Introduction New

A Study on the investment awareness of rural people
Chapter 1
INTRODUCTION
Investment is the employment of funds with the aim of achieving
additional income or growth in value. The essential quality of an investment is
that it involves waiting for a reward. It involves the commitment of recourse
which have been saved or put away from current consumption in the hope that
some benefits will occur in the future.
The ultimate objective of the investor is to derive a variety of investment
that meet his preference for risk and expected return. The investor will select a
portfolio, which will maximize his expected return subject to certain
consideration. There are various types of investment opportunities available
Known as investment avenues, each having its own risk return characteristics. In
short, to make an effective investment decision, the investor must be aware about
the option available and recognize the difference in risk return and must establish
the preference before making the investment decision to Vazhoor Panchayth.
11.
STATEMENT OF THE PROBLEM

Investment avenues are in plenty; some are simple and some arc complex.
But rural people are not aware Some are direct and some are indirect. An
investment suitable for one may not be suitable for another. Normally investors
will make a detailed analysis about these investment avenues by comparing risks
and return at these investment alternatives. There for the study was conducted to
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analyze investment awareness among rural people with special reference to

Vazhoor panchayath
1.2 SIGNIFICANCE OF THE STUDY
There are number of investment avenues before an investor. It includes
high risk securities, low risk securities etc. there are also schemes which provides
saving habits as well as protection through insurance. The knowledge about
various option is essential for proper investment.
1.3 SCOPE OF THE STUDY
The study attempts to examine the level of awareness on various
investment options available in the financial market. Even though there are a
number of financial alternatives the most commonly available financial products
were used for the analysis. The study covers financial products like Insurance,
Postoffice schemes, N.S.S, Capital market products and commercial bank
schemes.
1.4 OBJECTIVES OF THE STUDY
a) To study the investment awareness of rural people with special reference to
Vazhoor Grama Pamchayath.
b) To identify the various investment avenues in general.
c) To understand whether these people are interested in investment in
different schemes.
d) To understand whether rural people are aware of
new pattern of
investment.
e) To understand whether people at rural area are aware of capital market
condition and investments.
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f) To evaluate preference give by the respondents regarding different types of

investment scheme
1.5 METHODOLOGY
a) Nature of the study
The study is based on both primary and secondary data.
b) Sample Design
From the people of Vazhoor Panchayath. So were selected at stratified by
using sampling method. The sample includes 30 agriculturists, 30
Employees, and 30Businessmen.
The study is an analytical one which is mainly based on primary data nad
secondary dat. Secondary data was used to supplement and support the finding as
well as to develop a theoretical frame work of the study. Secondary datas are
collected from published reports, books, dailies and periodicals. Such information
have been carefully pursued and quoted. An interview schedule was prepared to
collect the primary data. The method of sampling is adopted stratified.
1.6 HYPOTHESES
1. There is no significant variation among respondents of different
occupation group regarding awareness of different investment,
opportunities.
2. There is no significant difference in the awareness level of different
respondents regarding capital market instruments and commercial
banks
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3. The is no significant difference in the level or awareness of life

insurance policies and post office deposits
1.7 ANALYSIS OF DATA

The data for the study has been collected from Respondants questionnaire.
Secondary data has also been used as a source of data.
All data collected were summarized and tabulated so as to d=facilitate
analysis. Collected data have been analysed by applying different mathematical,
statistical techniques and pie charts etc. the data was tabulated and analysed using
statistical tool such as
a.
2 and ANOVA(analysis of variance test.
test
The statistical test in which the test statistics follows a

is called the 2
therefore 2
- distribution
test is a statistical test the significance of
difference between observed frequencies and the corresponding theoretical

frequencies of distribution without any assumption about the distribution of the
population 2 - test is one of the most useful statistical tests. It is applicable to
very large number of problems in practice.
b). ANOVA
Analysis of variance technique is used to test whether the means of several
samples differ significantly. The ANOVA test is applied by calculating two
estimates of the variance of population of distribution.
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The variance between samples also known as mean square between

samples (MSC) and the variance within the samples also known as mean square
within (MSE)
F-test
Statistical test applied in analysis of variance is F-test. The test statistics
F which is the ratio between variance. If the test statistics is less than the
corresponding table value of F we accept the null hypothesis.
1.8 PERIOD OF STUDY
The study covers a period from 2011 to 2012 and relevant information was
obtained.
1.9. LIMITATIONS OF THE STUDY
i.
The study was based on the opinion preference given by the respondents.
The attitude of the respondents may likely to change frequently especially
ii.
to fast changing capital market, mutual fund etc.

Time constraint is another limitation of the study.
1.10. CHAPTERISATION
The study begins with an introduction to the topic. This chapter also
includes statement of the problem, significance of the study, objectives of the
study, methodology of the data collection, analysis of the data, tools of analysis
and period of study.
The second chapter describes the theoretical frame work of the investment
avenues.
The third chapter analysis the investment awareness of rural people.
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The forth chapter analysis the primary data, which include the profile of
the respondent and analysis of data.
The fifth chapter summarizes the report by stating the finding of the study,
conclusion and suggestions.
Chapter II
MEANING OF INVESTMENT
2.1 INTRODUCTION
Investment is the sacrifice of certain present value for the uncertain future
reward. It entails arriving at numerous decisions such as type, mix, amount,
timing, grade etc. of investment and disinvestment. Further, such decisionmaking has not only to be continuous but rational too. Broadly speaking, an
investment decision is a trade off between risk and return All investment choices
are made at points of time in accordance with the personal investment ends and in
contemplation of an uncertain future. Investment choices or decisions are found to
be the out come of three different related classes of factors. The first may be
described as factual or informational premises. The factual premises if investment
decisions are provided by many streams of data which taken together, represent to
an investor the observable environment and general as well as particular features
of the securities and Finns in which he may invest. The second class of factors
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entering into investment decisions may be described as expectational premises.

Expectations relating to the outcomes of alternative investments are subjective
and hypothetical in any case but their foundations are necessarily provided by the
environmental and financial facts available to investors. These limit not only the
range of investments which may be undertaken but also the expectations of
outcomes which may legitimately be entertained. The third and final class of
factors may be described as Valuational Premises. For investors generally these
comprise the structure of subjective preference for the size and regularity of the
income to be received from and for the safety and negotiability of specific
investments or combinations of investments, as these are appraised from time to
time.
2.2
MEANINGS OF INVESTMENT
2.2.1 Economic meaning of Investment

According to economist, economic investment means not to the capital
stock of the society. Here capital stock means goods or services that are used in
the production of other goods and services. Eg: durable equipment, Inventories
etc.
2.2.2 Business meaning of Investment
Business investment means money or cash could in or help by a person for
a private business.
2.2.3 Financial meaning of Investment
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This refers to collection of monitory resources in the form of asset

securities or debentures that are expected to yield same gain profit or return over
future period of time.
2.3
DEFINITION OF INVESTMENT
According to Fischer and Jordan, "Investment is the commitment of funds
made in expectation of some positive rate of interest".

