Investors online trading And equity market

CONTENTS CHAPTER 1 INTRODUCTION

PAGE NO.

1-6

CHAPTER 2 RESEARCH METHODOLOGY 7-8

CHAPTER 3 INDUSTRY PROFILE 9-20

CHAPTER 4 COMPANY PROFILE 21-25

CHAPTER 5 THEORETICAL FRAME WORK 26-55

CHAPTER 6 DATA ANALYSIS & INTERPRETATION 56-65

CHAPTER 7 FINDINGS & SUGGESTIONS 66-68

CHAPTER 8 CONCLUSION & BIBLIOGRAPHY 69-70

1 The stock market provides a market place for the purchase and sale of securities evidencing the ownership of business property or of a public or business debt . The origin of the stock market therefore goes back to the time when securities representing this property or promises to pay were the first issued and made transferable from one person to another . The earliest record of securities dealing in India were loan transactions of East India company , way back in the eighteenth century . By 1830s there was a perceptible increase in the volume of business , not only in loan but also in corporate stock and shares . In 1850, the companies Act introducing limited liability was enacted and with it commenced the era of modern joint stock enterprise in India . The Act also served to generate investor interest in corporate securities. From 1850 to 1865, the history of brokers and their rise to power in Bombay is the history of Premchand Roychand. Brokerage business attracted many people into the field and by 1860, the number of brokers had increased to 60. An important early in the development of the stock market in India was the formation of Native share and Stock Brokers Association in Bombay, in 1857, the precursor of the present day Bombay Stock Exchange . In fact , the oldest stock exchange in Asia is the BSE having been established in 1875,while the formation of associations in Ahmedabad (1894) , Calcutta (1908)and Madras (1937).

2 OBJECTIVE

SIGNIFICANCE OF THE STUDY:

Religare Securities is one of Indias leading financial services providers with strong presence in South India. It was incorporated in 1994 and over the years it acquired a name of trust through Equity and Commodity Broking businesses. In 2007, Baring India Private Equity Fund II Ltd., a leading private equity firm of international repute acquired a majority stake in the Company. outcry system of trading computerized screen of replace Religare Securities has developed a the conventional manual system trading

computers are all the eligible members.The representatives of M/S Tata Eixsi (India) LTD have taken up the installation of Computers regarding earthling ups etc. The software installed in VECTOR (Vector Engine for Centralized Trading & online Reporting) a product developed by CMC to implement a fully automated trade execution system. A lot of information is online so they can keep up-to-date with what is happening in the trading world.

3 OBJECTIVE OF THE STUDY:

1) To Know the Online screen based trading system adopted by NSE, about its communication facilities and appropriate configuration to set the network. 2) The Primary objective is to analyze the changes in trading after the exchange shifted from outcry to online trading system. 3) To study investors reasons to trade online. 4) To study the measure taken for investor protection in NSE.

NEED FOR THE STUDY:

Stock exchange are the integral part of the capital market . It is the most perfect type of market for securities whether of govt. semi govt.

bodies or other public bodies as for shares and shares and debentures issued by the joint stock Enterprise. Stock exchange provides liquidity to the listed companies they give quotations to the listed companies and help in trading raising funds from the market stock. Exchange Provides ready Marketability and unequal facility for the transfer of ownership of stock Shares and securities. Stock market in India is more than century old and has functioning effectively through

the medium of recognized stock exchanges the stock market which is the integral part of the capital has a economy major impact on the functioning agriculture industrial growth of the and

in turn the monsoon and

performance of the corporate sector in particular reflection the

4 fundamental in the economy would influenced the some of capital stock

market and since the capital market in playing a major role in the Indian economy from the past several years there is an essential need to study the tone of the capital market in India.

PERIOD OF THE STUDY:

Period of study includes a period of One month. In the first spell of the period data collection process regarding on-line trading has been carried on. In the second spell analysis of the data has been worked out . SCOPE OF THE STUDY :

The scope of the study analyse us to know the how the online trading activities are carried out in Religare Securities Ltd. The trading on stock exchange in India used to take place to open outcry without use of information technology for immediate matching or recording of trades. This was time consuming and inefficient with imposed limits on trading volumes and efficiency. In order to provide efficiency liquidity and transparency energy introduced a national wide online fully automated Screen Based Trading System (SBTS). Where a member can punch into the computer quantizes of securities and the price at

5 which he likes to transact are the transact means exhausted as soon as it finds a matching sales are buy order from a counter party. A SBTS electronically matched orders on a strict price time priority and hence cuts down on time, cost and risk of error, as well as on fraud resulting in improved operational efficiency. It allows faster in corporation of price sensitive information. In to prevailing price that increases the information of efficiency of markets. It enables market participants respective of geographical location to trade with one another simultaneously. Improving the depth and liquidity of the market it provides to anonymity by accepting orders, big or small the members without revealing there identity that providing equal access to everybody it also provides a perfect audit price it helps to resolve disputes by logging in the trade execution process in entity. This diverted liquidity from other exchange and in the every first year of the operation. NSE become the leading stock exchange in the company, impacting the fortune of other exchange and forecasting them adopt SBTS also. LIMITATIONS OF THE STUDY:

The study is confined to online trading procedure only .Exhaustive analysis, problem of listing , management of trade , SEBI guidelines relating to are not covered due to limited time to keep the study in manageable limits A study on online trading through investors view has been taken, through only limited number of twelve questions from only thirty investors.

6 Analysis has been done with in a limited boundary or area where the information is lacking behind from other investors when compared to entire geographical area.

CHAPTER- 2 RESEARCH METHODOLOGY

7 Research methodology will help us to know what is the research methods, techniques used in fulfilling the study conducted in Religare Securities Ltd. It also helps in giving scientific justification of the problems, which are all methods are relevant and which are not relevant, why particular research method is appropriate for the study. RESEARCH DESIGN Research design stands for advance planning of the methods adopted for collecting the relevant data and techniques to be used in their analysis, keeping in view the objective of the research and the availability of staff, time and money.

SAMPLING DESIGN A sampling design is a procedure the researcher would adopt in selecting the items for the sample. In fulfilling my project I have selected 30 employees randomly from Religare Securities Ltd to find out the Online Trading in the organization and how it does brings bad or good impact for both Investors and the organization.

In random sampling each and every item in the population have equal chance of inclusion in the sample and each one of the possible samples has the same probability of being selected.

Type of Data Collection Both primary and secondary methods have been used in collecting data from Religare Securities Ltd. Primary method means through observing and interviewing employees of Religare Securities Ltd and through questionnaire method. In secondary method data has been collected from Religare Securities Ltd s website.

Structured questionnaire: Structured questionnaire is a printed list of questions to be filled by the respondents. The structured questions should be short as possible and simple to understand. The questionnaire was designed such that it helps to elicit the accurate information.

Observation Method- This method is that subjective bias is eliminated. This is independent of respondents willingness to respond.

