Investors Perception Towards Online Trading

A STUDY ON INVESTORS PERCEPTION TOWARDS ONLINE STOCK TRADING
INTRODUCTION
The financial system is possibly the most important institutional and
functional vehicle for economic transformation. Finance is a bridge between the present and the
future and whether the mobilization of savings or their efficient, effective and equitable
allocations for investment, it then access with which the financial system performs its function
that sets the pace for achievement of border national objectives. They consist of complex, closely
related services, markets, and institutions intended to provide an efficient and regular linkage
between investors and depositors. Money, credit and finance are used as media of exchange in
financial systems. They serve as a medium of known value for goods and services can be
exchanged as an alternative to bartering. A modern financial system may include bank, financial
markets, financial instruments and services. Financial market is classified into money market and
capital market.
A capital market is a financial market in which long term debts or

equity backed securities are bought and sold. Capital markets are defined as markets in which
money is provided for periods longer than a year. Capital markets channels the wealth of savers
to those who can put it to long-term productive use like long-term investment. Modern capital
markets are almost invariably hasten on computer based electronic system, most can be accessed
only by entities in financial sector or the treasury departments of government and corporations
but same can be accessed directly by the public. A capital market can be either primary or
secondary market. In primary markets, new stock or bond issued are sold to investors, often via
mechanism known as underwriting. The main entities seeking to raise long term funds on the
primary market are government and business enterprise.
In secondary market, existing securities are sold and bought among

investors or traders, usually on an exchange, over the counter or elsewhere. The existence of
secondary market increases the willingness of investors in primary market, as they know they are
likely to be able to swiftly cash out their investment if the needed areas. A second important
division falls between the stock markets and the bond markets. A secondary market is the
aggregation of buyer & seller of stock. These may include securities listed on a stock exchange as
ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 1

well as those only traded privately. Online trading is the process by which traders buy & sell
securities over an electronic network, typically with a brokerage firm. This type of trading and
investing has become the norm for individual investors and traders since late 1990s with many
brokers offering services via a wide variety of online trading platforms.
Online stock trading is a model where you can enter your trades
directly into your brokers system and let their computer buy and sell for you. This is a
disintermediation of traditional model stock brokers; they may not be another human involved.
Log on to your brokers website or use their mobile app and you have off and running. With the
internet pervasive in home and business , and with mobile devices and applications giving you
access to your online brokerage anywhere you have internet access, buying and selling stocks ,
bonds commodities, currencies , funds, or whatever is easier and faster than ever. Online trading
reduced the amount of time you wanting to make a trade and you broker able to make that trade,
pervasive use of electronic platforms has reduced the amount of paperwork and manual labour
required to prepare, execute and record a trade. Its all electronic now. That cuts cost, improves
speed, and allows lots of discount brokers to provide better services at low prices.
Statement of the problem

This study helps us to understand the investors perception about online trading.
This study will help to understand how an investor selects and uses quality services of the stock
broking company. This study helps to know why the people want to invest in the online stock
market and why they prefer online stock trading instead of other investments. The study will also
help to know is people are resist to use online trading instead of traditional methods, and the
security measures in the online trading to protect the investors.
Significance of the study
The emergence of online stock trading makes the stock trading more easier.
The online stock trading replaces traditional stock trading and avoids the risks and difficulties of
it. Now the investors can make investment after he create the Demat A\C. The new innovations in
online stock trading attract more investors to online trading. As a result more investors take online

trading as a reliable source of income. Stock trading is also an important factor when it comes to
economic development and national income. More investors into stock trading help the country to
find new sources of income and it can allocate for economic development.
Scope of the study
This study aimed at collecting information about the stock investing public to know
about their preference towards online trading. The study is limited to Perumbavoor municipality.
The study would help to find out trend prevailing among the investor public such as how they
choose the brokerage house, frequency of trading, factors considering for making buying and
selling decisions.
Objectives
1. To study demographic profile of online investors in Perumbavoor Municipality.
2. To identify the perception of the investors towards online stock trading.
3. To find out the factors that is considered by the investors before choosing a brokerage
home.
4. To find out the problems faced by the investors while doing online trading
5. To suggest various measures to improve online trading.
Hypothesis
Ho = There is a relationship between investors income level and amount of investment in
online stock trading.
H1 = There is no relationship between investors income level and amount of investing in

online stock trading.

Methodology
The required data for the project collect through two ways;
1. Primary data:
Primary data is original research data that is obtained through first handed
investigation. It is collected through primary research like interviews, questionnaire etc. The
primary data for the study is directly collect from the selected sample through pre-determined
setoff questions in the form of questionnaire.
2. Secondary data:
Secondary data refers the data that was collected by someone other than
the researcher. It is the data which is already founded by any other person for his study and the
researcher uses the data for his study The secondary data for the study is collected from the
journals, magazines, websites, or other published sources etc
Research design
The process of selecting a sample from a large population is called sampling.
Research instrument
Structured questionnaire
Sampling size
` The study is conducting in Perumbavoor municipality among 50 investors, who are

a part of online trading.
Sampling technique
The sampling technique used for the study is convenience sampling method. Convenience
sampling is a specific type of non-probability sampling method that selects samples from the
population who are conveniently available for the study.

Statistical tools of analysis
The tools using in the study for analyzing the data collected through samples are
percentage table analysis, correlation coefficient and t- test.
Correlation Coefficient
A correlation coefficient is a statistical measure of the degree to which changes to the

value of one variable predict change to the value of another. In positively correlated variables,
the value increases or decreases in tandem. In negatively correlated variables, the value of one
increases as the value of the other decreases.
Correlation coefficients are expressed as value between +1 and -1. A coefficient of +1

indicates a perfect positive correlation. A change in the value of one variable will predict a
change in the same direction in the second variable. A coefficient of -1 indicates a perfect
negative correlation. A change in the value of one variable predicts a change in the opposite
direction in second variable. Lesser degrees of correlation are expressed as non-zero decimals.
A coefficient of zero indicates there is no discernable relationship between fluctuations of the
variable.
Testing the significance of an correlation coefficient
Given a random sample from a bivariate normal population. If we are to test the hypothesis that
the correlation coefficient of the population is zero that is the variables in the population are
uncorrelated, we have to apply the following test:
rn-2
t=
1- r2
Here t is based on (n-2) degrees of freedom.
If the calculated value of t exceeds t 0.05 for (n-2), degrees of freedom we say that the
value of r is significant at 5% level. If t < t 0.05 the data are consistent with the hypothesis of an
uncorrelated population.

