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Project Report Based OnComparative Study On Demat Schemes of Various Broking Firms in Association with :
Project Report Based OnComparative Study On Demat Schemes of Various Broking Firms in Association with Submitted By: Roll No Enrolment
No. Adarsh Menon B 014956 097010592009 AHMEDABAD INSTITUTE OF TECHNOLOGY GUJARAT TECNOLOGICAL UNIVERSITY, AHMEDABAD
Thursday, August 19, 2010 1
Vision :
Vision To be a leader and role model in financial services sector with a broad based and integrated business. Thursday, August 19, 2010 2
ABML SERVICES :
ABML SERVICES Thursday, August 19, 2010 4
PROGRESS OF ABML :
PROGRESS OF ABML Thursday, August 19, 2010 5
DEMAT :
DEMAT Dematerialization of financial securities is the first sign of financial reforms in India. Finance Ministry and SEBI realized the need of
more efficient financial system started in the early 1996 with NSE. As a result of this NSDL and CDSL came into picture. DEMAT is just like a
bank account where actual money is replaced by shares. ONE don't have to possess any physical certificates showing that HE/SHE own the
shares. They are all held electronically in your account. Thursday, August 19, 2010 6
Depository Participants :
Depository Participants NSDL NSDL works to support the investors and brokers in the capital market of the country. NSDL aims at ensuring the
safety and soundness of Indian marketplaces by developing settlement solutions that increase efficiency, minimize risk and reduce costs.
CDSL The second depository, Central Depository Services (India), was promoted by the Stock Exchange, Mumbai (BSE). Thursday, August 19,
2010 7
Comparative Study :
Comparative Study Comparison of Aditya Birla Money Ltd with other firms
Slide 9:
Thursday, August 19, 2010 9
Slide 10:
Thursday, August 19, 2010 10
Slide 11:
Thursday, August 19, 2010 11
Slide 12:
Thursday, August 19, 2010 12
Slide 13:
Thursday, August 19, 2010 13
Slide 14:
Thursday, August 19, 2010 14
Findings :
Findings Thursday, August 19, 2010 22 Maximum broking firm charge Rs. 500 for opening demate accounts The margin cheque is between
5000 and 10000 All broking firm are providing time limit of T+2 Credit limit varies customers to customer, even with intraday and on delivery
basis Average investment charge by all the broking firms is 18% Annual maintenance charge is between 250 to 500 New schemes of life time
maintenance charge are introduced in the market by some broking firms New system of advance broking scheme is also introduce recently by
many broking firms
Suggestions :
Suggestions Thursday, August 19, 2010 23 MORE BRANCHES Need to open more branches to be a topper in market because it has a low
distribution of network LESS TIME They should try to make some arrangements to reduce account opening time by verifying documents at
branch itself. LINK-BANK A/Cs Linked as many accounts as client wants to its online account
Suggestions Cont… :
Suggestions Cont… Thursday, August 19, 2010 24 NEW BANKS IN THE KITTY Need to tie up with major banks like HSBC, Punjab national bank,
canara bank etc CUSTOMER SATISFACTION The company should focus on the customer satisfaction not on just taking money from their pocket
CONTROLLED BRANCHES The company would have to make some arrangements to control the branches and make standardized procedures
for all of them for their better control and performance appraisal
Consumer Survey :
Consumer Survey
9. What things you will consider while getting the DEMAT account? :
9. What things you will consider while getting the DEMAT account? Maximum people who are interested to open new demat account they first
ask the brokerage of the firm which can be further reduce according to the trade done by the customer second preference is for the credit
limit for share purchase Thursday, August 19, 2010 34
10.2 Are you satisfied with tips and Information provided by your dealer? :
10.2 Are you satisfied with tips and Information provided by your dealer? This question is related with the above question and only 67% of
people are satisfied with the tips provided by the broking firms Thursday, August 19, 2010 36
11.2 Would you like to get the facility life time scheme? :
11.2 Would you like to get the facility life time scheme? This is question is related with the above question. Only those people purchase life
time scheme who wish to trade for long-term Thursday, August 19, 2010 38
12. Are you satisfied with your soft ware provided with the firm for online trade? :
12. Are you satisfied with your soft ware provided with the firm for online trade? Out of 23% people only 85% people are satisfied with the