Interview Method- this method of data collection involves of oral-verbal stimuli and reply in terms of oral-verbal response. In fulfilling this project in Religare Securities Ltd personal interview method is used i.e. direct personal investigation.

CHAPTER 3 INDUSTRY PROFILE

9 HISTORY OF STOCK EXCHANGE

The only stock exchanges operating in the 19th century were those of Bombay set up in 1875 and Ahmedabad set up in 1894. These were organized as voluntary non profit-making association of brokers to regulate and protect their interests. Before the control on securities trading became central subject under the constitution in 1950, it was a state subject and the Bombay securities contracts (control) Act of 1925 used to regulate trading in securities. Under this act, the Bombay stock exchange was recognized in 1927 and Ahmedbad in 1937. During the war boom, a number of stock exchanges were organized in Bombay, Ahmedbad and other centers, but they were not recognized. Soon after it became a central subject, central legislation was proposed and a committee headed by A.D. Gorwala went into the bill for securities regulation. On the basis of the committees recommendations and public discussion, the securities contracts (regulation) Act became law in 1956.

DEFINITION OF STOCK EXCHANGE

Stock exchange means anybody or individuals whether incorporated or not, constituted for the purpose of assisting, regulating or controlling the business of buying, selling or dealing in securities. It is an association of member brokers for the purpose of self-regulation and protecting the interests of its members.

10 It can operate only if it is recognized by the Government under the securities contracts (regulation) Act, 1956. The recognition is granted under section 3 of the Act by the central government, Ministry of Finance.

BYLAWS Besides the above act, the securities contracts (regulation) rules were also made in 1975 to regulative certain matters of trading on the stock exchanges. There are also bylaws of the exchanges, which are concerned with the following subjects. Opening / closing of the stock exchanges, timing of trading, regulation of blank transfers, regulation of Badla or carryover business, control of the settlement and other activities of the stock exchange, fixating of margin, fixation of market prices or making up prices, regulation of taravani business (jobbing), etc., regulation of brokers trading, brokerage chargers, trading rules on the exchange, arbitrage and settlement of disputes, settlement and clearing of the trading etc.

REGULATION OF STOCK EXCHANGES

The securities contracts (regulation) act is the basis for operations of the stock exchanges in India. No exchange can operate legally without the government permission or recognition. Stock exchanges are given monopoly in certain areas under section 19 of the above Act to ensure that the control and regulation are facilitated. Recognition can be granted to a stock exchange provided certain

11 conditions are satisfied and the necessary information is supplied to the government. Recognition can also be withdrawn, if necessary. Where there are no stock exchanges, the government licenses some of the brokers to perform the functions of a stock exchange in its absence.

SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI).

SEBI was set up as an autonomous regulatory authority by the government of India in 1988 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market and for matter connected therewith or incidental thereto. It is empowered by two acts namely the SEBI Act, 1992 and the securities contract (regulation) Act, 1956 to perform the function of protecting investors rights and regulating the capital markets.

BOMBAY STOCK EXCHANGE

This stock exchange, Mumbai, popularly known as BSE was established in 1875 as The Native share and stock brokers association, as a voluntary non-profit making association. It has an evolved over the years into its present status as the premiere stock exchange in the country. It may be noted that the stock exchanges the oldest one in Asia, even older than the Tokyo stock exchange, which was founded in 1878.

12 The exchange, while providing an efficient and transparent market for trading in securities, upholds the interests of the investors and ensures redressed of their grievances, whether against the companies or its own member brokers. It also strives to educate and enlighten the investors by making available necessary informative inputs and conducting investor education programs. A governing board comprising of 9 elected directors, 2 SEBI nominees, 7 public representatives and an executive director is the apex body, which decides is the apex body, which decides the policies and regulates the affairs of the exchange.The Exchange director as the chief executive offices is responsible for the daily today administration of the exchange.

BSE INDICES :

In order to enable the market participants, analysts etc., to track the various ups and downs in the Indian stock market, the Exchange has introduced in 1986 an equity stock index called BSE-SENSEX that subsequently became the barometer of the moments of the share prices in the Indian stock market. It is a Market capitalization weighted index of 30 component stocks representing a sample of large, well-established and leading companies. The base year of sensex 1978-79. The Sensex is widely reported in both domestic and international markets through print as well as electronic media. Sensex is calculated using a market capitalization weighted method. As per this methodology the level of the index reflects the total market value of all 30-

13 component stocks from different industries related to particular base period. The total market value of a company is determined by multiplying the price of its stock by the nu7mber of shared outstanding. Statisticians call index of a set of combined variables (such as price and number of shares) a composite Index. An indexed number is used to represent the results of this allocution in order to make the value easier to go work with and track over a time. It is much easier to graph a chart based on Indexed values than on based on actual valued world over majority of the well-known Indices are constructed using Market capitalization weighted method.

NATIONAL STOCK EXCHANGE

The NSE was incorporated in Nov, 1992 with an equity capital of Rs.25 crs. The international securities consultancy (ISC) of Hong Kong has helped in setting up NSE. ISC has prepared the detailed business plans and initialization of hardware and software systems. The promotions for NSE were financial institutions, insurances, companies, banks and SEBI capital market ltd, Infrastructure leasing and financial services ltd and stock holding corporations ltd.

14 CORPORATE HIERARCHY: The Trading member has the facility of defining a hierarchy amongst its users of the NEAT system.

Corporate Manager

Branch 1

Branch 2

Dealer 1

Dealer 2

Dealer 11

Dealer 12

The users of the trading system can logon as either of the user type. The significance of each type is explained below:

A. Corporate Manager: The corporate manager is a term assigned to a user placed at the highest level in a trading firm. The facility to set Branch order value limits and user order value limits is available to the corporate manager.

B. Branch Manager: The branch manager is term assigned to a user who is placed under the corporate manager. The branch manager can set user order value limits for each of his branch.

15 C. Dealer: Dealers are users at the lower most level of the hierarchy. A dealer can view and perform order and related activities only for oneself.

TRADING PROCEDURE BEFORE ON-LINE

THE TRADING RING:

Trading on stock exchanges is officially done in the ring for a few hours from 11.00 A.M to 2.30P.M. Trading before or after official hour is called KERB TRADING. In the trading ring space is provided for specified and non-specified sections. The members of their authorized assistants have to wear a badge or carry with them identify cards given by the exchange to enter the trading ring. They carry a Sauda book or confirmation memos duly authorized by exchange. The stock exchanges operations at floor level are highly technical in nature. Non-members are not permitted to enter into stock market. Hence, various stages have to be completed in executing a transaction at a stock exchange. The steps involved in the methods of trading have been given below:

CHOICE OF BROKER:

The prospective investor who wants to buy shares or the investor who wants to sell his shares cannot enter into hall of the exchange and transact business. They have to act through only member brokers. They can also appoint their bankers for this purpose. Since, bankers can become members of stock exchange as per the present regulations.