Limitation of the study
1. Due to shortage of time, this study is conducted among 50 investors only.
2. Area of the study is confined to Perumbavoor municipality. So the findings cannot be

generalized.
3. Sometimes it was difficult to make the respondents understand the purpose of the survey.
4. The study is based on the expressed information or opinion of the respondents which might
have its own limitation.
CHAPTER SCHEME:
The study on investors perception towards online trading in Perumbavoor municipality is

presented in 5 chapters.
Chapter 1 Introduction.
Chapter 2 Review of literature.
Chapter 3 Theoretical frame work.
Chapter 4 Data analysis and interpretation.
Chapter 5 Findings, suggestions and conclusion.

Review of Literature
In the study conducted by Nidhi walia and Ravinder kumar (2007)

examined the investor's preference for traditional trading and online trading. The major findings
of the study were that Indian investors are more conservative, they do not change easily and
Indian traditional traders still choose brokers for trading. But Internet traders are more
comfortable with online trading because of its transparency and complete control over the
terminal.
Several earlier studies done regarding the characteristics of online traders in USA by Barber and
Odean (2002) found that young men are more likely to use the Internet for investing, and that
online investors tend to increase turnover and decrease their performance after switching to online
trading.
Research conducted by Konari Uchida (2006) on the characteristics of Japanese online investors
found Japanese online investors prefer higher capital gains, choose low-volatility stocks less
often, use chart data more frequently, and are more likely to choose stocks to buy and sell
themselves.
To enhance this thought, study conducted by Jyoti Shanker Sahoo (2012), reflects that most of
the Indian investors believe offline trading as a safer and easiest way to trade in stock market. As
investors appreciate the thinking of stock traders and invest according to their advice and
research. Due to lack of exposure towards technology, investors consider online share trading as
challenging task.
Investors need good knowledge and experience for operating the demat account of Chinmaya
(2010) most of the investors are unaware of online trading and they are not confident that they can
do trading independently. But he also states that online trading has bright future in upcoming days
because of the technological development.
In the study carried out by Kasisomayajula (2012), people are facing problems for trading in
stock market due to lack of information of stock market. Investors are more focused to invest their
money in post office schemes, banks etc. investors are very confined towards stock market.

Technology is updating on a rapid rate, due to this investors are focusing towards demat account
as it saves their time and brokerage. With the help of online share trading, investors are able to
judge their portfolio and continuously keep on upgrading it.
Varadharajan.P and Vikkraman.P (2011) in their study has stated that an investor decides on
an investment after getting opinion from family, friends and colleagues, Brokers
recommendation and also other professional advice. The investor also takes into consideration the
market situations like financial results of the companies, bonus issue, Price Earnings Ratio and the
reputation of the company.
Devi.S and Renuga Bharathi. N (2008) found that the following factors namely advertisement,
risk factor, investor grievances, investment pattern, change in life style, stock broker service,
investment knowledge, investment information, personal savings, size of investment, economic
condition and decreasing level of sensex influences the perception of investors on investment.
Ruta Khaparde and Anjali Bhute (2014) in their research suggested that the perception of
investors differs around on the basis of different factors like age, income, experience of investing,
investment objectives and individual social needs. They also suggest that stocks are the most
wonderful category of financial instruments and one of the greatest tools ever invented for
building financial wealth.
Kousalya.P.R and Gurusamy.P (2012) in their research has concluded that investors make self-
decision regarding their investment. Investments are made for a period of less than three years
and there is a significant relationship between age and awareness.
Manasa Vipparthi and Ashwin Margam (2012) revealed that the investors perception is
dependent on the demographic profile and assesses that the investors age, marital status and
occupation has direct impact on the investors choice of investment. The study further revealed
that female segment are not fully tapped and even there is low target on higher income people. It
reveals that Liquidity, Flexibility, Tax savings, Service Quality and Transparency are the factors
which have a higher impact on perception of investors.

Financial system
A financial system is system that allows the exchange between tenders,
investors, borrowers. Financial System operates at national, global, firm and specified levels.
They consist of complex, closely related services, markets, and institutions intended to provide an
efficient and regular linkage between investors and depositors. Money, credit and finance are used
as media of exchange in financial systems. They serve as a medium of known value for goods and
services can be exchanged as an alternative to bartering. A modern financial system may include
bank, financial markets, financial instruments and services.
Capital market
A capital market is a financial market in which long-term debt or equity-
backed securities are bought and sold. Capital markets are defined as markets in which money is
provided for periods longer than a year. Capital markets channel the wealth of savers to those who
can put it to long-term productive use, such as companies or governments making long-term
investments. A capital market can be either a primary market or a secondary market. In primary
markets, new stock or bond issues are sold to investors, often via a mechanism known as
underwriting. The main entities seeking to raise long-term funds on the primary capital markets
are governments (which may be municipal, local or national) and business enterprises
(companies). In the secondary markets, existing securities are sold and bought among investors or
traders, usually on an exchange, over-the-counter, or elsewhere.
Stock Exchange
A stock exchange or bourse is an exchange where stock brokers and traders can
buy and/or sell stocks (also called shares), bonds, and other securities. Stock exchanges may also
provide facilities for issue and redemption of securities and other financial instruments, and
capital events including the payment of income and dividends. Securities traded on a stock
exchange include stock issued by listed companies, unit trusts, derivatives, pooled investment
products and bonds. Stock exchanges often function as "continuous auction" markets, with buyers
and sellers consummating transactions at a central location, such as the floor of the exchange. In
recent years, various other trading venues, such as electronic communication networks, alternative
trading systems and "dark pools" have taken much of the trading activity away from traditional

