SUMMER TRAINING REPORT SUBMITTED TOWARDS THE

PARTIAL FULFILLMENT OF POST GRADUATE DEGREE IN

MASTER OF BUSINESS ADMINISTRATION

“STUDY OF FUNDAMENTALS OF
SHARE MARKET OPERATIONS
AND CONSUMER PREFERENCES
FOR ONLINE TRADING”
SUBMITTED BY:
VARUN KATOCH
MBA–PGPM (2009-11)
ENROLMENT NO.: A30101909010

INDUSTRY GUIDE: FACULTY GUIDE:

Ms. Ritika Balyan Mrs. Aprajita Das Gupta
(Senior Relationship Manger)

AMITY GLOBAL BUSINESS SCHOOL,

NOIDA
AMITY UNIVERSITY- UTTAR PRADESH

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 To Whom It May Concern

This is to certify that Mr Varun Katoch , ENROLMENT NO. A30101909010 , a student of

Amity Global Business School, Noida, undertook a project on “STUDY OF
FUNDAMENTALS OF SHARE MARKET OPERATIONS AND CONSUMER
PREFERENCES FOR ONLINE TRADING ”from 1st june to 31st july .
Mr Varun katoch has succesfully completed the project under the guidance
of Ms Ritika Balyan(SR. RELATIONSHIP MANAGER) . He is a sincere and hard working
student with pleasant manners.

Signature with date

(NAME)
(Designation)
(COMPANY NAME)

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 ACKNOWLEDGEMENT

I would like to express my ineptness to Mrs.APRAJITA DAS GUPTA for her outstanding
contribution to my project. She is the person who has always supported me and encouraged
me to work hard. I don’t have words to express my gratitude for her guidance, but will always
follow her principles.

I am thankful to Ms RITIKA BALYAN of Religare Securities Limited, for her

guidance and precious time at every level of this study. She has been a source of inspiration
and a cause of convictions and compulsion.

I also thank my friends for their moral support to accomplish the project work. I thank
AMITY GLOBAL BUSINESS SCHOOL, Noida for providing the technical support.

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1

INDEX
Sr No. Contents Page No.

Executive I-III
Summary

INTRODUCTION
1 1.1 Basic Concepts of
the Topic
1.2 Literature Review
1.3 Need for the Study
1.4 Statement of the
Problem
1.5 Objectives of the
Project
1.6 Research
Hypothesis
1.7 Scope of the Study

2 PROFILE OF THE
2 ORGANISATION
2.1 Name of the
Organisation
2.2 Vision and Mission
2.3 History and
Background
2.4 Group Structure
2.5 Services
2.6 Organisation
Structure
2.7 Competitors of
Religare Sec. Ltd.
2.8 About Religare Sec.
Ltd.
2.9 The Religare Edge

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 RESEARCH
3 DESIGN &
METHODOLOGY
3.1 Introduction to
Research Methodology
3.2 Sampling Design
3.3 Sources of Data
Collection
3.4 Limitations of Study
DATA
PRESENTATION,
ANALYSIS
INTERPRETATION
FINDINGS &
SUGGESTIONS
5.1 Main Findings
(Conclusions)
5.2 Policy Suggestions
5.3 Scope of
Development

6 BIBLIOGRAPHY 42-43
7 ANNEXURE 44-46
1
LIST OF TABLE
Table No. Title of the Table Page No.
5.1 Preference of Investment 30
5.2 Awareness of Online Share Trading 31
5.3 Awareness of Religare as a Brand 32
5.4 Awareness of Religare’s Facilities 33
5.5 DEMAT Account Market 34
5.6 Satisfaction level of Customer 35
5.7 Frequency of Trading % of Earning Invested in
Trading
36
2
LIST OF CHART
Chart No. Title of the Chart Page No.
5.1 Preference of Investment 30
5.2 Awareness of Online Share Trading 31
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5.3 Awareness of Religare as a Brand 32
5.4 Awareness of Religare’s Facilities 33
5.5 DEMAT Account Market 34
5.6 Satisfaction level of Customer 35
5.7 Frequency of Trading % of Earning Invested in
Trading
36

EXECUTIVE SUMMARY

Project Title: - “Risk Management Regarding Working of a

Broking Firm and
Its Investors”

Name of the Organization: - Religare Securities Ltd

Introduction: - All investments are risky, whether in stock, capital

market,
Banking, financial sector, real estate, bullion, gold etc. The degree of
risk however varies on the basis of the features of the assets,
investments instrument, the mode of investment, time frame or the
issuer of the security etc. Risk can be defined as “Possibility of
suffering losses”.” The chance of something happening that will have
an impact upon objectives. It is measured in terms of consequences
and likelihood”. Risk management in a Broking Industry is a new
concept in India, since it Posses’ maximum risk in the financial
market, managing it was felt most essential
by the regulatory bodies and exchanges.