According to V.K. Bhalla, "Investment is the sacrifice in the certain
present value for the uncertain future rewards."
2.4
IMPORTANCE OF INVESTMENT
Investments are both important and useful in the context of present day
conditions. Some factors that have made investment decisions increasingly

important are:
2.4.1 Longer life expectancy
Most people in India retire between die age of 55 and 60. The earnings
from employment should be calculated in such a manner that a portion should be
put away as savings. Saving must be invested in such a way that the principal and
income will be adequate for a greater no of retirement years.
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2.4.2 Increasing no of women workers

The importance of investment decisions is further enhanced by the fact that
there is an increasing no. of women working in organization. These women will
be responsible for their own investment during their working life so that after
retirement, they are able to have a stable income.
2.4.3 Increasing rates of taxation

Taxation is one of the crucial factors in any country. Which introduces an
element of compulsion in a person's savings. There are various forms of savings
outlets in our country in the from of investments which help jn bringing down the
tax level by offering deductions in Personal income. Some examples are
investment in NSC,LIC,ULIP etc.
2.4.4 Inflation
Inflation has become a continuous problem. In these years of rising prices, several
problems are associated coupled with a falling standard of living. The Investor
will try and search an outlet which will give him a high rate of return in the
from of investment to cover any decrease due to inflation.
2.45.5 Income
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Another reason why investment decisions have assumed importance is the

general increase in employment opportunities in India. The employment
opportunities gave rise to both male and female working force. More incomes
and more avenues of investment have led to the ability and willingness of
working people to save and invest their funds.
2.4.6 Investment channels
The growth and development of the country leading to grater economic
activity has led to the introduction of a vast array of investment channels. Apart
from putting aside savings in savings banks where interest is low, investors have
the choice of a variety of instruments like corporate stock, life insurance, unit
trust schemes, provident fond and so on.
2.5
SECURITIES
2.5.1 Definition of Securities

Securities is a general term for a stock exchange investment. Securities
contract (Regulation) Act 1956 defined securities as to include.
a. Shares, Scrip's, Stocks, Bonds, Debentures.
b. Government securities.
c. Such other instruments as may be declared by the central Govt. to be
securities.
d. Rights or interests in securities.
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e. Derivatives.
2.6 TYPES OF SECURITIES
2.61 Equity shares
These are the ordinary shares of a limited company. These types of instruments
entitled to get anything remaining after payable of external liability and the claims
of the preference share holders. They are called ownership securities.
2.6.2 Preference shares
As per the provision of sec & 5 of the companies Act the preference shares are:i.
Carry a preferential right to get a fixed ration of dividend during the life
time of the company.
ii.
Carry a preferential right to get back their capital before distributing

anything among the equity shareholders in the event if winding up of the
company preference shares have the failures of both equity share and fixed
interest bearing bonds like debentures. They are paid a fixed dividend
before any dividend is declared to equity share holders.
2.6.3 Debentures
These are credit instruments Debentures are acknowledgement of debit I
issued under the seal of a company with a promise to pay interest and repay the I
principal on maturity of the instruments. Sec2(12) of the companies Act state that
debentures tock bonds and specify the right of the debenture deed specify the
right of the debenture holders and the obligations of the company.
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2.64. Government Securities

Securities issued by the central Government are referred to as securities.
They are issued in the denominations of Rs.10000 or 100. The interest is payable
half yearly. They are issued through the public Debt Office of Rs. B1. Their
market is usually our the counter market. This is a source of raising find to
Government activities.
2.6.5 Bonds
A negotiable certificate evidencing indebtedness. It is normally unsecured.
A debt security is generally issued by a company, municipality or government
agency. The issue usually pays the bond holder periodic interest payments over
the life of the loan. Bond is an instrument issued by the state Government,
Central Government and local authorities as a society for raising money from the
public.
2.7 DIFFERENT KINDS OF LIC POLICES
Life Insurance is a contract between a person and an insurance company
for a no. of years covering either the life time period or a fixed no of years. The
various kinds of LIC Polices are given below:
2.7.1 Whole Life Polices
The whole life policy is for the full life time of the insurer and the amount
of insurance will be paid only at the time of death. The insurer, therefore, gets no
benefit but his nominee receives the amount after his death. The premiums may
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be paid in three ways single premium plan, limited premium plan or continuous
premium plan. The whole life policy may be issued in the following way:
a) ordinary whole life policy
b) Limited payment whole life policy.
c) Single payment whole life policy.
d) Special whole life policy
e) Convertible whole life policy.
2.7.2 Endowment Policy
The endowment insurance policy is the best form of investment to an
investor who wishes to take life policy as a form of investment with the benefit
of saving his income, protection to life and receiving tax benefits. Under this
plan, the company promises to pay a stated amount of money to the beneficiary
if the insured dies during the life of policy or to the insurer himself if he survives
the endowment period. The premium of this policy is higher than whole life
policies. Endowment Policy may be issued in the following different forms:
Ordinary Endowment Policy
Pure Endowment Policy
Optional Endowment Policy.
Double Endowment Policy.
Anticipated Endowment Policy.
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Endowment combined with whole life policy.

Education/marriage Endowment Policy.
2.7.3 Term Insurance Policy
This is a method or contract for payment of amount insured only if the
insured dies during the term of the policy or a specified period stated within the
contract. If the insured does not die during the specified period, the contract
expires and is treated as cancelled. This Policy may be Straight Term Policy
Convertible Policy
Decreasing Term Policy
Renewable term Policy.
Yearly Renewable Policy
2.7.4 New Polices Of LIC

Besides the above polices several new policies are issued by LIC to cater to
the needs of different persons. The new policies of LIC are as follows:
o Jeevan Mitra
o Jeevan Sathi
o New Jan Raksha
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o Jeevan mitra plan

o Jeevan Surabhi
o Jeevan Asha
o Jeevan Bharati
o Jeevan Akshay
o Jeevan Sanchay
o Jeevan Sukanya
o Bhavishya jeevan
o Bhima Sandesh
2.8
OBJECTIVES OF LIC
The corporation would normally entertain proposals for assurance where the
object of assurance is :
2.8.1 Family Protection
It affords full protection against risk of death. In case of death the full sum
assured is made available under a life assurance policy. It gives protection to the
family at the time when is requirement is the highest, ie, loss of the earning
member of the family.
2.8.2 Provision for oldage
It provides to the small man a sum of money at the expiry of a number of
years. The premium paid by the person accumulates over the years and at the time
of retirement he gets the total amount. It will very helpful to the old age.
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2.8.3 Insurance encourages and forces thrift

The payment of life insurance premiums becomes a habit and comes to be
viewed with the same seriousness as the payment of interest on a mortgage. Thus,
in effect brings about compulsory savings.
2.9
MUTUAL FUNDS
In India, there are a large number of mutual funds. Which are under the
regulatory frame work of the securities Exchange Board of India (SEBI) with the
exception of unit Trust of India (UTI). All mutual funds should have a net worth
of Rs.5 crore each, they have to set up a board of trustees and appoint directors.
The mutual fund concept is based on sharing of risks and rewards. Their
securities are subject to market risk. Share Price can move up or down.
The investor should be aware to those risks while making an investment decision.
Even with risks, the mutual funds are able to perform better than an individual
because a careful selection of securities over a diversified portfolio covering large
number of companies and industries is made and the Portfolio is constantly
reviewed. Mutual funds select a large share of equities in the case of growth
schemes. Although this has a greater risk, the Potential for capital appreciation is
higher in growth schemes.
Mutual Funds also have an income schemes. When they have an income
schemes, they invest in securities of the guaranteed return. They generally select a
large share of fixed income securities like debentures and bonds. All growth
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schemes are closed ended and income schemes are either closed ended or open
ended. In India a large number of mutual funds have been floated.
2.10 CONCEPT OF MUTUAL FUNDS
The concept of mutual fund is a new feather in the cap of Indian Capital
Market but not to international capital markets. The formal origin of Mutual
Funds can be traced to Belgium where Society Generate dc Belgique was
established in 1822 as an investment company to finance investment in national
industries with high associated risks. In India first mutual fund was started in
1964 when UTI was established in the similar line of operation of the UK based
Investment Trust Companies.
2.11 TYPES OF MUTUAL FUND
To achieve the different objectives of the investors, mutual funds adopt
different strategies and accordingly offer different schemes of investment. The
various mutual funds may be classified under five broad categories.
2.11.1 According to ownership

According to ownership, mutual funds in India may be classified as public
sector and private sector mutual funds.
2.11.1.1 Private Sector Mutual Funds
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The Government of India allowed the private sector corporate to join the
mutual Fund industry on 14.02.1992, Example : Reliance- MF, TATA- MF etc.
2.11.1.2 Public Sector Mutual Funds
Mutual Funds working in the public sector are called Public Sector Mutual
Funds. Example: UTI - MF, SBI- MF, LIC-MF.
2.11.2 According to scheme of operation
2.11.2.1 Open-Ended Schemes
Open ended schemes means a schemes of mutual funds which offers units
for sale without specifying any duration for redemption. These schemes do not
have a fixed maturity and entry to the fund is always open to investors who can
subscribe it at any time.
2.11.2.2 Close -Ended Schemes
A close ended schemes means any scheme of mutual fund in which the
period of maturity of the scheme is specified. Unlike open ended funds, the
corpus of close- ended scheme is fixed and an investor can subscribe directly to
the scheme only at the time of initial issue.
2.11.3 According to Portfolio