16 So, the first task in transacting business on stock exchanges is to choose a broker of repute or banker. Such peoples can ensure prompt and quick execution of a transaction at the possible price. At present there are 4500 authorized brokers in NSBL.

PLACEMENT OF ORDER:

The next step in planning of order for the purchase or sale of Securities with the broker. The order is usually by telegram, telephone, letter, fax etc., or in person. To avoid delay it is placed generally over the phone. The orders may take any one of the forms such as at best order, limit order, immediate or cancel order, discretionary order, limited discretionary order, open order and stop loss order.

ENTRY OF ORDER INTO THE BOOKS:

After receiving the order, the member enters them in his books and the purchase and sale orders are distributed among his assistants to handle them separately in non-specified and odd-lots.

EXECUTION OF ORDER:

Big brokers transact their business through their authorized clerk. Small ones out their business personally. Orders are executed in the trading ring of the NSBL. This works from 12:00 noon to 2:00 p.m discretionary order on all working days from Monday to Friday and a special hour session on Saturday.

17 The floor of the stock exchange is divided into number of markets (pits) according to the nature of security deal in. The authorized clerk/broker goes to the pit and jobbers offer two way quotes for the scrips they deal in. they act as market makers and provide liquidity to the market. The system has been designed to get the bet lids and offers from the jobbers book as well as the best buy and sell orders from the book. If the quotation is not acceptable to the brokers, he may make a counter bid/offer

Ultimately the bargains may be closed at a price mutually acceptable to both the parties. In case the quotation is not acceptable to him, the broker may go to another dealer and make a bargain. All bargains on the stock exchanges are settled by word of mouth and there is no written contract signed immediately by the parties concerned.

Once the transaction is finalized, the deals are recorded in a Chaupri Rough notebook or transaction note or confirmation memos. Soudha block books or confirmation memos are provided by the stock exchange. The details are recorded in these books also. The prices at which different scrip are traded on a particular day published on the next day in the newspapers. An authorized representative of the stock exchange is also present in the hall to supervNSBL the trading.

PREPARATION OF CONTRACT NOTES

Usually, the authorized clerks enter the particulars of the business transacted during a particular day in Kacha Sauda Book they are transferred to Pucca Sauda Book, which are maintained separately for the ready delivery contracts. Then the broker/authorized clerk prepares a contract note. A contract note is a written agreement between the broker and his client for the transaction executed. It contains the details of

18 the contract made for the purchase/sale of Securities, the brokerage chargeable, name of the company, number of shares bought/sold, net rate, etc., it is prepared in a prescribed from and a copy of it is also sent to the client.

PLACING ORDER WITH THE BROKER:

The next step is placing an order for the purchase/sale of securities with the broker. The order is usually placed over telephone, fax. It can also take the form of telegram or letter or in person. The order placed may be any of the following varieties (largely classified on the basis of price limits that it imposes.).

AT BEST ORDER (OR) BEST RATE ORDER: Buy 1000 XYZ ltd., it does not specify any price. It means buy XYZ Ltd. Securities at the prevailing market price. These are executed very fast as there is no price limits.

LIMIT ORDER: Buy 100 XYZ Ltd. At Rs 100, it is an order for the purchase of shares at a specified price by the client.(Rs 100)

LIMITED DISCRETIONARY ORDER: Buy 1000 XYZ Ltd., around Rs.100. it gives discretion to the broker. The price can be a little above Rs 100. How much discretion is implied depends on how the broker and client define around.

19 OPEN ORDER:

It is an order to buy or sell without fixing any time or price limit on the execution of the order.

STOP LOSS ORDER: Buy 100 XYZ Ltd. @ Rs 12 to stop Rs 10. It means buy 100 XYZ Ltd securities at the market rate of Rs. 12 but if on the same day the price falls to Rs. 10 immediately sell of the securities /shares. Thus an attempt is made to limit the loss of sudden unfavorable shift in the market.

NET RATE ORDER: Buy 1000 XYZ Ltd. @Rs.30 net would mean that the client is willing to buy 1000 XYZ Ltd. For not more than Rs.30 per security inclusive of brokerage payable to the broker. Net rate is purchase or sale rate minus brokerage.

MARKET RATE ORDER:

Market rate is net rate plus brokerage for purchase and net minus brokerage for sale. So, Buy 1000 XYZ Ltd. @Rs.30 market would mean that the client is willing to pay Rs.30 plus brokerage for each security of XYZ Ltd.

20 CLEARING HOUSE

The exchange has a clearing house as a part of its Market Operations Department to collect the securities from all members and distribute to each member, all the securities that are due to him in respect of every settlement. The whole of the operations of the clearing house are computerized.

CH is like bank where all the members of NSBL maintain their accounts. CH acts as a member between the buyer and seller. It gets a record of all the transactions (buying and selling) done by a particular week and process these transactions and directs the members to deliver the shares or make payment on the pay-in day.

On the payout day, the CH gives the delivery and the payment to the members according to their respective positions. There are 5 counters in the NSBLs, CH where bad deliveries, auction, odd-lot shares transaction, spot transaction etc.., are dealt in respect of all the transactions done from Monday to Friday all the shares will have to be delivered through the NSBLs CH as per the settlement program field, which is generally, a Saturday on next.

NORMAL TRANSACTION: In case of regular transaction, shares are deposited in clearing house on Tuesday and Wednesday. Payout will be on Thursday. Deliveries will also be on Thursday.

CHAPTER 4 COMPANY PROFILE

21

EQUITIES, DERIVATIVES, COMMODITIES & CURRENCY

Alice Blue Commodities Private Limited Chennai, Tamil Nadu About Us alice blue commodities (p) ltd is a commodity broking firm. Being trading cum clearing member of multi commodity exchange of india limited (mcx), national commodity & derivatives exchange limited (ncdex) we offer online trading in more than 52 future commodities. We have specialists from different backgrounds having a broad set of skills and the perfect experience in commodity market. They are able to bring a depth of talent and creativity to the company. In order to deliver the best service, we're staffed around the clock. Our knowledge base and avid experience acquired by our technical team leverage our customer to benefit much more than that is expected. Time and to market and value for money with continued innovation is the main motto of our team. SERVICES We're continuously thinking creatively, searching for innovations, and working hard to introduce new services in the area of Equity, Derivatives, Commodities & Currency investments and trading. We are Member of Following Equity & Commodity exchanges National Stock Exchange of India Limited (NSE) MCX Stock Exchange Limited (MCX-SX) Inter-Connected Stock Exchange of India Limited (ISE) Multi Commodity Exchange of India Limited (MCX) National Commodity & Derivatives Exchange Limited (NCDEX)

22 National Multi Commodity Exchange of India Limited (NMCX) National Spot Exchange Limited (NSEL) To enhance client relationship we offer Pro-active Relationship Management: Educating and providing awareness about commodities futures markets to clients. Dedicated relationship team to answer client queries round the clock related to any of the commodities. Studying price movements and advising clients in trading opportunities on real time basis using various tools. Trading Recommendations / Alerts to clients on actively traded commodities via online messenger, Flash on ODIN terminals. We regularly conduct awareness and educational programs for our esteemed clients, business associates and traders to facilitate knowledge of the advancements being made in this sector. PRODUCTS AND SERVICES