software facility provided by the broking firms as a single firm has many up gradation with the software which is only provided to the premium
customer Thursday, August 19, 2010 39
FINDINGS… :
FINDINGS… Preference of Investment: Consumers want to invest 30% in banks, 19 % in insurance, 13% in PPF and 8% & 12% in commodity
and equity market respectively Awareness on Online Share Trading: 23% consumers are aware of online share trading and 44% consumers
are not aware of online share trading Future customer of ABML: 37% of respondent are willing to be the future customer of ABML and 17% are
not interested to change their existing broking firm Thursday, August 19, 2010 43
FINDINGS… :
FINDINGS… Satisfaction about facilities provided by broking firms: 61% consumers are satisfied with the facilities provided by broking firms
were as 3% of consumers are not at all satisfied by the facilities provided by broking firms Provide a large no. of Products and services: Now
days to beat competition many broking firms are providing multiple product in the collaboration with their subsidiary financial company
Thursday, August 19, 2010 44
Recommendations :
Recommendations Thursday, August 19, 2010 45 Brokerage should be reduce to the possible extent, so that new customers can be attracted
They should offer demonstration for on line share trading and other seminars for cultivation of knowledge to the customers Advertisement
should be given in newspapers, so that the persons who do not know about online facility of share trading can be attracted
Recommendation cont… :
Recommendation cont… Thursday, August 19, 2010 46 After opening of account, customer should provide a guidebook, so that they can
easily learn and transact with ABML Some discount/offer can be given to those who are opening accounts in groups The customers who want
to open a savings bank account as well as Demat account can be call for open an online share trading Offer can be give to the existing Demat
account holder Company should give Tip through Phone to customer
Recommendation cont… :
Recommendation cont… Thursday, August 19, 2010 47 Company should try to reduce size of Account Opening Form Company should develop
live Terminal
THANK YOU :
THANK YOU Thursday, August 19, 2010 48
•
In today’s troubled economic scenario, we prefer the kind of investments that will protect our wealth rather than create wealth for us. Gold is one such
investment. It is a bedrock of investments that can weather any storm. Gold as an asset has long-term intrinsic value, which helps shield our investment
from inflation, currency debasement and equity market declines. At the same time, it saves the country’s purchasing power from nosediving. In fact, it
offers the best protection against volatile markets. The reason: gold prices are maintained or increased irrespective of the country’s economy moves in an
upward or a downward direction. From the last 20-30 years, gold prices have been on a steady and continuous rise. The precious metal has given returns
of around 9.45 per cent as the prices went up from Rs 1,000 per 10 gram in 1979 to its present value of Rs 15,000 per 10 gram.
Highlights
o Gold helps shield investment from
inflation, currency debasement and
equity market declines
o Gold prices are generally not affected
by the economic conditions
o One should allocate at least 10-20
per cent of one’s investment portfolio
towards gold, irrespective of the risk
appetite
Gold ETFs Lowest Highest High Comparable to market returns No storage risk
Bullion Gold Lowest Highest High Comparable to market returns Storage risk
Table 2: Tax Treatments of Different Gold Investments
Short-term Gains1 Long-term Gains2
Gold jewellery
We all love the yellow metal, don’t we? Be it in whatever form, jewellery or others. Nothing can match the emotions that are attached to the buying of
gold jewellery. In India, we buy gold jewellery either out of desire (to wear gold ornaments) or needs (mandatory purchase in marriages and other
functions). This is an expensive way of buying the precious metal since a buyer has to pay for the craftsmanship associated with the making of jewellery,
which increases the total cost. Moreover, selling of the jewellery may not fetch the same price in case the current market price does not exceed the buying
price.
Gold coins
It is one of the purest forms of gold. All the commercial banks and financial distributors are authorised to sell gold coins of 24 karat (the purest), with a
certification from an independent agency. The prices of gold coins depend on the daily market rates of gold. But banks don’t buy the coins back, so our
only option to get our money back in this case will be by selling the coins to jewellers at the prevailing market price.