Objectives of the Project:-

➢ To get familiar with the working of a broking firm.
➢ To understand various risks involved in the broking firm.
➢ To understand various risk for the investors of the broking firm.
➢ To manage and reduce the identified risks.

Need of the Study:-

➢ Create awareness among investors about the different risks
involved in the
broking firms.
➢ Understand the total transparency and automation of broking firm

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➢ Give basic knowledge to investors regarding risk in broking firm
➢ Also understand the equity market and different way of trading

Research Hypothesis: - Capital Market is growing very fast,

turnover wise as well as area of operation wise. The activities have
reached through lengths and breadth of the country. So there is
increase in various broking firms. The working of a broking firm is a
very risky job because risk is involved in each and every activity of
the business.

Conclusions:-

➢ The researcher found that the working of a broking firm is a very

risky job because risk is involved in each and every activity of the
business.
➢ The risk prevailing in the business is recognized therefore an
efficient risk management department is essential in every broking
firm.
➢ Broking business is a client-based business. The recent trend of
voluminous increase in investors has also increased the risk involved
in it.
There is need of continuous up gradation of internal control
measures
➢ Staff in a broking firm is continuous busy and due to which they
are always under stress.

Suggestions:-

➢ An Organization should have a risk management function that is

independent of its trading staff i.e. personnel responsible for the risk
management function should be separate from trading floor
personnel.
➢ A periodical compliance review should be conducted to ensure
conformity
with the rules and regulations.
➢ The designated compliance officer should perform a review of
trading
Practices annually.

Limitations of Study:-

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➢ To understand the overall working of share market, the period of
60 days
is not enough.
➢ Moreover, very few investor and agents have a detail knowledge
of the
study.
➢ The study was conducted in Noida only, which restricted the scope
of the study.

CHAPTER I

INTRODUCTION
1.1 Basic Concepts of the Topic
Introduction to Capital Markets Financial System

The financial system of every economy consists of various

constituents such as
1) Financial Institutions
2) Financial Companies
3) Financial Markets
4) Financial Instruments
5) Financial Services
6) Financial regulations
The financial market in India comprised of capital market and money
market
Whereas the financial system of the country comprised of
institutions, which
Operate the financial markets and the financial instruments with
which the
financial system is put into operation.
Tax anomy of financial markets can be understood on functional,
sectoral and
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institutional basis. On a functional basis we can divide financial
markets into
1. Capital market (long term)
2. Money market (short term)

What is Capital Market?

A Capital Market deals in financial assets, excluding coins and

currency. The
financial assets comprise of banking accounts, pension funds,
provident fund,
mutual fund, insurance policy, shares, debentures, and other
securities. If the
2
stock exchanges are well regulated and function smoothly, then it is
an indication
of healthy capital market. Stock exchange provide a good leverage
of the capital
market and their relationship is directly proportional. India has multi-
stock
exchange system with more than 24 stock exchanges functioning
across the
country. In our country, capital markets are generally also known as
security/stock market.
The Indian Capital Markets can be broadly classified into three types
of markets.
1. Money market
2. Primary market
3. Secondary market

Money market
The money market is part of overall financial system and securities
or capital
market. It deals in short term financial assets which can be readily
converted into cash. Money market is a place for trading in money
and short tern financial assets that are as liquid as money. It
provides a platform for short term surplus funds of lenders or
investors and short term requirements of borrowers, the instruments
can be traded at low cost and are highly liquid.

Primary market
The primary market provides the channel for sale of new securities.
Primary
market provides opportunity to issuers of securities; Government as
well as
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corporates, to raise resources to meet their requirements of
investment and/or
discharge some obligation. They may issue the securities at face
value, or at a discount/premium and these securities may take a
variety of forms such as equity, debt etc. They may issue the
securities in domestic market and/or international market.

Secondary Market
Secondary market refers to a market where securities are traded
after being
initially offered to the public in the primary market and/or listed on
the Stock
Exchange. Majority of the trading is done in the secondary market.
Secondary
market comprises of equity markets and the debt markets.