Black Pepper Castor Seed Copper And Zinc Metals Crude Oil Gaur Gum Gaur Seed Gold Metals Mentha Oil Natural Gas Pulses Chana Silver Metals Soya Oil Wheat

23 BOARD OF DIRECTORS Name of directors with designation.

Chairman Managing Director

A P Kurian C J George

Director

R Bupathy Mahesh Vyas Olivier Daniel Andre Le Grand Punnoose George Rakesh Jhunjhunwala

Company Secretary Additional Director Nominee

Liju K Johnson Jean Christophe Gougeon Tom Jose

24 COMPANY BACKGROUND

Incorporation Year

1994

Registered Office

11th Floor 34/659-P,Civil Line Road Padivattom, Kochi, Kerala-682024

Chairman Managing Director : Company Secretary Auditor Face Value Market Lot Listing Registrar

A P Kurian C J George Liju K Johnson Deloitte Haskins & Sells 1 1 MCX-SX,Mumbai,NSE SKDC Consultants Ltd Kanapathy Towers,3rd Flr 1391/A1,Sathy Road Ganapathy,Coimbatore - 641 006

CHAPTER- 5 THEORETICAL FRAME WORK

25 MEANING OF ONLINE TRADING

online trading refers to buying and selling securities via the Internet or other electronic means such a wireless access, touch-tone telephones, and other new technologies. Technology is revolutionizing every field of human endeavor

and activity. The rapid growth in number, volume and value of securities in the Indian capital Market expose the limitation of handling and dealing in securities in physical /Paper mode ; the shortcomings of the market became manifest in terms of bad deliveries ,delays in transfer and irregular settlement etc.Primary market is also referred to as New Issue Market. Primary market operations include new issues of shares by new and existing companies, further and right issues to existing shareholders, public offers, and issue of debt instruments such as debentures, bonds, etc. The number of listed companies rose from 2265 in 1980 to over Rs. 6800 at the end of 1998 the daily turnover accordingly shot up Rs. 25 crores in 1979-80 to about Rs 260 crores in 1994-95 . The number of shareholders increased from 10 lakhs in 198 to 1.5 crore in 1998.The number of share holder and investors in mutual funds has also risen sharply from about 2 million to over 40 million during this period , rendering thisnation to theposition of having the second largest investor population in the world next only to USA.

26 It eliminates the risk of bad deliveries, which in turn eliminates all costsand wastage of time associated with follow up for rectification. This reduction in risk associated with bad delivery has lead to reduction in Brokerage to the extent of 0.5% by quite a few brokerage firms. Screen-based trading facilitates the investor to keep a track of the transaction from the source to the end .He can punch in the orders and see the

results at the bottom of the screen .Thus,one can get instant trade confirmation. The investor should familiarize himself with order entry screen and the software provided to him. Any mistake made while inputing an order can cause him significantfinancial loss. Moreover, he will be responsible for any losses caused by lack of knowledge and/or experience .when an order is placed and executed, he becomes liable for payment of the securities.

Active trading is dependent upon a number of specialized software systems. Disruptions or failure of any electronic systems utilized may lead the investor with an open position at which time losses can occur.

27 Definition of online trading. The increasingly popular activity of buying and selling securities over the internet, or to a lesser extent, through a broker's proprietary software.

Online Equity Trading: Through the internet, investors can quickly find affordable market research Stock information ,and economic news .They often can have their broker/dealers execute trades almost instantaneously, while generally incurring lower Commissions. These facilities for online investing can thus provide significant benefits to many investors. At the same time ,investors should recognized that online trading might present Special risks. For example ,investors should understand that execution of their orders might be delayed during times of high market trading . Investors should appreciate the usefulness of limit orders, and they should treat bulletin boards and monetary with skepticism.

E-broking or trading of stock market shares on the internet has captured the minds of individual investor worldwide. Report says more than seven million American Investors have gone online in the last 5-7years , and this number is likely to double in the next two years in many other countries including India , individual investors have come out in open support of this new trading

28 system. The Internet has democratized the investing world by giving every webenabled individual access to a rich reservoir of data and analyses on the stock . Both BSE and NSE are trying to provide a cost-effective solution for their Members toprovide a standards-based internet trading facility to their clients at a Fraction of the cost ,of what it would cost the broker if he went alone . The typical Cost of setting up a decent sized internet trading solution is between Rs 10 to 15Crores, which a large number of brokers are unlikely to be affordable .The BSE Therefore plans to offer an exchange based system that leverages the economies of scale to offer routing via a centralized engine with the additions of content of Companies, available with the exchange .BSE has introduced an application Service provider model, which has widely been accepted. NSE has formed a 50-50 joint venture with i-flex solutions to offer the Exchange trading solutions . The joint venture christened dotex international in addition to providing access to the exchanges order matching system will also allow access to fundamental analysis , balance sheet analysis and any other relevant company information. The BSE too is offering tools like technical analysis and

scrip related information etc differs from the way that the automation is built into the system ,with the individual maintaining control of the path of transaction till the stage of execution .Only Demat (Dematerialization) shares can be traded on the internet.Following are the sailent features and benefits offered to individuals who desire to trade online

29 trading through various e-broking firms:

Convenience Liquidity advantages Tracking Technology benefits

In order to stay ahead in the competition e-broking firms have to provide their members with innovative schemes and clearly visible advantages in terms of Hassle-free transacting and more obviously low brokerage rates. Online trading is bottle for the Indian investors purse. The entry of competitive price online broking services has brought the excitement back in a rather lack luster market. It has exposed the investors to the dynamics of day trading. Online trading also has a role to play in economic factors such as the mobilization of savings. From a macro economic perspective in the us, about 15% of savings were invested inequities in 1996. The concept of online trading is eminently flexible due to scalability of

infrastructure and other evolving product offerings.Consequently the many benefits of online trading will continue to attract investors , which in turn in

economics of massive scale from the going mass of transaction. In turn,this will enable web managers of online trading sites to constantly upgrade their product offering can enhance the quality of online trading experience, on a continuous basis.

On-Line surveillance

30

Log-in

31 Enter your Order quickly here

32 ONLINE TRADING PLATFORM They are three types of online trading platforms are their:

a. Easy usage: b. Advance usage: c. Super usage:

ONLINE TRADING PLATFORM

A) Easy usage: It is a powerful browser based trading system for those who are relatively new to online investing. A unique integrated account, linking your banking, broking, and demat accounts. Our cutting-edge trading interface gives you the power to research stock trends, find the latest stock quotes and make fast trades right from the computer you already have. You no longer have to depend on someone else to handle your trades - the power to make your mark on the stock market is in your hands. EASY Usage simplifies the online trading process and gives you unlimited access to your trading history to see where you started, where you are now and where you have room to grow. And with our research and stock watch tools, you can be ready to trade stock at a moment's notice.

