Submitted By:

Subhasis Das

ISBR Business School

MBA – 14MB7971

Academic year: 2014 – 2016

Content

Sr. No.

Topics Page No.

1 Introduction about organization

2 Industry profile

3 Introduction to Topic

4 Literature Review

5Organization in detailo General informationo Organization structure

6 SWOT Analysis

7 Technology

8 At Edelweiss

9 Learning outcome

10 Conclusion

11 Bibliography

Acknowledgement

I take the opportunity to express my gratitude to all of them who in some or other way helped me to accomplish this challenging project in Edelweiss Broking Limited, Jayanagar. No amount of written expression is sufficient to show my sense of gratitude to them.

I am extremely thankful and pay my gratitude to my company guide Mr. S. K. Parthasarathy and my faculty guide Mr. Partho Ganguly for their everlasting support and guidance on the ground of which I have acquired a new field of knowledge and valuable guidance and support on completion of this project in its present form.

A special appreciative “Thank you” in accorded to all staff of Edelweiss Broking Limited, Jayanagar for their positive support.

I also acknowledge with a deep sense of reverence, my gratitude towards my parents and members of my family, who has always supported me morally as well as economically.

At last but not at all the least, deepest gratitude goes to all of my friends who directly or indirectly helped me to complete this project report.

Preface

“A good broker system must be able to cope with an extremely complex and dynamic environment.”The microstructure of the stock market in which brokers work is highly dynamic and volatile. Many stocks are available to be bought and sold, each exhibiting its own patterns and characteristics that are highly unpredictable. With so many options and considerations that need to be taken into account, it is an extremely difficult task for a broker to investigate aspects of the stock market and consistently provide effective advice to their clients.Thus, brokers perform their day-to-day tasks with the aid of a broker system. Such a system should provide tools for interacting with exchanges and performing analysis. As a consequence, these broker systems are quite large and complicated by themselves.This research aims to analysis Stock broker on the basis of their services, products, growth, and their competitiveness. Because Stockbrokers are one of the main participants in stock exchanges worldwide, they often act as an agent for their clients, making trades on their behalf. They also act as advisors, providing suggestions to their clients on what stocks to buy and sell

Abstract

There is growing competition between brokerage firms in post reform India. For investor it is always difficult to decide which brokerage firm to choose.

Research was carried out to find which brokerage house people prefer and to figure out what people prefer while investing in stock market.

This study suggests that people are reluctant while investing in stock and commodity market due to lack of knowledge.

Main purpose of investment is returns and liquidity, commodity market is less preferred by investors due to lack of awareness. The major findings of this study are that people are interested to invest in stock market but they lack knowledge.

Through this report we were also able to understand, what are our Company’s positive and strong points, on the basis of which we come to know what can be the basis of pitching to a potential client.

Introduction to Organisation

Edelweiss is one of the leading financial services company in India. Its current businesses include investment banking, securities and retail broking and investment management. The core inspiring thought of ideas creating wealth and values protecting it is translated into an approach that is led by entrepreneurship and creativity and protected by intellectual rigor, research and analysis. At Edelweiss you can build a personal relationship with our investment professionals. We see investing from your perspective, and offer recommendations based on your needs and preferences. To all the investors - From access to top research to investment guidance and portfolio planning, we offer it all!

Edelweiss is one of India’s leading diversified financial services Group. Edelweiss offers a large range of products and services spanning across asset classes and consumer segments.Its businesses are broadly divided into Credit including Retail Finance and Debt Capital Markets, Commodities, Financial Markets, Asset Management and Life Insurance.

The group’s research driven approach and proven history of innovation has enabled it to foster strong relationships across corporate, institutional and individual clients. The Life Insurance, Retail Finance including Housing Finance, Mutual Fund and Retail Broking businesses – both online and offline formats, have paved the way for Edelweiss to cater to the large retail client segment.

Edelweiss’ presence now covers 240 offices in 125 cities including eight international offices with 5,555 employees catering to over 572,000 clients across various businesses in retail and wholesale segments.