2.11.3.1 Income Funds
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These funds aim at providing maximum current return/ income to the

investors. The investments are made in stocks yielding higher returns and capital
appreciation is of small importance.
2.11.3.2 Growth Funds
These funds aim at providing capital appreciation in the value of
investment such funds invest in growth oriented securities have a potential to
appreciate in the long run,
2.11.3.3 Balanced Funds
Balanced funds spent both on common stock and preferred stock. Balanced
funds ensure both appreciation in stock as well as regular return in the shape of
interest and dividend.
2.11.3.4 Specialised Funds
These funds invest in a particular type of securities. The Funds may
specialize in securities of companies dealing in a particular product, finds in a
particular industry or of certain income producing securities.
2.11.3.5 Leverage Funds
The primary aim of leverage is to maximize capital appreciation. These
funds may use even borrowed funds for buying speculative stock which ensures a
profit in the future. The cost of raising loaned funds and the gain from holding
shares is the profit of the leverage fund.
2.11.4 According to Location
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2.11.4.1 Domestic Funds

These are the funds which mobiles savings of people within the country
where investments are made.
2.11.4.2 Off-shore Funds
Off-shore mutual funds are those which raise or mobiles funds in countries
other than where investments are to be made. These funds attract foreign savings
for investment in India.
2.11.5 Other Mutual Funds
In addition to the above mentioned mutual funds there can be some other
types of mutual funds also such as Loan funds and Non-Loan funds based upon
the expenses/fees to be charged.
2.12 POST OFFICE SCHEMES
Post Office schemes are generally like the commercial bank schemes.
They have a saving account, a recurring account, a ten-year cumulative Time
Deposit(CTD) account which are also recurring in nature. The savings account
operate in the same way as commercial banks through cheques and there is no
restriction on withdrawals.
2.13 KINDS OF POST OFFICE SAVINGS SCHEMES
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2.13.1 Saving Deposits

The public is encouraged to deposit their money is post office schemes. A
maximum amount of Rs- 50,000/- can be deposited in an individual account and
Rs. 1 lakh in a join account. The interest provided in these deposits is 15% and it
is tax free.
2.13.2 Fixed Deposit
Fixed deposit can be made for a fixed period between ! to 5 years. The
Interest given by the Post Office on this Fixed Deposit is between 7.5% Post
Office. make it convenient for the investor by giving half yearly interests. Interest
is exempt upto Rs 11000/- limit per annum.
2.13.3 Recurring deposit
The Post Office allows an individual to open an account upto 60 months. It
provides an interest of 9.5%. This is compounded quarterly and paid at maturity.
I The individual pays a fixed amount every month till maturity.
1 2.13.5 National Savings Certificate
The investor of National Savings Certificate receives an interest of 9.5% f
compounded half yearly. The principal plus interest is payable at maturity.
2.13.6. Savings Certificate
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The rate of interest in this instruments is 12% and it is compounded half

yearly, but it is payable only at maturity. The interest accrued is reinvested but has
the eligibility of receiving a rebate in tax under section 88.
2.13.7 Indiar Vikas Patra (VIS)
Post Office also sell Indira vikas Patra.
These securities are freely
transferable and are like bearer bounds. They are sold at the face value of Rs.
100/- 20/-,500/-, and 5000/-.
In India, these are very popular. They carry
compound interest of 9.5% and have a maturity value of 7 years.

2.13.8 Kisan Vikas Patra (KVP)
Post Office are also popularising Kisan Vikas Patra. This has a face value
of Rs. 1000/-, 5000/-, 10,000/- and give a corn pound interest of 9.5%. This
investment doubles in 7 years. The encashment of this certificates is possible
after the holding period of 2.5 years. These instruments cannot be transferred
easily from one person to another.
2.14 COMMERCIAL BANKS
The third forms of investments which in terms of prospects of investments
have been not only popular but have been growing because of the attractive kinds
of investment plans provided by the different programmes of the Commercial
banks. Commercial banks provide to the investor both deposits which are liquid
in nature which have stability and which also give an element of security.
Commercial bank fixed deposits also qualify as collateral for loans. While other
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forms of investments may be avoided by an investor, commercial bank deposits

cannot be eliminated from his portfolio nor can its use be underestimated from
the point of view of liquidity and stability of income.
Commercial banks provide to the investor both deposits which are liquid
in nature, which have stability and which also give an element of security.
Commercial bank fixed deposits also quality as collateral for loans.
215 DIFFERENT TYPES OF DEPOSITS
The primary function of a commercial bank is to accept different types of
deposits form the public. These deposits constitute one of the important sources
of bank's funds. Most of the commercial banks vie with one another in tapping
the savings of the Public by means of different kinds of deposits. The traditional
forms of deposits accepted by the banks are:
1. Fixed deposits or Time deposits
2. Savings deposits
3. Current deposits or Demand deposits
4. Recurring deposits or cumulative deposits.
2.15.1 Fixed Deposits or Time Deposits
Fixed deposits is a type of deposits made with the bank for a fixed period
which is specified at the time of making the deposits. They are called time
deposits or time liabilities. In England, as their withdrawals are subject to the
service of a period of notice. The following are the general features of fixed
deposits accounts:
a. A fixed amount of money is deposited by a customer for a fixed period of
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time at a fixed rate of interest.

b. It cannot be withdrawn on demand.
c. No cheques can be drawn against fixed deposit.
d. While making a fixed deposits a receipt known as fixed deposits receipt.
2.15.2 Savings Deposits
Savings deposits are those deposits made by people of the lower and
middle classes who wish to save a part of their current incomes to meet their
future needs and also intend to earn an income from their savings. By accepting
savings deposits, banks mobilize scattered savings of the public and utilize them
for productive purposes which will in turn stimulates economic development. The
general features of savings deposits are:
a. It is meant for middle and low income groups who can deposits only small
amounts.
b. The purpose of savings deposits to inculcate the habit of thrift among the
public.
c. A customer can deposits any amount of money and any number of times.
2.15.3 Current Account Deposits
Current account is a running account in which money can be deposited and
withdrawn any number of times and without any limit during a working day.
Current accounts generally suit the requirement of big businessmen joint stock
companies, institution, Public authorities etc. The general features of current
account deposit are:
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a. Current account holder can issue cheques to third parties against his
account.
b. ACurrent account is opened by a customer for convenience in making
payments by cheque. This relieves him of handling cash by himself and to
take the risk inherent therein.
c. Generally no interest is given to current account holders.
2.15.4 Recurring Deposits
Recurring Deposits is an innovation of the modern banker. The recurring
deposit accounts combine the characteristics of both savings accounts and fixed
deposit accounts. In the case of a recurring deposit account the depositor deposits
a fixed sum of money every month for an agreed period. These deposits
encourage thrift among low and middle income groups and help them to save a
fixed sum every month.
2.16 PROMISSORY NOTES
Promissory notes are the usual form of government securities. They are
purchased by banks and are highly liquid in nature. The promissory note can be
transferred by transfer or endorsement. Transfer can also be by delivery to the
transferee. They are registered promises of the government and are usually
entered in a register especially made for entering promissory notes. Government
provides to the investors a half-yearly interest which is given only in presentation
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of the promissory note at the office of purchase. This is the most popular
government security and finds favour with investors.
2.17 GOLD
Gold is one of the most valuable assets in any economy. It has been used in
India primarily as a form of saving by the housewives. Although it is said to
appreciate many times yet in India it is more of a sense of security and a fixed
asset rather than for the use of sale or for the purchase of making profit or income
on this investment. Gold may be called a hedge against inflation or a well or
reservoir for future use or substitute for the rupees which are used as a means of
transfer or exchange. Gold to the investor in recent years has been important
mainly because of rise in price due to inflation. It has been used more for
speculation rather than for a long-term investment and for quick profits. Gold may
be invested into either in the form of gold shares which are banned in India, gold
coins, gold bars and gold jewellery.
2.17.1 Gold Coins
In India, gold coins are not available now. But there are old coins of 1800 to 1895
of the time of King George and Queen Elizabeth. Gold Coins can also be used As
a form of Jewellery. Some investors prefer to trade them in the form of coins only
12.17.2 Gold Bars
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Gold bars also are not considered legal ownership in India. But in the
united states of America it has been legal to hold and make gold bars. Gold
bars compensate for inflation but it is an unproductive asset and is risky.
2.17.3 Gold Jewellery