33 Benefits of Easy usage:

Trading on NSE & BSE World class resources Integrated Bank, Demat and Trading Accounts Get Current & Historical Order Status Monitor your orders Updated buying power Anywhere access Access to all back end reports and data Online Research & Exchange Calls

B) Advance usage

ADVANCE Usage is a Applet-based system designed specially for Active Traders. Customers can also trade on ADVANCE Usage where they have access to live streaming quotes, which enables them to keep track of real-time price movement. Multiple market watch, message window and trading window, all in one screen, to help customers track individual stocks and make timely trades when investing online. Fast & capable trading application to power your online account.

34 Benefits of Advance usage

Streaming quotes Market Depth Window Trading on NSE & BSE Anywhere access Create Multiple Watch lists

C) Super usage

Trade along side professional stock brokers from the comfort of your own home or office. SUPER Usage is an advanced, customizable online trading platform built exclusively for active traders like you. SUPER Usage launches right from your desktop and offers professional, complimentary tools that can help give you an advantage in the marketplace. SUPER Usage makes the most of state-of the-art technology to deliver power, speed and reliability. Stock exchange is an organized market place where securities are traded. These securities are issued by the government, semi-government bodies, public sector undertakings and companies for borrowing funds and raising resources. Securities are defined as any monetary claims (promissory notes or I.O.U) and also include shares, debentures, bonds and etc., if these securities are marketable as in the case of

35 The government stock, they are transferable by endorsement and alike movable property. They are tradeable on the stock exchange. So is the case shares of companies.

Under the Securities Contract Regulation Act of 1956, securities trading is regulated by the Central Government and such trading can take place only in stock exchanges recognized by the government under this Act. As referred to earlier there are at present 23 such recognized stock exchanges in India. Of these, major stock exchanges, like Bombay Stock Exchange National Stock Exchange,Inter-Connected Stock Exchange, Culcutta, Delhi, Chennai, Hyderabad and Bangalore etc. are permanently recognized while a few are temporarily recognized.

The above act has also laid down that trading in approved contract should be done through registered members of the exchange. As per the rules made under the above act, trading in securities permitted to be traded would be in the normal trading hours (10 A.M to 3.30 P.M) on working days in the trading ring, as specified for trading purpose. Contracts approved to be traded are the following: a. Spot delivery deals are for deliveries of shares on the same day or the next day as the payment is made. b. Hand deliveries deals for delivering shares within a period of 7 to 14 days from the date of contract. c. Delivery through clearing for delivering shares with in a period of two months from the date of the contract, which is now reduce to 15 days.(Reduced to 2 days in demat trading)

36 4.2 HISTORY OF STOCK EXCHANGE The origin of the Stock Exchanges in India can be traced back to the later half of 19th century. After the American Civil War (1860-61) due to the share mania of the public, the number of brokers dealing in shares increased. The brokers organized an informal association in Mumbai named The Native Stock and Share Brokers Association in 1875.later evolved as Bombay stock exchange .

Increased activity in trade and commerce during the First World War and Second World War resulted in an increase in the stock trading. The Growth of Stock Exchanges suffered a set after the end of World War. World wide depression affected them most of the Stock Exchanges in the early stages had a speculative nature of working without technical strength.

After independence, government took keen interest to regulate the speculative nature of stock exchange working. In that direction, securities and Contract Regulation Act 1956 was passed, this gave powers to Central Government to regulate the stock exchanges. Further to develop secondary markets in the country, stock exchanges established at Mumbai, Chennai, Delhi, Hyderabad, Ahmedabad and Indore. The Bangalore Stock Exchange was recognized in 1963. At present there are 23 Stock Exchanges.

Till recent past, floor trading took place in all Stock Exchanges. In the floor trading system, the trade take place through open outcry system during the official trading hours. Trading posts are assigned for different securities where by and sell activities of securities took place. This system needs a face to face contact among

the traders and restricts the trading volume. The speed of the new information reflected on the prices was rather than the investors. 37

The Setting up of NSE and OTCEI (Over the counter exchange of India with the screen based trading facility resulted in more and more Sock exchanges turning towards the computer based trading. BSE introduced the screen based trading system in 1995, which known as BOLT (Bombay on line Trading. System).

Madras Stock Exchange introduced Automated Network Trading System (MANTRA) on October 7, 1996 Apart from Bombay Stock Exchanges have introduced screen based trading. Benefits of Super usage Personalized Stock Quote Lists Fully Customizable display Streaming Intraday, Daily and Weekly Charts Quick Quote. Online Trading in Commodities : INTRODUCTION: Commodities Futures trading! in India have a long history. The first commodity futures market appeared in 1875. But the new standardized form of trading in the Indian capital market is an attractive package for all the people who earn money through speculation by trading into FUTURES. It is a well-known fact and should be remembered that the trading in commodities through futures exchanges is merely, old wine in a new bottle.

38 The trading in commodities was started with the first transaction that took place between two individuals. We can relate this to the ancient method of trading i.e., BARTER SYSTEM. This method faced the initial hiccups due to the problems like: store of value, medium of exchange, deferred payment, measure of wealth etc.. This led to the invention of MONEY. As the market started to expand, the problem of scarcity piled up. The farmers/traders then felt the need to protect themselves against the fluctuations in the price for their produce. In the ancient times, the commodities traded were the Agricultural Produce, which was exposed to higher risk i.e., the natural calamities and had to face the price uncertainty. It was certain that during the scarcity, the farmer, realized higher prices and during the oversupply he had to loose his profitability. On the other hand, the trader had to pay higher price during the scarcity and vice versa. It was at this time that both joined hands and entered into a contract for the trade i.e., delivery of the produce after the harvest, for a price decided earlier. By this both had reduced the future uncertainty. One stone still remained unturned- surety of honoring the contract on part from either of the parties. This problem was settled in the year 1848, when a group of traders in CHICAGO came forward to standardize the trading. They initiated the concept of to-arrive contract and permitted the farmers to lock in the price upfront and deliver the grain at a contracted date later. This trading was carried on a platform called CHICAGO BOARD OF TRADE, one of the most popular commodities trading exchanges today. It was this time that the trading in commodity futures picked up and never looked back. Although in the 19 th century only agricultural produce was traded as a futures contract, but now, the

39 commodities of global or at least domestic importance are being traded over the commodity futures exchanges. This form of trading has proved useful as a device for HEDGING and SPECULATION. The commodities that are traded today are: Agro-Based Commodities Wheat, Corn, Cotton, Oils, Oilseeds etc.. Soft Commodities.. Coffee, Cocoa, Sugar etc Livestock. Live Cattle, Pork Bellies etc Energy.. Crude Oil, Natural Gas, Gasoline etc Precious Metals.. Gold, Silver, Platinum etc Other Metals Nickel, Aluminum, Copper etc