stock exchanges. The initial public offering of stocks and bonds to investors is by definition done
in the primary market and subsequent trading is done in the secondary market. A stock exchange
is often the most important component of a stock market. Supply and demand in stock markets are
driven by various factors that, as in all free markets, affect the price of stocks.
History
The first organized stock exchange in India was started in 1875 at Bombay and it is stated
to be the oldest in Asia. In 1894 the Ahmedabad Stock Exchange was started to facilitate dealings
in the shares of textile mills there. The Calcutta stock exchange was started in 1908 to provide a
market for shares of plantations and jute mills. Then the madras stock exchange was started in
1920. At present there are 24 stock exchanges in the country, 21 of them being regional ones with
allotted areas. Two others set up in the reform era, viz., the National Stock Exchange (NSE) and
Over the Counter Exchange of India (OICEI), have mandate to have nation-wise trading. They are
located at Ahmedabad, Vadodara, Bangalore, Bhubaneswar, Mumbai, Kolkata, Kochi,
Coimbatore, Delhi, Guwahati, Hyderabad, Indore, Jaipur Kanpur, Ludhiana, Chennai Mangalore,
Meerut, Patna, Pune, Rajkot. The Stock Exchanges are being administered by their governing
boards and executive chiefs. Policies relating to their regulation and control are laid down by the
Ministry of Finance. Government also constituted Securities and Exchange Board of India (SEBI)
in April 1988 for orderly development and regulation of securities industry and stock exchanges.
Major stock exchanges in India
Bombay Stock Exchange (BSE) - located in Mumbai, one of the two principal large stock
exchanges of India
National Stock Exchange of India (NSE) - located in Mumbai, one of the two principal
large stock exchanges of India
Calcutta Stock Exchange - a smaller stock exchange located in Kolkata
Cochin Stock Exchange - a small stock exchange located in Kochi
Inter-connected Stock Exchange of India
Multi Commodity Exchange of India
OTC Exchange of India

Pune Stock Exchange - a small stock exchange located in Pune

National Commodity and Derivatives Exchange
S&P BSE SENSEX - The Barometer of Indian Capital Markets
The Bombay Stock Exchange (BSE)

The Bombay Stock Exchange (BSE) is an Indian stock exchange located at Dalal
Street, Kala Ghoda, Mumbai (formerly Bombay), Maharashtra, India. Established in 1875, the
BSE is Asias first stock exchange. It claims to be the world's fastest stock exchange, with a
median trade speed of 6 microseconds. The BSE is the world's 11th largest stock exchange with
an overall market capitalization of $1.43 Trillion as of March, 2016. More than 5500 companies
are publicly listed on the BSE. Unlike countries like the United States where 70% of the GDP is
derived from larger companies and the corporate sector, the corporate sector in India accounts for
only 12-14% of the national GDP. Of these, as of November 2016, there are only 7,800 listed
companies of which only 4000 trade on the stock exchanges at BSE and NSE. Hence the stocks
trading at the BSE and NSE account for only about 4% of the Indian economy. Bombay Stock
Exchange founded by Premchand Roychand. He was one of the most influential businessmen in
19th-century Bombay. A man who made a fortune in the stockbroking business and came to be
known as the Cotton King, the Bullion King or just the Big Bull. He was also the founder of the
Native Share and Stock Brokers Association, an institution that is now known as the BSE.
The Bombay Stock Exchange is the oldest exchange

in Asia. Its history dates back to 1855, when five stockbrokers would gather under banyan trees in
front of Mumbai's Town Hall. The location of these meetings changed many times to
accommodate an increasing number of brokers. The group eventually moved to Dalal Street in
1874 and became an official organization known as "The Native Share & Stock Brokers
Association" in 1875.On August 31, 1957, the BSE became the first stock exchange to be
recognized by the Indian Government under the Securities Contracts Regulation Act.

BSE- SENSEX
S&P BSE SENSEX, first compiled in 1986, was calculated on a "Market

Capitalization-Weighted" methodology of 30 component stocks representing large, well-
established and financially sound companies across key sectors. The base year of S&P BSE
SENSEX was taken as 1978-79. S&P BSE SENSEX today is widely reported in both domestic
and international markets through print as well as electronic media. It is scientifically designed
and is based on globally accepted construction and review methodology. Since September 1,
2003, S&P BSE SENSEX is being calculated on a free-float market capitalization methodology.
The "free-float market capitalization-weighted" methodology is a widely followed index
construction methodology on which majority of global equity indices are based; all major index
providers like MSCI, FTSE, STOXX, and Dow Jones use the free-float methodology.
National Stock Exchange {NSE}

The National Stock Exchange of India Limited (NSE) is the leading stock
exchange of India, located in Mumbai. NSE was established in 1992 as the first demutualized
electronic exchange in the country. NSE was the first exchange in the country to provide a
modern, fully automated screen-based electronic trading system which offered easy trading
facility to the investors spread across the length and breadth of the country. National Stock
Exchange has a total market capitalization of more than US$1.41 trillion, making it the worlds
12th-largest stock exchange as of March 2016. NSE's flagship index, the NIFTY 50, the 51 stock
index (50 companies with 51 securities inclusive of DVR), is used extensively by investors in
India and around the world as a barometer of the Indian capital markets. The key domestic
investors include Life Insurance Corporation of India, State Bank of India, IFCI Limited IDFC
Limited and Stock Holding Corporation of India Limited. And the key global investors are Gagil
FDI Limited, GS Strategic Investments Limited, SAIF II SE Investments Mauritius Limited,
Aranda Investments (Mauritius) Pte Limited and PI Opportunities Fund I.NSE offers trading,
clearing and settlement services in equity, equity derivatives, debt and currency derivatives
segments. It is the first exchange in India to introduce electronic trading facility thus connecting
together the investor base of the entire country. NSE has 2500 VSATs and 3000 leased lines
spread over more than 2000 cities across India.