RISK MANAGEMENT
Risk is defined as “possibility of suffering losses”.This risk in itself is
not bad, risk is essential to progress, and failure is often key part of
learning, but we must learn to balance the possible negative
consequences of risk against the potential benefits of its associated
opportunities. This is risk management.

Principles of Risk management are as follows

1 Global Perspective
– Viewing development within the context of large level
developments
– Recognizing both the potential value of opportunity and the
potential
impact of adverse effects

1 Forward looking view

– Thinking towards tomorrow, identifying uncertainties, anticipating
potential outcomes
– Managing project resources and activities while anticipating
uncertainties

1 Open Communications
– Encouraging free-flowing information at and between all project
levels
– Enabling formal, informal, and proper communication
– Using processes that value the individual voice (bringing unique
knowledge and insight to identifying and managing risk).
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4 Integrated management
– Making risk management an integral and vital part of project
management
– Adapting risk management methods and tools to a projects
infrastructure
and culture.

5 Continuous processes
– Sustaining constant vigilance
– Identifying and managing risks routinely through all phases of the
projects
Lifecycle.

6 Shared product vision

– Mutual product vision based on common purpose, shared
ownership, and
Collective communication
– Focusing on results

7 Team work
– Working cooperatively to achieve common goal
– Pooling talents, skills, and knowledge

Functions of Risk Management are as follows

i. Identify - Search for and locate risks before they become problems
ii. Analyze - Transform risks data into decision-making information.
Evaluate
impact, probability, and time frame, classify risks, and prioritize
them.
iii. Plan - Translate risk information into decision and mitigating
actions (both
present and future) and implement those actions
iv. Track - Monitor risk indicators and mitigation actions
v. Control - Correct for deviations from the risk mitigation plan.
vi. Communicate - Provide information and feedback internal and
external to
the project on the risk activities, current risks, and emerging risks.

RISK MANAGEMENT IN A BROKING FIRM

Risk management in a Broking Industry is a new concept in India,
since it poses maximum risk in the financial market, managing it was
felt most essential by the regulatory bodies and exchanges.
Therefore NSE introduced for the first time in India, risk containment
measures that were common internationally but were absent from
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the Indian Securities Market. NSCCL has put in place a
comprehensive risk management system, which is constantly
upgraded to preempt market failures. These measures were taken to
reduce the brokers’ risks. Whereas SEBI has given some guidelines
under Investors Protection to protect investors risks. NSE has given
the following risk management measures.

Margins
NSE has specified Different margins for different instruments like
stocks futures and options etc. Margins depend upon the volatility
and market conditions, It vary from stock to stock and instrument to
instrument
Categorization of stocks for imposition of margins Daily margins
payable by members consists of the following:
1 . Value at Risk Margins
2 . Mark to Market Margins
Daily margin, comprising of the sum of VaR margin and mark to
market margin is payable.

Value at Risk Margin

VaR margin is applicable for all securities in rolling settlement. All
securities are classified into three groups for the purpose of VaR
margin. The VaR based margin would be rounded off to the next
higher integer (For E.g.: if the VaR based Margin rate is 10. 0 1, it
would be rounded off to 11. 00) and capped at 100%.The VaR
margin rate computed as mentioned above will be charged on the
net outstanding position (buy value-sell value) of the respective
clients on the respective securities across all open settlements. The
net positions at a client level for a member are arrived at and
thereafter, it is grossed across all the clients for a member to
compute gross exposure for margin calculation.

For example, in case of a member, if client A has a buy position of

1000 in a
security and client B has a sell position of 1000 in the same security,
the net
position of the member in the security would be taken as 2000. The
buy position of client A and sell position of client B in the same
security would not be netted. It would be summed up to arrive at the
member's exposure for the purpose of margin calculation. VaR
margin rate & Security category.

Mark-to-Market Margin
Mark to market margin is computed on the basis of mark to market
loss of a
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member. Mark to market loss is the notional loss which the member
would incur in case the cumulative net outstanding position of the
member in all securities, at the end of the relevant day were closed
out at the closing price of the securities as announced at the end of
the day by the NSE. Mark to market margin is calculated by marking
each transaction in scrip to the closing price of the scrip at the end
of trading. In case the security has not been traded on a particular
day, the latest available closing price at the NSE is considered as the
closing price. In the event of the net outstanding position of a
member in any security being nil, the difference between the buy
and sell values would be considered as notional loss for the purpose
of calculating the mark to market margin payable.

