INDUSTRY PROFILE

INTRODUCTION OF STOCK MARKET AND MUTUAL FUND IN

INDIA:-

The stock market is one of the most important sources for companies to raise
money. this allows businesses to be publicaly traded, or raise additional financial
capital for expansion by selling shares of ownership of the company in a public
market. The liquidity that an exchange affords the investors gives them the ability
to quickly and easily sell securities. This is an attractive feature of investing in
stocks, compared to other less liquid investments. Some companies actively
increase liquidity by trading in their own shares.

A stock market or equity market is the aggregation of buyers and sellers (a loose
network of economic transaction, not a physical facility or discrete entity) of stocks
(shares); these are securities listed on a stock exchange as well as those only traded
privately.

The Indian financial system is based on four basic components like financial
market, financial institution, financial service and financial instruments. The main
aim of the Indian financial system is to provide service to the capital market. The
Indian capital market has been increasing tremendously during the second
generation reforms. The first generation reforms started in 1991 the concept of
LPG (liberalization, privatization and globalization.)

One of the important investment avenues in financial market is the "Mutual fund".
Through out of the world, mutual funds have played a significant role as for as an
investment is concerned. Mutual fund plays an important role in transforming
saving into investments and thereby improving financial health of a country. One
way to measure this role is to analyze performance of mutual fund scheme. Also
understanding of mutual fund structure and advantage etc. is very important.
Mutual funds offer many benefits to the small investors such as diversification,
liquidity, low transaction cost, low risk, more options and scheme, professional
management, flexibility, convenience to switch and many more.

INDUSTRY PROFILE:-
Bombay Stock Exchange

history:

BSE Limited, also known as the Bombay Stock Exchange (BSE), is an

Indian stock exchange located on Dalal Street in Mumbai. Established in
1875 by cotton merchant Premchand Roychand, a Rajasthani Jain
businessman, it is the oldest stock exchange in Asia, and also the tenth
oldest in the world. The BSE is the 9th largest stock exchange with an
overall market capitalisation of more than 276.713 lakh crore, as of
January 2022.

Bombay Stock Exchange was started by Premchand Roychand in

1875.[8] While BSE Limited is now synonymous with Dalal Street, it
was not always so. In the 1850s, five stock brokers gathered together
under a Banyan tree in front of Mumbai Town Hall, where Horniman
Circle is now situated.[9] A decade later, the brokers moved their
location to another leafy setting, this time under banyan trees at the
junction of Meadows Street and what was then called Esplanade Road,
now Mahatma Gandhi Road. With a rapid increase in the number of
brokers, they had to shift places repeatedly. At last, in 1874, the brokers
found a permanent location, the one that they could call their own. The
brokers group became an official organization known as "The Native
Share & Stock Brokers Association" in 1875.

Dalal Street, Mumbai, Bombay Share Bazar is a stock exchange on

Maharashtra, India. It is the 11th largest stock exchange in the world by
market capitalization as on 31 December 2012. Established in 1875,
BSE ltd. (formally known as Bombay stock exchange ltd.) is India's
second oldest Stock Exchange (Oldest being the Calcutta stock exchange
[CSE] located at the lyons Range, years, BSE has facilitated the growth
of the Indian corporate sector by providing it an efficient capital-rising
platform.

National Stock Exchange

history:

Capital market reforms in India and the launch of the Securities and
Exchange Board of India (SEBI) accelerated the integration of the
(NSE) in 1992.

After a few years operations, the NSE has become the largest stock
exchange in india. There were segments of the NSE trading platform
were established one after another. The Wholesale Dept Market (CM)
segment was opened at the end of 1994. Finally, the Future and options
segment began operating in 2000. Today the NSE takes the 14th position
in the top 40 futures exchanges in the world.

National Stock Exchange of India Limited (NSE) is the leading stock

exchange of India, located in Mumbai, Maharashtra. It is under the
ownership of some leading financial institutions, banks, and insurance
companies. NSE was established in 1992 as the first dematerialized
electronic exchange in the country. NSE was the first exchange in the
country to provide a modern, fully automated screen-based electronic
trading system that offered easy trading facilities to investors spread
across the length and breadth of the country. Vikram Limaye is the
Managing Director and Chief Executive Officer of NSE.

National Stock Exchange has a total market capitalization of more than

US$3.4 trillion, making it the world's 10th-largest stock exchange as of
August 2021. NSE's flagship index, the NIFTY 50, a 50 stock index is
used extensively by investors in India and around the world as a
barometer of the Indian capital market. The NIFTY 50 index was
launched in 1996 by NSE. However, Vaidyanathan (2016) estimates that
only about 4% of the Indian economy / GDP is actually derived from the
stock exchanges in India.

Association of Mutual Funds in India:

history:
The first modern mutual fund was launched in the U.S. in 1924. The
oldest mutual fund still in existence is MFS' Massachusetts Investors
Trust (MITTX), also established in 1924. The exchange-traded fund, a
modern variation, has taken the market by storm since the Great
Recession of 2007–2009.

The Mutual Fund industry in India started in 1963 with formation of

UTI in 1963 by an Act of Parliament and functioned under the
Regulatory and administrative control of the Reserve Bank of India
(RBI).

the UTI Mutual Fund, sponsored by SBI, PNB, BOB and LIC. It is
registered with SEBI and functions under the Mutual Fund Regulations.
With the bifurcation of the erstwhile UTI which had in March 2000
more than Rs. 76,000 crores of assets under management and with the
setting up of a UTI Mutual Fund, conforming to the SEBI Mutual Fund
Regulations, and with recent mergers taking place among different
private sector funds, the mutual fund industry has entered its current
phase of consolidation and growth.

LITERATURE REVIEW:
Dr. Sandeep Bansal, Deepak Garg and Sanjeev K Saini (2012),
Dr. Sandeep Bansal, Deepak Garg and Sanjeev K Saini have studied
Impact of Sharpe Ratio & Treynor’s Ratio on Selected Mutual Fund
Schemes. This paper examines the performance of selected mutual fund
schemes, that the risk profile of the aggregate mutual fund universe can
be accurately compared by a simple market index that offers
comparative monthly liquidity, returns, systematic & unsystematic risk
and complete fund analysis by using the special reference of Sharpe ratio
and Treynor’s ratio.

Prof. V. Vanaja and Dr. R. Karrupasamy (2013), have done a Study on

the Performance of select Private Sector Balanced Category Mutual
Fund Schemes in India. This study of performance evaluation would
help the investors to choose the best schemes available and will also
help the AUM’s in better portfolio construction and can rectify the
problems of underperforming schemes. The objective of the study is to
evaluate the performance of select Private sector balanced schemes on
the basis of returns and comparison with their bench marks and also to
appraise the performance of different category of funds using risk
adjusted measures as suggested by Sharpe, Treynor and Jensen.

Dr. K. Veeraiah and Dr. A. Kishore Kumar (Jan 2014),

Dr. K. Veeraiah and Dr. A. Kishore Kumar conducted a research on
Comparative Performance Analysis of Select Indian Mutual Fund
Schemes.
This study analyzes the performance of Indian owned mutual funds and
compares their performance. The performance of these funds was
analyzed using a five year NAVs and portfolio allocation. Findings of
the study reveals that, mutual funds out perform naïve investment.
Mutual funds as a medium-to-long term investment option are preferred
as a suitable investment option by investors.