Industry Profile

The emergence of stock market can be traced back to 1830. In Bombay, business passed in the shares of banks like the commercial bank, the chartered mercantile bank, the chartered bank, the oriental bank and the old bank of Bombay and shares of cotton presses. In Calcutta, Englishman reported the quotations of 4%, 5%, and 6% loans of East India Company as well as the shares of the bank of Bengal in 1836. This list was a further broadened in 1839 when the Calcutta newspaper printed the quotations of banks like union bank and Agra bank. It also quoted the prices of business ventures like the Bengal bonded warehouse, the Docking Company and the storm tug company.Between 1840 and 1850, only half a dozen brokers existed for the limited business. But during the share mania of 1860-65, the number of brokers increased considerably. By 1860, the number of brokers was about 60 and during the exciting period of the American Civil war, their number increased to about 200 to 250. The end of American Civil war brought disillusionment and many failures and the brokers decreased in number and prosperity. It was in those troublesome times between 1868 and 1875 that brokers organized an informal association and finally as recited in the Indenture constituting the “Articles of Association of the Exchange”. On or about 9th day of July, 1875, a few native brokers doing brokerage business in shares and stocks resolved upon forming in Bombay an association for protecting the character, status and interest of native share and stock brokers and providing a hall or building for the use of the members of such association.As a meeting held in the broker’ Hall on the 5th day of February, 1887, it was resolved to execute a formal deal of association and to constitute the first managing committee and to appoint the first trustees. Accordingly, the Articles of Association of the Exchange and the Stock Exchange was formally established in Bombay on 3rd day of December, 1887. The Association is now known as “The Stock Exchange”.The entrance fee for new member was Re.1 and there were 318 members on the list, when the exchange was constituted. The numbers of members increased to 333 in 1896, 362 in 1916and 478 in 1920 and the entrance fee was raised to Rs.5 in 1877, Rs.1000 in 1896, Rs.2500 in 1916 and Rs. 48,000 in 1920. At present there are 23 recognized stock exchanges with about 6000 stock brokers. Organization structure of stock exchange varies.14 stock exchanges are organized as public limited companies, 6 as companies limited by guarantee and 3 are non-profit voluntary organization. Of the total of 23, only 9 stock exchanges have been permanent recognition. Others have to seek recognition on annual basis. These exchange do not work of its own, rather, these are run by some persons and with the help of some persons and institution. All these are down as functionaries on stock exchange. These are

1. Stockbrokers2. sub-broker3. market makers4. Portfolio consultants etc.

1.) StockbrokersStock brokers are the members of stock exchanges. These are the persons who buy, sell or deal in securities. A certificate of registration from SEBI is mandatory to act as a broker. SEBI can impose certain conditions while granting the certificate of registrations. It is obligatory for the person to abide by the rules, regulations and the buy-law. Stock brokers are commission broker, floor broker, arbitrageur etc.

2.) Sub-brokerA sub-broker acts as agent of stock broker. He is not a member of a stock exchange. He assists the investors in buying, selling or dealing in securities through stockbroker. The broker and sub-broker should enter into an agreement in which obligations of both should be specified. Sub-broker must be registered SEBI for a dealing in securities. For getting registered with SEBI, he must fulfill certain rules and regulation.

3.) Market Makers Market maker is a designated specialist in the specified securities. They make both bid and offer at the same time. A market maker has to abide by bye-laws, rules regulations of the concerned stock exchange. He is exempt from the margin requirements. As per the listing requirements, a company where the paid-up capital is Rs. 3 crore but not more than Rs. 5 crore and having a commercial operation for less than 2 years should appoint a market maker at the time of issue of securities.

4.) Portfolio consultantsA combination of securities such as stocks, bonds and money market instruments is collectively called as portfolio. Whereas the portfolio consultants are the persons, firms or companies who advise, direct or undertake the management or administration of securities or funds on behalf of their clients.

Introduction to Topic

In most industrialized countries, a substantial part of financial wealth is not managed directly by savers, but through a financial intermediary, which implies the existence of an agency contract between the investor (the principal) and a broker or portfolio manager (the agent). Therefore, delegated brokerage management is arguably one of the most important agency relationships intervening in the economy, with a possible impact on financial market and economic developments at a macro level. In most of the metros, people like to put their money in stock options instead of dumping it in the bank-lockers. Now, this trend pick pace in small but fast developing cities as well.As the per-capita-income of the city is on the higher side, so it is quite obvious that they want to invest their money in profitable ventures. On the other hand, a number of brokerage houses make sure the hassle free investment in stocks. Asset management firms allow investors to estimate both the expected risks and returns, as measured statistically. There are mainly two types of Portfolio management strategies.

1. Passive Portfolio Strategy2. Active Portfolio Strategy

1. Passive Portfolio Strategy: A strategy that involves minimal expectation input, and instead relies on diversification to match the performance of some market index. A passive strategy assumes that the marketplace will reflect all available information in the price paid for securities

2. Active Portfolio Strategy: A strategy that uses available information and forecasting techniques to seek a better performance than a portfolio that is simply diversified broadly.

History of broking house in India:-Stock markets refer to a market place where investors can buy and sell stocks. The price at which each buying and selling transaction takes is determined by the market forces (i.e. demand and supply for a particular stock).In earlier times, buyers and sellers used to assemble at Stock Exchanges to make a transaction but now with the dawn of IT, most of the operations are done electronically and the stock markets

have become almost paperless. Now, investors do not have to gather at the Exchanges, and can trade freely from their home or office over the phone or through Internet. A broker is a person or firm that facilitates trades between customers. A broker acts as a go between and, in doing so, does not assume any risk for the trade. The broker does, however, charge a commission. A broking firm acts as an intermediary between NSE and Client.

What is NSE & BSE?1. NSE (National Stock Exchange):-

The National Stock Exchange (NSE) is a stock exchange located at Delhi, India. It is the 9th largest stock exchange in the world by market capitalization and largest in India by daily turnover and number of trades, for both equities and derivative trading. NSE has a market capitalization of around US$1.59 trillion and over 1,552 listings as of December 2010. Though a number of other exchanges exist, NSE and the Bombay Stock Exchange are the two most significant stock exchanges in India, and between them are responsible for the vast majority of share transactions. The NSE's

key index is the S&P CNX Nifty, known as the NSE NIFTY (National Stock Exchange Fifty), an index of fifty major stocks weighted by market capitalisation.