Some Risk management are also taken by BSE they are

as follows

1. Know your client scheme

Under the procedure the member brokers of the exchange are
compulsory
required to obtain detailed information of clients prior to
commencement
of any transactions with new clients. A similar procedure is also to be
followed for existing clients. This information is to be made available
to
the exchange authorities whenever called for. In case the member
broker
fails to furnish the same it is viewed seriously.

2. Verification of shares at members office

The exchange has outlined the process i.e. in case the transaction in
a
script with one particular client in a settlement exceeds Rs 10 laks
then the member are to send the photocopies of the transfer deeds
and the share
certificates to the company/ registrar for verification of the material
particulars. The basic idea behind the introduction of this procedure
is to prevent fake/forged/stolen shares from being introduced in the
market.

3. Inspection
The department is carrying out inspection of the member brokers
records
as regards compliance of the risk management procedures.

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4. Insurance
The exchange presently has in place insurance policies to protect
itself in
the event of losses on account of fire, damage to computer systems
and a
comprehensive policy that covers risks faced by the exchange, its
member
brokers and the clearinghouse.The risks covered under the basic
cover of the policy are detailed as below.
– Loss to members on account of infidelity of employees
– Loss of member on account of fake/forged/ stolen shares being
introduced
by his clients
– Direct financial losses suffered by the member broker on account
of
physical loss, destruction, theft or damage to securities and cash.
– Loss on account of securities lost in transit
– Loss suffered on account of incomplete transaction
– Loss sustained as final receiving member on exchange on account
of
default of the introducing member
– Loss on account of errors and omission
– Directors and officials liability cover

Measures taken by SEBI for Investors protection are as

follows

Government of India and SEBI have been stressing upon the need for
regulating
the secondary market and bringing transparency in transactions on
the floor of
stock exchanges
The steps taken by SEBI to regulate and control the business of stock
exchanges
and reduce the risks of investors are as follows
1. Regulation on insider trading with the object to curb it completely
and
punish the guilty
2
2. Uniform Trading hours at all the stock exchanges in the country to
check
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arbitrage.
3. Registration of market players- brokers, non member brokers, sub
brokers,
registrars to issues, merchant bankers, portfolio managers,
underwriters,
debenture trustees, custodians etc so as to have access/inspection
of their
books, records and verification of transactions..
4. Indirect supervision through stock exchanges in day-to-day
business by
fixing margins, imposing curbs, penalties and fines.
5. Gradual automation to reduce paper work and ensure
transparency in
transactions this is now almost complete and all stock exchanges
have
been computerized.
6. Brokers contact notes to mention brokerage separately.
7. Nationwide paperless trading through over the counter exchange
of India,
National Stock Exchange, BSE, DSE and other exchanges.
8. Brokers to keep clients money in a separate bank account.
9. Forward trading being banned on stock exchanges
10.Stress upon shorter settlement period.
11.Dematerialization of securities permitted on a selective basis. By
March
2001, about 3500 companies will have compulsory trading in Demat
mode.
12.Stern action against erring brokers, stock exchanges, companies,
merchant
bankers, etc.
13.Regulation for fraudulent trade practices
14.Total transparency and automation of stock exchanges.
15.Effective margin system for smooth settlement.
16.Circuit breaker system to check volatility on the exchanges
17. Introduction of modified carry forward system and automated
lending
borrowing mechanism (ALBM).
18. Introduction of Internet trading.
19.Derivative trading in index based futures of 30, 60 and 90 days.
20.Practicing prudent governance norms.

Recent Development steps taken by SEBI for Investor

protection

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1. Appointment of administrators to check bad deliveries
To get rid of bad deliveries, SEBI has decided to appoint
administrator to
implement the signature guarantee and certificate authentication
programs.
The administrators appointed by SEBI act on behalf regulator in
resolving
problems arising out of signature mismatch

2. Streamlining Investor protection fund

The committee set up by SEBI to review the sources and utilization
of
investor protection fund of stock exchanges has made following
recommendations
– Funds should be on trust structure and set upon under Indian Trust
Act, 1882 with independent trustees
– Regular contributions from active member brokers and stock
exchanges
– Fund to be utilized only for investor claims and not broker claims.
– Trustees to ensure that fund is not deployed in risky instruments or
for the benefit of any member but only in prescribed avenues.
– Time schedule to be specified while setting investor claims.