NSE NIFTY
The NIFTY 50 index is National Stock Exchange of India's benchmark stock market
index for Indian equity market. Nifty is owned and managed by India Index Services and Products
(IISL), which is a wholly owned subsidiary of the NSE Strategic Investment Corporation Limited.
IISL had marketing and licensing agreement with Standard & Poor's for co-branding equity
indices until 2013. NIFTY 50 Index has shaped up as a largest single financial product in India,
with an ecosystem comprising: exchange traded funds (onshore and offshore), exchange-traded
futures and options (at NSE in India and at SGX and CME abroad), other index funds and OTC
derivatives (mostly offshore).NIFTY 50 is the worlds most actively traded contract. WFE, IOMA
and FIA surveys endorse NSEs leadership position. The NIFTY 50 covers 13 sectors of the
Indian economy and offers investment managers exposure to the Indian market in one portfolio.
During 2008-12, NIFTY 50 50 Index share of NSE market capitalization fell from 65% to 29%
due to the rise of sectorial indices like NIFTY Bank, NIFTY IT, NIFTY Next 50, etc. The NIFTY
50 Index gives 29.70% weightage to financial services, 0.73% weightage to industrial
manufacturing and nil weightage to agricultural sector. The NIFTY 50 index is a free float market
capitalization weighted index. The index was initially calculated on full market capitalization
methodology.
Securities and Exchange Board of India (SEBI)
The Securities and Exchange Board of India (SEBI) is the designated

regulatory body for the finance and investment markets in India. The board plays a vital role in
maintaining stable and efficient financial and investment markets by creating and enforcing
effective regulation in India's financial marketplace. The SEBI was established in 1988 but was
only given regulatory powers on April 12, 1992, through the Securities and Exchange Board of
India Act, 1992. It plays a key role in ensuring the stability of the financial markets in India, by
attracting foreign investors and protecting Indian investors. SEBI was built by the government of
India. Its headquarters is located at the Bandra Kurla Complex Business District found in
Mumbai. It also has northern, eastern, southern and western regional offices. SEBI's management
is composed of its own members. Its management team consists of a chairman nominated by the

Union Government of India, two members who are officers from the Union Finance Ministry, one
member from the Reserve Bank of India and five other members who are also nominated by the
Union Government of India.
Objectives of SEBI
The preamble of SEBI Act, 1992 states its objectives as;
An Act to provide for the establishment of a Board to protect the interests of investors in
securities and to promote the development of, and to regulate, the securities market and for
matters connected therewith or incidental thereto.
The primary objective of SEBI is to promote healthy and orderly growth of the securities market
and secure investor protection. However, other objectives of SEBI can be categorized as:-
Ensuring fair practices in securities market.

Promoting efficient, competitive and professional services by merchant bankers, brokers,
advisors, underwriters, portfolio managers and other intermediaries.
Formulate rules and regulations for the securities market in India.
Settlement of investors grievances in securities market.

Online trading
Prior to the advent of the Internet, investors had to call up their stockbroker
and place an order on the telephone. The brokerage firm would then enter the order in their system
which was linked to trading floors and exchanges. In 1985, Trade*Plus offered a retail trading
platform on America Online and CompuServe, and in 1991 one of its founders, William Porter,
created a new subsidiary company called E*Trade Securities, Inc.[1]In August 1994, K.
Aufhauser & Company, Inc. (later acquired by TD Ameritrade) became the first brokerage firm to
offer online trading via its "WealthWEB".[2][non-primary source needed] Online investing has
experienced significant growth since that time. Investors could now enter orders directly online or
even trade with other investors via electronic communication networks (ECN). Some orders
entered online are still routed through the broker, allowing agents to approve or monitor the
trades. This step assists in the protection of both the client and brokerage firm from unlawful or
incorrect trades which could affect the clients portfolio or the stockbrokers license; this doesnt
signify that trading made within states law limits is also permitted in a moral religious context as
the social and legal endorsement does not exempt each individual from moral responsibility to
avoid speculative forms morally reprehensible.
Online brokers in the US are often referred to as discount brokers but

in Europe and Asia many so-called online brokers work with high-net-worth individuals. Their
popularity is attributable to the speed and ease of their online order entry, and to fees and
commissions significantly lower than those of full service brokerage firms within the US. Two
types of online brokerages have emerged in the US in the mid-2000s: those offering direct-access
trading on exchanges, and those which route orders to market maker firms to have their orders
filled.

DEMAT A/C
In India, shares and securities are held electronically in a dematerialized

account, instead of the investor taking physical possession of certificates. A Demat account is
opened by the investor while registering with an investment broker (or sub-broker). The
Dematerialized account number is quoted for all transactions to enable electronic settlements of
trades to take place. Every shareholder will have a Dematerialized account for the purpose of
transacting Access to the Dematerialized account requires an internet password and a transaction
password. Transfers or purchases of securities can then be initiated. Purchases and sales of
securities on the Dematerialized account are automatically made once transactions are confirmed
and completed. Demat account is just like an account in a bank. All the money used in shares is
taken from this account.
DEMAT ACCOUNT is an account offered by a bank in its capacity as a

depository participant. The demat account reduces brokerage charges, makes
pledging/hypothecation of shares easier, enables quick ownership of securities on settlement
resulting in increased liquidity, avoids confusion in the ownership title of securities, and provides
easy receipt of public issue allotments. It also helps you avoid bad deliveries caused by signature
mismatch, postal delays and loss of certificates in transit. Further, it eliminates risks associated
with forgery, counterfeiting and loss due to fire, theft or mutilation. Demat account holders can
also avoid stamp duty, avoid filling up of transfer deeds, and obtain quick receipt of such benefits
as stock splits and bonuses.
The Trading procedure involves the following steps:
1. Selection of a broker:
The buying and selling of securities can only be done through SEBI registered
brokers who are members of the Stock Exchange. The broker can be an individual, partnership
firms or corporate bodies. So the first step is to select a broker who will buy/sell securities on
behalf of the investor or speculator.

2. Opening Demat Account with Depository:
Demat (Dematerialized) account refer to an account which an Indian citizen must

open with the depository participant (banks or stock brokers) to trade in listed securities in
electronic form. Second step in trading procedure is to open a Demat account. The securities are
held in the electronic form by a depository. Depository is an institution or an organization which
holds securities (e.g. Shares, Debentures, Bonds, Mutual (Funds, etc.) At present in India there are
two depositories: NSDL (National Securities Depository Ltd.) and CDSL (Central Depository
Services Ltd.) There is no direct contact between depository and investor. Depository interacts
with investors through depository participants only. Depository participant will maintain
securities account balances of investor and intimate investor about the status of their holdings
from time to time.
3. Placing the Order:
After opening the Demat Account, the investor can place the order. The order can
be placed to the broker either (DP) personally or through phone, email, etc. Investor must place
the order very clearly specifying the range of price at which securities can be bought or sold. e.g.
Buy 100 equity shares of Reliance for not more than Rs 500 per share.
4. Executing the Order:
As per the Instructions of the investor, the broker executes the order i.e. he buys
or sells the securities. Broker prepares a contract note for the order executed. The contract note
contains the name and the price of securities, name of parties and brokerage (commission)
charged by him. Contract note is signed by the broker.
5. Settlement:
This means actual transfer of securities. This is the last stage in the trading of
securities done by the broker on behalf of their clients. There can be two types of settlement.