NSE is mutually-owned by a set of leading financial institutions, banks, insurance companies and other financial intermediaries in India but its ownership and management operate as separate entities. There are at least 2 foreign investors NYSE Euronext and Goldman Sachs who have taken a stake in the NSE As of 2006, the NSE VSAT terminals, 2799 in total, cover more than 1500 cities across India NSE is the third largest Stock Exchange in the world in terms of the number of trades in equities. It is the second fastest growing stock exchange in the world with a recorded growth of 16.6%.

Markets:-

Currently, NSE has the following major segments of the capital market:

EquityFutures and OptionsRetail Debt MarketWholesale Debt MarketCurrency futuresMutual FundStock Lending & Borrowing

2. BSE (Bombay Stock Exchange):-

The Bombay Stock Exchange (BSE) is a stock exchange located on Dalal Street, Mumbai and is the oldest stock exchange in Asia. The equity market capitalization of the companies listed on the BSE was US$1.63 trillion as of December 2010, making it the 4th largest stock exchange in Asia and the 8th largest in the world. The BSE has the largest number of listed companies in the world.

As of December 2010, there are over 5,034 listed Indian companies and over 7700 scraps on the stock exchange, the Bombay Stock Exchange has a significant trading volume. The BSE SENSEX, also called "BSE 30", is a widely used market index in India and Asia. Though many other exchanges exist, BSE and the National Stock Exchange of India account for the majority of the equity trading in India. While both have similar total market capitalization (about USD 1.6 trillion), share volume in NSE is typically five times that of BSE.

BSE Index Cell carries out the day-to-day maintenance of all indices and conducts research on development of new indices. SENSEX is significantly correlated with the stock indices of other emerging markets.

Literature Review

1. Dr. Jayanta Kumar Seal explore equity trading in India was basically a floor-based activity in the BSE. Traditionally, stock trading was done through stock brokers, personally or through telephones. As the no. of people trading in stock market increased enormously in last few years, a no. of stock brokers comes in the field, thus increasing further competition. Due to this, there come new innovations in trading. In this scenario, the existing players are left with two options-either to change their product offerings or to perish.

2. Ravinder Kumar & Nidhi Walia found Indian investors are more conservative; they do not adopt any change easily. Till now just few investors can be recognized who are using technology for online stock trading. Traditional traders still prefer to choose broker as a stock trading mechanism because they are more loyal to their broker. Online trading empowers educated investors to make their own decisions with close watch on market sensitivity by browsing through various sites.

3. Ms. Nidhi Walia explores that with IT fueling economy, internet is adopted as effective tool in catalyzing the business activities. Latest developments in information technology have altogether changed business done traditionally. As financial system is becoming more complex it has become need of hour, where investor should comprehend the data and understand recent intricacies of online trading. In Indian context, e-trading is relatively new concept, which has yet to gain some significant meaning. In the past, investor had no option to get market information except to contact local broker. But internet trading in stock trading is becoming medium of exchange whereby investor can order stock exchange on simple mouse click sitting at his place. Keeping in view current market requirement an attempt has been made in this research paper to analyze current status of online trading in Indian scenario.

4. Mr. Ajay Kumar through this research finds which brokerage house people prefer and to figure out what people prefer while investing in stock market. This study suggests that people are reluctant while investing in stock and commodity market due to lack of knowledge. Main purpose of investment is returns and liquidity, commodity market is less preferred by investors due to lack of awareness. The major findings of this study are that people are interested to invest in stock market but they lack knowledge.

About the Organisation

Whether it’s retiring early, saving for children’s education, paying off a loan or to live a secured and satisfied life everyone has dreams they can achieve by investing their savings. Definition of investing is the purchase of a financial product or other item of value with an expectation of favorable future returns. However, the question that arises is that, should one leave his money tucked away in the bank or plough it into the stock market where the potential for higher returns is greater but the chances of losing money is higher? Deciding where to invest depends on one`s attitude towards risk (one`s capacity to take risk and one`s tolerance towards risk) and the investment horizon and non-availability of guaranteed-return investment products. In such a scenario, investing in equity, which offers returns that are higher than the inflation rate, help to build wealth and to improve the standard of living.India is a developing economy. It’s prospering in all spheres. Share market is a compelling determinant of the economy and the financial situation of a country. Ever since the liberalization, privatization and globalization, the foreign investment in our country is booming. Share market is a clear indicator of the developing trend prevailing in our country. Statistics reveal that the trade volume has been increasing continuously, coupled with the ups and downs which is a nature of share trading. We are living in an interlinked world. With the growing volume of trade; it has become a necessity that people are aware of the intricacies of the web world.

SENSEX the benchmark indicator of share trading has more than tripled ever since on line share trading commenced. It has become imperative to be a participant of this mode of trading.Recently, the crisis in the financial market resulted in global inflation. The share market was a clear indicator of the prevailing prices.Share trading is a way of faster earning and losing money. In the recent years, a volatile market could be witnessed. In the desire to earn money in a quick manner, more and more people have ventured out into share trading. Lack of awareness of many investors has made them loose lakhs of money in the stock market. Wise plays by many others have made them earn in crores.