1. Service centers for investors

SEBI has directed all stock exchanges to constitute service centers
for
investors to enable the investors to have a form for recording and
counseling of their grievances as well as access financial and other
information of companies on government policies, rules, regulations,
etc.

2. Compliance Officer
Each company is required to appoint compliance officer who would
be
able to verify rumors and information floating in the market about
the
company to the stock exchange. This will reduce motivated rumors
about
companies, which aids in price manipulation.

3. Corporate Governance
SEBI has prescribed prudent corporate governance norms for all
listed
companies to ensure transparency and better disclosure practices.

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4. Investor Education
SEBI has taken steps to educate investors through various
awareness
programmes and publications

1.2 Literature Review

No one has done work over there yet, on this topic.
In literature review I read various documents provided by the
manager of
Religare Sec. In this I reffer the Demat form of the Religare Sec. And
Visiting various websites.In this I also read the various modules of
NCFM. And also read the following books:
i) FINANCIAL SERVICES AND MARKETS
Author: - Dr. Gurusamy

ii)RESEARCH METHODOLOGY METOHDS & TECHNIQUES

Author: - C.R.Kothari

iii)PROJECT REPORT WRITING

Author: - M.K.Rampal & S.L. Gupta

1.3 Need for the Study

➢ Create awareness among investors about the different risks
involved in the
broking firms.
➢ Understand the total transparency and automation of broking firm
➢ Give basic knowledge to investors regarding risk in broking firm
➢ Also understand the equity market and different way of trading
➢ Convert our therotical knowledge in to practical knowledge

1.2 Statement of the Problem

There are several financial security companies playing their roles in
Indian equity market. But People don’t have basic knowledge
regarding
stock market. So they not understand there is various risk involved
in the
working of broking firm. Due to none availability of the proper
guidance
most of the person take stock market as gambling.

1.3 Objectives of the Project

 o get familiar with the working of a broking firm.
➢ T
➢ To understand various risks involved in the broking firm.
➢ To understand various risk for the investors of the broking firm.

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➢ To manage and reduce the identified risks.

1.2 Research Hypotheses

Capital Market is growing very fast, turnover wise as well as area of
operation wise. The activities have reached through lengths and
breadth of
the country. So there is increase in various broking firms. The
working of a
broking firm is a very risky job because risk is involved in each and
every
activity of the business.

1.3 Scope of the Study

Company can take review from market through this project.
Management
people can get overall idea about the risk management regarding
working
of broking firms. They also understand what information provide to
investor for avoiding the risk.

CHAPTER II
PROFILE OF THE
ORGANISATION
2.1 NAME : RELIGARE SECURITIES LTD.
Corporate Office:
Plot No.A-3/4/5,2nd Floor, GYS Global, Sector-125,
Noida(U.P.)-201301
Website : www.religare.in
Email : info@religare.in

2.2 VISION & MISSION

Company’s Vision –
“To build Religare as a globally trusted brand in the financial
services domain
and present it as the ‘Investment Gateway of India”.

Company’s Mission –

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“Providing complete financial care driven by the core values of
diligence and
transparency”.

Brand Essence –
“Core brand essence is Diligence and Religare is driven by ethical
and dynamic processes for wealth creation”.

2.3 History and background

RELIGARE Securities Ltd. (RSL) is a wholly owned subsidiary of
RELIGARE Financial Services Ltd. (RFSL), a Company promoted by
the late Dr.Parvinder Singh, Ex-CMD of Ranbaxy Laboratories Ltd.
The primary focus of Religare Securities Ltd. is to cater to services in
Capital Market Operations to Institutional Investors. The Company is
a member of the National Stock Exchange (NSE) and OTCEI. The
growing list of financial institutions with whom RSL is empanelled as
approved Broker is a reflection of the high levels of services
maintained by the Company. REL operates from seven domestic
regional offices, 43 sub-regional offices, and has a presence in 498*
cities and towns controlling 1,837* business locations all over
India.To make a mark in the global arena, REL acquired UK-based
Hichens, Harrison & Co. in 2008 which was subsequently re-named
as Religare Hichens Harrison PLC("RHH"). Hichens, Harrison & Co.
was incorporated in London in the year 1803 and is believed to be
one of the oldest firms of stockbrokers in the City of London.
Pursuant to expansion of REL's business, the company has grown
from largely an equity trading company into a diversified financial
services company. With the addition of RHH the REL group now
operates out of multiple global locations, other than India, (the UK,
the USA, Brazil, South Africa, Dubai and Singapore).RELIGARE was
founded with the vision of providing integrated financial care driven
by the relationship of trust. The bouquet of services offered by
RELIGARE includes Broking (Stocks and Commodities), Depository
Participant Service, Advisory on Mutual Fund Investments and
Portfolio Management Services. RELIGARE is a pioneer in the concept
of partnership to reach multiple locations in order to effectively
service its large base of individual clients. Besides the reach of
RELIGARE, the clients of the company greatly benefit by its strong
research capability, which encompasses fundamentals as well as
technical knowledge.