(a) On the spot settlement:
It means settlement is done immediately and on spot settlement follows. T + 2 rolling

settlement. This means any trade taking place on Monday gets settled by Wednesday.
(b) Forward settlement:
It means settlement will Take place on some future date. It can be T + 5 or T+7 etc. All
trading in stock exchanges takes placed between 9.55 am to 3.30 pm, from Monday to Friday.
Consumer perception
Perception
Perception is defined as the process by which an individual selects, organize and

interprets stimuli in to a meaning full and coherent picture of the world .it can be described as a
how we see the world around us two individual may be exposed to the same stimuli under the
same apparent condition but know each person recognized, select, organize and interpret these
stimuli is a highly individual process based on each person own needs, values and expectation
Consumer perception
Consumers act and re act on the basis of this perception .but on the basis of
objective reality ,for each individual reality is a totally personal phenomenon, based on that
person needs ,wants, values and personal experience .thus the markets ,consumes perception are
much more important than their knowledge of objective reality .for it one thanks about it ,it is not
about actually is so but what consume think is so that effect this action and this buying habit and
because individual make decision and take diction based on what they perceive to be reality . It is
important that markets understand the nation of perception and its related concepts to determine
more reality what factors influence consumers buy.

Definition
Consumer perception applies the concept of sensory perception to marketing and

advertising. Just as sensory perception relate to how human perceive and process sensory stimuli
through this five senses .consumer perception performs to how individuals from opinion about
companies and the mechanics apply consumer perception theory to determine how these
consumer receive them .they also use customer perception theory to develops marketing and
advertising .strategies intended to return current customer and attract new ones.
Elements of consumer perception

Perception is made up of different concept .how ever with the frame
work consumer behavior the basis element or concept of perception include sensation ,absolute
,threshold, different threshold, subliminal perception
1. Sensation
Sensation is immediate response of the sensory organs to stimuli is any unit of input to
any of the sense. Sensory receptors are the human organs receive sensory inputs. These sensory
functions are come to pay either singly or combination in the evaluation and use of most
consumes product
2. Absolute threshold
The lowest level at which an individual can expenses a sensation is called the absolute
thresholds .the point at which a person can detect and differentiate between something and
nothing is that person absolute the threshold for that stimuli. Packages design tries to determine
consumer absolute threshold to make sure that their new product design well stand out from
competitor packages.

3. Differential thresholds
The minimum difference that can be detected between two stimuli is called different
threshold or the just noticeable different .When it comes to product improvement, markets, very
much wants to meet or exceed the consumer to deferential thresholds, that is they want consumers
to readily perceive any improvement made in original product
4. Subliminal perception
Stimuli these is too weak or to brief to be seen or heard may never these to be strong enough
to be perceived by one or more receptors cells. This process is called subliminal perception
because the stimulus is beneath the threshold or limens of conscious awareness through obviously
not beneath the absolute threshold of the receptors involved.
Perception process
The perception process is divided into three parts
1. Pre attentive processing
Pre attentive processing refers to the simultaneous pre conscious monitoring of all sensory
channels for events that will require a shift in attention. Lined of pre attentive processing is what
makes is possible for us to suddenly hear our name spoken across a crowed or a noisy room.
2. Selection
Perceptual selection refers to the fact that consumers select only a small portion of the
stimuli to which they exposed for conscious processing or what we might term fecal attention to
get the consumers fecal attention ,an escalation of sensory impulses is required .
3. Organization
The third part in the perceptual process is perceptual organization. Consumers classify
perception into categories and apply prior knowledge about the categories involve comparison
between perceived target and categorical knowledge

Sub process of organization
1. Internal causation: it occurs due to the internal focus of control as the perception of people can
be attributed to internal factors
2. External causation; it occurs due to the external focus of control as perception in such can be
attributed to the external factors or factors
3. Sensual stimulations; it can be generated by supervisor new proceed was of the organization .all
these cues first register stimuli sensory and neural mechanisms.
4. Physical environment; it could be the office the stop floor the store and climate.
Type of perception
Detection
It refers to weather people can sense that they are being stimulated by some form of energy.
Recognition
It means being able to perceive one pattern of stimulation as different from another.
Principles of consumer perception.
1. Principle of closure
It means a propensity of people to perceive things as complete and unified when engineer
visualize the entire shapes from a prototype. They make us of this principle.
2. Principle of constancy
It makes people perceive objects as constant in size, shape, color, and other qualities.
3. Principle of perceptual context
It refers to the influences of surrounding condition on perception.

Factors that influence perception
1) Factors in the situation
Time
Work Setting
Social setting
2) Factors in the perceives
Attitude
Motive
Interest
Expenses
Expectation
3) Factors in the target
Novelty
Motivation
Sound
Size
Background
Proximity

Table: 4.1 Gender wise classification of respondents
No. of
Gender Percentage
Respondents
Male 36 72%
Female 14 28 %
Total 50 100%
Source: Primary Data
Figure 4.1
Female
40%
Male
60%
Inference: Table 4.1 reveals that 72% belongs to male category where as 28% belongs to female
category. So it can be clearly inferred that majority of the respondents were males.

Table: 4.2 Age wise classification of respondents
Age Category No. of Respondents Percentage
20 40 30 30 %
40 60 12 20%
Above 60 years 8 4%
Total 50 100%
Figure 4.2
35%
30%
30%
25%
20%
20%
15%
10%
4%
5%
0%
20 40 40 60 Above 60 years
Inference: Table 4.2 and figure 4.2 shows that the percentage of respondents in age category in
between 20 40years is 30% and in case of 40 60 years is 20%. This graph also shows that
percentage of respondents whose age above 60 year shows the percentages 4%

Table 4.3: Table showing marital status respondents
Marital status No. of Respondents Percentage
Married 18 36%
Unmarried 32 64%
Total 50 100%
Figure 4.3
36%
64%
Inference: According to Table 4.3 and figure 4.3 the most of the respondents are unmarried, 64%
. 36% of the respondents are married

Table: 4.4 Classification on the basis of educational qualification.
Educational No. of Respondents Percentage

classification
School level 4 8%
College Education 22 44%
Professional 18 36%
Others 6 12%
Total 50 100%
Figure 4.4
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
School level College Education Professional Others
Inference: From the analysis of table 4.4 and the figure 4.4 we can analyze that 44% of the
respondents are belongs to college education and 36% belongs to professional qualification. 8% of
respondents are of school level and 12% are I other educational background.

