Yarn, Kapas
Carbon Credit
SPICES PLANTATIONS
Arecanut, Cashew Kernel, Coffee (Robusta),
Cardamom, Jeera, Pepper, Red Chilli
Rubber
PULSES PETROCHEMICALS
Chana, Masur, Yellow Peas HDPE, Polypropylene(PP), PVC
OIL & OIL SEEDS
Castor Oil, Castor Seeds, Coconut Cake, Coconut Oil, Cotton Seed, Crude Palm Oil,
Groundnut Oil, Kapasia Khalli, Mustard Oil, Mustard Seed (Jaipur), Mustard Seed (Sirsa),
RBD Palmolein, Refined Soy Oil, Refined Sunflower Oil, Rice Bran DOC, Rice Bran
Refined Oil, Sesame Seed, Soymeal, Soy Bean, Soy Seeds
CEREALS OTHERS
Guargum, Guar Seed, Gurchaku, Mentha Oil,
Maize
Potato (Agra), Potato (Tarkeshwar), S

49
 National Commodity & Derivatives Exchange Limited

National Commodity & Derivatives Exchange Limited (NCDEX) is an online

commodity exchange based in India. It was incorporated as a private limited
company incorporated on April 23, 2003 under the Companies Act, 1956. It
obtained its Certificate for Commencement of Business on May 9, 2003. It has
commenced its operations on December 15, 2003. NCDEX is a closely held
private company which is promoted by national level institutions and has an
independent Board of Directors and professionals not having vested interest in
commodity markets.

NCDEX is a public limited company incorporated on April 23, 2003 under the
Companies Act, 1956. NCDEX is regulated by Forward Market Commission
(FMC) in respect of futures trading in commodities. Besides, NCDEX is subjected
to various laws of the land like the Companies Act, Stamp Act, Contracts Act,
Forward Commission (Regulation) Act and various other legislations, which
impinge on its working. On February 3rd, 2006, the FMC found NCDEX guilty of
violating settlement price norms and ordered the exchange to fire one of their
executive.

NCDEX is located in Mumbai and offers facilities in more than 550 centres in
India. is a game of dismanage of market

Commodities Traded

NCDEX currently facilitates trading of 57 commodities -

Agri-based commodities - Castor Seed

Chana
Chilli

50
Coffee - Arabica, Coffee - Robusta
Cotton Seed Oilcake
Crude Palm Oil
Expeller Mustard Oil
Groundnut (in shell)
Groundnut Expeller Oil
Guar gum
Guar Seeds
Gur, Jeera
Jute sacking bags
Kidney Beans
Indian 28 mm Cotton
Indian 31 mm Cotton
Masoor Grain Bold
Medium Staple Cotton
Mentha Oil
Mulberry Green Cocoons
Mulberry Raw Silk
Rapeseed - Mustard Seed
Pepper
Raw Jute
RBD Palmolein
Refined Soy Oil
Rubber
Sesame Seeds
Soy Bean
Sugar - Small
Sugar - Medium
Turmeric
Urad (Black Matpe)
V-797 Kapas
Yellow Peas
Yellow Red Maize
Yellow Soybean Meal.

Bullion -
Gold 1 KG
Gold 100gm
Silver 30 KG
Silver 5 KG

51
Energy -
Brent Crude Oil
Furnace Oil
Light Sweet Crude Oil.

Ferrous metals
Mild Steel Ingot

Plastics
Polypropylene
Linear Low Density Polyethylene
Polyvinyl Chloride.

Non-ferrous metals
Aluminum Ingot,
Copper Cathode
Nickel Ingot
Zinc Cathode

At subsequent phases trading in more commodities would be facilitated.

Facilities offered

NCDEX also offers as an information product, an agricultural commodity index.

This is a composite index, called NCDEXAGRI that convers 20 commodities
currently being offered for trading by NCDEX. This is a spot-price based index.
NCDEX also offers as an information product, the index futures, called
FUTEXAGRI. This is essentially a what-if index. It indicates, that if futures on the
index could be traded, then the current FUTEXAGRI value should be the no-
arbitrage value for the index futures. However, indexes and index futures are not
allowed to be traded under the current regulatory structure. Hence, these are only
available for information, as of now.

52
 METHODOLOGY

• SORCES OF DATA
Primary source of data collection

• SAMPLE SIZE
60 respondents

• METOD OF DATA COLLECTION

Census sampling

• INSTRUMENT USED

Structured questionnaire

• TOOLS AND TECHNIQUE OF ANALYSIS

M.S.Excel, M.S.Word

53
 ABOUT THE PROJECT TOPIC

“CONSUMER BEHAVIOUR REGARDING SECURITIES

MARKET AND COMMODITY MARKET”

The objective of the project is to know about the behaviour of consumer regarding
the securities market and commodities market.