Gold Jewellery is a method of shaping pure gold into ornaments. The
standard used in India is usually 9.2 carate.
2.18 SILVER
Silver is sold in the form of weight by Kilograms in India. Silver may
be owned in the form of coins, Utensils, glasses, bowls, plates, jewellery.
This like gold, has been a hedge during inflation. The price of silver although
less than gold, also keeps on rising in the same way as gold.
2.19 COINS AND STAMPS COLLECTION
An investor may collect stamps and coins as an investment. Old coins
have antique value and can be sold for high prices. Old stamps also increase
in value. But from the investor's point of view coins and stamps should be
collected only after careful understanding of the subject and by seeking
professional guidance because they are risky investments and the value
increases only after holding them for a large number of years.
2.20 DIAMONDS
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Since the price of diamonds keep in increasing in the same way as the price
of gold they have good investment value. Diamond is to be judged in terms of its
size and shape. In India the investor may cautious to buy diamond because each
Jeweller decides the value of diamond according to his own judgment. The
investor may be careful that he is not cheated.
2.21 ANTIQUES
For antique demand is more and supply is very rare as this increases its
value. Antique may be in the form of paintings, Coins, Stamps, Cars. It has been
found that the longer the time of holding this investment the greater the value of
this asset.
2.22 MONEY MARKET FUNDS
The money market funds are operative, namely in the united states
Government securities relating to short-term maturities. Large amounts are used
for the purchase of these securities. These securities involve complete safety but
the yields are not so high. For safety, investment companies make investments, in
these funds and pass on the benefits to the investors.
2.23 DEBENTURES
Debenture is an instrument in writing given by a company acknowledging
the liability for the total amount received and agreeing there by to pay the money
raised after the expiry of the stipulated period at the certain rate of interest per
annum. There are various types of debentures are used for this purpose.
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2.24 BONDS
Bonds are senior securities in firm they represent a promise by a company
to the bondholder to pay a specified rate of interest during a stated time period
annually and the return of the principal sum on the date of maturity. Date of
maturity is also called the date of retirement of a bond. Bonds are of many Kinds.
Bonds are an important source of funds to the corporate sector. They are usually
an issue of long-term debt of a corporate organisation.
2.25 FEATURES OF BONDS
a) Repayment of principal
b) Specified Time period
c) Call
d) P ledge of security
e) Interest
2.26 TYPES OF BONDS
2.26.1 Serial Bonds
Serial bonds are issued by an organization with different maturity dates.
This is done to enable the company to retire the bonds in installments rather then
all together. It is less likely to disturb the cash position of the firm than if all the
bonds were retired together.
2.26.2 Sinking Fund Bonds
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Sometimes, an organization plans the issue of its bonds in such a way that there is
no burden on the company at the time of retiring bonds. This has the advantage of
using the funds as well as retiring them without any excessive liquidity problems
2.26.3 Registered Bonds
Registered bonds offer an additional security by a safety value attached to them. A
registered bond protects the owner from loss of principal.
2.26.4 Debenture Bonds

Debenture in the USA are considered to be slightly different from bonds.
Debenture bonds are issued by those companies who have an excellent credit
rating but do not have security in the form of assets to pledge to the bondholders.
2.26.5Mortgage Bonds
A mortgage bond is a promise by the bond issuing authority to pledge real
property as additional security. If the company does not pay its bondholders the
interest or the principal when it falls due, the bond holders have the right to sell
the security and get back their dues.
2.26.6 Collateral Trust Bonds
A collateral trust bond is issued generally when two companies exist and are in
the relationship of parent and subsidiary. The collateral that is provided in these
bonds is the personal property of the company which issues the bonds.
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2.26.7 Equipment Trust Bonds

Equipment trust bonds is the issue of bonds with equipment like
machinery as security. The property papers are submitted to trustees. These
bonds are retired serially. The equity issue is like a reserve to protect the lender in
cases where the value of the asset falls in the market.
2.26.8 Supplemental Credit Bonds

When additional pledge is guaranteed to the bondholders, their bonds are
categorised as supplemental by an additional non-specific guarantee. Such bonds
are classified as:
a) Guaranteed Bonds
b) Joint Bonds and
c) Assumed Bonds
2.27 PREFERENCE SHARES
As per the provision of see 85 of the companies Act the preference shares
are:a) Carry a preferential right to get a fixed ratio of dividend during the life time
of the company.
b) Carry a preferential right to get book their capital before distributing any
thing among the equity share holders in the event of winding up of the
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company.
2.28 TYPES OF PREFERENCE SHARES
Preference Shares if not described in a legal document are irredeemable
and non-participating but cumulative in nature. The following varieties of
preference shares are available depending on the clause inserted in the agreement
made at the time of issue of the shares:
2.28.1 Cumulative or Non-Cumulative

Cumulative preference shares have the right of dividend of a company
even in those years in which it makes no profit. If the preference shares are noncumulative in nature, they do not have a share in the profits of the company in the
year in which the company does not make profit. The advantage of preference
shares is that they are usually issued as cumulative.
2.28.2 Participating and Non- Participating preference shares
Participating preference shares get a share of dividends over and above the
share of dividends received at a fixed rate yearly. The preference shares are
usually non-participating unless it is specifically stated at the time of the issue of
shares.
2.28.3 Redeemable and Non-Redeemable Shares
All preference shares are non- redeemable in nature. Non- redeemable
means like the common stock, its existence is permanent in nature and its
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shareholding is continuous till the liquidation of the company. The small investor
finds a redeemable preference share as attractive form of investment. Redeemable
preference shares are also callable at the option of the issuing firm.
2.28.4 Convertible and Non Convertible Preference Shares.
A convertible preference share is to be evaluated both as a preference share
as well as an equity stock. It has the advantage of receiving a stable income in the
initial few years and then the conversion into an equity stock. Non-Convertible
preference shares do not enjoy the same status as a convertible stock. It is an
ordinary preference share but such a share may be issued with features of
participation in the dividends and may also be cumulative in nature. NonConvertible preference shares may also be redeemable.
2.29 EQUITY SHARES
Equity shares are also called common shares and are from the point of
view of investment more risky than both bonds and preference shares. These are
the ordinary shares of a limited company. These types of instruments entitled to
get any tiling remaining after payable of external liability and the claims of the
preference show holders. There fore they are considered as the ownership
instruments. They are the real owners of the institution.
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Chapter III
INVESTMENT AWARENESS OF RURAL PEOPLE
From the olden days itself. People have habits of saving a part of their
earnings for meeting contingencies in the future But during that period all classes
of people were too much cautious and avoiding risk in their investments and life.
So they preferred bank deposits LIC policies during that period.
But later the investment pattern of people especially high income group as
well as middle income group were changed and they preferred high return from
their investment. The growth of capital market and investment institutions resulted
in the introductions of various types of investment schemes and opportunities.
Capable of satisfying the investment needs of investors with different interests
those who preferred high rate of returns and ready to take risk invested in
securities. Especially shares those who preferred safety and fixed rate of return
and not interested in taking risk were preferred investment in insurance policies
units of mutual funds and Debentures.
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Another group of people who where not interested in return but reserving
they fund for meeting future necessities were invested in bank deposits.
At present most of the people in a society are aware about the investment
opportunities because of development in communication techniques such as
mobile phone, internet, email, magazine, television etc.
Growth of outlets and branches, capital market institutions. (investment agencies ,
LIC, Branches private life, Insurance schmes etc.
Even in the villages have made tremendous change in the investment habits and
making investment awareness among all classes of people . especially, in the rural
areas of societies.
CHAPTER IV
ANALYSIS OF DATA AND TESTING OF HYPOTHESES
INTRODUCTION
The analysis are done on the basis of primary data collected from sample
of 90 respondents, 30 each from agriculturist, 30 each from employees and 30
each from business men.
The data for the study has been collected from respondants through
questionnaire. Secondary data has also been used as a source of data all data
collected were summarized and tabulated. So as to facilitate analysis collected
data have been analysed by applying different mathematical satisfied teqniques
and charts etc.
Tools
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Following are the statistical tools used for analyzing data.
1. Percentage Analysis
2. 2 test chi-square test
3. ANOVA Analysis of variance test
Table 4.1
Distribution of Respondents on the basis of Age
Age Level
Agriculture
Employees
Busines
Total %
Below 25
13
43
12
40
s
11
37
36
40
25-50
10
33
30
10
33
29
32
Above 50
24
30
30
25
28
Total
30
100
30
100
30
100
90
90
Source : Primary Data