Where the American NASDAQ is in the commanding position, Hongkong, etc. are some of the Asian exchanges being quoted repeatedly when it comes to news about the share market. SENSEX is not far behind. Indian bourses are also often quoted.Electronic trading or online trading eliminates the need for physical trading floors. Brokers can trade from their offices, using fully automated screen based processes. Their workstations are connected to a stock exchange’s central computer via satellite using Very Small Aperture Terminus (VSATs). The orders placed by brokers reach the exchange’s central computer and are matched electronically.

Stock exchangeA stock exchange , share market or bourse is a corporation or mutual organization which provides facilities for stock brokers and traders , to trade company stocks and other securities. Stock exchanges also provide facilities for the issue redemption, as well as, other financial instruments and capital events including the payment of income and dividends . The securities traded on a stock exchange include: shares issued by companies , unit trusts and other pooled investment products and bonds .To be able to trade a security on a certain stock exchange, it has to be listed . Usually there is a central Location at least for recordkeeping, but trade is less and

less linked to such a physical place, as modern markets are electronic networks, which gives them advantages of speed and cost of transactions. Trade on an exchange is by definition done in the primary market and subsequent trading is done in the secondary market. Supply and demand in stock markets is driven by various factors which, as in free markets, affect the price of stocks(see stock valuation).There is usually no compulsion to issue stock via the stock exchange itself, nor must stock be subsequently traded on the exchange. Such trading is said to be off exchange or over-the-counter. This is the usually way that bonds are traded. Increasingly more and more stock exchanges are part of a global market for securities.

A. The role of the stock exchange Raising capital for businesses The stock exchange provides companies with the facility to raise capital for expansion

through selling shares to the investing public. Mobilizing savings for investment When people draw their savings and invest in shares, it leads to a more rational allocation

of resources because funds, which could have been consumed, or kept in idle deposits with banks are mobilized and redirected to promote business activity with benefits for several economic growth and higher productivity levels.

Facilitate company growth Companies view acquisitions as an opportunity to expand product lines, increase

distribution channels, hedge against volatility, increase its market share, or acquire other necessary business assets. A takeover bid or a merger agreement through the stock market is one of the simplest and most common ways to company growing by acquisition or fusion.

Redistribution of wealth By giving a wide spectrum of people a chance to buy shares and therefore become part-

owners (shareholders) of profitable enterprises the stock market helps to reduce large income inequalities. Both casual and professional stock investors through stock price rise and dividends get a chance to share in the profits of promising business that were set up by other people.

Corporate governance-By having a wide and varied scope of owners , companies generally tend to improve on their management standards and efficiency in order to satisfy the demands of these shareholders and the more stringent rules for public corporations by public stock exchange and the government . Consequently , it is alleged that public companies (companies that are owned by shareholders who are members of the general public and trade shares on public exchange) tend to have better management records than privately-held companies (those companies where shares are not publicly traded ,often owned by the company founders and / or their families and heirs , or otherwise by a small group of investors) . However, some well-documented cases are known where it is alleged that there has been considerable slippage in corporate governance on the part of some public companies.Creates investment opportunities for small investorsAs opposed to their businesses that require huge capital outlay, investing in shares is open to both the large and small stock investors because a person buys the number of shares they can afford. Therefore the Stock Exchange provides an extra source of income to small savers.Government raises capital for development projects.

Governments at various levels may decide to borrow money in order to finance infrastructure projects such as sewage and water treatment works or housing estates by selling another category of securities known as bonds .These bonds can be raised through the Stock Exchange whereby members of the public buy them , thus loaning money to the government . The issuance of such municipal bonds can obviate the need to directly tax the citizens in order to finance development, although by securing such bonds with the full faith and credit of the government instead of with collateral, the result is that the government must tax the citizens or otherwise raise additional funds to make any regular coupon payments and refund the principal when the bonds mature.

Barometer of the economyAt the stock exchange, share prices rise and fall depending, largely, on market forces. Share prices rise tend to rise or remain stable when companies and the economy in general show signs of stability and growth .An economic recession, depression, or financial crisis could eventually lead to a stock market crash. Therefore the movement of the general trend in the economy .The listing requirements is the set of conditions imposed by a given stock exchange upon companies that want to be listed on that exchange .Such conditions sometimes include minimum number of shares outstanding, minimum market capitalization, and minimum annual income.

Edelweiss is one of the leading financial services company in India. Its current businesses include investment banking, securities and retail broking and investment management. The core inspiring thought of ideas creating wealth and values protecting it is translated into an approach that is led by entrepreneurship and creativity and protected by intellectual rigor, research and analysis. At Edelweiss you can build a personal relationship with our investment professionals. We see investing from your perspective, and offer recommendations based on your needs and preferences. To all the investors - From access to top research to investment guidance and portfolio planning, we offer it all!

Chairman, CEO and Founder of Edelweiss. Mr. Rajesh Shah has previously worked for ICICI (now ICICI Bank, India’s largest private sector financial conglomerate) where he handled a World Bank aided program for export- oriented projects. He was subsequently with Prime Securities as Head of Research. Mr. Shah’s relentless focus is on organization building and human capital development. He has been featured in a variety of publications, including The Far Eastern Economic Review, Business India, Business World and The Economic Times. Mr. Shah earned an MBA from the Indian Institute of Management, Ahmedabad and a Bachelor’s degree in Science from the University of Bombay.