40 Structure of the commodity market.

41 Rolling settlement system: Under rolling settlement system, the settlement takes place n days (usually 1,2 ,3 or 5days) after the trading day. The shares bought and sold are paid in for n days after the trading day of the particular transaction. Share settlement is likely to be completed much sooner after the transaction than under the fixed settlement system. The rolling settlement system is noted by T+N i.e the settlement period is n days after the trading day. A rolling period which offers a large number of days nagate the advantages of the system. Generally longer settlement periods are shortened gradually. SEBI made RS compulsory for trading in 10 securities selected on the basis of the criteria that they were in compulsory demats list and had daily turnover of about Re.1 crore or more. Then it was extend ed to A stocks in Modified Carry Forward Scheme, Automated Lending and Borrowing Mechanism (ALBM) and Borrowing and lending Securities Scheme (BELSS) with effect from dec 31, 2001. SEBI has introduced T+5 rolling settlement in equity market from July 2001 and subsequently shortened the cycle to T+3 from April 2002. After the T+3 rolling settlement experience it was further reduced to T+2 to reduce the risk in the market and to protect the interest of the investors from 1st April 2003. Activities on T+1: conformation of the institutional trades by the custodian is sent to the stock exchange by 11.00 am.

42 The exchanges/clearing house/ clearing corporation would process and download the obligation files to the brokers terminals late by 1.30 pm on T+1. D epository participants accept the instructions for pay in securities by investors in physical form up to 4 pm and in electronic form up to 6 p.m. the depositories accept from other DPs till 8p.m for same day processing.

T+2 activities: The depository permits the download of the paying in files of securities and funds till 10.30 am on T+2 from the brokers pool accounts. The depository processes the pay in requests and transfers the consolidated pay in files to clearing House/clearing Corporation by 11.00am/on T+2. The exchange/clearing house/clearing corporation executes the pay-out of securities and funds latest by 1.30 pm on T+2 to the depositories and clearing banks. In the demat mode net basis settlement is allowed. The buy and sale positions in the same scrip can be settled and net quantity has to be settled.

At the end of each trading day, concluded or locked-in trades are received from NSE by NSCCL. NSCCL determines the cumulative obligations of each member and electronically transfers the data to Clearing Members (CMs). All trades concluded during a particular trading period are settled together.

43

 44 2.4 FUNDS SETTLEMENT Currently, NSCCL offers settlement of funds through 13 clearing banks namely Canara Bank Indusind Bank Bank of India HDFC Bank

ICICI Bank UTI Bank

IDBI Bank Standard Chartered Bank HSBC Ltd Kotak Mahindra Bank SBI Union Bank of India & Citibank

Funds pay-in obligation is required to have clear funds in his a/c on or before 11.00 a.m. on the scheduled pay-in day. The payout of funds is cr. to the clearing account of the members on or after 1.30 p.m. on the scheduled payout day. Clearing Account: The clearing account is to be used exclusively for clearing operations i.e., for settling funds and other obligations to the Clearing Corporation including payments of Margins and penal charges. Clearing Members are required to authorize the Clearing Bank to access their clearing account for debiting and crediting their accounts, reporting of balances and other information as may be required by NSCCL from time to time as per the specified format.

45 Safety of Transaction On The Internet The safety of transaction on the internet depends on encryption system used. The better the transaction system , the more difficult it is for any person to Hack the site .Internationally ,the best system available today , According to industry experts , in future when the quantum of funds Manage by the online levels a security related issues Would take the

brokers reach significant

center stage .However, most of the domestic player use some kind of securities features to enable safe transaction on the net .Encryption , build on the Secured socked layer (SSL) protocol developed by Netscape ,provides sufficient amount of security to the customers. Although , a majority of players offer 40-Bits Encryption method , ICICI and investment have already graduated to 128-Bit Encryption technology ..Mr.Anup Bagchi.COO at ICICI Direct, Brokerages are practically a non-issue,going by the US experience. What matters more are things like trust and security especially because the service involves dealing with peoples cash as well as stocks.He normally gets a secured user ID and password ,the secrecy of which is to be maintained entirely by him.If the transaction system requires no manual intervention, it becomes safer.Among the Indian sites,

ICICI Direct. Com ,Investsmart India Ltd., Sharekhan,Indiabulls.com are among the few fully integrated online trading sites.It enablesThe elimination of the possibility of any manual intervention.Thus,orders can beDirectly sent to the exchange, ensuring that the investor gets the best and right

46 Advantages Of Online Trading:

Many customers, who have chosen to trade shares online today , had at onePoint of time been trading through offline brokers .After realizing the advantagesof trading shares online, they have switched over to online trading now .However,before choosing an online trading site ,all the sites should be compared in orderto form a decision.

Online trading has made it possible for anyone to efficient

have easy and

access to more reports and charts than it was previously possible if one whento brokers office .Thus, we have access to a lot more information online to self teach ourselves.

It eliminates the risk of bad deliveries, which in turn eliminates all costs and wastage of time associated with follow up for rectification.

This reduction in risk associated with bad delivery has lead to reduction inBrokerage to the extent of 0.5% by quite a few brokerage firms.

47 Screen-based trading facilitates the investor to keep a track of the transaction from the source to the end .He can punch in the orders and see the results at the bottom of the screen .Thus, one can get instant trade confirmation.

.Online trading has allowed companies

to locate themselves were

theywant, as physical location is not an issue anymore. Companies can establishthemselves according to their gains and losses, for instance, where tax(salesand value-added taxes) is best suited to them.

Online trading gives control to individuals and they can exercise it overtheir accounts thus comprehend what is going on the trade. It is like going back to school and re-educating oneself on how to trade online.

Individuals benefit by saving comparatively a lot more when trading online as the cost per trade is less.

Individuals can invest in a variety of products, unlike earlier when people bought bonds, mutual funds, and stocks for long-term basis. Now they can invest in stocks, and index options, mutual funds, individuals, government, Corporate, municipal bonds, various types of IRA account ,mortgages and even insurance.

48 Other services that one gets by trading shares online: Internet has brought to the retail what was till sometime ago the sole prerogativeof large brokerage houses and high net worth individuals .At the online tradingsites one can access a multimedia of resources to arrive at his stock picks. reliable research with an enviable track record is available free of cost . Most of the e-broking sites offer research reports on most of the top companies andhave data like balance sheets and profit and loss a/c An investor can now access there web sites and do his fundamental and technical analysis, by getting an access to real time quotes ,knowing what other leading brokers think about a company and whether particular scrip is a buy or a sell.Indianinfoline.com Managing Director Mt.Nirmal Jain Notes, sites like ours also offer investors technical analysis tools which enable even relatively detailed analysis like an intra day share price charting, using the tools developed in association with Singapore based Asian bourses.Such as reuters ,CNBC ,read about what the leading CEOs think about the stateOf the economy and capital market .Thus ,the internet helps the investors in shaping their investment decisions.Sites like sharekhan.com and Investmartindia.com allows the facility toreceive updates on mobile phones and via e-mail ,for stocks bought through theirsites . The clients can get automatic update on any news development, pricetargets met ,any news up dates on the stocks posted by the site or any circuit limitreached the stock

via mobile and e-mail for free.Indiabulls.com also offer similar facilities like short messaging services(SMS)On mobile phones of their clients and thus keep them updated.