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Gold mining companies
It is not a direct investment in gold but in the stocks or shares of a gold mining and exploration company. It brings additional rewards as well as its share
of risks. The price of these stocks moves with the price of the gold and also depends on the company’s future outlook. In India, there are not many gold
mining companies but on the international front one will find companies such as Newcrest Mining, Barrick Gold, Impala, Gold Corp, Lihir Gold, etc.
However, we can invest in world (gold) mining stocks through mutual funds such as DSL BlackRock (DSPBR World Gold Fund) and AIG India MF (AIG
World Gold).
Gold futures
Gold futures are a sophisticated tool to invest in gold markets. But be cautious: Risks attached to gold futures are of the highest level. One can make 500
per cent in a single day by trading in gold futures or even lose all the money put up. However, gold futures are not about minuses only. Its plus point is it
eliminates the hassle and costs of settlement and storage. Investors need much less money (margin money) to participate in quite large scale. Even
traders can short sell as the market is deep and liquid. But these options are not recommended for retail investors.
Gold ETFs
It is a very recent development that the market regulator SEBI allowed gold Exchange Traded Funds (ETFs) in India. Gold ETFs enable investors to
purchase and sell shares of a mutual fund whose primary asset is gold. These funds are listed on the stock exchanges, i.e., can be bought or sold like
other stocks or shares. But one needs to have a demat account and a share trading account to invest in gold ETFs. The unit size in a gold ETF is as small
as one gram of gold equivalents. Investments in gold ETFs are eligible for tax treatments similar to that in a debt mutual fund and subject to long-term
capital gains after one year against three years for physical gold. The cost involved is also less and investors do not face the risk involved in holding gold
like theft. Some of the gold ETFs are UTI Gold ETF, Gold BeES, Kotak Gold ETF and Reliance Gold ETF.
Want to invest in Gold ETFs, apply for Demat Account: Click here
Gold bullion
This investment avenue is open for investors with a higher investment corpus or greater risk profile. Gold bullion or bars can be bought or sold with the
help of brokerage firms or gold dealers. It is traded on commodity exchanges, i.e., MCX and NCDEX, at an amount above the market price of gold.
Investors can keep the bars in their custody or leave them with the broking firm. Though the brokerage charged in this case is very low compared to
market price, its overall cost is more as it also involves storage and assay (analyse gold to determine its composition) costs.
Historical returns of different gold investment options
Let us analyse the performance of different gold products as on July 31, 2009 with the help of Table 3. The data has been obtained from
www.mcxindia.com and www.mutualfundsindia.com, an online arm of Financial Technologies and ICRA Online Ltd, respectively. The table shows that all
investments with gold as an asset have given comparable returns of around 16 per cent while the return of gold mining dedicated mutual fund (AIG World
Gold) is stipulated to a paltry 3.48 per cent. The fall in return in the mutual fund can be attributed to underperformance of gold mining stocks due to a
slump in gold demand. But in case of gold ornaments and gold coins, the return would be comparatively less than gold bullion and gold ETFs as they also
involve making costs and storage costs.
Gold in portfolio
Since gold has emerged as an asset class, fund managers are advising investors to allocate at least 10-20 per cent of their investment portfolio towards
gold, irrespective of their risk appetite. It has seen that trading in Gold ETFs is the best way to invest in gold given its low cost of buying, high liquidity,
low risk associated with it, etc. Moreover, whatever be the economic scenario, gold will always remain the best hedge against inflation and also help in
achieving our long-term goals.
Published on May 11, 2010 · Filed under: Investment Case Studies; Tagged as: fixed cum floating interest rate, floating interest rate, home
loan, income tax benefit, invest in property, loan transfer, Mutual funds
5 Comments
1. News on Personal Finance in India – Home Loans, Credit Cards, Personal Loans, Car Loans, Life Insurance, Health Insurance,
Stocks, Fixed Deposits, Tax » Gold and gold ETFs are the right investment for this gold season said on May 17th, 2010 at 12:48
pm
[...] in units and prices of gold are reflected in value of each unit. At present there are seven gold ETF fund listed on the BSE. Another advantage with gold
ETFs is that investments in paper gold are not [...]
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