Its Current Businesses Include: Investment Banking, Securities Broking, and Investment Management.

Edelweiss also provides a wide range of services to: Corporations, Institutional Investors High Net-Worth Individuals

Services offered by the company: Investment Banking. Institutional investment. Asset management. Wealth management. Private client brokerage. Insurance brokerage. Wholesale financing.

Various Products Offered by the Company: Products: Stocks, Derivatives, IPO, MF, Strategies Trading Accounts with different features: Trader, Investor Brokerage Plans: To suit needs of every client Model Portfolio based on comprehensive analysis of your investment objectives Advanced Data tools Customized investment Strategies Manage all asset classes under My Portfolio

Financial Research on your fingertips

Organisation Structure

Organisation Structure (Sales)

Managing Director

SalesTrading Credit

ESOP Demat InsuranceCommodityMutual Fund

General Manager(Sales)

Asst. General Manager

Financial Planner

HNI/ ESOP

Sales Manager

Relationship Manager(Demat)

Sr. Relationship Manager

SWOT Analysis

Strengths:-

Large Workforce

Diversity in Experience

Young and Energetic

Ownership of New Technology

Weakness:-

Limited Facilities

Poor coordination

Low Productivity

Lack of Competency and Skill

Unrealistic Contract Duration

Labor Problem

Opportunities:-

Utilization of Latest Construction Technology Method

Association with Large Projects Like Real Estate

Geographical Focus

Threats:-

Defects in Design

Changes in Specification

Slow Verification

Late Issue of Instruction

Delay of Work Approval

Proceeding Pending

Any Failure will affect company

Loss of Key people

Technology

Information technology focuses on the development of electronic networks that exchange information. Because all financial transactions involve the exchange of information, the increasing popularity of online finance coincided with advances in information technology. Financial institutions were at the forefront in creating the global information economy as it exists today. Finance today relies on information technology.

HistoryIn the 1960s, the New York Stock Exchange shortened its trading days because the volume of trades was too high to process manually. The development of information technologies such as computers and local networks in the 1970s brought fast and affordable information access to the finance industry. Increasingly affordable computers encouraged the development of numerous small financial firms that handled electronic data processing. At the same time, the speed and reliability of information technology supported the creation of nationwide financial services, including electronic check and credit card processing.

The InternetThe open, public nature of the Internet threatens the closed information networks developed by the financial industry in the late 20th century. As a result of this conflict, banks are at the forefront of both information sharing and information security technology. Online commercial transactions began in 1995, and by 1998 the Internet was processing more than $50 billion worth of transactions. In the 21st century, the annual worth of Internet transactions is higher and requires more networks, more computers and more security programs. Financial institutions cannot compete without a broad but secure information network, so information technology is essential to their success.

Global FinancingInformation technology allows finance to function on a global level. "Financial markets can be thought of as the first organized, global information markets operating through networked computers," Winn says. Without information technology, financial markets couldn't react to global developments and finance companies couldn't consistently acquire information at the same time as their competitors. For example, the Internet allows continuous access to credit scores and credit ratings to all lenders, insurance companies and businesses that need financially responsible customers.

Social MediaThe information technology that runs social media on the Internet provides financial institutions with valuable information on their customers. By encouraging online communities associated with their products, finance companies not only acquire information but also encourage brand loyalty. For example, websites such as TradeKing allow online stock traders to discuss their picks and advise newcomers. Socially driven information technology allows finance companies to contact the younger demographics that will be their future customers.

Information technology has many uses in finance. From trading financial instruments to keeping records of personal budgets to reporting the earnings of a business, computer technology is used by financial companies daily. Information technology allows the rapid calculation of financial statistics, as well as electronic transfers of money.

Trading

Financial trading is enhanced with information technology. Some computer systems even trade for the users. A system is programmed to enter buy and sell orders when the price of a stock or bond reaches a certain level, and automatically closes the order when the target price or the stop-loss is reached. Computer based trading is useful when a trader has a system that allows profitable trading and does not want to enter each order individually. Information technology provides instant information for stock traders to make decisions, and allows them to enter orders that are immediately executed.

Reporting

Financial reports are also improved with information technology. The language known as XBRL, or Extensible Business Reporting Language, is used to standardize the financial information in public companies' annual reports. Traders can quickly sort through records in this format. They can easily find the statistical data they need to determine which companies to invest in. According to the California State University at Fullerton, XBRL is based on XML, the extensible markup language used to transfer information over the Internet.

Function

Financial data can be easily transferred with information technology. Instead of using checks and checking accounts, information technology can clear a transaction instantly. A debit or credit card purchase is rapidly compared with the user's account balance, allowing a bank to decide whether to allow a transaction. Information technology allows transactions during weekends and holidays, when there is no staff working at the bank.

Convenience

Personal finance is simplified using information technology. Banks provide data on checking and savings deposits and withdrawals in standardized formats. A customer can download account transactions and store them in records on a home computer. Personal finance software includes additional features, such as charts and reports that show home users what they are spending money on and where their funds are coming from.