49 Disadvantages Of Online Trading

The ease and speed of online trading can give the investor a false sense of security and encourage him to trade more frequently without paying any heed tomarket basics like, researching a company or knowing the risk he is going to assume. The concept of chat rooms, which has become very investors ,may provide them with misleading information . chat room participants are often paidto highlight certain stocks. Online trading is not always instantaneous . In a rapidly changing market, orders may not get executed at the price on the computer screen .This is because even anano seconds delay can put one out of the race for that particular stock at thatparticular price. Delays in execution usually arise due to various technological choke pointslike the internet slowing down to heavy traffic or if modems , computer the popular with the

or internet service provider (ISP) is mal

functioning .If the investor dose notfactor in these technological lags while entering into a volatile market ,he maysuffer heavy losses.

50 The investor should familiarize himself with order entry screen and the software provided to him. Any mistake made while inputing an order can cause him significantfinancial loss. Moreover, he will be responsible for any losses caused by lack of knowledgeand/or experience .when an order is placed and executed, he becomes liable for payment of the securities.

Active trading is dependent upon a number of systems. Disruptions

specialized

software

or failure of any electronic systems utilized may lead the investor with an open position at which time losses can occur.

Customers trading on-line may have difficulty accessing their account due to high internet traffic or because of systems capacity limitations .Customers trading through representatives of on- line firms ,when on-line trading has been disabled or in not available because of systemlimitation, may have difficulty reaching account representatives on the telephone during periods of high volume.

51 INTERNET TRADING AND ONLINE INVESTING INTERNET FRAU HOW TO AVOID INVESTMENT SCAMS The serves as an excellent tool for investors, allowing them to easily and inexpensively research investment opportunities. But the internet is also an excellent tool for fraudsters. Thats why you should always think twice before you invest your money in any opportunity you learn about through the internet. This alert tells you hoe to spot different types of internet fraud, what the SEC is doing to fight internet investment scams, and how to use the internet to invest wisely. Navigating the Frontier: where the frauds areThe internet allows individuals or companies to communicate with a large audience without spending a lot of time, effort, or money. Anyone can reach ,ten thousands of people by building an internet website, posting a message on an online bulletin board, entering a discussion in a live chatroom, or send help investors gather valuable information, some online newsletters are tools for fraud. Some companies pay the people who write online newsletters cash or securities to tout or recommend their stocks .While this isnt illegal, the federal securities laws require the newsletters to disclose who paid them, the amount and the type of payment. But many fraudsters fail to do so. Instead, they will lie about the payments they received, their fraudsters fail to do so. Instead, they will lie about the payments they received, their independence, their so-called research their track records. Their newsletters masquerade as sources of unbiased and

52 information, when in fact they stand to profit handsomely if they convince investors to buy or sell particular stocks. Some online newsletters falsely claim to independently research the stocks they profile. others spread false information or promote worthless stocks. The most notorious sometime scalp the stocks they type, driving up the price of the stock with their baseless recommendations and then selling their own holding at high prices and high profits. To learn how to separate the good from the bad, read our tips for checking out newsletters. E-mail Spams Because spam-junk e-mail- is so cheap and easy to create, fraudsters increasingly use it to find investors for bogus investment schemes or to spread false information about a company. Spam allows the unscrupulous to target many more potential investors than cold calling or mass mailing. Using a bulk e-mail program, spammers can send personalized messages to thousands and even millions of internet users at a time. How To Use The Internet Wisely If you want to invest wisely and steer clear of frauds, you must get the facts. Never ever, make an investment based solely on what you read in an

online newsletter or bulletin board posting, specially if the investment involves a small, thinly-traded company that isnt will known and even think about investing on your own in small companies that dont file regular reports with the SEC,Unless you are willing to investigate each company thoroughly and to check the truth of every statement about the company .For instance, youll need to:

53 Get financial statements from the company and be able to analyze them.

Verify the claims about new product development or lucrative contracts.

Call every supplier or customer of the company and ask if they really do business with the company.

Check out the people running the company and find out if they have ever made money for

Online Investment Fraud: New Medium, same old scam The types of investment fraud seen online mirror the frauds perpetrated over the phone or through the mail. Remember that fraudsters can use a variety of internet tools to spread false information, including bulletin boards, online newsletters, spam, or chat including internet relay chat or web page chat. They can also build a glitzy, sophisticated web page. All of these tools cost very little money and can be found at the fingertips of fraudsters. Consider all offers with skepticism. Investment frauds usually fit one of the following categories :

54 The pump and Dump Scam

Its common to see messages posted online that urge readers to buy a stock quickly or tell you to sell before the prices goes down. Often the writers will claim to have inside information about an impending development or to use an infallible combination of economic and stock market data to pick stocks. In reality, they may be insiders or paid promoters who stand to gain by selling their shares after the stock price is pumped up by gullible investors. Once these fraudsters sell their shares and stop hyping the stock, the price and investors lose their typically falls

money. Fraudsters frequently use this plan with

small, thinly traded companies because its easier to manipulate a stock when theres little or no information available about the company.

The Pyramid

Be wary of messages that read .How To Make Big Money From Your Home Computer!!! One online promoter claimed that investors could turn 45 into$60000 in just three to six weeks, in reality, this program was nothing more than a products toted do not even exist-they are merely scams, be wary of opportunities that promise spectacular profits or guaranteed returns. If the deal sounds too good to be true, then it is probable.

55 Off-Shore Frauds At one time, off-shore schemes targeting U.S. investors cost a great deal of money and were difficult to carry out. Conflicting time zones, differing currencies and the high costs of international telephone calls and overnight mailings made it difficult for fraudsters to prey on U.S. residents. But the internet has removed those obstacles. Be extra careful when any considering investment opportunity that comes from another country, because its

difficult for U.S. law enforcement agencies to investigate and prosecute foreign frauds.

CHAPTER- 6

DATA ANALYSIS & INTERPRETATION

56 Q1.DO YOU TRADE ONLINE OR NOT?

OPINION No

Response 20

Yes

80

Total

100

DO YOU TRADE ONLINE OR NOT?

100 80 60 40 20 0 yes no Series1

INTERPRETATION The total number of people who trade online out of 100 is 80 people. The total number of people who does not trade online 20.

57 Q2. DO YOU FEEL ONLINE TRADING IS SECURE?

OPINION No

RESPONSE 15

Yes

85

Total

100

DO YOU FEEL ONLINE TRADING IS SECURE?

100 80 60 40 20 0 yes no

Series1

INTERPRETATIONThe 85 %people believe that online trading is secure. This shows that the online trading has taken a good place in the minds of Indian stock traders and the Indian consumer or investor is moving towards online trading faithfully.