RELIGARE GROUP:
RELIGARE in recent years has expanded its reach in health care and

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financial services wherein it has multiple specialty hospital and labs
which
provide health care services and multiple financial services such as
secondary
market equity services, portfolio management services, depository
services etc.RELIGARE financial services group comprises of Religare
Securities
Limited, RELIGARE Comdex Limited and RELIGARE Finvest Limited
which
provide services in Equity, Commodity and Financial Services
business &
Religare Insurance Advisory Ltd.

RELIGARE SECURITIES LIMITED

1. Member of National Stock Exchange of India and Bombay Stock
Exchange
of India.
2. Depository Participant with National Securities Depository
Limited(NSDL) and Central Depository Services Limited (CDSL). A
SEBI approved Portfolio Manager. RSL provides platform to all
segments of the investor to leverage the immense opportunity
offered by equity investing in India either on their own or through
managed funds in Portfolio Management. The ARN No. of the
Religare Securities Ltd. is 33764. The ARN No. is required by to be
available with the broker who deals on behalf of investors or sell the
mutual funds of the different companies present in the market.

2.4

Religare Enterprises Limited

Religare Securities Limited

• Equity Broking
• Online Investment Portal
• Portfolio Management Services
• Depository Services

Religare Commodities Limited

• Commodity Broking

Religare Finvest Limited

• Lending and Distribution business
• Proposed Custodial business
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Religare Insurance Broking Limited
• Life Insurance
• General Insurance
• Reinsurance

Religare Capital Markets Limited

• Investment Banking
• Proposed Institutional Broking

Religare Realty Limited

• In house Real Estate
• Management Company

Religare Hichens Harrison**

• Corporate Broking
• Institutional Broking

2.5 SERVICES :-

Religare Arts Initiative Limited

• Business of Art
• Gallery launched - arts-i

Religare Venture Capital Limited

• Private Equity and
• Investment Manager

Religare Asset Management*

• Derivatives Sales
• Corporate finance

2.6 Organization Structure:

2.7 Competititors of Religare:-

There are several financial security companies playing their roles in
Indian equity market. But Religare faces competitions from these
few companies.
➢ ICICI Direct.com
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➢ Share Khan (SSKI)
➢ Kotak Securities.com
➢ India Bulls
➢ HDFC Securities
➢ 5paisa.com
➢ Motilal Oswal
➢ IL&FS
➢ Karvy

2.8 About Religare Securities Limited (RSL)

 One of the leading integrated financial services groups of India
 Diverse range of offerings
 Client base of more than 5000,000 and growing across the retail,
wealth
and Institutional Spectrum.
 Pan India and global footprint.
 Width and depth of management leading a formidable employee
base.
 Best-in-class Research.
 “Sweetly placed” to spot new opportunities and power ahead.

2.9 The Religare Edge

 Diverse offerings
 Dynamic Management Team
 State-of-the art technology
 Vast Distribution and Reach
 Robust Brand Recognition
 Synergistic partnerships
 Innovative Initiatives

CHAPTER III
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RESEARCH DESIGN &
METHODOLOGY
3.1Introduction to Research Methodology-
Research Methodology comprises defining and redefining the
problem,
formulating hypothesis or suggesting solution, collecting, organizing
and
evaluating the data, making deduction and reaching to conclusions
and
determines whether the formulated hypothesis is right and
wrong.Research Methodology is a way to solve research in study and
solving research problems along with logic behind them are defined
through research
methodology. Thus while talking about research methodologies we
are not only talking of research methods but also consider the logic
behind the methods. During my project, I collected data through
various sources primary & secondary.

3.2Sampling Design –
I have taken sample size of 50 respondents. Because the population
is too large so it is difficult to survey.Any organization whether big or
small, private or public need different types of information are to
know its popularity. I have gathered secondary data and primary
data and collected information from the combination of these two
data.