Budgeting and Bookkeeping

Information technology is also helpful for companies that are considering financial transactions. Computer systems calculate and display the interest and principal of a loan, and estimate the returns on investment when the company borrows money to expand its operations. Companies can securely transfer data online, and the computer system records all transfers, which simplifies bookkeeping.

At Edelweiss

At EDELIISS, initially I was imparted process and product knowledge. I was given sufficient time to know about the products and also about sales and distribution channel. I had to work with the sales representatives and think of ways of improving the sales and distribution channel and implementing them. The main aim was to increase sales and for this, different ways were tried and implemented. I was provided with database and had to make calls from the data. Company activity was also one of the major sources for generating business. I also had to visit to the clients place for documentation of Loan against Debentures. Main objective was to know the need of the customer and how to fulfill that in the best way.

The project dealt with various fields like: Demat ESOP

This experience helped me to understand the basic functioning of the EDELWEISS as a Broking House and I came to know the products of Edelweiss. The Training Sessions Ire held by different persons. I Ire assigned targets to sell the ESOP funding facility and Demat A/c of EdelIiss. The training for ESOP and Demat was conducted by Mr. S. K. Parthasarathy. These training gave me an insight into the products that Edelweiss deals in. The best learning experience was that I started from the very basics of getting to that position and not from the position itself. This helped me get useful insight and understanding of various financial products, the market details about them and the benefits provided by them to the customers.

The task was divided in 4 phases:

1. Product knowledge: This included the theoretical knowledge about the field and products which needed to be marketed.

2. Pitching in retail sector: This included the implementation of the knowledge imparted to us and the test of our marketing skills. Initially I Ire accompanied by other sales executive so that I can learn how to deal with the customers and understand their need. This also enhanced our interpersonal skills and confidence level.

3. Implementation in retail sector and pitching in corporate: By the start of this phase I were confident enough about the pitching and fulfilling the needs of the customer in the retail sector. This also included of the ways I should pitch the corporate.

4. Implementation at corporate levels: This included the implementation of the all the knowledge and ways learnt for the pitching and extracting business out of the corporate.With the end of 5 weeks every phase was completed and it gave us the real experience of retail as well as corporate world.

Demat Account:-

The term Demat, in India, refers to a dematerialized account for individual Indian citizens to trade in listed stocks or debentures, required for investors by The Securities Exchange Board of India (SEBI). In a demat account, shares and securities are held electronically instead of the investor taking physical possession of certificates. A Demat Account is opened by the investor while registering with an investment broker (or sub broker). The Demat account number is quoted for all transactions to enable electronic settlements of trades to take place.

Access to the Demat account requires an internet password and a transaction password as well as initiating and confirming transfers or purchases of securities. Purchases and sales of securities on the Demat account are automatically made once transactions are executed and completed.

Objective of Demat System:-

India has adopted this system of electronic bookkeeping, eliminating the need for paper when shares or securities are held in electronic form. Before the introduction of the depository system by the Depository Act, 1996, the process of sale, purchase and transfer of shares was difficult and there was a high risk of loss.

Basics of Stock Market:-Investing in equity involves purchasing shares of a company listed on a stock exchange. You can acquire these shares in two ways - either through the Primary Market, i.e., when a company makes an offer to issue its equity for the first time (this is called Initial Public Offering (IPO)) or through the secondary market, i.e. via a stock exchange. When you trade in equity through a stock exchange, you have to make use of the services of a brokerage firm, which acts as your agent whenever you buy or sell.Equity is considered a high risk-high return investment avenue. This is because there is scope for considerable appreciation or loss of the capital that you invest, depending on various factors such as the performance of the company that you have invested in, general market conditions, the state of the economy, etc. However, it forms an integral part of any well-balanced portfolio, since it is at one end of the risk-return spectrum.

Equity is a must for any well-balanced portfolio. So, irrespective of whether you are a high net worth investor or a small retail investor and irrespective of whether you have a large or timid appetite for risk, you must hold some portion of your assets in equity. This is because it is the only instrument that has the ability to truly deliver a high return, when held over a long period of time.

However, the amount of equity that you hold in your portfolio is a very subjective decision and will depend upon various factors. These include your investment objectives, time horizon and risk appetite. But as a general guideline, there’s a rule of thumb that states that to decide upon the proportion of your assets that should go into equities, reduce your age from 100 and that’s the proportion of your money which should be put in equities. The remaining can be invested in fixed income securities.

Selection of StockEvery investor must do some homework before investing money in equities…

While recommendations and tips received from your broker, a friend, etc. may be the starting point of your selection, let it not be the only reason that makes you purchase a particular stock, even if these tips have come from ‘market experts’. Short list the shares that you want to buy on the basis of your investment objective, risk profile and the stock’s fundamentals.

If you feel that the price of a stock is high, don’t purchase it. Buy stocks that you believe still have scope for appreciation.

Don’t try to time your purchases. That could turn you into a speculator instead of an investor.

Lastly, once you have purchased shares, if the business prospects of the company change to its detriment, get rid of the stock. Don’t hesitate to liquidate your portfolio before your target time horizon if circumstances lead you to believe that it’s necessary.