Table: 4.5 Classification on the basis of Occupation.
Occupation No. of Respondents Percentage
Salaried 23 46%
Business 7 14%
Professional 13 26%
others 3 14%
Total 40 100%
Figure 4.5
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Salaried Business Professional others
Inference: The classification based on occupation of the respondents shows 26% are
professionals. Peoples who are engaged in the business is 12% and 46% of the respondents are
salaried. And 6% doing other occupations

Table : 4.6 Table showing monthly income of respondents
Monthly income No. of Respondents Percentage
Below 20000 7 14 %
20000 40000 19 38 %
40000 60000 13 26 %
Above 60000 11 22 %
Total 50 100%
Figure 4.6
40%
35%
30%
25%
20%
15%
10%
5%
0%
Below 20000 20000 40000 40000 60000 Above 60000
-
Inference: From the table 4.6 and figure 4.6 it shows that percentage of respondents having a
monthly income below 200000 is 14% and monthly income in between 200000-400000 is 38%.
monthly income in between 400000-600000 are 26% above 600000 are 22%.

Table 4.7, Table showing motivation factor to begin online stock trading of
respondents
Motivation No. of Respondents Percentage
Reference by Friends 21 42%

Advice by financial
16 32%
consultants
Online Advertisements 7 14%
Others 6 12%
Total 50 100%
Figure 4.7
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Frnds Advice Online Others
Inference: Most of the respondents state that the factor behind their motivation to begin online
trading are friends 42%, advise by financial consultants 32% , online advertisement 14% and
others factors 12%.

Table 4.8 Table showing duration of online trading
Duration No. of Respondents Percentage
Below 1year 15 32 %
1 3 years 19 38 %
3 5 years 12 12 %
Above 5 years 4 18 %
Total 50 100%
Figure 4.8
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
SHORT LONG BOTH
Inference: According to table 4.8 and figure 4. 8, 19 investors are started their trading between
1-3 years. 15 investors are new to the trading they start trading blow 1 year and the study shows
that there 12 and 4 investors are started 3-5 and above 5 years respectively.

Table 4.9 Table showing brokerage house of respondents which have Demat
A/c
Brokers No. of Respondents Percentage
SHERKHAN 4 8%
ICICI DIRECT 15 30 %
KOTAK MAHENDRA 8 16 %
OTHERS 23 46 %
Total 50 100%
Figure 4.9
50
45
40
35
30
25
20
15
10
5
0
SHERKHAN ICICI DIRECT KOTAK MAHENDRA OTHERS
Inferences: Based on table 4.9 and figure 4.9 the investors in perumbavoor municipality
have the demat account in other stock brokers 46% other than sherkhan 8%,icici direct
30% kotak mahendra 16% .
31
ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY
Table 4.10 Table showing the frequency of trade
Category No. of Respondents Percentage
DAILY 6 12%
WEEKLY 7 14%
MONTHLY 7 14%
ACCORDING TO MKT 30 60%
Total 50 100%
Figure 4.10
60%
50%
40%
30%
20%
10%
0%
DAILY WEEKLY MONTHLY ACCORDING TO
MKT
Inferences: The study shows that most of the investors are choose trading according to
market conditions44%, 14% of investors are choose trading weekly and monthly and
only 8% investors trade daily.
32
Table 4.11, Table showing Means of access
No. of
ACEESS Percentage
Respondents
PHONE 7 14%
INTERNET 15 30%
BROKERAGE
11 22%
HOUSE
MOBILE APP 17 34%
Total 50 100%
Figure 4.11
40%
35%
30%
25%
20%
15%
10%
5%
0%
PHONE INTERNET BROKERAGE MOBILE APP
HOUSE
Inferences: investors were categorized on the basis of their means of access. The study
shows that 14% of investors use phone as their means of access. 30% use internet as their
access. 22% and 34% investors use their access as brokerage house and mobile app
respectively.
33
Table 4.12, Classification of respondents on the basis of Stock exchange
No. of
EXCHANGE Percentage
Respondents
BSE 31 62%
NSE 17 34%
OTCEI 2 4%
OTHERS 0 0%
Total 50 100%
Figure 4.12
70%
60%
50%
40%
30%
20%
10%
0%
BSE NSE OTCEI OTHERS
Inferences: The investors are classified on the basis of the stock exchange the mostly
trade. It is classified to BSE, NSE, OTCEI and others. Most of the investors , 62% state
that they trade in the BSE most. 34% and 4% of investors state that they trade in NSE and
OTCEI respectively. None of the traders state that they have trade in any other stock
exchanges
34
Table 4.15, Table showing type of investment
TYPE No. of Respondents Percentage
SHORT 21 42%
LONG 11 22%
BOTH 18 36%
Total 50 100%
Figure 4.15
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
SHORT LONG BOTH
Inferences: According to table 4.15 and figure 4.15 42% of the investors choose short
term investment. 22% of investors choose long term investment and 36% choose both
long term and short term.
35
Table 4.14, Table showing type of trade
Type No. of Respondents Percentage
Stock 31 62%
Commodities 5 10%
Mutual fund 11 22%

Others 3 6%
Total 50 100%
Figure 4.14
70%
60%
50%
40%
30%
20%
10%
0%
Stock Commodities mutualfund Others
Inferences: The investors asked to state the type of investment they prefer and
categorized them on the basis of that. 62% investors state that they are preferring stock
over others. 10% of investors prefer commodities, 22% of investors prefer mutual fund
and 6% choose other type of investment.
36
Table 4.15, Table showing source of funds
Source No. of Respondents Percentage
Salary/Personal 43 86%
Loan 7 14%
Pledging 0 0%
Total 50 100%
Figure 4.15
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Salary/Personal Loan Pledging
Inferences: On the basis of the source of the funds 86% of the investors us e their salary
or personal as their source of funds. Balance 14% investors find funds from the loans, no
investors are using pledging to find the fund.
37
Table 4.16 classification of respondents on the basis of amount of

investment
Amount No. of Respondents Percentage
Below 100000 32 62%
100000 200000 7 10%
200000 300000 8 12%