3.3 Sources of Data Collection-

Primary source includes:-
1) Discussion with branch manager
2) Discussion with experts
3) Discussion with investors of the firm.
4) Live trading in the market
5) Data collected from questionnaire.

Secondary source includes:-

1) Various books related to stock market
2) Books related to Financial Management
3) Web sites were used as the vital information source
4) References given by Relationship Manager

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3.4 LIMITATIONS OF STUDY
➢ To understand the overall working of share market, the period of
60 days
is not enough.
➢ Moreover, very few investor and agents have a detail knowledge
of the
study.
➢ The study was conducted in Noida only, which restricted the scope
of the study.
➢ The data provided by the investor and the agents can’t be held
true as
100% correct.
➢ The study was conducted to understand with respect to Risk
involved in broking firm and investors, which is a part of the equity
share market.

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CHAPTER IV
DATA PRESENTATION,
ANALYSIS &
INTERPRETATION
1) Preference of Investment:
Financial Instruments No. Of Investors (50)
Shares 37
Mutual Funds 8
Bonds 4
Derivatives 1
Source: Primary Data (Table No. 5.1)
Chart 5.1
Interpretation: This shows that although the mutual funds market
is on the rise yet, the most favored investment continues to be in the
Share Market. So, with a more transparent system, investment in the
Stock Market can definitely be increased.

2) Awareness of online Share trading :

YES NO
45 5
Source: Primary Data (Table No. 5.2)

Chart 5.2
Interpretation: With the increase in cyber education, the
awareness towards
online share trading has increased by leaps and bounds. This
awareness is
expected to increase further with the increase in Internet education.

3) Awareness of Religare as a Brand.

YES NO
29 21
Source: Primary Data (Table No. 5.3)
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Chart 5.3
Interpretation: This shows that Religare has a reasonable amount
of Brand awareness in terms of a premier Retail stock broking
company. The
company to increase its market share over its competitors should
further leverage this brand image.

4) Awareness of the facilities provided by Religare :

YES NO
42 8
Source: Primary Data (Table No. 5.4)

Chart 5.4
Interpretation: Although there is sufficiently low brand equity
among the target audience yet, it is to be noted that the customers
are not aware of the facilities provided by the company meaning
thereby, that, the company should concentrate more towards
promotional tools and increase its focus on product awareness rather
than brand awareness.

5) DEMAT Account Market :

BROKING FIRMS INVESTORS

Religare Securities 6
ICICI Direct 15
Kotak Securities 4
India Bulls 12
Others 13
Source: Primary Data (Table No. 5.5)

Chart 5.5
Interpretation: This shows that even with sufficiently high Brand
Equity,
Religare ranks only 3rd amongst the Demat account providers. This is
probably
because of two main reasons:
1. Lack of promotion and unfocussed approach towards Product
awareness
1. Non – transparent marketing policies of the company Hence, the
company should crystallize its products and should indulge in
aggressive marketing and promotion.

1) Satisfaction level among Customers with current

Broker :
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 YES NO
46 4
Source: Primary Data (Table No.5.6)

Satisfaction level among Customers with

current broker
Yes - 92% No- 8%
Chart 5.6
Interpretation: This pie chart accentuates the fact that Strategic
marketing,
today, has gone beyond only meeting Sales targets and generating
profit volumes.
It shows that all the competitors are striving hard not only to woo the
customers
but also to make them Brand loyal by generating customer
satisfaction.

2) How often do you trade:

FREQUENCY OF
TRADING
NO. OF INVESTORS
Daily 5
Weekly 13
Monthly 26
Yearly 6
Source: Primary Data (Table No. 5.7)

Frequency of Trading
Daily - 9%
Weekly - 27%
Monthly -53%
Yearly -11%

Chart 5.7
Interpretation: In spite of the huge returns that the share market
promises, we see that there is still a dearth of active traders and
investors. This is because of the non – transparent structure of the
Indian share market and the skepticism of the target audience that is
generated by the volatility of the stock market. It requires efficient
bureaucratic intervention on the part of the Government.

3) Percentage of earnings invested in Share Trading :

1
% of Earning
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Invested
No. of Investors
Up to 10 % 35
Up to 25 % 9
Up to 50 % 4
Above 50 % 2
Source: Primary Data (Table No. 5.8)

Chart 5.8
Interpretation: This shows that people invest only upto 10% of
their earnings in the stock market, again reiterating the volatile and
non-transparent structure of the Indian stock market. Hence,
effective and efficient steps should be undertaken to woo the
customers to invest more in the lucrative stock market.