It is clear from the Table that among respondents 43% agriculturists, 40%
Employees, 37% Businessmen were below 25 and 33% of agriculturists 30%
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Employees 33% of Businessmen were between 25 and 50 remaining 24% of

agriculturists, 30% of employees, 30% of Businessmen were above 50.
Figure 4.1
Distribution of Respondents on the basis of Age
14
12
13
12
11
10
10
9
10
9 9
7
Agriculture
Percentage
Employees
6
Business
4
2
0
Dept. Of Commerce
Below 25
25-50
37
Above 50
MES College Erumely
SEX WISE CLASSIFICATION

The following table and figure shows sex- wise classification of
Respondents
Table 4.2
Sex wise classification
Sex
Agriculturist
Employee
s
Businessm
en
Tota
l
Male
20
67
18
60
21
70
59
66
Female
10
33
12
40
30
31
34
100
30
100 90
Total
30
Source : Primary Data
100 30
100
It is clear from the table 67% agriculturist 60% Employees, 70%

Businessmen were males and 33% of agriculturists, 40% of Employees, 30% of
Business were Females.
Figure 4.2
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Sex wise Classification

80
70
60
50
40
Male
30
Female
20
10
0
Agriculturist
Employees
Businessmen
Education wise classification of respondents

The following table and figure shows Education wise Classification of
Respondents.
Table -4.3

Education
Agricul
ture
Employee
s
Businessme
n
Total
Below
10
33
12
40
30
31
34
S.S.L.C
S.S.L.C
Graduate
Above
8
7
5
27
23
17
6
7
5
20
23
17
9
6
6
30
20
20
23
20
16
26
22
18
Graduate
Total
30
10
0
30
10
0
30
10
0
90
Source of Primary data
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It is clear from the table that among respondents 33% of agriculturists,

40% of Employees, 30% of Businessmen were Below S.S.L.C and 27% of
agriculturists, 20% of Employees, 30% of Businessmen were S.S.L.C and 23% of
agriculturists, 23% of Employees, 20% of Businessmen were Graduate and 17%
of agriculturists, 17% of Employees, 20% of Businessmen Above Graduate
Table -4.3
40
35
30
25
Percentage
Below S.S.L.C
S.S.L.C
20
Graduate
Above Graduate
15
10
5
0
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Agriculture
Employees Businessmen
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Marital status
The following table and figure shows marital status wise classification of
Respondents
Table 4.4
Marital Status wise Classification of Respondents
Marital
Agriculturists
Employees
Businessmen
Total
Status
Married
Un
20
10
Married
Total
30
Source of Primary Data
67
33
22
8
73
27
21
9
70
30
63
27
70
30
100
30
100
30
100
90
100
Table shows that 67% of Agriculturists, 73% of Employees, 70% of

Businessmen were married, and 33% of agriculturists, 27% of Employees 30% of
Businessmen were Unmarried.
Figure -4.4
Marital Status wise Classification of Respondents
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80
70
60
50
Percentage
Married
40
Un Married
30
20
10
0
Agriculture
Employees
Businessmen
Monthly Income
The following table and figures shows monthly Income classification of
Respondents
Table -4.5
Monthly Income wise Classification of Respondents
Monthly
Agricult
Income
urists
Below 3000
3000-5000
Above 5000
Total
12
10
8
30
Employee
Businessm
40
33
27
%
Total
23
30
47
%
27
28
35
Total
30
31
39
100
en
8
9
13
30
27
30
43
%
7
9
14
30
Source of primary Data

In this Classification 40% of agriculturists, 27% of Employees, 23% of
Businessmen were below 3000, and 33% of Agriculturists, 30% of Employees
30% of Businessmen were between 3000 and 5000 and27% of Agriculturists, 43%
of Employees 47% of Businessmen were Above 5000.
Figure - 4.5
Monthly Income wise Classification of Respondents
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50
45
40
35
30
25
20
15
10
5
0
Below 3000
3000-5000
Above 5000
3000-5000
Below 3000
Above 5000
COMMERCIAL BANK SCHEMES

Commercial Bank, provide to the investors both deposits which are liquid
in nature, which have stability and which also give an elements of security
commercial bank fixed deposits also quality as collateral foe loans.
Savings Bank Account
The most liquid form of investment is the maintenance of a saving bank
account withdrawal can make at any time during the year up to a limit of the
saving bank account.
Table -4.6
Distribution of Respondents on the basis of level of awareness on Saving
Bank Account.
Level of
Awareness
Fully
Agricu
lturists
12
Dept. Of Commerce
Employ
40
ees
14
43
Business
Total
47
men
13
43
39
43
MES College Erumely
Awareness
Partially
10
Awareness
Un Awareness
8
Total
30
33
30
30
28
31
27
100
7
30
23
100
8
30
27
100
23
90
26
100
In this Classification 40% of Agriculturists, 47% of Employees, 43% of

Businessmen were Fully aware about this scheme and 33% of Agriculturists, 30%
of Employees, 30% of Businessmen were Partially aware about this scheme and
27% of agriculturists 23% of Employees, 27% of Businessmen were Unaware
about in this scheme.
Figure - 4.6
Distribution of Respondents on the basis of level of awareness on Saving
Bank Account.
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47
50
45
40
43
40
33
35
30 30
30
27
25
27
23
20
Fully Awareness
Partially Awareness
Un Awareness
15
10
5
0
Agriculturists
Employees
Businessmen
Fixed Deposits
Fixed Deposits scheme vary from bank to bank but the maturity value is
normally. The same and the interest at a fixed deposits is specifies time to time by
the Reserve Bank of India.
Table -4.7
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Distribution of Respondants on the basis of level of awareness on Investment

in fixed deposits.
Level of
Agricul
Awareness
Fully
Awareness
Partially
Emplo
turists
14
10
Awareness
Un Awareness
6
Total
30
Business
Total
47
yees
15
50
men
16
53
45
50
33
27
27
26
29
20
100
7
30
23
100
6
30
20
100
19
90
21
100
It was found that 47% of agriculturists, 50% of Employees, 50% of

Businessmen and 33% of Agriculturists 27% of Employees, 27% of Businessmen
and 20% of agriculturists, 23% of Employees, 20% of Businessmen were an
aware about in this deposits.
Figure - 4.7
in fixed deposits.
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60
50
40
53
50
47
33
20
27 23
30
2720
Fully Awareness
20
Partially Awareness
10
Un Awareness
Un Awareness
Partially Awareness
Fully Awareness
CURRENT ACCOUNT
A current account is usually opened by business house, the account holder
is permitted to draw according to a fixed like provide by the bank in agreement
with account opening association.
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Distribution of respondents on the basis of level of awareness on

investment in current account.
Table 4.8
in Current account
Level of
Agricul
Awareness
Fully
Awareness
Partially
Emplo
turists
13
10
Awareness
Un Awareness
7
Total
30
Business
Total
43
yees
15
50
men
17
56
45
50
33
30
20
25
28
24
100
6
30
20
100
7
30
24
100
20
90
22
100
It is found that 43% of agriculturists, 50% of employees,56% business ,