Above 300000 3 6%
Total 50 100%
Figure 4.16
70%
60%
50%
40%
30%
20%
10%
0%
Below
100000 100000
200000 200000
300000 Above
300000
Inferences: According to table 4.16 and figure 4.16 most investors amount of
investment is below 100000 62% followed by 200000-300000 12%, 100000-200000
10%, and above 300000 6%.
38
Testing of hypothesis
X Y XY X2 Y2
14 62 868 196 3844
38 10 380 1444 100
26 12 312 676 144
22 6 132 484 36
x=100 y=100 xy=1692 x = 2800
2
y =4124
2
Correlation Coefficient r = nxy-x*y
nx2-(x)2 ny2-(y)2
= 4*1692-100*100
4*2800-(100)2 4*4124-(100)2
= -3232
34.64*80.59
= -3232
2792
= -1
39
Testing of hypothesis
Testing significance of correlation coefficient Ho; given correlation is

significant.
rn-2
t=
1-r2
-14-2
=
1- (-1)2
(-1)*1.414
=
1- 1
= 1.414
= 0.05, n= 4, Degrees of freedom = n-2= 2
Table value = 4.303
Interpretation: The calculated value is less than the table value. So the null hypothesis
is accepted. There is a significant relation between the income level and investment
level of investors in online stock trading.
40
Table 4.17 classification on the basis of Selection of brokerage house
Factors No. of Respondents Percentage
Guidance from
14 28%
financial consultants
Brokerage ratio 12 24%
Customer service 18 36%
Other factors 6 12%
Total 50 100%
Figure 4.17
70%
60%
50%
40%
30%
20%
10%
0%
Guidance Brokerage ratio Customer Other factors
service
Inferences: 28% of the investor state that they choose brokerage house on the basis of
the guidance they providing, 24% investors state that their selection depend on the
brokerage ratio. 36%of investors select on the basis of customer services they provide.
12% of the investors selection depends on other factors.
41
Table 4.18, Table showing the satisfaction level of respondents on brokerage

house
Scale No. of Respondents Percentage
Highly Satisfied 15 30%
Satisfied 27 54%
Dissatisfied 8 16%
Total 50 100%
Figure 4.18
60%
50%
40%
30%
20%
10%
0%
Highly Satisfied Satisfied Dissatisfied
Inferences: According to the investors response 54% of investors are satisfied by their
brokerage house. 30% are of investors are highly satisfied with the services provide by
the brokerage house. 16% of investors are dissatisfied with their brokers service
42
Table 4.19 Table showing risks involved in the online stock trading.
Risk No. of Respondents Percentage
Failure of computer 8 16%
Electricity failure 2 4%
Hiding of data 13 26%
Volatile market 27 54%
Total 50 100%
Figure 4.19
60%
50%
40%
30%
20%
10%
0%
Failure of Electricity Hiding of data Volatile market
computer failure
Inferences: Investors are classified on the basis of risk involved in the online trading.
14% investors state that failure of computers. 4% investors state that failure of the
electricity, 26% of investors state that hiding of data by the brokerage is a reason for
risk, 54% investors state that the volatile market condition is the main risk involved in
the online trading.
43
Table 4.20, Table showing the influencing investment Decision
Based on No. of Respondents Percentage
Broker tips 10 20%

World trends 11 22%
News and article 11 22%
Own Speculation 28 56%
Total 50 100%
Figure 4.20
60%
50%
40%
30%
20%
10%
0%
Broker tips World trends News and Own
article Speculation
Inferences: According to the analysis 20% of investors make their buying and selling on
the basis of tips given by the broker. 22% of investors make their on the based on world
market trends and news and articles. 54% investors make the decisions on the basis of
their own speculation analysis. Most of investors make their buying and selling decision
on the basis of own speculation analysis.
44
Table 4.21, Table showing level satisfaction of return
No. of
Satisfied Percentage
Respondents
Yes 29 58%
No 21 42%
Total 50 100%
Figure 4.21
No
42%
Yes
58%
Inferences: According to the study 58% of the invetors are satisfied with their return on
investment and 48% of the investors are not satisfied with theier return.
45
Table 4.22, Table showing whether investors facing loss during trading.
No. of
Loss Percentage
Respondents
Yes 32 64%
No 18 36%
Total 50 100%
Figure 4.24
No
36%
Yes
64%
Inferences: 68% of investors state that they are face loss in the online trading and 32% of
the investors state they never face losses in online trading.
46
Table 4.22.1, Table showing the reasons for loss
Reasons No. of respondents Percentage
Volatile market 13 41%

Frequent losses 3 9%
Lack of expected
10 31%
return
others 6 19%
Total 32 100%
Figure 4 .22.1
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Volatile market Frequent losses Lack of others
expected return
Inferences: From the loss faced 32 investors, 41% investors state that the reason for loss
is volatile market conditions. 9% state that it is because facing frequent losses. 31% of
investors state that it is because lack of expected return. And 19% state that reason for
loss is other factors.
47
Table 4.23, Table showing how to avoid loss
Loss avoidance No. of respondents Percentage
Follow stop loss 4 8%

Avoid trading when
17 34%
market is volatile
Buy lesser volume of
14 28%
shares
Taking minimum
9 18%
profit
Others 6 12%
Total 50 100%
Figure 4.23
35%
30%
25%
20%
15%
10%
5%
0%
Follow stop Avoid Buy lesser Taking
loss trading Others
volume of minimum
when shares profit
market is
volatile
Inferences: According to the analysis 8% of investors state that they avoid loss by
following adequate steps, 32% state that the avoid loss by avoiding trading when
market is volatile, 14% investors state that they avoid loss by buy lesser volume of
shares, 18% believe that taking minimum profit will avoid the less and 12% think
other factors are the reason for loss.
48
Table 4.24, classification of investors on the basis of attracting new investor
Scale No. of Respondents Percentage
Strongly Agree 13 26%
Agree 31 62%
Strongly disagree 8 12%

Total 50 100%
Figure 4.24
62%
26%
16%
Strongly disagree Agree Disagree
Inference: 62% of investors state that they are agrees that the introduction of online
trading attract new investors, 26% strongly agree and 16% of investors disagree.
49
Findings
72% of the respondents are male.