The overall project and research is conducted by keeping in mind following aspect.

• To know the awareness level of general public about securities market and
commodities market.

• To understand their investment pattern.

• To know how they rate risk associated with securities market and
commodities market.

FEDBACK

In my analysis I found that people are aware about securities market

and commodities market but they are not ready to take the risk. There are few % of
people investing in securities market and commodities market only.

54
 FINDINGS AND DATA ANALYSIS

1.) What is the age group of the respondents?

no.of respondents

20 -30 31 -45 46-55 56 and above

In my analysis I found that

Out of 60 respondents 49 are in between the age group of 20-30, 7 are in between
the age group of 31-45, 3 are in between the age group of 46-55,1is in between the
age group of 56 and above.

55
2.) The Profession of the respondents?

businessman government employee

private employee student

In my analysis I found that

Out of 60 respondents 10 respondents are businessman, 6 respondents are

government employee, 28 respondents are private employee, and 16 respondents
are
Students.

56
3.) What is your monthly income?

<10000 1 0000 -25000 25000 -35000 >35000

In my analysis I found that

Out of 60 respondents 40 are in between the monthly income of <10000,13 are in

between the monthly income of 10000-25000,4 are in between the monthly income
of 25000-35000,3 are in between the monthly income of >35000.

57
4.) What percent of income do you invest?

no of respondents

< 10 % 1 0 %-2 0 % 21 %-30 % > 30%

In my analysis I found that

Out of 60 respondents 33 respondents invest <10%,14 respondents invest between

the 10%-20%,6 respondents invest between the 21%-30%,7 respondents invest
>30%.

58
5.) Which instrument do you prefer for your investing?

no of respondents

FD mutual funds Shares Others

In my analysis I found that

Out of 60 respondents 22 respondents use FD as the instrument for their investing,

10 respondents use mutual funds as the instrument for their investing,8 respondents
use shares as the instrument for their investing and 20 respondents use others like
banks etc as the instrument for their investing .

59
6.) Please specify the investment pattern?

no of respondents

short term mid term long term mix

In my analysis I found that

Out of 60 respondents 21 respondents prefer short term investment pattern,10

respondents prefer midterm investment pattern, 22 respondents prefer long term
investment pattern,7 respondents prefer mix investment pattern.

60
7.) You invest on the basis of?

no of respondents

own observation family & friends

newapaper & magazines electronic media

In my analysis I found that

Out of 60 respondents 26 respondents invest on the basis of their own

observations, 17 respondents invest on the basis of their family and friends, 3
respondents invest on the basis of newspaper and magazines, 14 respondents invest
on the basis of electronic media.

61
8.) Are you aware of securities market?

no of respondents

50
40
30
no of respondents
20
10
0
yes no

In my analysis I found that

Out of 60 respondents 45 respondents are aware of the securities market while the
rest 15 respondents are not aware of the securities market.

62
9.) Are you invest in securities market?

40

30

20 no of respondents

10

0
yes no

In my analysis I found that

Out of 45 respondents who are aware of securities market only 30 invest on

securities market while the rest 15 respondents does not invest on securities
market.

63
10.) Which broking company do you prefer for trading?

no of respondents

angel broking ltd sharekhan ICICI Direct others

In my analysis I found that

Out of 54 respondents of this question 16 respondents prefer Angel broking ltd.,8

respondents prefer Sharekhan, 10 respondents prefer ICICI Direct, 20 respondents
prefer others like motilal oswal,reliance,anand rathi,india bulls, and 6 respondents
are unaware of broking firms.

64
11.) Why you have selected this company?

no of respondents

good services low brokerage

company background others

In my analysis I found that

Out of 57 respondents 21 selected the company for its good services, 14 selected
the company for its low brokerage, 12 selected the company for the companies
background, 10 selected the company for others and 3 respondents are unaware of
broking firms.

65
12.) Which facility do you avail from your broker?

no of respondents

SMS facility call alert mail alert all of above

In my analysis I found that

Out of the 55 respondents 7 respondents chooses SMS facility which they prefer
from their broking firm, 6 respondents chooses call alert facility which they prefer
from their broking firm,, 6 respondents chooses mail alert facility which they
prefer from their broking firm, 36 respondents chooses all of the above viz. SMS,
call, mail all of three facility which they prefer from their broking firm, and 5
respondents are unaware of broking firms.

66
13.) How do you rate the risk associated with securities market?