56% of businessmen were fully aware about this deposits and. 33% of
agriculturist and 30% of employees, 20% of businessmen. Were partially aware
and 25% of agriculturists 20% of employees, 24% of businessmen were un aware
about this type of investment.
Figure- 4.8
Distribution of respondants on the basis of level of awareness on Investment
in Current account
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60
56
50
50
43
40
33
30
24
30
Fully Awareness
20
20
20
24
Partially Awareness
Un Awareness
10
0
Agriculturists
Employees
Businessmen
CAPITAL MARKET INSTRUMENTS

Capital Market refers to the market for long-term fund. The followingare
main instruments traded in the Capital Market.
SHARE
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The level of awareness or respondents, on investment in share was

accessed.
Table 4.9
Distribution of Respondents on the basis of Level of awareness on shares.
Level of
Agricu
Employee
Busines
Total
Awareness
Fully
lturists
12
40
s
14
46
smen
15
50
41
46
Awareness
Partially
10
33
27
30
27
30
Awareness
Un
27
27
20
22
24
Awareness
Total
30
100
30
100
30
100
90
100
The Table shows that 40% of Agriculturists 46% of Employees, 50% of

Businessmen were Fully Aware and 33% of Agriculturists, 27% of Employees
30% of Businessmen were partially aware and 27% of Agriculturists, 27% of
Employees, 20% of Businessmen were Unaware about the investments.
Figure- 4.9
Distribution of Respondents on the basis of Level of awareness on shares.
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50
45
50
46
40
40
33
35
27
30
25
30
27 27
Fully Awareness
20
20
15
Partially Awareness
Un Awareness
10
5
0
Agriculturists
Employees
Businessmen
MUTUAL FUND
Mutual Fund represent a valuable for collecting Investments. When an
investor participate of Mutual Fund.
Table 4.10
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Distribution or respondents on the basis of level of Awareness of Mutual

Fund.
Level
of Agricul
Awareness
Fully
turists
13
Employe %
Business
es
53
44
49
43
15
50
men
16
Total
Awareness
Partially
30
27
27
25
28
Awareness
Un
27
23
20
21
23
100
30
100
30
100
90
100
Awareness
Total
30
The Level of awareness of respondents on investments in Mutual fund was

assessed. It is found that 43% of Agriculturists, 50% of Employees, 53% of
Businessmen were fully aware and 30% of Agriculturists, 27% of Employees,
27% of Businessmen were Partially aware and 27% of Agriculturists 23% of
employees, 20% of Businessmen were Unaware about this type of Investments.
Figure- 4.10
Distribution or respondents on the basis of level of Awareness of Mutual
Fund.
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60
53
50
50
43
40
30
30
27
27
Fully Awareness
27
23
Partially Awareness
20
20
Un Awareness
10
0
Agriculturists
Employees
Businessmen
DEBENTURE
The are credit
Instruments, debentures are acknowledgement of debt
issued under the seal of a company with a promise to pay interest and repay the
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principal an maturity of the instruments of the Companies act state that debentures
stock bonds and other securities of a company.
Table 4.11
Distribution of Respondent on the basis of level of awareness on debenture.
Level
of Agricultu
Awareness
Fully
rists
11
Awareness
Partially
Awareness
Un
Employ
37
ees
13
10
33
Awareness
Total
30
Business
Tota
43
men
15
l
50
39
43
30
27
27
30
30
27
23
24
27
100
30
100
30
100
90
100
In this Classification 37% of Agriculturists, 43% of Employees, 50% of

Businessmen were Fully aware and 33% of agriculturists, 30% of Employees 27%
of Businessmen were Partially aware and 30% of Agriculturists, 27% of
Employees, 23% of Businessmen were Unaware.
Figure- 4.11
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Distribution of Respondent on the basis of level of awareness on debenture.
60
50
50
43
40
37
33
30
30
30
27
Fully Awareness
27
23
Partially Awareness
Un Awareness
20
10
0
Agriculturists
Employees
Businessmen
LIFE INSURANCE POLICIES

Life Insurance is an Investment outlet and its importance is growing day by
day because it provides protection to life along with investments. Even though
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there are number of policies offered by Insurance companies. They may be

divided in the three broad division on
a) Whole life policy
b) Endowment Policy
c) Special Policy
WHOLE LIFE POLICY
Under this policy, the assured is liable to pay premium through out his
lifetime. The amount assured will be paid to the respondent only the death of the
assured.
Table 4.12
Distribution of Respondents on the basis of level of awareness on whole life
Policy.
Level
of Agricultur
Awareness
Fully
ists
Employe
es
Busines
Total
11
37
14
47
smen
16
Awareness
Partially
10
33
30
27
27
30
Awareness
Un
30
23
20
22
24
100
30
100
30
100
90
100
Awareness
Total
30
53
41
46
It is found that 37% of Agriculturists, 47% of Employees, 53% of

Businessmen and 33% of were Fully Aware of Agriculturists, 30% of employees
27% of Businessmen were Partially aware and 30% of Agriculturists, 23% of
Employees, 20% of Businessmen were Unaware about its Policies.
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Figure - 4.12
Distribution of Respondents on the basis of level of awareness on whole life
Policy.
60
53
50
40
47
37
33
30
30
30
Fully Awareness
27
Partially Awareness
23
20
20
Un Awareness
10
0
Agriculturists
Employees
Businessmen
ENDOWMENT POLICY
Under this scheme the assured is liable to pay premium only to a specified
period or until the death of the assured whichever is earlier.
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Table 4.13
Distribution of Respondents on the basis of level of awareness on Endowment
Policy.
Level
of Agricultur
Employ
Business
Total
47
men
16
53
42
47
Awareness
Fully
ists
12
40
ees
14
Awareness
Partially
10
33
30
27
27
30
Awareness
Un
27
23
20
21
23
100
30
100 30
100
90
100
Awareness
Total
30
The above Table shows that 40% of Agriculturists, 47% of Employees,

53% of
Businessmen were Fully aware and 33% of Agriculturists, 30% of
Employees 27% of Businessmen were Partially aware and 27% of Agriculturists,

23% of Employees, 20% of Businessmen were Unaware about this policy.
Table 4.13
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Distribution of Respondents on the basis of level of awareness on Endowment

Policy.
60
53
50
40
47
40
33
30
30
Fully Awareness
27
27
23
Partially Awareness
21
Un Awareness
20
10
0
Agriculturists
Employees
Businessmen
SPECIAL POLICY
There are a number of special policies offered by LIC, which include
children, education scheme, Children Marriage scheme, plan for handicapped
pension scheme etc.
Table 4.14
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Distribution of Respondents on the basis of level of awareness in special

policies
Level
of Agricultur
Employe
Business
Total
47
men
16
53
47
Awareness
Fully
ists
12
40
es
14
Awareness
Partially
30
10
33
27
27
30
Awareness
Un
30
20
20
21
23
100
30
100
30
100
90
100
Awareness
Total
30
It is clear from above Table that 40% of Agriculturists, 47% of Employees,

53% of Businessmen were Fully aware and 30% of Agriculturists, 33% of
Employees, 27% of Businessmen were Partially aware and 30% of Agriculturists
20% of Employees, 20% of Businessmen were Unaware about this Policies.
Figures- 4.14
Distribution of Respondents on the basis of level of awareness in special
policies
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60
53
50
40
47
40
33
30
30 30
Fully Awareness
27
Partially Awareness
Un Awareness
20
20
20
10
0
Agriculturists
Employees
Businessmen
POST OFFICE SAVING SCHEME

This is one of the important Investment outlets similar to bank deposits.
They are Saving Account, repairing Account and cumulative deposits which are
also recurring in nature.
POST OFFICE RECURRING DEPOSITS
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Recurring deposits scheme are in the form of Cumulative deposits scheme

covering a period of 10 year, 15 years and 20 years.
Table -4.15
Distribution of respondants on the basis of level of awareness on Post Office
recurring Deposits.
Level of
Agricult
Employe
Business
Total
Awareness
Fully
urists
11
37
es
13
43
men
15
50
39
43
Awareness
Partially
10
33
10
33
27
28
31
Awareness
Un
30
27
23
23
26
100
30
100
30
100
90
100
Awareness
Total
30
The above Table shows that 37% of Agriculturists, 43% of Employees,