Stock Pricing

There are various factors that determine the value of a stock. Understanding these will help you to pay a price that reflects the true value of a stock.

Demand and Supply:

In the short term, the basic economic theory of demand and supply determines a stock’s worth. So, when the demand for a stock exceeds its supply (that is, there are more buyers than sellers), its price tends to rise. And, when supply overtakes demand (that is, sellers exceed buyers), the stock loses value. However, these are short-term market trends, which tend to get evened out over a period of time. In the medium to long-term, a stock is driven by the company’s fundamental strength i.e. business potential, past performance, competence and credibility of its promoters and management, etc.

Growth potential:

Investors are willing to pay a premium for stocks of companies that have the potential to increase their revenues and net profits. The greater this growth potential, the higher the premium given to the stock. If a company proves that it is capable of sustaining growth, the market will continue to give it high valuations. And, that’s likely to be the major driver for stock valuations.

Fundamentals: A company’s growth outlook is linked to its business prospects and how well its management is capitalizing on the existing opportunities. The quality of a company’s management is crucial. So, pay attention to the management practices of a company and its level of corporate governance.

Profit Maximization Buy low and sell high is the ultimate guide to successful stock investing. It is also the reverse of

what many investors do, although they don’t intend to. They tend to buy high and sell low because

they use price, and in particular, the price movement, as their only signal to buy or sell.Investors are tempted to buy stocks that have shot up and are basking in the media spotlight just to get a part of the action. They jump at a stock that is already trading at a premium that’s how they buy high. Ironically, if a stock has had a good run up it may be time to sell, not buy (sell high). On the flip side, when a stock price is falling, most investors may want to sell in a panic, although the company has not lost any intrinsic value and still remains a sound investment that’s how they sell low. In fact, when a stock’s price has fallen, it’s a great time to buy (buy low), if your research on the company suggests that it is a good long term buy. Experienced traders can make money jumping in and out of a stock that’s caught the public’s attention, but it’s not a game for the inexperienced and it can definitely not be called ‘investing’, in the true sense of the word. There are risks involved and tax consequences that apply to such trading, along with other issues, which means that most investors should leave this tricky activity to short-term traders.

Asset Allocation

Asset allocation means diversifying your money among different types of investment categories, such as stocks, bonds and cash. The goal is to help reduce risk and enhance returns.

This strategy can work because different categories behave differently, Stocks, for instance, offer potential for both growth and income, while bonds typically offer stability and income. The benefits of different asset categories can be combined into a portfolio with a level of risk you find acceptable.

Establishing a well-diversified portfolio may allow you to avoid the risks associated with putting all your eggs in one basket.

Right allocation for an investor:-

Asset allocation decisions involve tradeoffs among 3 important variables:

Investors’ time frame Their risk tolerance Their personal circumstances

Competitors of Edelweiss

TRADING PORTALOnline trading refers to buying and selling of the shares/stocks/contracts/bonds with the use of internet. In this shares are not issued in physical form rather they are transferred in the dematerialized form in the Demat account directly.

DEMAT ACCOUNTIn India, a Demat account, the abbreviation for dematerialized account, is a type of banking account which dematerializes paper-based physical stock shares. The dematerialized account is used to avoid holding physical shares: the shares are bought and sold through a broker. This account is popular in India. The Securities and Exchange Board of India (SEBI) mandates a Demat account for share trading above 500 shares. As of April 2006, it became mandatory that any person holding a Demat account should posses a Permanent Account Number (PAN).

Benefits of opening a Demat accountDemat account has become a necessity for all categories of investors for the following reasons/ benefits:

SEBI has made it compulsory for trades in almost all scrip’s to be settled in Demat mode. Although, trades up to 500 shares can be settled in physical form, physical settlement is virtually not taking place for the apprehension of bad delivery on account of mismatch of signatures, forgery of signatures, fake certificates, etc.

It is a safe and convenient way to hold securities compared to holding securities in physical form.

No stamp duty is levied on transfer of securities held in Demat form. Instantaneous transfer of securities enhances liquidity. It eliminates delays, thefts, interceptions and subsequent misuse of certificates. Change of name, address, registration of power of attorney, deletion of deceased's name,

etc. - can be effected across companies by one single instruction to the DP. Each share is a market lot for the purpose of transactions - so no odd lot problem. Any number of securities can be transferred/delivered with one delivery order. Therefore,

paperwork and signing of multiple transfer forms is done away with. It facilitates taking advances against securities on low margin/low interest.

DEMAT ACCOUNTThere are many broking houses doing business in India and they charge a brokerage on every transaction made online or offline. (Buying and Selling are treated as separate transaction). Reliance Money’s advantage over others is that it’s charging the lowest brokerage in the market which is just 1 paisa on every executive trade irrespective of the volume traded. Reliance Money, the brokerage and distribution arm of Reliance ADA Group, aims to tap investors in the smaller towns and cities through a flat fee structure. The current leaders in the retail broking segment like ICICI Direct, India Infoline and Indiabulls offer a ‘pay per use’ model where the customer pays a percentage of the amount transacted by him. Reliance Money’s brokerage rates are quite competitive. The new wonder is Reliance Money's pre-paid card for stock market brokerage. Reliance Money, the financial services division of Anil Dhirubhai Ambani Group-promoted Reliance Capital, is

bringing to the market pre-paid cards in denominations of Rs500, Rs1000, Rs 2500, Rs 5000,Rs 10000.

