trading system of stock exchange

8/3/2019 Trading System of Stock Exchange

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A SUMMER TRAINING PROJECT REPORT ON TRADING SYSTEM2011

ACKNOWLEDGEMENT

At the very outset, I take the opportunity to convey my heartiestgratitudeto those persons whose cooperation, suggestions and support paved theway for the accomplishment of my work successfully.

I am extremely grateful to Mr. Krishna Kumar, Regional Head,BMA Wealth Creators Limited, Patna for giving me the goldenopportunity to pursue my summer internship programme in thisesteemed organization.

I extend my warm thanks to all the members of this office, whohave extended their kind support whatever & wherever needed. I alsoextend my gratitude to the Faculty Of Management Studies, Dr. HariSingh Gour University, Sagar (M.P.) because it is the endeavor of thefaculty that has given me such a scope.

Last but not the least, I am immensely grateful to my familymembers, who not only rendered sustained help, moral andencouragement but also provide me the necessary motivation for thiswork.

With regards

JITENDRA KUMAR KESHRI




DECLARATION

I, Jitendra Kumar Keshri, hereby declare that the project reportnamely, “Trading System Of Stock Exchange” prepared by me is anoriginal work, is the result of independent research carried out by me inpartial fulfillment of the MBA program of FMS Dr. Hari Singh GourUniversity, Sagar (M.P.). To the best of my knowledge and belief, thisresearch is an original piece of my work and is the sheer outcome of myefforts and has not been submitted to any other University or Institutionfor the award of any degree or diploma.

Signature of the student

JITENDRA KUMAR KESHRI MBA 3 rd SemesterFMS, Sagar




EXECUTIVE SUMMARY

Title of the project :

Trading System Of Stock Exchange

Name of the organization:

BMA Wealth Creators Limited

Organizational Guide:

Mr. Krishna Kumar (Regional Head)




List of Abbreviation GOI – Government of India

IPO – Initial Public Offerings

NSE - National Stock Exchange

BSE - Bombay Stock exchange

CDSL – Central Depository Services (India) Limited

NSDL – National Securities Depositories Limited

SEBI – Securities and Exchange Board of India

SBTS – Screen Based Trading System

WAP – Wireless Application Protocol

BOLT - BSE On Line Trading (System)

TWS - Trader Work Station

CRSS - Compulsory Rolling Settlement Segment

CC – Clearing Corporation

NSCCL – National Securities Clearing Corporation

SAT - Securities Appellate Tribunal




Objectives of the study

(a) To have an idea about the various Trading System OfStock Exchange.

(b) To gather some knowledge about the Trading System.

(c) To understand the Trading System in a better way.

(d) To understand the trends of trade in the stock market inthe last few years.




Section AIntroduction




Introduction of Stock Exchange

A Stock Exchange is the single most important institution in thesecondary market for providing a platform to the investors for buying andselling of securities through its member. It is a place where alreadyissued securities of companies are bought and sold by investors. StockExchanges are an organized marketplace, either corporation or mutual

organization, where members of the organization gather to tradecompany stocks or other securities. The members may act either asagents for their customers, or as principals for their own accounts. It alsofacilitates for the issue and redemption of securities and other financialinstruments including the payment of income and dividends.

Traditionally a stock exchange is an association of its members orstock brokers, formed for the purpose of facilitating the buying and

selling of securities by the public and institutions at large and regulatingits day to day operations. Of late however, stock exchanges in India areoperating now with due recognition from Security and Exchange Boardof India (SEBI)/ the Government of India under the securities contracts(Regulation) Act, 1956. There are 24 recognized stock exchanges inIndia, out of which one has not commenced its operations. Out of the 23remaining stock exchanges, the trading volumes are recorded. Most ofthe regional stock exchanges have formed subsidiary companies and

obtained membership of Bombay Stock Exchanges (BSE), or NationalStock Exchange (NSE) or both. Members of these stock exchanges arenow working as sub brokers of BSE / NSE brokers.

Securities listed on the stock exchange(s) have following advantages:-√ The stock exchange(s) provides a fair market place√ It exchanges liquidity√ There is continuous reporting of their prices√ Full information is available on the companies√ Rights of investors are protected

Stock Exchanges inIndia




List of Stock Exchanges in India

Bombay Stock Exchange National Stock Exchange Interconnected Stock Exchange Regional Stock Exchanges

o Ahmedabad Stock Exchangeo Bangalore Stock Exchangeo Bhubaneshwar Stock Exchangeo Calcutta Stock Exchangeo Cochin Stock Exchangeo Coimbatore Stock Exchangeo Delhi Stock Exchangeo Guwahati Stock Exchangeo Hyderabad Stock Exchangeo Jaipur Stock Exchangeo Ludhiana Stock Exchangeo Madhya Pradesh Stock Exchangeo Madras Stock Exchangeo Magadha Stock Exchangeo Mangalore Stock Exchangeo Meerut Stock Exchangeo OTC Exchange Of Indiao Pune Stock Exchangeo Saurashtra Kutch Stock Exchangeo Uttar Pradesh Stock Exchangeo Vadodara Stock Exchange

Historical Background of Stock Exchanges

Earliest records of securities trading in India are availablefrom the end of the eighteenth century. Before 1850, there was businessconducted in Mumbai in shares of the East India Company, which wereconsidered as securities for buying, selling\ & exchange. The shares ofthe Commercial Banks, mercantile bank & the Bank of Bombay weresome of the prominent shares traded.