50% of Businessmen were fully aware and 33% of Agriculturists, 33% of
Employees, 275 of Businessmen were Partially aware and 30% of Agriculturists ,
24% of Employees, 23% of Businessmen were unaware about this type of
Deposits.
Figure -4.15
Distribution of respondents on the basis of level of awareness on Post Office
recurring Deposits.
Dept. Of Commerce
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60
50
50
43
40
37
33
30
33
30
Fully Awareness
27
24
Partially Awareness
23
Un Awareness
20
10
0
Agriculturists
Employees
Businessmen
POST OFFICE TIME DEPOSIT

This is one of the important Investment channel offered by Post Office for
the rule avert Investors. The minimum amount of deposit should be Rs.50 and
there is no limit for investment.
Table 4.16
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Distribution of Respondents on the basis of level of Awareness on Post Office

Time Deposits.
Level
of
Agricult
Employe
Business
Total
50
men
17
57
45
50
Awareness
Fully
urists
13
43
es
15
Awareness
Partially
30
27
23
24
27
Awareness
Un
27
23
20
21
23
Awareness
Total
30
100
30
100
30
100
90
100
It is found that 43% of Agriculturists, 50% of Employees, 57% of

Businessmen were Fully aware and 30% of Agriculturists, 27% of Employees,
23% of Businessmen were partially aware and 27% of Agriculturists, 23% of
Employees,20% of Businessmen were Unaware about this type of Deposits.
Figure 4.16
Distribution of Respondents on the basis of level of Awareness on Post Office
Time Deposits.
Dept. Of Commerce
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60
57
50
50
43
40
30
30
27
Fully Awareness
27
Partially Awareness
23
20
Un Awareness
23
20
10
0
Agriculturists
Employees
Businessmen
Mutual Fund Scheme

Mutual Fund represents a valuable for collective Investment. When an
investor participate in a scheme of mutual fund, he become the part of owner of
investment held by the Company.
Income Funds
These funds aim a providing maximum current return/ income to the investors.
The investment are made in stocks yielding higher returns and capital appreciation
is of small importance.
Table 4.17
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Distribution of Respondents on the basis of level of awareness on income

funds.
Level
of Agricultu
Employ
Busine
Tota
47
ssmen
16
53
l
42
47
Awareness
Fully
rists
12
40
ees
14
Awareness
Partially
10
33
30
27
27
30
Awareness
Un
27
23
20
21
23
100
30
100
30
100
90
100
Awareness
Total
30
The above table shows 40% of Agriculturists,,47% of Employees, 53% of

Businessmen were Fully aware and 33% of Agriculturists, 30% of Employees,
27% of Businessmen were Partially aware about this investment and 27% of
Agriculturists, 30% of Employees, 20% of Businessmen were Unaware about this
type of Investment.
Figure- 4.17
Distribution of Respondents on the basis of level of awareness on income
funds.
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50
47
45
42
40
40
35
33
30
27
30
27
25
Fully Awareness
23
20
21
Partially Awareness
Un Awareness
15
10
5
0
Agriculturists
Employees
Businessmen
GROWTH FUND
These Funds aim at providing Capital appreciation in the value of
investment. Such funds invest in growth oriented securities have a potential to
appreciate in the long run.
Dept. Of Commerce
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Table 4.18
Distribution of Respondents on the basis of level of awareness on Growth
funds
Level
of Agricult
Employ %
Business
Total
43
men
15
50
39
43
Awareness
Fully
urists
11
37
ees
13
Awareness
Partially
10
33
30
27
27
30
Awareness
Un
30
27
23
24
27
Awareness
Total
30
100
30
100
30
100
90
100
It is clear from the Table 37% of Agriculturists, 43% of Employees, 50% of

Businessmen were fully aware and 33% of Agriculturists, 30% of Employees,
27% of Businessmen were Partially aware and 30% of Agriculturists, 27% of
Employees,23% of Businessmen were unaware about the Investments.
Figure - 4.18
Distribution of Respondents on the basis of level of awareness on Growth
funds
Dept. Of Commerce
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60
50
50
43
40
37
33
30
30
30
Fully Awareness
27
27
Partially Awareness
23
Un Awareness
20
10
0
Agriculturists
Employees
Businessmen
TESTING OF HYPOTHESES
The following hypotheses were formulated and tested.
There is no significant variation among respondents of different occupation.
Group regarding awareness of different investment, opportunities.
Dept. Of Commerce
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Hypotheses 1
The Hypothesis is tested with the help of
Level of
Agriculturists
Employees
test (Chi-square test)
Businessmen
Total
Awareness
Fully Awareness
Partially
12
10
11
10
14
9
34
29
Awareness
Un Awareness
24
Total
30
30
30
90
30 x 37
90
= 12 =
30 x 37
90
= 12 =
Partially Awareness =
30 x 29
90
= 9.6 =
30 x 29
90
= 9.6 =
Un Awareness
30 x 24
90
=8 =
Fully Awareness
Dept. Of Commerce
30 x 24
90
12
10
8
11
10
12
12
12
9.6
9.6
70
=8 =
30 x 37
90
30 x 29
90
30 x 24
90
OE
E
= 12
= 9.6
=8
0
0.3
1.3
0.24
0.01
MES College Erumely
9
14
9
7
( 0E )2
E
9.6
8
8
8
0.03
4.5
0.12
0.12
6.62
= 6.62
Degree of freedom
(r-1) (C-1)
(3-1) (3-1) = 2 +2= 4
Table Value = 9.48
Calculated value is less than table value- s 0 we accept this hypothesis.

There Calculates that There is no significant variation among respondents of
different occupation group regarding awareness of different investment,
opportunities.
Hypothesis : 2
1.
There is no significant difference in the level of awareness of Capital

Market instruments and Commercial Bank Scheme.
The Hypothesis is tested with the help of F test at 5% of level of significance.
Dept. Of Commerce
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Level of
Agriculturists
Employees
Businessmen
Fully Awareness
14
10
Partially
16
13
16
Un Awareness
nil
Total
30
30
30
Awareness
Awareness
T = Sum of all observations = 90

2
T
N
90
8
= 1012.5
S.S.T. Sum of squares of the observations
T2
N
= 119.5
2
S.S.C =
( x1)
n1
( x2 )
n2
( x3 )
n3
T2
N
=37.5
S.S.E= SST SSC = 82

MSC = 18.75
MSE = 16.4
Source of variation Sum of squares
Degree of
Mean square
freedom
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Between sample
SSC =37.5
(k-1) = 2
MSC = 18.75
Within samples
SSE = 82
(N-k) = 5
MSE -16.4
SST = 119.5
N-1=7
Total
F=
MSC
MSE
= 1.143
Degree of freedom =( k-1), (N-k)

= (2,5)
Table value = 5.79
The Task Value of F at 5% level of significance for (2.5) degree of
freedom is 5.79 The calculated value F is 1.143 Since calculated value is less
than table value. The null hypothesis sis accepted therefore concludes that There
is no significant difference in the level of awareness of Capital Market
instruments and Commercial Bank Scheme.
Hypotheses 3
There is no significant difference in the level or awareness of life insurance
policies and post office deposits.
The Hypothesis tested with the help of

Level
of Agriculturists
2 test
Employees
Businessmen
Total
Awareness
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Fully Awareness
11
13
13
37
Partially
10
27
Un Awareness
26
Total
30
30
30
90
Fully Awareness
30 x 37
90
= 12.3
Partially Awareness =
30 x 27
90
=9
30 x 27
90
=9
Un Awareness
30 x 26
90
= 8.6
30 x 26
90
= 8.6
Awareness
30 x 37
90
30 x 37
90
= 12.3
= 12.3
30 x 27
90
=9
30 x 26
90
= 8.6
11
12.3
0.13
10
12.3
0.43
12.3
0.08
13
9.6
1.7
9.6
9.6
0.11
13
8.6
4.7
8.6
0.04
8.6
0.29
7.48
Dept. Of Commerce
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OE
E
MES College Erumely
2 =
( 0E )2
E
= 7.48
Degree of freedom
(r-1) (C-1)
(3-1) (3-1) = 2 +2= 4
Table Value = 9.48
Calculated value is less than table Value. So we accept this hypothesis.
There are concludes that There is no significant difference in the level or
awareness of life insurance policies and post office deposits
SUMMARY OF HYPOTHESES
HYPOTHESES
ACCEPTED / REJECTED
a There is no significant variation Accepted
among
respondents
occupation.
Group
of
different
regarding
awareness of different investment,

opportunities.
b There is no significant difference in Accepted
the awareness level of different
respondents regarding capital market
instruments and commercial banks
c The is no significant difference in the Accepted
level or awareness of life insurance
policies and post office deposits
Dept. Of Commerce
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CHAPTER - V
FINDINGS, SUGGESTIONS AND CONCLUSIONS
5.1 INTRODUCTION
This chapter summarizes the major findings and suggestions drawn from
the study .
the purpose of the study was to assess the awareness of rural
respondents in vazhoor panchyath about various investment outlets .