25
20
15
no of respondents
10
5
0
low moderate high

In my analysis I found that

Out of the 55 respondents 10 respondents rate the risk associated with securities
market as low,22 respondents rate the risk associated with securities market as
moderate , 23 respondents rate the risk associated with securities market as high. 5
respondents are unaware of the rate the risk associated with securities market.

67
14.) Are you aware of commodity market?

32

30

28 no of respondents

26

24
yes no

In my analysis I found that

Out of the 60 respondents 26 are aware of the commodity market while the rest 34
are unaware of the commodity market.

68
15.) Are you invest in commodity market?

no of respondents
1 4.5
14
1 3.5
13
1 2 .5
12
1 1 .5
11
yes no

In my analysis I found that

Out of 26 respondents who are aware of commodity market only 12 invest on

commodity market while the rest respondent does not invest on commodity
market.

69
16.) How do you rate the risk associated with commodity market?

no of respondents
25

20

15

10

0
low moderate high

In my analysis I found that

Out of the 51 respondents 8 respondents rate the risk associated with commodity
market as low,23 respondents rate the risk associated with commodity market as
moderate, 20 respondents rate the risk associated with commodity market as high
and 9 respondents are unaware of the risk associated with commodity market.

70
17.) Compare securities market with commodity market………….

Some of the respondents answer the question as

 Commodity market is more volatile segment of market.

 Commodity market is high risk market.
 Securities market is more secure than Commodity market.
 Risk is high in Securities market as compare to Commodity market.
 Commodity market is associated with high degree of risk while Securities
market risk is moderate.
 Commodity market is a market for futures and in for cash and future more
penetration and there is lot stimulation and speculation.
 Securities market is less risky than Commodity market as Commodities
trades in futures which are a highly volatile instrument which requires a margin of
nearly 10% of the contract while in Securities one can invest stocks and can hold it
as long as he can and as much as he has the capability to buy.

71
 CONCLUSION

The report is all about the consumers behavior regarding securities market
and commodity market. The analysis shows the tendency of consumers and their
awareness regarding the securities market and commodity market.
The analysis of 60 respondents shows that the consumers are not well
aware of the securities market and commodity market. The amount of consumers
investing in share market is less and in commodity market even lesser.
In securities market risk involvement is high, securities market is
more volatile because of speculation whereas in commodity market risk
involvement is very high as all the transactions are fully futures. Delivery is on
futures.
Or it can be said, Securities market is less risky than Commodity market
as Commodities trades in futures which are a highly volatile instrument which
requires a margin of nearly 10% of the contract while in Securities one can invest
stocks and can hold it as long as he can and as much as he has the capability to buy

72
QUESTIONNAIRE:-

SECURITY Market Survey Sheet

Name:-
Contact no:-

1) Age group?
a) 20-30 b) 31-45
c) 46-55 d) 56 and above

2) Profession?
a) Businessman b.) Government employee
c.)Private employee d.) Student

3) What is your monthly income?

a.) <10000 b.)10000-25000
c) 25000-35000 d)>35000

4) What percent of income do you invest?

a) <10% b) 10%-20%
c) 21%-30% d) >30%

5) Which instrument do you prefer for your investing?

a) FD b) Mutual funds
c) Shares d) others (specify)

6) Please specify the investment pattern

a) Short term b) mid term
c) Long term d) mix

7) You invest on the basis of

a) Own Observations b) family & friends
c) Newspaper & magazines d) Electronic media

73
8) Are you aware of securities market?
a) Yes b) no

9) Are you invest in securities market?

a) Yes b) no

10) Which broking company do you prefer for trading?

a) Angel broking ltd. b)Sharekhan
c) ICICI Direct d) others (specify)

11) Why you have selected this company?

a) Good services b) low brokerage
c) Company background d) others (specify)

12) Which facility do you avail from your broker?

a) SMS facility b) call alert
c) Mail alert d) all of above

13) How do you rate the risk associated with securities market?
a) Low b) moderate c) high

14) Are you aware of commodity market?

a) Yes b) no

15) Are you invest in commodity market?

a) Yes b) no

16) How do you rate the risk associated with commodity market?
a) Low b) moderate c) high

17) Compare securities market with commodity

market……………………………………………………………………………………
……………………………………………………………………………………………
……………………………………

Thank you for your support

Place: Signature

74
 REFERNCES
Here I would like to present the names of the websites used for references while
preparing this report.

• www.bseindia.cm
• www.moneycontrol.com
• www.nseindia.com
• www.angelbrokoing.com
• www.sebi.gov.in
• www.angeltrade.com
• www.harmony.angeltrade.com

The books used for references while preparing this report.

• Research Metholody-C.R.Kothari
• NCFM

75