In 1850, the Companies Act was passed & that heralded thecommencement of the joint stock companies in India.

It was the American civil war that helped Indian to establishbroking business. The leading broker, Shri Premchand Roy Chand

http://www.surfindia.com/finance/bombay-stock-exchange.html

http://www.surfindia.com/finance/national-stock-exchange.html

http://www.surfindia.com/finance/regional-stock-exchanges.html

http://www.surfindia.com/finance/bangalore-stock-exchange.html

http://www.surfindia.com/finance/bhubaneshwar-stock-exchange.html

http://www.surfindia.com/finance/calcutta-stock-exchange.html

http://www.surfindia.com/finance/cochin-stock-exchange.html

http://www.surfindia.com/finance/coimbatore-stock-exchange.html

http://www.surfindia.com/finance/delhi-stock-exchange.html

http://www.surfindia.com/finance/guwahati-stock-exchange.html

http://www.surfindia.com/finance/hyderabad-stock-exchange.html

http://www.surfindia.com/finance/jaipur-stock-exchange.html

http://www.surfindia.com/finance/ludhiana-stock-exchange.html

http://www.surfindia.com/finance/madhya-pradesh-stock-exchange.html

http://www.surfindia.com/finance/madras-stock-exchange.html

http://www.surfindia.com/finance/mangalore-stock-exchange.html

http://www.surfindia.com/finance/meerut-stock-exchange.html

http://www.surfindia.com/finance/otc-exchange-india.html

http://www.surfindia.com/finance/pune-stock-exchange.html

http://www.surfindia.com/finance/kutch-stock-exchange.html

http://www.surfindia.com/finance/uttar-pradesh-stock-exchange.html

http://www.surfindia.com/finance/vadodara-stock-exchange.html

http://www.surfindia.com/finance/vadodara-stock-exchange.html

http://www.surfindia.com/finance/uttar-pradesh-stock-exchange.html

http://www.surfindia.com/finance/kutch-stock-exchange.html

http://www.surfindia.com/finance/pune-stock-exchange.html

http://www.surfindia.com/finance/otc-exchange-india.html

http://www.surfindia.com/finance/meerut-stock-exchange.html

http://www.surfindia.com/finance/mangalore-stock-exchange.html

http://www.surfindia.com/finance/madras-stock-exchange.html

http://www.surfindia.com/finance/madhya-pradesh-stock-exchange.html

http://www.surfindia.com/finance/ludhiana-stock-exchange.html

http://www.surfindia.com/finance/jaipur-stock-exchange.html

http://www.surfindia.com/finance/hyderabad-stock-exchange.html

http://www.surfindia.com/finance/guwahati-stock-exchange.html

http://www.surfindia.com/finance/delhi-stock-exchange.html

http://www.surfindia.com/finance/coimbatore-stock-exchange.html

http://www.surfindia.com/finance/cochin-stock-exchange.html

http://www.surfindia.com/finance/calcutta-stock-exchange.html

http://www.surfindia.com/finance/bhubaneshwar-stock-exchange.html

http://www.surfindia.com/finance/bangalore-stock-exchange.html

http://www.surfindia.com/finance/regional-stock-exchanges.html

http://www.surfindia.com/finance/national-stock-exchange.html

http://www.surfindia.com/finance/bombay-stock-exchange.html




designed & developed the procedure to be followed while dealing inshares.

In 1874, the Dalal Street became the permanent place formeeting the brokers to conduct their business. The brokers organized anassociation on 9 th July 1875 known as “Native share 7 stock Brokers

Association” to protect the stock & interest of the native brokers. Thatwas the foundation of the Stock Exchange, Mumbai. The Exchange wasestablished with 318 members. The Stock Exchange, Mumbai did nothave to look back as it started riding high in the ladder of growth. InJanuary 1899, Mr. James M.Maclen, M.P inaugurated the Brokers hall.

After the 1 st World War, the stock exchange was housedproperly at an old building near the Town Hall. In 1928 the presentpremises were acquired surrounded by Dalal Street, Bombay SamacherMarg and Hamman Street. At new building the present location wasconstructed and was occupied on 1 st December 1930.

In 1950, the regulation of business in securities and stockexchanges became an exclusively Central Govt. subject followingadoption of the constitution of India. In 1956, the Parliament of Indiapassed the Security Contract (Regulation) Act. To regulate the securitymarket, SEBI was initially established on October 12, 1988, as aninterim board under control of the Ministry of Finance, Govt. of India. In1992 the SEBI Act came into existence.

In 1992 Over the Counter Exchange of India (OTCEI) cameinto existence where securities of small companies are listed. In 1994,National Stock Exchange (NSE) came into existence, which brought anend to the open out cry system of trading securities which was in voguefor 150 years, and introduced Screen Board Trading (SBT) system.BSE’s one line t rading system was launched on March 14, 1995. Nowthe trading in securities is done using screen based trading systemthrough duly authorized members of the exchange.




ABOUT THE ORGANIZATION

Board Of Directors

Anubhav Bhatter (Managing Director & CEO) Avinash Agarwal (Director) Shiv Kumar Damani (Director)

Asit Kumar Ghosh (Director) Saikat Ganguly (COO)

About BMA Wealth CreatorsA premier financial services organization providing

individual and corporates with customized financial solutions.