The first chapter introduce the problems of the study and the methodology
adopted to analysis it. The study was conducted to analyses investment awareness
among rural people with special reference to vazhoor.
The study was concerned with the following.
1. To identify the investment awareness of rural people with special reference
to vazhoor gram panchayath
2. To identify the various investment avenues
3. To understand whether these people are interested in investment in
different schemes.
4. To understand whether
rural people are aware of new pattern of
investment
5. To understand whether people at rural area are aware of capital market
conditions and instruments.
Dept. Of Commerce
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With reference of above objectives the following hypothesis were formulated and
tested
1. There is no significant variation among respondents of different occupation.
Group regarding awareness of different investment, opportunities.
respondents regarding capital market instruments and commercial banks
3. There is no significant difference in the level or awareness of life insurance
The Scope of the study was limited Vazhoor Panchayath. The data for
study was collected through a structured questionnaire.
The Second chapter describes the theoretical frame work of the investment
avenues. This Chapter cover financial products like insurance, Post office
schemes, N.S.S. Capital Market products and Commercial Bank schemes.
The Third chapter analysis the primary data. The analysis and testing hypothesis
are given in the third chapter.
5.2 FINDINGS OF THE STUDY

MAJOR FINDINGS OF THE STUDY
1. Out of the total 90 responandents, 30 are agriculturists, 30 Employees and

30 businessmen
2. Out of total 90 respondants 59% are makes and 31% are females.
3. Out of the 90 respondants 36% of the respondants belong to the age group
of below 25 and 29% belong to the age group of 25-50 and 25% belong to
the age group of above 50
4. Out of 90 respondants 34% have only below S.S.L.C 26% have S.S.L.C.
22% have graduation and 18% have above graduation.
5. Out of thetotal 90 respondants 70 % are married and 30% are unmarried.
Dept. Of Commerce
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6. Out of the total 90 respondants 30% are belong to the monthly income
group of below 3000, 31% are belong to the monthly income group of
3000-5000 and 39% are belong to the monthly income group above 5000.
AWARENESS ABOUT SAVING AVENUES
a) Commercial Bank Account
Out of 90 respondents, 43% fully aware and 31% of respondents are Partially
aware and 26% of respondents are un aware.
b). Fixed Deposits
Out of 90 respondents 50% are fully aware and 29% of respondents are partially
aware and 21% are un aware this deposits.
c) Current Account
Out of total 90 respondants 50% of respondants are fully aware and 28% of
respondants are Partially aware and 22% of respondants and un aware.
a). Capital Market - Investments (SHARE)
Instruments (SHARE) out of total 90 respondents 465 are fully aware and
30% are partially aware and 24% are an aware.
b). Mutual fund
Out of the total 90 respondents 49% of respondants are fully aware and 28% are
Partially aware and 23% are un aware this investments.
Dept. Of Commerce
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c). Debenture
Out of the total 90 respondents 43% of respondents are fully aware and 30% of
respondents are partially aware and 27% of respondents are un aware this
investments.
LIFE INSURANCE POLICIES
a). Whole Life Policy
Out of the total 90 respondants 46% are fully aware and 30% of respondents are
partially aware and 24% of respondents are un aware about this policies.
b). Endowment Policy
Out of the total 90 respondents, 47% of rspondants were fully aware about this
policy and 30% were partially aware and 23% were un aware about this policy.
c). Special Policy
Out of the total 90 respondents, 47% were fully aware and 30% were partially
aware and 23% were un aware about this deposits.
POST OFFICE DEPOSITS
a). Post Office Recurring Deposits
Out of the total 90 respondant. 43% are fully aware and 31% are partially
aware and 26% are un aware about this Deposits.
Dept. Of Commerce
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b). Post Office Time Deposits

Out of the total 90 respondants 50% are fully aware and 27% are partially
aware and 23% are un aware about this deposits.
MUTUAL FUND SCHEMES
a). Income Fund
Out of the total 90% respondants, 47% respondants are fully ware and 30% are
Partially aware and 23% are unaware about this deposits.
b). Growth Fund
Out of the total 90% respondents, 43% respondents are fully aware and 30% are
partially aware and 27% are unaware about this funds.
occupation. Group regarding awareness of different investment,
opportunities.
3. There is no significant difference in the level or awareness of life
insurance policies and post office deposits
Dept. Of Commerce
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5. 3 SUGGESTIONS
This project is made as an enquiry regarding the investment awareness,
investment habits,and investment pattern of people in Vazhoor Panchayath on the
basis of this study. I could understand that
occupation.
Group
regarding
awareness
of
different
investment,
opportunities.
3. There is no significant difference in the level or awareness of life insurance
So, I suggest that to enhance their investment habits by including risk free
investment opportunities among median income level and lower income level
people.
CONCLUSION
Various options are available infront of invests ie. Risky debenture and
Government security to high risk avenues available in the market. A moderate
level of knowledge is essential for the investment decision. It will conclude that
Dept. Of Commerce
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rural people are much aware about investment avenues. However the people in
Vazhoor panchayth are aware about Capital Market instruments,, commercial
Bank schemes, LIC policies, post Office Saving etc.
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A Study on the investment awareness of rural people

STATEMENT OF THE PROBLEM

MES College Erumely

A Study on the investment awareness of rural people

analyze investment awareness among rural people with special reference to

MES College Erumely

A Study on the investment awareness of rural people

f) To evaluate preference give by the respondents regarding different types of

MES College Erumely

A Study on the investment awareness of rural people

3. The is no significant difference in the level or awareness of life

1.7 ANALYSIS OF DATA

2 and ANOVA(analysis of variance test.

The statistical test in which the test statistics follows a

test is a statistical test the significance of

difference between observed frequencies and the corresponding theoretical

MES College Erumely

A Study on the investment awareness of rural people

The variance between samples also known as mean square between

to fast changing capital market, mutual fund etc.

MES College Erumely

A Study on the investment awareness of rural people

MES College Erumely

A Study on the investment awareness of rural people

entering into investment decisions may be described as expectational premises.

2.2.1 Economic meaning of Investment

MES College Erumely

A Study on the investment awareness of rural people

This refers to collection of monitory resources in the form of asset

made in expectation of some positive rate of interest".

conditions. Some factors that have made investment decisions increasingly

MES College Erumely

A Study on the investment awareness of rural people

2.4.2 Increasing no of women workers

2.4.3 Increasing rates of taxation

MES College Erumely

A Study on the investment awareness of rural people

Another reason why investment decisions have assumed importance is the

2.5.1 Definition of Securities

MES College Erumely

A Study on the investment awareness of rural people

Carry a preferential right to get back their capital before distributing

MES College Erumely

A Study on the investment awareness of rural people

2.64. Government Securities

MES College Erumely

A Study on the investment awareness of rural people

MES College Erumely

A Study on the investment awareness of rural people

Endowment combined with whole life policy.

2.7.4 New Polices Of LIC

MES College Erumely

A Study on the investment awareness of rural people

o Jeevan mitra plan

MES College Erumely

A Study on the investment awareness of rural people

2.8.3 Insurance encourages and forces thrift

MES College Erumely

A Study on the investment awareness of rural people

2.11.1 According to ownership

MES College Erumely

A Study on the investment awareness of rural people

2.11.3 According to Portfolio