58 Q3.IS SECURITY AN IMPORTANT FACTOR FOR ONLINE TRADING? OPINION Strongly agree RESPONSE 40

Agree

22 5

Neither agree nor disagree

23 Disagree 10

Strongly disagree

DO YOU FEEL ONLINE TRADING IS SECURE?

strongly agree 10 23 40 Agree Neither agree nor disagree disagree 22 strongly disagree

INTERPRETATION Majority of the people agree that they consider security as an important factor when they go for online trading, while 33 respondents disagree with this fact. Five people have neutral opinion.

59 Q4. IN WHICH OF THE FOLLOWING DO YOU TRADE ONLINE?

Equity Portfolio Management Commodities Future and options (Derivatives)

55 15 18 12

In which of the following do you trade online?

12% 18% 55% 15%

Equity Portfolio management Commodities Future and options

INTERPRETATION Maximum number of people prefers to trade in equity online. The second preference is to trade in Portfolio management which is about 15%. 18 deal in Commodities and 12 deal in future and options.

60 Q5. WHICH OF THE FOLLOWING COMPANIES ARE YOU AWARE OF? INDIA INFOLINE ICICI DIRECT SHAREKHAN INDIABULLS KOTAK SECURITIES 32 39 15 8 6

Which of the following companies are you aware of?

8% 6% 32% 15% SHAREKHAN INDIA BULLS 39% KOTAK SEURITIES INDIA INFOLINE ICICI DIRECT

INTERPRETATION Maximum number of people is aware of ICICI DIECT. 32% are aware of INDIA INFOLINE. 15% are aware of SHAREKHAN, 8% are aware of INDIA BULLS and 6% of KOTAK SECURITIES.

61 Q6. DO YOU THINK ONLINE TRADING HAS HELPED THE GROWTH AND DEVELOPMENT OF INDIAN STOCK MARKET?

OPINION YES NO Total

RESPONSE 86 14 100

Do you think online trading has helped the growth and development of Indian stock market?
100 80 60 Series1 40 20 0 YES NO

INTERPRETATION About 86 people responded that online trading has helped the growth and development of Indian stock market and 14 people disagree with this fact.

62 Q7.WHICH OF THE FOLLOWING METHODS DO YOU PREFER?

OPINION Online Offline Both

RESPONSE 62 25 13

Which of the following methods do you prefer?

70 60 50 40 30 20 10 0 Online Offline Both

Series1

INTERPRETATION More than half number of people prefer online trading, 23 people prefer offline trading while 13 people prefer both online and offline.

63 Q8. DO YOU THINK ONLINE TRADING IS EASY AND FAST WAY OF TRADING?

OPINION YES NO

RESPONSE 92 8

Do you think online trading is easy and fast way of trading? 100 80 60 40 20 0 YES NO

Series1

INTERPRETATION Maximum people say that online trading is easy and fast way of trading while 8 people say it is not easy and fast way of trading.

64 Q9. DO YOU THINK INTRODUCTION OF ONLINE TRADING HAS HELPED IN ATTRACTING THE NEW INVESTORS THUS INCREASING THE TRADING VOLUMES AT STOCK MARKET?

OPINION YES NO

RESPONSE 78 22

100 80 60 40 20 0 YES NO Series1

Do you think introduction of online trading has helped in attracting the new investors thus increasing the trading volumes at stock

INTERPRETATION About 78 people feel that online trading has helped in attracting the new investors while 22 people believe that it does not attract new investor.

65 Q10. DO YOU AGREE WITH THE EXTENDED TIMINGS OF TRADING HOURS?

OPINION YES NO

RESPONSE 37 63

DO YOU AGREE WITH THE EXTENDED TIMINGS OF TRADING HOURS?

80 60 40 20 0 YES NO Series1

INTERPRETATION Only 37 people are satisfied with extended trading hours and majority of people i.e., 63 are not happy with the extended hours of trading.

CHAPTER VII CONCLUSIONS, FINDINGS AND SUGGESTIONS

66 FINDINGS

Majority of people find it easy to trade online and about 85 % people believe that online trading is safe and secure. Majority of the people consider security as an important factor for online trading, while 33 respondents disagree with this fact. Five people have neutral opinion.

Maximum amount of people prefer to trade in EQUITY online. The second preference is to trade in PORTFOLIO MANAGEMENT. About 18 deals in COMMODITITES and 12 deal in FUTURE AND OPTIONS.

Maximum number of people aware of ICICI DIECT and INDIA INFOLINE. 15% are aware of SHAREKHAN, 8% are aware of INDIA BULLS and 6% of KOTAK SECURITIES.

About 86 people responded that online trading has helped the growth and development of Indian stock market and also helps in attracting new investors.

Out of 100 respondents, 62 people prefer online trading, 23 prefer offline trading while 13 people prefer both online and offline.

67 SUGGESTIONS

The companies should come up with more and more innovative features in their web portals.

The customer should be educated regularly regarding the new technologies and of online trading and also other relevant information

The companies should make efforts to promote online trading and create awareness about its benefits.

The companies should look after to develop more safe and secure ways of transacting business online.

The companies should make maximum efforts to detect fraud cases and minimize them.

68 In the present scenario to compete with the Brokers would require sound infrastructure and trading as per international standards.

The introduction of on-line trading would influence the investors resulting in an increase in the business of the exchange. It has helped the brokers handling a vast amount of transactions and this can be an efficient trading, delivering, settlement system with adequate protection to investors.

Due to invention of online trading there has been greater benefit to the investors as they could sell/buy shares as and when required and that to with online trading.

The brokers has a greater scope than compared to the earlier times because of invention of online trading.

The concept of business has changed today, this is a service oriented industry hence the survival would require them to provide the best possible service to the clients.

Chapter 8 CONCLUSION & BIBLIOGRAPHY

69

CONCLUSION
In the present scenario to compete with the Brokers would require sound infrastructure and trading as per international standards.

The introduction of on-line trading would influence the investors resulting in an increase in the business of the exchange. It has helped the brokers handling a vast amount of transactions and this can be an efficient trading, delivering, settlement system with adequate protection to investors.

Due to invention of online trading there has been greater benefit to the investors as they could sell/buy shares as and when required and that to with online trading.

The brokers has a greater scope than compared to the earlier times because of invention of online trading.

The concept of business has changed today, this is a service oriented industry hence the survival would require them to provide the best possible service to the clients.

Online trading facility is good boon to the investors. Investor cans easily updated information about their securities (shares etc) day to day.

70 BIBLIOGRAPHY Refarance
on the site at a cost ,which is 10 to 20%of the cost of the broker going solo. In India quite a number of websites today ,offer online trading and e-Broking over the internet. These are either wholly specialized services or are being offered as an extension to an already existing offline business model . popular Websites like ICICI direct.com investmartindia.com,

websites Geojitsecurities.com, 5paisa.com, kotakstreet.com, sharekhan.com,