We work towards understanding your financial goalsand risk profile. Our expertise combined with thoroughunderstanding of the financial markets results in appropriateinvestment solutions for you. At Wealth Creators werealize your dreams, needs, aspirations, concerns andresources are unique. This is reflected in every move we makewith and for you. We have deep appreciation for the Value ofbuilding an everlasting relationship with YOU.

BMA WEALTH CREATORS LTD . – which holds corporate membership in National Stock

Exchange Ltd, Bombay Stock Exchange Ltd. and CentralDepositories Securities Ltd




BMA COMMODITIES PVT. LTD.Which holds corporate membership in commodities

exchange of NCDEX and MCX.It is also is SEBI approved AMFI registered Mutual Fundadvisory and intermediary. We inherit the legacy of BMA groupwhich has been one of the dominant entities in Ferrous andFerro Alloy industry in India. The BMA Group has created itsniche in by promoting successful ventures in the fields of coalmining, refractory, steel and Ferro alloy. The strive to achieveexcellence and dynamic growth has been possible throughoptimum mix of technology, customer orientation, best businesspractices, forging alliances, high quality standards andproactive business culture.

MISSIONTo be a premier financial supermarket providing integrated

investment services.

VISIONTo provide integrated financial services building investor

wealth and confidence.

Product and Services Equities & Equity Derivatives (NSE, BSE) Commodity Futures (MCX, NCDEX) Currency Futures (MCX – SX) Depository Services (NSDL, CDSL) Mutual Funds (AMFI) Insurance – Life and Non Life / Group Insurance(IRDA)

IPOs Bonds and fixed Deposits Equity Broking




BMAWC, as a member of the National Stock Exchange and theBombay Stock Exchange, offers you equity trading through a network ofvarious offices across the country. It is our objective to offer you a rangeof services to suit your trading needs. Therefore, apart from investment

activity, you can undertake day trading at both the above exchanges.

Seamless ExecutionBMAWC provides unmatched flexibility and the power of choice to

the clients for executing trades through multiple channels, viz., throughour main office or branches, at any of our franchise centers or overtelephone. A client may use any of these secured channels tocommunicate his/her orders, and he/she would be identified by his/heraccount code. We have endeavoured to design all our processes and

systems with a client-centric focus to provide a client the convenience oftransacting with us through the mode and channel of his/her preference.

Product and Services

Technical Analysis BMAWC has its own Equity Research team with rich

experience in identifying and analyzing attractive investmentopportunities with fundamental long-term growth potential. Theteam also has a division specializing in Technical Analysis,which offers technical tips for short term and day trading.

Daily Analysis Outlines the day’s m arket outlook, latest domestic and

international market developments, our call on the upcoming

economic and market environment and highlights the stockswhich we expect to outperform over the months ahead.

Derivatives TradingBMAWC provides trading facilities in Equity Derivatives at

National Stock Exchange (NSE) since 200 and over the years,been able to generate substantial revenues with rising volumesfrom wide scale participation of retail investors in this segment.




Depository ServicesBMAWC is a depository participant with CDSL and NSDL.

BMAWC offers a range ofservices including :

Account opening facilitiesDematerialization of physical sharesRe-materializationPledging

Financial Products Distribution

Product BasketOur Financial Products Distribution (FPD) desk handles all

types of primary market investments you may require. Be it a

Mutual Fund, Life Insurance, General Insurance , Bonds, FixedDeposits of blue chip corporates or IPO's of Equities. A strongdistribution channel across the country providing easy accessto our clients is dispersed over severalstates.

Mutual FundsOur team tracks the performance of Mutual Funds across

the gamut of investor options and advises investors. In additionto tracking the key performing funds and analyzing theportfolios and maturity profiles of different funds, our FPD teamis geared to advice investors on the available options / NFOs tobest suit their investment needs.




InsuranceBMAWC is a leading intermediary in the LIFE and General

Insurance market licensed by Insurance Regulatory andDevelopment Authority of India. At BMAWC, we analyze theclient's requirement and capacity to understand their riskexposure and then evaluate their insurance portfolio in terms ofits adequacy to protect the same. Our focus is to develop costeffective and near foolproof insurance package forour clients. In the event of a claim, our team facilitates theprocess to ensure speedy settlements.BMAWC has professional relationships with major Life andnon-life insurance companies in the country and is well poisedto provide its clients a comprehensive risk managementstrategy.(Reliance Life Insurance, Birla Sun Life Insurance, Apollo DKVHealth Insurance, NationalInsurance Company and Reliance General Insurance are our KeyPartners)

BondsFor investors who prefer risk-free returns without thetension of volatile markets, the best option is the GoI SavingsBond. These bonds have sovereign guarantee and thus givesafe returns.

Corporate Fixed DepositsBMA WC takes the help of its own Research Desk in order

to choose and cater Fixed Deposits of blue chip corporates.

IPO'sIn case of IPOs of Equities, PSL markets almost all the

major issues that hit the Indian Capital Market.

Customised ServicesAnd if you are interested in any of the above investments,

we would be privileged to be of assistance to you to invest yourmoney safely. All you have to do is to call your nearest




BMAWC Office and any of our team members will get in touchwith you.

Competitive StrengthRegional management (regional hub and spoke topology)for retail operation Large and diverse distribution networkStrong track record of high growth and profitability Strong riskmanagement system Well established brand.

Existing Business Networks

BMA WEALTH CREATORS LTD has 25 strategically located ownoffices in India, with its headquartersin Salt Lake and 700 plus business outlets in all prime locations of India

Eastern Region Southern Region Western Region Northern RegionKolkata Chennai Baroda Delhi

Siliguri Salem Mumbai Noida

Burdwan Bangalore Pune Kanpur

Durgapur Hyderabad Varanasi

Cuttack Coimbatore Lucknow

Bhubaneswar

Jamshedpur

Tamluk




Section BResearch Design




Introduction : -

In this chapter, it is discussed in detail about the assigned topic,

objective of the study, scope of the study, research methodology usedi.e., data source, research design and limitation of the study aredescribed.

Scope of Research:-

In this study, the Trading System Of Stock Exchange have beenanalyzed. It gives an idea about the various courses of conduct made inthe stock market in trading and settlement part. And also, the variousrules regulating trading and settlement have also been discussed here.Besides that, the trends of trade with the passage of time can also beknown from the analysis.

Research Methodology:-

The research conducted in the above case is an Analytical one.Here information has been gathered from the related sources to analyzethem in a suitable order. Moreover, some data have also been analyzedto know the market movement in a better way.

Data Source: -The source of information is both primary and secondary. The

secondary data has been taken through the help of internet to get thefigures required for the research purpose.

Limitations of the study: -

A portion of the study has been conducted with the help of differentdata collected from secondary sources. So, there is a possibility ofincluding few less accurate or appropriate information in the report.

Secondly, the time limit of the training is only 8 weeks, within sucha small time it is very uphill task to prepare a project on such an

important and wide subject. Hence, the time period is also a limitation forthe project.




Section C

About the topic




Online Trading SystemsOnline Trading Systems, was started to help you find the right

trading system to make money in the market. We offer all different typesof trading systems, from Futures Trading, Forex Trading, Stock Tradingto Options Trading. Our Trading systems include day trading, swingtrading and longer term trading systems.

Online Trading Systems will continue to test and list varioustrading systems on our website. All Trading systems including Futures,Forex, Stocks and Options should be tested and verified before you usereal money. Some trading systems will post actual accounts on theirwebsites or newsletters. We still recommend you paper trade theirtrading system before using real money.

Also realize the markets are always changing, and a tradingsystem that has worked in the past might not work going forward.Another thing to consider is when you paper trade a trading system, youcan make money with it, but due to slippage or your trading software theactual results once you go live will not be the same.

Online trading in India

Online trading in India is the internet based investment activity thatinvolves no direct involvement of the broker. There are many leadingonline trading portals in India along with the online trading platforms ofthe biggest stock houses like the National stock exchange and theBombay stock exchange. The total portion of online share trading Indiahas been found to have grown from just 3 per cent of the total turnoverin 2003-04 to 16 per cent in 2006-07.

Facilities of the Online trading in India:

The investor has to register with an online trading portal and getinto an agreement with the firm to trade in different securities followingthe terms and conditions listed down on the agreement. The orderprocessing is done in correct timings as the servers of the online tradingportal are connected to the stock exchanges and designated banks allround the clock. They can also get updates on the trading and check thecurrent status of their orders either through e-mail or through the




interface. Brokerages also provides research content on their websites,such that the clients can take their own decisions on stocks beforeinvesting.

Products and services of the Online trading in India:

The major financial products and services of the Online trading inIndia are like equities, mutual funds, life insurance, general insurance,loans, share trading, commodities trading, portfolio management andfinancial planning.

National stock exchange and Bombay stock exchange:

In spite of many private stock houses at present involved in onlinetrading in India, the NSE and BSE are among the largest exchanges.They handle huge daily trading volumes, supporting large amounts ofdata traffic, and possessing a countrywide network. The automatedonline systems used for trading by the national stock exchange and the

Bombay stock exchange are the NIBIS or NSE's Internet BasedInformation System and NEAT for the national stock exchange and theBSE OnLine Trading system or BOLT for the Bombay stock exchange.




Online Trading in India

::BMA Wealth Creators

:: A1 Technology Online Trading

:: Best online trading

:: Bonanza Online Trading

:: BullishIndian.com OnlineTrading

:: Express Computer OnlineTrading

:: Geojit Securities Online

:: ICICI Online Trading

:: Indiabulls Online

:: India Insurance

:: BSE India

:: JV Financial Online :: Kotak Securities OnlineTrading

:: Mansukh Securities OnlineTrading

:: Quote.com Online Trading

:: SHCL Online Trading

:: STC Online Trading

:: Technical Analysis Trading

:: Union Bank of India OnlineTrading

:: Best Online Trading

Software DemoNobleTrading offers a variety of different trading software to fit our

customer needs.

OmnesysOmnesys technologies pvt. Ltd. Provides software for securities trading and is

a leading provider of OMS for multi asset, multi venue trading system. Omnesyssoftware provides market data and connectivity solutions to both the buy-side andsell-side firms.




Web Based Trading PlatformThe Web Based trading platform is an advanced and flexible

browser-based trading platform for Stocks, Options and Futures. Theproduct combines direct access trading capabilities with an intuitive

web-based platform. The Web platform is FREE with no monthly trademinimums. It Includes Charts, News, Stock Screener, Stock Calendar,Market Movers, Watch Lists and many more insightful tools for research.

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Lightspeed TraderLightspeed Trader, our flagship trading platform, delivers a feature-

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Lightspeed ForexA next generation forex trading platform designed for active traders

looking for an edge. ForexTrader Pro Desktop is a robust, feature richplatform. Advanced charting functionality allows you to spot trends in themarket. Flip between multiple charts and trade setups, layer on technicalstudies, even visually track and trade directly on the charts. Customizeyour trading layouts to suit your style. Try our pre-set layouts or createand save your own. Tear-off windows to ensure that you're never farfrom your next trade, even when working in other programs.

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Online share trading tips • Do not over trade - Do not put all your money in share market.• Do not put all your money in single share or single sector - Put ordivide your money in multiple shares or sectors. This may reduce the

risk of heavy loss.• Do not panic or fear - Think twice before making your trade/plan andonce done stick to it, don’t panic or fear. • Accept Loss - If you trade is going against you and if you are not sureabout your trade then immediately accept the loss and come out of yourtrade. It will save you from heavy loss.• Right Opportunity - Do not fall in trade early, wait for right opportunityand then trade. It’s very important.

"Wait, Watch and then trade" you will get success.• Everyday is not trading day - Do not force yourself to do tradingeveryday. It’s wrong. If you are not sure about the market movement for that day then it always wise decision to be away from market and not totrade.• Keep you greediness away - Most of the people loose in share marketdue to greediness. Get satisfied with whatever profit you get and comeout of that trade and wait for next opportunity. Don’t wait to take huge for that single trade.

Of course, online trading has many pros. There areseveral wonderful reasons to invest online and consideronline trading.

1. Money saving opportunitiesThe amount of money you save depends primarily on the online

brokerage firm that you choose. No two firms are the same. There maybe different regulations, similar to bank regulations. There are minimumdeposits required that must be maintained. As mentioned above, this willdepend on the online brokerage firm.

2. Instant online accessYou can gain instant access to your account, the value of your

portfolio updates immediately before your eyes.

3. Enter online trades at anytimeYou can enter online trades at anytime and from anywhere. This is




very convenient if you live in a different time zone than the country youare trading in. Not to mention, it is especially fit for investors with busyschedules.

4. With online trading you are in chargeYou are in control of your investments. No sales pitches and nohassle. You decide where to invest your money.

5. No need to depend on broker -First up of all you need not have to depend on any share broker for

buying and selling of shares. Depending on broker may result in delay ofbuying and selling of shares which may in turn result in huge loss or lessprofit. If you are doing online share trading then you can execute yourtrades at any time because you are observing every movement of sharemarket right in front of your computer screen.

6. All updates on your computer screen -As you have internet connection with you will get all updates of

government news, companies’ announcements, an d corporatedeclaration etc during market hours. It’s not so practically for your broker to provide you all the updates and news. So its very important point thatyou get all news, especially those news which affects share market rightin front of your computer screen.

“Share Market always reacts to appropriate news”

7. Independent for your trades -On the other part you will get all information of your traders on your

computer screen. You can view yourself your profits and losses doneand depending on your current situation you can plan your furthertrades. In other words you are totally independent for your trades fromyour broker.

You are boss of your self.

Problems online share trading As there are couples of good advantages there are also some

technical disadvantages. As every coin have two sides.

• Disconnection from Internet – In online share trading there is the possibility that your internet

connection may get slow or get stopped, this may result in disconnection

from share market. At such critical times you have to call your executive




(from whom you opened your trading account) and place your order orsquare off your pending orders.

• Computer Problem –

If your computer stops functioning then this may also result indisconnection from share market at this time also you have contact yourexecutive.

• Other Problem – Other problems like electricity disconnection. Solution for this is

inverter or batter backup.Above all technical problems which may exist at any time and they arebeyond our control means not in control.

What is offline share trading – Trading done through share broker is called offline share trading

method

Nevertheless, with all the convenience of online trading there arestill investors who prefer the old fashion way of offline trading. Offlinetrading has lost some popularity but it is still the main form of investing.

Offline trading offers many benefits as well:

1. The one benefit that an investor appreciates the most is thatthey are not alone when making investment decisions.

2. There are experienced and professional brokerage companiesthat handle their investments for them.

3. Investors are not faced with the challenge of making these vitalinvestment decisions; especially, if they do not have the experience

necessary to make the appropriate investments.4. Also, there is someone there to answer any questions that may

cause concerns.

Not to mention, with offline trading mistakes are less likely to takeplace. No one wants to throw their money away or stand by and watchsomeone else throw their money away. It may be wise to hire aprofessional to assist you in making the correct investment decisions ifyou feel you lack the knowledge necessary.




Don’t be led by market rumours or get into shady transactions.

Do not sign blank Delivery instruction slip(s) while meeting security payinobligation

Section D

SWOT Analysis Of Indian StockMarket




SWOT ANALYSIS OF INDIAN STOCK MARKET

STRENGTH:

1. The very first strength of Indian stock market is its ability to providehigh return.2. SEBI a regulatory body of Indian stock market who protects the

interest of the investors.3. Large no. of securities which provides medium for investment.4. Large no. of brokers who plays a role of facilitator for investment.

WEAKNESS:1. The weak point of Indian stock market is its volatility i.e. High risk.2. It is a kind of gambling where no guarantee of return and some

time it depends on luck also.

OPPORTUNITY:1. Stock market provides an opportunity to money lender and money

seeker to invest and use money for their plan.2. It provides an opportunity to the investor to be the owner of the

company and contributes in the business decision of the company.3. Stock market is a kind of indicator of the economic growth of the

country where it provides an provides an opportunity to gainaccording to the inflation of the country or more than that.

THREATS:1. There are many competitors of stock market such as Post office

savings, Public provident fund, company fixed deposits, Fixeddeposits with bank etc. which provides fixed and assured returns.




LIMITATIONS OF STUDY

It is said, “What is worth doing is worth doing best”. In other words a

person should aim at perfection. However in real life this is not alwayspossible. Human have to work within the limitation set by the nature and

society. That is to say even though every possible effort has been made

to make this project report authentic and comprehensive however many

constraints were also at play. The major limitations of the study are:-

Due to paucity of time and resources a countrywide survey

was not possible. Hence only Chandigarh city has been taken

for the study.

Since a smaller sample was chosen so it may not be a true

representative of the population under study.

The possibility of the respondent’s responses being biased

cannot be ruled out.

Most of the study was restricted to Internet and published

data because of the non availability of primary data.

The information given by the respondents might be biased

because some of them might not be interested to given

correct information..

Some of the respondents could not answer the questions due

to lack of knowledge. Some of the respondents of the survey were unwilling to

share information.




Section F

Questionnaire & Interpretation




QUESTIONNAIRE

Dear respondent,

I am a student of MBA, FMS Dr. HARI SINGH GOUR CENTRAL

UNIVERSITY, SAGAR (M.P.) is conducting a research on “ Trading System of the

Stock Market ”. I would be extremely thankful if you spare some time to answer the

following questions. All the facts disclosed by you will be used for academic purpose

only.

PERSONAL PROFILE

(A) Name:(B) Age: Less than 20 years

20 – 40 years Greater than 40 years

(C) Gender:a) Male b) Female

(D) Occupation:a) Service b) Profession c) Business d) Student

(E) Income: Less than Rs 20000 (per month) Rs 20000 – Rs 40000

Greater than Rs 40000 (F) Qualification:

a) Matric b) Under Graduate c) Post Graduate

Q1. Do you invest in share market?

i) Yes ii) No

Q2. Out of the following, which type of instrument are you aware of?

a) Shares b) Mutual Funds c) Debentures d) Bonds e) Derivatives




Q3.Where have you been investing?

a) Shares b) Mutual Funds c) Debentures

d) Bonds e) Derivatives

Q4.At which rates do you want your investment to grow?

a) Steadily

b) At an average rate

c) At fast rate

Q5. How frequently do you invest?a) Daily

b) Weekly c) Monthly d) Yearly

Q6. What percentage of your annual income do you invest in share market?a) Up to 10% b) 10-15% c) 15-20%

d) More than 20%

Q7. By which source of information you came to know about particular option?

a) Self b) Friends and Relatives c) Service providers and Consultants d) Newspapers, Magazines and Advertisements e) Agents f) Workshops & Seminars

Q8.Which factor do you consider before investing in share market?

a) Capital Appreciation b) Maturity Period c) Safety of Principal d) Risk e) Return on investment f) Tax benefits g) Liquidity




Q9. In your opinion, what would be the optimum strategy if stock market dropsimmediately after you invest in it?

a) Cut your losses and transfer funds into secure investments b) Wait to see if investment improves

c) Invest more funds to lower your losses expecting future growth d) Withdraw your funds and stop investing

Q10. Do you have any other investment policy?

a) Yes b) No

Q11. Rate the satisfaction with the return generated by your investment option?

Highly Satisfied Neutral Dissatisfied HighlySatisfied Dissatisfied

(5) (4) (3) (2) (1)a) Shares ______ ______ ______ _______ _________ b) Mutual funds ______ ______ ______ _______ _________ c) Bonds ______ ______ ______ _______ _________ d) Debentures ______ ______ ______ _______ _________ e) Derivatives ______ ______ ______ _______ _________

Q12. Rate the satisfaction with the factors that was considered while investing?

Highly Satisfied Neutral Dissatisfied HighlySatisfied Dissatisfied

(5) (4) (3) (2) (1)a) Return on

Investment ______ ______ ______ _______ _________ b) Tax Benefits ______ ______ ______ _______ _________ c) Capital

Appreciation ______ ______ ______ _______ _________ d) Maturity Period ______ ______ ______ _______ _________ e) Risk ______ ______ ______ _______ _________ f) Safety of principal______ ______ ______ _______ _________ g) Liquidity ______ ______ ______ _______ _________

THANKS FOR YOUR CO-OPERATION..




DATA ANALYSIS AND INTERPREATATION

1. Demographic Profile of investors

Table 1.0: Demographic Profile of investors

Demographics No. of respondents Percentage ofrespondents

AgeLess than 20 years 0 020-40 20 40Greater than 40 30 60

Total 50 Total 100QualificationMatric 0 0Under Graduate 25 50Post Graduate 25 50

Total 50 Total 100OccupationService 19 38Profession 6 12Business 15 30Student 10 20

Total 50 Total 100Income (per month)Less than Rs.20000Rs.20000-40000 10 20Greater than 40000 25 50

15 30Total 100 Total 100

Analysis & Interpretation:

It was found that the major population of investors was greater than 40yrs and

60% was of 20-40 yrs. And 50% respondents were under graduate and 50% were

post graduate. 35% of respondents were doing service. And majority of respondents

i.e. 50% earn income between Rs.20000-40000 per month. It means majority of

investors was greater than 40 years having income in between Rs 20000-40000.




Statement 1. To know whether respondents invest.

Table No. 1.1 To know whether respondents invest.

Investment Decision No. of Respondents Percentage of Respondents

Yes 45 90No 5 10Total 50 100

Figure No. 1.1 To know whether respondents invest.


From the survey it was found that 90% respondents invest in the stock market

and 10% who were non-investors.

90%

10%

Yes No




Statement 2. Awareness regarding types of Investment Instruments

Table No. 1.2 Type of investment option the person is aware of

Types of InvestmentInstruments

No. of Respondents Percentage ofRespondents

Shares 15 30%Mutual Funds 23 46%Debentures 5 10%Bonds 5 10%Derivatives 2 4%Total 50 100%

Figure No.1.2 Type of investment option the person is aware of

Analysis & Interpretation

Above pie-chart shows that 45% investors were aware of the mutual fund,

25% investors were aware of shares, 15% investors were aware of debentures, 10%

investors were bonds. It means majority of persons aware about mutual fund

whereas shares and debentures were of second importance.

30%

46%

10%

10%4%

Shares Mutual Funds Debentures Bonds Derivatives




Statement 3 .To know the type of investment option the person has been

investing

Table No.1.3 Type of investment option the person has been investing

Investment alternative No. of Respondents Percentage of Respondents

Shares 15 30% Mutual Funds 15 30% Debentures 10 20% Bonds 5 10% Derivatives 5 10% Total 50 100%

Figure No.1.3 Type of investment option the person has been investing


From the survey it was found that 30% respondents invest in Mutual funds,

25% invest in Shares and 20% invest in Debentures. Thus, it can be stated that

maximum people invest in Mutual Funds whereas shares are having 2 nd importance.

30%

30%

20%

10%

10%

Shares Mutual Funds Debentures Bonds Derivatives




Statement 4 .To know the rates at which the investment grow

Table No.1.4 The rates at which the investment grow

Investment Growth Rate No. of Respondents Percentage ofRespondentsSteadily 0 0%At an average rate 5 10%At fast rate 45 90%Total 50 100%

Analysis & Interpretation:From the survey it was found that 90% respondents wants their investment grow at

fast rate whereas only 10% respondents were in the favour of investment growth at

average rate.

0%

10%

90%

Steadily At an average rate At fast rate




Statement 5. To know the frequency of investment by the Respondents.

Table No. 1.5 Frequency of investment

Frequency of Investment No. of Respondents Percentage of Respondents

Daily 0 0% Weekly 10 20% Monthly 24 48% Yearly 16 32% Total 50 100%

Figure No.1.5 Frequency of Investment


From the above table & chart it was found that 45 respondents invest monthly,

35 invest yearly and there were 20 respondents who invest daily. Thus, it can be

stated that majority of the investors invest monthly in stock market.

0%

20%

48%

32%

Daily Weekly Monthly Yearly




Statement 6 .To know the percentage of income that respondent invest

annually

Table No. 1.6 The percentage of income that respondent invest annually

Annual IncomeInvested

No. of Respondents Percentage of Respondents

Up to 10% 7 14% 10-15% 11 22% 15-20% 20 40% More than 20% 12 24% Total 50 100%

Figure No. 1.6 The percentage of income that respondent invest annually


From the above table & chart, it was found that 40 respondents invest 15-

20% of their annual income, 24 respondents invest more than 20% of their annual

income, 22 respondents invest up to 10-15% of their income and 14 respondents

invest up to 10% of their income in different investment avenues. Thus, it can be

concluded that majority of investors invest 10% to 20% of their monthly income.

14%

22%

40%

24%

Up to 10% 10-15% 15-20% More than 20%




Statement 7. To know the respondent’s influence on Investment decision.

Table No.1 .7 The respondent’s influence on Invest ment decision

Sources No. of Respondents Percentage of Respondents Self 24 48% Friends & Relatives 10 20% Service providers & consultants 6 12% Newspapers & Advertisement 5 10% Agents 3 6% Workshops & Seminars 2 4% Total 50 100%

Figure No.1.7 The respondent’s influence on Investment decision

Analysis & Interpretation:From the above table & chart, it was found that multiple aspects for investing

influenced respondents.48% respondents take investment decision on the basis of

their personal evaluation where as 20% respondents invest because of influence of

friends & relatives, the consultants influences 12% respondent and the

advertisement influences 10% respondents. It can be stated that majority of the

persons are influenced by their own while opting for investment tool.

48%

20%

12%

10%

6% 4%

Self Friends & Relatives

Service providers & consultants Newspapers & Advertisement

Agents Workshops & Seminars




Statement 8. To Know The Factors That Were Considered While Investing.

Table No. 1.8 The Factors That Were Considered While Investing

Investment Factors No. of Respondents Percentage of Respondents Return on investment 15 30% Tax benefits 9 18% Capital appreciation 7 15% Maturity period 3 6% Risk 6 12% Safety of principal 3 6% Liquidity 7 14% Total 50 100%

Figure No. 1.8 The Factors That Were Considered While Investing


From the survey it was found that the maximum respondents considered

return on investment was most important factor, 18% respondents considered tax

benefits as an important factor and 14% respondents considered capital appreciation

as an important factor. It can be stated that majority of investors were consider return

as an important factor while investing.

30%

18%14%

6%

12%

6% 14%

Return on investment Tax benefitsCapital appreciation Maturity periodRisk Safety of principalLiquidity




Statement 9. To Know Investor’s Action In Case Of Stock Market drop.

Table No. 1 .9 The Investor’s Action In Case Of Stock Market drop

Investor’s preference in caseof losses

No. of Respondents Percentage of Respondents

Transfer funds into secureinvestment 15 25%

Wait to see if investmentimproves

20 40%

Invest more funds 13 30% Withdraw funds & stopinvesting

2 5%

Total 50 100%

Figure No. 1 .9 The Investor’s Action In Case Of Stock Market Drop


From the survey it was found that maximum respondents would wait to see if

their investment improves and start generating funds, 30% respondents would invest

more funds, 25% respondents would transfer funds into secure investment and 5%

respondents would stop investing. It can be stated that majority of investors would

like to wait to see whether investment improves or they can invest more funds.

30%

40%

26%

4%

Transfer funds into secure investment

Wait to see if investment improves

Invest more funds




Statement 10. To Know The Decision Regarding Other Investment Policy

Table no. 1.10 The Other Investment Policy

Investment Decision No. of Respondents Percentage ofRespondents

Yes 49 98% No 1 2% Total 50 100%

Figure 1.10 The Other Investment Policy


From the survey it was found that 98% respondents have the other

investment policy where as 2% respondents do not have the other investment policy.

98%

2%

Yes No




Statement 11. To Know the Satisfaction Level Of Respondents With Their

Investment Option

Table no. 1.11 Important Factors for Choosing The Investment Option

Range

Max. Score=100*5=500 (Highly Satisfied)

Avg. Score=100*3=300 (Neutral)

Min. Score=100*1=100 (Highly Dissatisfied)


Most of the respondents have given the highest summated score to shares.

And the second most important investment option is debentures which influenced

the decision regarding investment. Other important factor is mutual fund coverage

which has the 332 summated score. Return on derivatives get the 280 summated

score.

Particulars HighlyDissatisfie

d

Dissatisfied

Neutral Satisfied HighlySatisfied

Summated Score

(1) (2) (3) (4) (5)

Shares 10 6 14 30 40 384

Mutual funds 12 15 20 35 18 332

Bonds 20 18 35 19 8 277

Debentures 15 10 15 40 20 340

Derivatives 30 10 20 30 10 280




Statement 12. Important Factors That Was Considered While Investing

Table No. 1.12 Important Factors That Was Considered While Investing

Particulars Highly

Dissatisfie

d

Dissatisfie

d

Neutral Satisfied Highly

Satisfied

Summated

Score

(1) (2) (3) (4) (5)

Return on

investment

0 0 4 30 66 462

Tax benefits 0 0 18 48 34 416 Capital

appreciation

0 0 20 40 40 420

Maturity

period

5 5 40 30 20 355

Risk 5 10 20 35 30 375

Safety of

principal

10 20 40 20 10 300

Liquidity 15 15 20 30 20 325

Range:

Max. Score=100*5=500 (Highly Satisfied)

Avg. Score=100*3=300 (Neutral)

Min. Score=100*1=100 (Highly Dissatisfied)


Most of the respondents have given the highest summated score to Return

on investment. And the second most important factor is Capital appreciation which

influenced the decision regarding investment. Other important factor is Tax benefit

which has the 416 summated score.




FINDINGS OF THE STUDY

Following findings were generated from the study:-

1. Maximum investors are aware of all the investment options.

2. Investors do not invest in a single avenue. They prefer different

avenues and maximum investors prefer to invest in shares, mutual

funds & debentures.

3. Maximum investors wants their investment grow at fast rate.

4. The investment decision of investors is influenced by their own

decision and through friends & relatives.

5. Different factors considered by investors while investing are return,

risk, tax benefits, capital appreciation and the most prominent

factor is the return on any investment avenue.

6. Majority of investors invest 15-20% of their annual income.

7. Maximum investors invest on monthly basis.

8. The investors investing in different avenues are highly satisfied

with the return generated by their investment option.

9. Maximum investors have other investment policies.

10. The most important factor is Return which influenced the

decision regarding investment.




Don’t be led by market rumours or get into shady transactions.

Do not sign blank Delivery instruction slip(s) while meeting security payinobligation

Section E

Conclusion




Conclusion

Stock market is a place where the savers and the users if theirfunds come together in the market for finance, and the rules of supplyand demand are applicable and also subject to Government regulation.In the trading, several transfers of funds and securities take placebetween various investors. And after this trading, the accounts of allthose investors need to be settled within a specified time limit. SEBI hasdeveloped the rules and regulations to protect the common investorsfrom market failures by fixing margins, capital adequacy of brokers, limitsthe turnover, indemnity insurance, on-line position monitoring etc. andmost of the company is doing online trading because it helps them to beup-to-date from Stock Market.




Section F

Bibliography




◙◙ www.nseindia.com (website)

◙◙ www.bseindia.com (website)

◙◙ www.google.com (website)

◙◙ BSE’s CERTIFICATION ON SECURITIES MARKET

(BCSM)

◙◙ Securities Market (Basic) Module Work Book

◙◙ Research Methodology- Methods and Techniques (byC.R. Kothari)

◙◙ Financial Management (by Ravi M. Kishore)

trading system of stock exchange

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