These cards would offer brokerage at one-third of the rate being charged by institutional and individual brokerage houses. Sample this. For a pre-paid card worth Rs500, an investor can trade up to Rs2 lakh in both non delivery and delivery option.The Rs1000 worth pre-paid card, total trading limit would reach Rs 1 crore, of which Rs 90lakhs is for the non delivery segment and Rs10 lakh for delivery-based activities. For Rs2500 pre-paid card, total trading limit is fixed at Rs3 crores, of which Rs2.70crore is for the non delivery option and Rs 30 lakhs for delivery option.For the Rs 5000 pre-paid card, the total trading limit is Rs 7 crores, out of which Rs 6.30crore is for non delivery option and Rs 70 lakhs for delivery option.For the Rs.10000 pre paid card, the total trading limit is Rs 20crore, out of which Rs 18 crores is for non delivery option and Rs 2 crores for delivery option. Reliance Money offers most competitive brokerage rates - 0.01paise for intraday trades and 0.05paise for delivery trades. Target low level of retail penetration in India - less than 3 per cent of household financing savings makes it into equity marketsReliance Money consumers can trade in equities, commodities and offshore Investments , IPO’s, Mutual Funds, Insurance, Money transfer and Money Changing - all through single window, both off-line and online.

Pros:- 1. Sure money returns

People can benefit from better returns from an active stock trading that just buying and holding the investment.

2. PopularityBefore choosing one or another trading stock, you must be popular with it. Try to find as much information as you can in order to understand each of them. Then, choose.

3. A variety of choicesThere is a variety of stocks people may choose between but the most important is how to make the best choice. Try to find stocks that have moving prices.

Cons:- 1. Leverage

Leverage means a flaw of stock trading. The flaw for this trading is lower than compared with future trading or with Forex.

2. The costsWhile the price cannot be compared to other types of trading, the stock trading virtually becomes impossible for those people who don’t get some money before they can start investing.

3. Rule on short sellingThe traders have to wait for a quite long time before the stock price ticks up and they’ll get a chance to short selling it. This way, the profits of a trader will be limited. The Forex trading does not have such a policy.

But, remember that all of the trading systems like Forex, Stock or Future also have their advantages and disadvantages.

Conclusion: So if you are a wise trader, then it’s just up to you to think about these aspects. It would be better if you can estimate it properly before choosing any of those systems.

Online trading benefits:-1) fees and commissions are much lower in comparison with traditional ways of trading;2) an opportunity to act on price movement immediately;3) direct access to information on real time prices and charts;4) absence of broker gives any trader an opportunity to take his/her own decisions without hurry;5) completing or denying a trade can be performed within a few seconds so it's easier to manage your investments and shorten your losses.

Learning Outcome

Main purpose of investment is returns and liquidity, commodity market is less preferred by investors due to lack of awareness. The major findings of this study are that people are interested to invest in stock market but they lack knowledge.

Through this report I am also able to understand, what the Company’s positive are and strong points, on the basis of which I come to know what can be the basis of pitching to a potential client.

I have also understood the importance of having a Demat account and the method of taking Loan against debentures. All the procedures of documentations required for both the purpose – Demat Account and Loan against Debentures. This period of internship also allowed me to meet HNI clients which were a great experience.

This internship provided me with exposure to equity share trading which has been an intriguing learning experience. Also I came to know about the different companies whose shares are traded. This will help me in the long run.

On the whole, the internship has proved to be a great exposure and rich source of learning which will not only be useful just for the purpose of academics but also in my everyday life.

Conclusion

Stock markets refer to a market place where investors can buy and sell stocks. The price at which each buying and selling transaction takes is determined by the market forces (i.e. demand and supply for a particular stock).

The term Demat, in India, refers to a dematerialized account for individual Indian citizens to trade in listed stocks or debentures, required for investors by The Securities Exchange Board of India (SEBI). In a demat account, shares and securities are held electronically instead of the investor taking physical possession of certificates. A Demat Account is opened by the investor while registering with an investment broker (or sub broker). The Demat account number is quoted for all transactions to enable electronic settlements of trades to take place.

Edelweiss Broking Ltd. as a company has been successful since it moved into retail. On a positive note the company always focuses on long term goals and more focus on customer satisfaction that helped Edelweiss to grow in market.In the last few years the earnings per share of Edelweiss Broking Ltd has shown very good growth due to aggressive and passionate sales trading team, they are able to seamlessly execute complex trades, across the entire spectrum of trading strategies. Their more concentration towards customer satisfaction and they are doing it brilliantly.Edelweiss Broking Ltd. has been performing well when compared with some of its competitors. Some of the products and services offered by Edelweiss are quite unique which gives them an upper edge over other competitors. And this is the reasoned why they are successful in broking market. They came to know what customer wants and how can they satisfy themThere are many pros and cons and customer now understand importance of share trading through which they can earn money by doing easy task whether it is online or off line.

Bibliograph y

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