CHAPTER V
FINDINGS &
SUGGESTIONS
5.1 MAIN FINDINGS (CONCLUSION)
Working with a broking firm especially was really a great experience.
➢ The researcher found that the working of a broking firm is a very
risky job
because risk is involved in each and every activity of the business.
➢ The risk prevailing in the business is recognized therefore an
efficient risk
management department is essential in every broking firm.
➢ Capital Market is growing very fast, turnover wise as well as area
of
operation wise. The activities have reached through lengths and
breadth of
the country. All these necessitated in the introduction of latest
technology
in the form of advanced software’s.
➢ Broking business is a client-based business. The recent trend of
voluminous increase in investors has also increased the risk involved
in it.
There is need of continuous up gradation of internal control
measures

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➢ Staff in a broking firm is continuous busy and due to which they
are
always under stress.

5.2 POLICY SUGGESTIONS

➢ An Organization should have a risk management function that is
independent of its trading staff i.e. personnel responsible for the risk
management function should be separate from trading floor
personnel.
➢ Senior management should regularly evaluate the risk
management
procedure in place to ensure they are appropriate and sound.
➢ Senior management should also foster and participate in active
discussions
with the board of directors, sub brokers, franchisee, staff of risk
management function and investors regarding procedures for
measuring
and managing risk.
➢ Highly qualified staff not only in front office positions such as
trading
desk, relationship officer and sales but also all back office functions
responsible for risk management and internal control.
➢ Risk management or control function should be able to produce a
risk
management report that highlights positions, limits and excess on a
basis
commensurate with trading activity. This report should be sent to
senior
management, reviewed, signed and returned to control staff.
➢ Auditors should perform a comprehensive review of risk
management
annually, emphasizing segregation of duties and validation of data
integrity.
➢ The designated compliance officer should perform a review of
trading
Practices annually.
5.3 SCOPE FOR DEVELOPMENT RELIGARE
SECURITIES)
RELIGARE SECURITIES have set themselves very stringent and high
standards of Risk Management. However I would like to make a few
points, which would help the organization in a big way.
➢ Recording of trader and dealer telephone calls, which will facilitate
to
resolve the disputes at different levels.

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➢ Fast and frequent interaction between the risk managers, the sub
brokers
and client will help in reducing the delay in giving limits.
➢ Periodical visits to the sub brokers and franchisee by the
RELIGARE
SECURITIES personnel for interaction and inspection will help in
minimizing the risk to great extent.
➢ Regarding dealers risks, well-trained and less stressed dealers will
help in
reducing the mistakes. It has been observed that most of the
mistakes are
done when they are under stress. HRD must help in this matter.
➢ In settlement department the persons have be appointed with
utmost care
and their periodic check can be conducted to avoid any employee
fraud.
➢ Along with large client base, quality of clientele will help in
balanced
growth of business and minimizing the risk.

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CHAPTER VI
BIBLIOGRAPHY
&
WEBLIOGRAPHY
➢ FINANCIAL SERVICES AND MARKETS
Author: - Dr. Gurusamy
➢ RESEARCH METHODOLOGY METOHDS & TECHNIQUES
Author: - C.R.Kothari
1
➢ PROJECT REPORT WRITING
Author: - M.K.Rampal & S.L. Gupta
➢ www.religare.in
➢ www.bseindia.com
➢ www.nseindia.com
➢ www.google.co.in
➢ Dalal Street
➢ Various books of Equity Management.

ANNEXURE
QUESTIONNAIRE
Q1. In which of these Financial Instruments do you invest
into?
Shares Mutual Funds Bonds Derivatives
3
Q2. Are you aware of online Share trading?
Yes No
Q3. Heard about Religare?
Yes No
Q4. Do you know about the facilities provided by Religare?
Yes No
Q5. With which company do you have your DEMAT account?
Religare ICICI Direct Kotak Mahindra India Bulls
Others (please specify) __________
Q6. Are you currently satisfied with your Share trading
company?
Yes No
Q7. How often do you trade?
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Daily Weekly Monthly Yearly
Q8. What percentage of your earnings do you invest in share
trading?
Up to 10% Up to 25% Up to 50% Above 50%
Q9. Is broking firms are always risk free?
Yes No
Q10.What more facilities do you think you require with your
DEMAT
account?
------------------------------------------------------------------------------------------------
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3
Additional Information (optional)
Name:
Age:
Phone No:
Occupation:
1

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