Most of the respondents fall in the age category of 20-40.
64 % of the respondents are unmarried.
Based on the study majority of the respondents are graduated.
46% of investors are salaried.
The study clearly shows that 38% of respondents having an income in the range of
20000-40000 are comparatively high
Motivation factor of most of the respondents to begin online trading is reference by
friends.
Duration of online stock period of most respondents is 1-3 years.
46% of the respondents choose Geojith as their brokerage house.
60% of respondents trade according to market.
34 % investors trade through the mobile app.
62 % investors trade mostly in BSE
42% of the investors invest in short term investment
Majority of respondents invest in stocks
Majority of the respondents find source of investment from salary/personal income
The study shows that the amount of investment of most of the investors is below
100000.
36% of the investors select brokerage on the basis of their customer service.
Most of the respondents are satisfied by the performance of the brokerage house.
Most of the respondents think that risk involved in stock market because of volatile
market.
56% take decisions in the basis of own speculation.
Majority of the respondents are satisfied with the return.
64 % of the investors face loss in trading
The study state that the reason for loss is volatile market conditions
The study finds that investors avoid loss through avoid trading when market is volatile.
62% of the investors agree that online trading attract new investors.

SUGGESTIONS
It can be ascertained that most of the investors in the perumbavoor municipality are
males, it is suggested that the brokerage house should take initiative to provide proper
education about the online stock trading to womens.
Online stock trading can be highlighted as one of means to earn to extra income to the
public by the brokerage house.
The study analyses that most of the persons included in online trading are salaried
persons. So the brokerage house should create awareness among the investors, to bring
knowledge about online share trading to each and every class of people.
All brokerage houses should collect brokerage charge uniformly. It helps to attract new
investors.
The investors should always watch the market level before investing to avoid losses.
The investors who are newly entering into online share trading should buy familiar and
blue-chip stock to trade safely.
Shares, debentures and bonds are familiar to urban investors. But their counterparts in
rural area do not know anything about them.
The transparency must be made about the companies and their financial performance so
that the investors can decide their investment on suitable and profitable shares.
Senior citizen can be used online stock trading as a regular income. They must be
educated and encourage

SUGGESTIONS
It can be ascertained that most of the investors in the perumbavoor municipality are
males, it is suggested that the brokerage house should take initiative to provide proper
education to women.
Online stock trading can be highlighted as one of means to earn to extra income to the
public by the brokerage house.
The study analyses that most of the persons included in online trading are salaried
persons. So the brokerage house should create awareness among the investors, to bring
knowledge about online share trading to each and every class of people.
All brokerage houses should collect brokerage charge uniformly. It helps to attract new
investors.
The investors should always watch the market level before investing to avoid losses.
The investors who are newly entering into online share trading should buy familiar and
blue-chip stock to trade safely.
Shares, debentures and bonds are familiar to urban investors. But their counterparts in
rural area do not know anything about them.
The transparency must be made about the companys financial performance so that the
investors can decide their investment on suitable and profitable shares.
Senior citizen can be used online stock trading as a regular income. They must be
educated and encourage.

Conclusion
Online investing has benefits to offer investors as well as brokers. These
benefits include low transaction costs, convenience, speed, boundary spanning, improved
communication, and risk management. The hypothesis study proves that there is no
relationship between income level and investors level. The study observed that the risk in
online trading is default and it can be reduce through avoid trading when the market is
volatile.
The results indicate that the online stock trading attracting new
investors. But there is a big portion of people who has no knowledge about online stock
market. The study also indicates that source of funds of most of the investors are salary /
personal income.

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A STUDY ON INVESTORS PERCEPTION TOWARDS ONLINE STOCK TRADING

A capital market is a financial market in which long term debts or

In secondary market, existing securities are sold and bought among

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 1

Statement of the problem

Significance of the study

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 2

Scope of the study

H1 = There is no relationship between investors income level and amount of investing in

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 3

The process of selecting a sample from a large population is called sampling.

` The study is conducting in Perumbavoor municipality among 50 investors, who are

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 4

Statistical tools of analysis

A correlation coefficient is a statistical measure of the degree to which changes to the

Correlation coefficients are expressed as value between +1 and -1. A coefficient of +1

Testing the significance of an correlation coefficient

Here t is based on (n-2) degrees of freedom.

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 5

Limitation of the study

1. Due to shortage of time, this study is conducted among 50 investors only.

2. Area of the study is confined to Perumbavoor municipality. So the findings cannot be

The study on investors perception towards online trading in Perumbavoor municipality is

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 6

In the study conducted by Nidhi walia and Ravinder kumar (2007)

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 7

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 8

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 9

Major stock exchanges in India

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 10

Pune Stock Exchange - a small stock exchange located in Pune

The Bombay Stock Exchange (BSE)

The Bombay Stock Exchange is the oldest exchange

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 11

S&P BSE SENSEX, first compiled in 1986, was calculated on a "Market

National Stock Exchange {NSE}

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 12

Securities and Exchange Board of India (SEBI)

The Securities and Exchange Board of India (SEBI) is the designated

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 13

The preamble of SEBI Act, 1992 states its objectives as;

Ensuring fair practices in securities market.

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 14

Online brokers in the US are often referred to as discount brokers but

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 15

In India, shares and securities are held electronically in a dematerialized

DEMAT ACCOUNT is an account offered by a bank in its capacity as a

The Trading procedure involves the following steps:

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 16

2. Opening Demat Account with Depository:

Demat (Dematerialized) account refer to an account which an Indian citizen must

3. Placing the Order:

4. Executing the Order:

ST.KURIAKOSE COLLEGE OF MANGEMENT AND SCICENCE, KURUPPAMPADY 17

(a) On the spot settlement:

It means settlement is done immediately and on spot settlement follows. T + 2 rolling

(b) Forward settlement: