PROJECT REPORT

ON

“COMPARATIVE ANALYSIS OF INVESTOR SWITCHING OVER TO

DIFFERENT STOCK BROKERAGE FIRMS”

Survey Project Submitted to JAMIA MILLIA ISLAMIA

In partial fulfilment for the Award of the Degree of

MASTER OF BUSINESS ADMINISTRATION

(DISTANCE MODE)
Submitted by:

ABDULLAH ABRAR
Roll No: D19MBA-011
Enrollment No: 15-1107

Under the Supervision of

DR. SABIHA KHATOON

CENTRE FOR DISTANCE & ONLINE EDUCATION

JAMIA MILLIA ISLAMIA
 NEW DELHI – 110025

CERTIFICATE

On the basis of declaration submitted by ABDULLAH ABRAR (15-1107) this is to certify

that he has completed his Survey Project Report entitled “COMPARATIVE ANALYSIS
OF INVESTOR SWITCHING OVER TO DIFFERENT STOCK BROKERAGE
FIRMS” which is submitted to the Centre for Distance and Online Education, Jamia Millia
Islamia, New Delhi in partial fulfillment of the requirements for the award of the degree of
Master of Business administration (Distance Mode).

The project report submitted by him reflects his original work. He has successfully completed
project assigned to him and presented in the form of the present survey project report under
my guidance and supervision.

Date: Dr Sabiha Khatoon

Assistant Professor
(Commerce) CDOE, JMI
 DECLARATION

I, ABDULLAH ABRAR a student of MBA (Distance Mode) Program at Centre for Distance
and Online Education, JAMIA MILLIA ISLAMIA, New Delhi. Hereby declare that the
Project Report Entitled “SURVEY PROJECT REPORT ON COMPARATIVE
ANALYSIS OF INVESTOR SWITCHING OVER TO DIFFERENT STOCK
BROKERAGE FIRMS” is fulfillment of requirement for the degree of Master of Business
Administration (Distance Mode). The Content of this project report has not been submitted to
any other University or Institution for the award of degree. This project is my original work
and it has not been presented earlier in this manner. This information is purely of academic
interest.

Further, I assign the right to the university to use the information and contents of this project
to develop cases, caselets, case leads, and papers for publication and/or for use in teaching.

ABDULLAH ABRAR

ROLL NO. D19MBA-011

ENROLLMENT NO. 15-1107

 CHAPTER 1
INTRODUCTION
 1.1 INDIAN FINANCIAL MARKET

The economic development of a nation is reflected by the progress of the various economic
units, broadly classified into corporate sector, government and household sector.

While performing their activities these units will be placed in a surplus/deficit/balanced

budgetary situations. There are areas or people with surplus funds and there are those with a
deficit. A financial system or financial sector functions as an intermediary and facilitates the
flow of funds from the areas of surplus to the areas of deficit.

A Financial System is a composition of various institutions, markets, regulations and laws,

practices, money manager, analysts, transactions and claims and liabilities.

Financial System;

The word "system", in the term "financial system", implies a set of complex and closely
connected or interlined institutions, agents, practices, markets, transactions, claims, and
liabilities in the economy. The financial system is concerned about money, credit and
finance-the three terms are intimately related yet are somewhat different from each other.
Indian financial system consists of financial market, financial instruments and financial
intermediation.

The Five Parts to the Indian Financial System:

Money: It is used as a medium to buy goods & services. It also is a standard unit of
measurement and acts as a store of value. However, money may not be a good store of value
since it loses value with inflation.

Financial Instruments: Financial Instruments are formal obligations that entitle one party to
receive payments or a share of assets from another party. Examples of tradable financial
instruments include loans, stocks, bonds.

Financial Markets: A Financial Market is a place or network where financial instruments can
be sold quickly & cheaply. There are two types of Financial Markets – the primary market
and the secondary market.

Financial Institutions: Financial Institutions are firms that connect borrowers and lenders,
provide savers and borrowers access to financial instruments & markets.

Central Banks: Central Banks are large financial institutions that handle government finances,
they regulate the supply of money, and they serve as banks to commercial banks.
FINANCIAL MARKETS
A Financial Market can be defined as the market in which financial assets are created or
transferred. As against a real transaction that involves exchange of money for real goods or
services, a financial transaction involves creation or transfer of a financial asset. Financial
Assets or Financial Instruments represents a claim to the payment of a sum of money
sometime in the future and /or periodic payment in the form of interest or dividend. Few
Financial Markets below:

Money Market- The money market ifs a wholesale debt market for low-risk, highly-liquid,
short-term instrument. Funds are available in this market for periods ranging from a single
day up to a year. This market is dominated mostly by government, banks and financial
institutions. Money Market is a type of financial market for lending or borrowing short term
loans with a maturity of less than 1 year. The players are usually corporates, banks and
financial institutions as a huge amount of money is involved. The instruments dealt in the
money market are Treasury Bills, Commercial Papers, Certificate of Deposit, Bills of
exchange, etc.

Capital Market - The capital market is designed to finance the long-term investments. The
transactions taking place in this market will be for periods over a year. Capital Market is a
type of financial market for the trading of stocks (shares) and bonds. This market is used for
lending or borrowing money for the long term. Capital markets are further split into the
primary and secondary markets. The companies issue shares in the form of equity or
preference shares or fixed interest-bearing bonds in the primary market. Once the shares are
issued, the investors subscribe to them at a lower price and later sell them to another investor
at a higher price to earn profit in the secondary market.

Forex Market - The Forex market deals with the multicurrency requirements, which are met
by the exchange of currencies. Depending on the exchange rate that is applicable, the
transfer of funds takes place in this market. This is one of the most developed and integrated
market across the globe. Foreign Exchange Market facilitates the trading of currencies. These
markets are operated through financial institutions and determine foreign exchange prices for
every currency.

Credit Market- Credit market is a place where banks, FIs and NBFCs purvey short, medium
and long-term loans to corporate and individuals. The credit market is a financial market
where the government and companies issue debt to investors to raise money. Here, the
investors buy and sell securities, mostly in the form of bonds. Moreover, the market size of
the Indian credit market is one of the largest in Asia. Furthermore, like other countries, the
credit market in India is also a substitute for banking channels for finance. Hence, the Credit
market is also known as the Debt Market.

1.2 MONEY MARKET

The money market is a market for short-term funds, which deals in financial assets whose
period of maturity is upto one year. It should be noted that money market does not deal in
cash or money as such but simply provides a market for credit instruments such as bills of
exchange, promissory notes, commercial paper, treasury bills, etc. These financial
instruments are close substitute of money. These instruments help the business units, other
organizations and the Government to borrow the funds to meet their short-term requirement.
Money market does not imply to any specific market place. Rather it refers to the whole
networks of financial institutions dealing in short-term funds, which provides an outlet to
lenders and a source of supply for such funds to borrowers. Most of the money market
transactions are taken place on telephone, fax or Internet. The Indian money market consists
of Reserve Bank of India, Commercial banks, Co-operative banks, and other specialized
financial institutions. The Reserve Bank of India is the leader of the money market in India.
Some Non-Banking Financial Companies (NBFCs) and financial institutions like LIC, GIC,
UTI, etc. also operate in the Indian money market.
 MONEY MARKET INSTRUMENTS

Following are some of the important money market instruments or securities.

(a) Call Money: Call money is mainly used by the banks to meet their temporary requirement
of cash. They borrow and lend money from each other normally on a daily

(b) Treasury Bill: A treasury bill is a promissory note issued by the RBI to meet the short-
term requirement of funds. Treasury bills are highly liquid instruments that means, at any
time the holder of treasury bills can transfer of or get it discounted from RBI.

(c) Commercial Paper: Commercial paper (CP) is a popular instrument for financing working
capital requirements of companies. The CP is an unsecured instrument issued in the form of
promissory note.

(d) Certificate of Deposit: Certificate of Deposit (CDs) are short-term instruments issued by
Commercial Banks and Special Financial Institutions (SFIs), which are freely transferable
from one party to another

(e) Trade Bill: Normally the traders buy goods from the wholesalers or manufactures on
credit. The sellers get payment after the end of the credit period. But if any seller does not
want to wait or in immediate need of money he/she can draw a bill of exchange in favour of
the buyer.

1.3 CAPITAL MARKET

Capital Market may be defined as a market dealing in medium and long-term funds. So it
constitutes all long-term borrowings from banks and financial institutions, borrowings from
foreign markets and raising of capital by issue various securities such as shares debentures,
bonds, etc. The market where securities are traded known as Securities market.
 1.4 PRIMARY MARKET
The Primary Market consists of arrangements, which facilitate the procurement of long-term
funds by companies by making fresh issue of shares and debentures. It is usually done
through private placement to friends, relatives and financial institutions or by making public
issue. In any case, the companies have to follow a well-established legal procedure and
involve a number of intermediaries such as underwriters, brokers, etc. who form an integral
part of the primary market.

Functions of Primary Market

Role and functions of primary market are:

1. Origination
2. Underwriting
3. Distribution

1. Origination
In primary market, origination means to investigate, evaluate and procedure new project
proposals. It initiates before an issue is present in the market. It is done with the help of
merchant bankers.

The merchant bankers can be

 banks,
 financial institutions,
 Private investment firms, etc.

In primary market, the preliminary investigation involves a detailed study of economic, finan-
cial, legal, technical aspects to ensure the soundness of the project. The second function is
performed by sponsoring institutions. They provide advisory service.

Advisory service includes:

 Types of issue,
 Thug,
 Pricing,
 Methods of issue, etc.

2. Underwriting

In primary market, to ensure success of new issue, there is a need for underwriting firms. The
company needs to appoint underwriters. They can be banks or financial institutions or
specialized underwriting firms. In primary market, underwriting can be done by a single
underwriter or by a group of underwriters. Minimum subscription is guaranteed by
underwriters. If the issue is completely subscribed, no liability would be left for the
underwriters.

3. Distribution

In primary market, the success of any grand new issue is hinges on the issue is being sub-
scribed by the people. The sale of the securities to the supreme or highest investors is termed
as distribution.

Distribution Job is given to brokers and dealers. The brokers or agents maintain direct contact
with the supreme investors.

1.4 SECONDARY MARKET

The secondary market known as stock market or stock exchange plays an equally important
role in mobilizing long-term funds by providing the necessary liquidity to holdings in shares
and debentures. It is an organized market where shares, and debentures are traded regularly
with high degree of transparency and security. The major players in the primary market are
merchant bankers, mutual funds, financial institutions, and the individual investors; and in the
secondary market you have all these and the stockbrokers who are members of the stock
exchange who facilitate the trading.

Any investor holding shares or bonds needs a mechanism through which he can sell these
investments. Secondary market or stock market is a mechanism which provides exit route to
existing investors to find buyers for their securities at a price determined by the market. The
price of the securities can be thus known on a continuous basis. This helps the investors to
take a decision above for sale or purchase of securities. On the basis of the sentiments too
they can decide about when to issue fresh securities. It is a well-known fact that most of the
issues in the primary market takes place when the secondary markets are bullish.

This is the market where securities are traded. Investors trade securities without the
involvement of the issuing companies. Investors buy and sell securities among themselves.
The secondary market does not provide financing to issuing companies –they are not
involved in the transaction. The amount received for a security in the secondary market is
income for the investor who is selling the securities.

Secondary Market: Exchanges and OTC Market

Exchanges

In an exchange-traded market, securities are traded via a centralized place (for example, NSE
and BSE). Buys and sells are conducted through the exchange and there is no direct contact
between sellers and buyers.

Exchange-traded markets are considered a safe place for investors to trade securities due to
regulatory oversight. However, securities traded on an exchange-traded market face a higher
transaction cost due to exchange fees and commissions.

Over-the-counter (OTC) Markets

In the over-the-counter market, securities are traded by market participants in a decentralized

place (e.g., the foreign exchange market). The market is made up of all participants in the
market trading among themselves. Since the over-the-counter market is not centralized, there
is competition between providers to gain a higher trading volume for their company. Prices
for the securities vary from company to company. Therefore, the best price may not be
offered by every seller in an OTC market.

Functions of the Secondary Market

1. Act as a barometer for micro as well as macro level.

2. Act as a platform for marketability and liquidity of the outstanding equity and debt
instruments.

3. To provide instant valuation of securities caused by changes in the internal environment of

the company and industry factors. Such valuation facilitates the measurement of the cost of
capital for the company and the rate of return to the investors of the company’s shares.

4. To ensure a measure of safety and fair dealing to protect investors’ interest.

1.5 STOCK MARKET

It is a place where shares of pubic listed companies are traded. The primary market is where
companies float shares to the general public in an initial public offering (IPO) to raise capital.
Once new securities have been sold in the primary market, they are traded in the secondary
market—where one investor buys shares from another investor at the prevailing market price
or at whatever price both the buyer and seller agree upon. The secondary market or the stock
exchanges are regulated by the regulatory authority. In India, the secondary and primary
markets are governed by the Security and Exchange Board of India (SEBI). India's premier
stock exchanges are the Bombay Stock Exchange and the National Stock Exchange.

Stocks, also known as equities, represent fractional ownership in a company, and the stock
market is a place where investors can buy and sell ownership of such investible assets. An
efficiently functioning stock market is considered critical to economic development, as it
gives companies the ability to quickly access capital from the public.
The stock market refers to the collection of markets and exchanges where the issuing and
trading of equities (stocks of publicly held companies), bonds and other sorts
of securities takes place, either through formal exchanges or over-the-counter markets.

Stock markets are venues where buyers and sellers meet to exchange equity shares of public
corporations. They are vital components of a free-market economy because they enable
democratized access to trading and exchange of capital for investors of all kinds. They
perform several functions in markets, including efficient price discovery and efficient
dealing.

1.6 BULLISH AND BEARISH MARKET

Bull Market

Bull Market is a term often used to describe the stock market which has rising prices as its
main characteristics the famous Bull Market of US in the 1990s which was the longest in fin-
ance history and financial markets worldwide. During this phase most of the financial mar-
kets achieved a whopping growth rate and investors achieved more than ever.   

Another common term used in Bull Market is ‘herd,’ which is used for a large group of mar-
ket participants or investors in the financial market. Bull Market is also termed as Bull Run.
Bull that, like all other markets bull market does not lasts forever as no market can last
forever.

The task becomes all the more predictable because of continuous speculation and psycholo-
gical effect. It plays a very important role in various trends in the market. In fact, it often res-
ults in either stock market ‘bubble’ or ‘crash’ which are the two extremes for any market. In
fact, a person who expects prices to rise and invests in the market on this assumption is com-
monly referred as bull. Another characteristic of bull market is that the number of buyers is
far more than sellers. 
Bear Market – Alarms a fall in Economy

Economy and financial market are closely related. A rise or fall in the financial market will
affect the economy of the state. In fact the economic conditions of the nation are better ex-
pressed in connection with the financial market status.

When the financial market is increasing in terms of value, the economy is usually referred to
as bull market. In other words, it refers to a rising market. Here the investors act with an op-
timistic mentality. Bear market is a condition which speaks about a reverse or opposite condi-
tion.

The investors start making investments with ultimate care. Bear market has impacts and
reflections on more than one market. When the declination is felt in a single market, it cannot
be referred to as a bear market. But it can be considered as the initial stages of a bear market.
Bear market can alarm the beginning of a recession. There can be severe unemployment
prevailing in the state when a recession starts. A rising inflation follows. The value of
housing falls below average. Stagflation economy can trigger a bear market.

Market Capitalization

Market capitalization is the aggregate valuation of the company based on its current share
price and the total number of outstanding stocks. It is calculated by multiplying the current
market price of the company's share with the total outstanding shares of the company.
Market capitalization is one of the most important characteristics that helps the investor
determine the returns and the risk in the share. It also helps the investors choose the stock that
can meet their risk and diversification criterion.

Stocks of companies are of three types. The stocks with a market cap of Rs 10,000 crore or
more are large cap stocks. Company stocks with a market cap between Rs 2 crore and 10
crore are mid cap stocks and those less than Rs 2 crore market cap are small cap stocks.
 1.7 STOCK EXCHANGES IN INDIA

India has two major stock exchanges - National Stock Exchange of India (NSE) and Bombay
Stock Exchange of India (BSE). Most of the share trading in the Indian equity market takes
place on these two stock exchanges.

The BSE, Asia's first stock exchange, was established in 1875. BSE is one of the world's
fastest stock exchanges, with a median trade speed of 6 microseconds. Is the world's 11th
largest stock exchange with an overall market capitalization of $1.83 Trillion as of March,
2017.

The NSE, on the other hand, was founded in 1992 and started trading in 1994, as the first
demutualized electronic exchange in the country. It was the first exchange in the country to
provide a modern, fully automated screen-based electronic trading system which offered easy
trading facility to the investors spread across the length and breadth of the country.
 NATIONAL STOCK EXCHANGE OF INDIA LIMITED

(NSE)

The National Stock Exchange of India Limited (NSE) is the leading stock exchange of In-

dia, located in Mumbai. The NSE was established in 1992 as the first demutualized electronic
exchange in the country. NSE was the first exchange in the country to provide a modern,
fully automated screen-based electronic trading system which offered easy trading facility to
the investors spread across the length and breadth of the country.
National Stock Exchange has a total market capitalization of more than US$1.41 trillion,
making it the world’s 10th-largest stock exchange as of March 2017. NSE's flagship index,
the NIFTY 50, the 50 stock index is used extensively by investors in India and around the
world as a barometer of the Indian capital markets.
NSE offers trading, clearing and settlement services in equity, equity derivatives, and debt
and currency derivatives segments. It is the first exchange in India to introduce electronic
trading facility thus connecting together the investor base of the entire country. NSE has 2500
VSATs and 3000 leased lines spread over more than 2000 cities across India.
NSE was also instrumental in creating the National Securities Depository Limited (NSDL)
which allows investors to securely hold and transfer their shares and bonds electronically. It
also allows investors to hold and trade in as few as one share or bond.
MARKET
NSE offers trading and investment in the following segments

1. Equities
2. Derivatives
3. Debt
4. Equity Derivatives
5. Interest Rate Futures
6. Debt Market

BOMBAY STOCK EXCHANGE OF INDIA LIMITED

(BSE)

The Bombay Stock Exchange (BSE) is an Indian stock exchange located at Dalal

Street, Mumbai. The BSE is the world's 12th largest stock exchange with an overall market
capitalization of more than $ 2 Trillion as of July, 2020.
Bombay Stock Exchange was founded by Premchand Roychand. He was one of the most in-
fluential businessmen in 19th-century Bombay. Historically an open outcry floor trading ex-
change, the Bombay Stock Exchange switched to an electronic trading system developed by
CMC Ltd. in 1995. It took the exchange only 50 days to make this transition. This auto-
mated, screen-based trading platform called BSE On-Line Trading (BOLT) had a capacity of
8 million orders per day.
The BSE is also a Partner Exchange of the United Nations Sustainable Stock Exchange initi-
ative, joining in September 2012.
BSE established India INX on 30 December 2016. India INX is the first international ex-
change of India.
BSE SENSEX
The BSE SENSEX also known as the SENSEX is a free-float market-weighted stock market
index of 30 well-established and financially sound companies listed on the Bombay Stock
Exchange.
The 30 constituent companies which are some of the largest and most actively traded stocks,
are representative of various industrial sectors of the Indian economy. Published since 1 Janu-
ary 1986, the S&P BSE SENSEX is regarded as the pulse of the domestic stock markets in
India.

1.8 TRADING ON A STOCK EXCHANGE

Before selling the securities through stock exchange, the companies have to get their securit-
ies listed in the stock exchange. The name of the company is included in listed securities only
when stock exchange authorities are satisfied with the financial soundness and other aspects
of the company.
There are primarily two forms of the market – organised and unorganised. Organised market
is constituted with the set of rules and regulations which very entity operating the market
needs to adhere to and usually consist of regulatory body to supervise such adherence. An un-
organised market does not contain any strict rules and regulations and even if it does, adher-
ence is not mandatory.
With Online trading and investing, the process has become much more convenient, whereas
most markets have been simulated on the internet.

TRADING PROCEDURE ON A STOCK EXCHANGE

STEP 1. Selecting a Broker or Sub-broker:

When a person wishes to trade in the stock market, it cannot do so in his/her individual capa-
city. The transactions can only occur through a broker or a sub-broker. So according to one’s
requirement, a broker must be appointed.
Now such a broker can be an individual or a partnership or a company or a financial institu-
tion (like banks). They must be registered under SEBI. Once such a broker is appointed you
can buy/sell shares on the stock exchange.

STEP 2. Opening a Demat Account:

Since the reforms, all securities are now in electronic format. There are no issues of physical
shares/securities anymore. So an investor must open a dematerialized account, i.e. a Demat
account to hold and trade in such electronic securities.
So you or your broker will open a Demat account with the depository participant. Currently,
in India, there are two depository participants, namely Central Depository Services Ltd.
(CDSL) and National Depository Services Ltd. (NDSL).
STEP 3. Placing Orders:
And then the investor will actually place an order to buy or sell shares. The order will be
placed with his broker, or the individual can transact online if the broker provides such ser-
vices. One thing of essential importance is that the order /instructions should be very clear.
Example: Buy 100 shares of XYZ Co. for a price of Rs. 140/- or less.
Then the broker will act according to your transactions and place an order for the shares at
the price mentioned or an even better price if available. The broker will issue an order con-
firmation slip to the investor.
STEP 4. Execution of the Order:
Once the broker receives the order from the investor, he executes it. Within 24 hours of this,
the broker must issue a Contract Note. This document contains all the information about the
transactions, like the number of shares transacted, the price, date and time of the transaction,
brokerage amount, etc.

Contract Note is an important document. In the case of a legal dispute, it is evidence of the
transaction. It also contains the Unique Order Code assigned to it by the stock exchange.

STEP 5.  Settlement:
The spot dealings are settled there in full. The selling broker hands over the transfer form and
share certificates to the buying broker after receiving the price. The settlement for ready de-
livery and forward contracts is done with a different procedure.

(i) Settlement of Ready Delivery Contracts:

Here the actual securities are transferred from the buyer to the seller. And the funds will also
be transferred. Here too the broker will deal with the transfer.

 On the Spot settlement: Here we exchange the funds immediately and the settlement
follows the T+2 pattern. So a transaction occurring on Monday will be settled by
Wednesday (by the second working day)

 Forward Settlement: Simply means both parties have decided the settlement will take
place on some future date. It can be T+% or T+9 etc.

If the settlement is done by giving actual delivery of securities on receiving the price, it is
called liquidation in full. In another method the dealings are squared by adjusting price differ-
ences only.

(a) Liquidation in Full:
The securities are delivered and payment is received or vice-versa after crossing all interme-
diate purchases and sales.

(c) Carry over to the Next Settlement:

When the buyer does not want to settle the contract but wants to carry it to a future date then
it is called carry over.

1.9 Stock Brokers

A stock broker or brokerage is licensed and regulated financial firm that facilitates buying
and selling transactions in various financial instruments for investor clients, institutions and
or for the firm. All financial market transactions have to be executed through a broker. Basic-
ally, a broker is responsible for facilitating all stock trades you place. Most brokers allow
users to sign up through online applications. Brokers charge commissions for their services.
The type of broker will determine how expensive and how the commissions are structured.

There are two main types of brokerage firms: Full-service Brokerage and Discount Brokerage

Full-service Broker

A full-service broker offers a range of add-ons in addition to trading at stock exchanges. This
includes research reports, advisory and a relationship manager apart from helping you buy
and sell shares. They also offer a wide range of products including Mutual Funds, IPO, Debt,
Insurance and Loans.

A beginner investors need to have their hand held by some in initial days of trading. Traders
who are looking for higher margin or margin funding. A trader can get significantly higher
margin based on his personal relationship with the broker or sub-broker.

Investors looking for a verity of financial products for investment through the broker i.e. Mu-
tual Funds, IPO, Debt, Insurance, FD etc.

Discount Broker

The discount brokers (flat fee brokers or budget brokers) are online stock brokers offering
low-cost brokerage services. They are technology driven brokers with low operations cost.
Most discount brokers do not offer add-ons like research, advisory (trading tips), PMS,
Wealth Management, dedicated relationship manager and local branch support. This allows
them to offer trading at a very low brokerage charges.

The discount brokerage firms charge over 60% lower brokerage fees in comparison to full-
service brokers. They offer free online trading software to all the customers.

Most discount brokers including Zerodha and Upstox offer brokerage free equity delivery
trading and direct mutual funds. For all other segments, they charge a flat rate brokerage i.e.
Rs 20 per executed order irrespective to the size of the trade.

1.10 Trading in time of Covid’19 Pandemic

Historically, we have seen that consumer sentiment tend to move in tandem with stock mar-
ket indices. However, since the outbreak of COVID-19, we have witnessed a shift as con-
sumers and stock markets tend to move in opposite direction. Consumer sentiment indices are
widely recognised indicators that spell out the overall perception and expectations of con-
sumers towards the economy. These indicators tend to rise during periods of boom when con-
sumers are financially more confident, and fall during periods of recession as consumers tend
to reduce their discretionary spending.

Additionally, these indicators help business communities to gauge the mood of the consumer
to anticipate strategies for the same. Finally, it is known that the overall economic health of a
country is likely to affect the movements of the stock markets. Such a disconnect has been
witnessed in India as well. After a sharp drop in major Indian stock indices like SENSEX and
NIFTY 50 during February–March 2020, we witnessed a rebound in them after April 2020.
However, this rebound stood in strident contrast to consumer sentiments that continue to wit-
ness a sharp fall since February 2020.
It show that investors increase their trading activities as the COVID-19 pandemic unfolds,
both at the extensive and at the intensive margin. The number of investors who first open an
account with the broker increases, while at the same time established investors increase their
average trading activities.

The increase in trading is especially pronounced for male and older investors, and largest
during the period from February 23, to March 22. Investors also marginally increase their
tendency to engage in short selling. Stock trading increases most for industries that tend to be
losers as the crisis progresses.

CHAPTER 2
RESEARCH METHODOLOGY
 RESEARCH METHODOLOGY

2.1 REVIEW OF LITERATURE

According to SEBI, Professional Rating of market intermediaries, as a concept, is a

matter of debate and discussions. The need for rating is felt not only from
thepoint of view of greater disclosure requirements for investor’s interests, considering
the important role such intermediaries play, being an interface between investors
and exchanges but also from the point of view of measuring the adequacy of systems
and controls to meet internal as well as external compliance requirements. So that need
for Intermediaries Rating services (Brokers), In view of the developments that are
taking place in the capital markets, the need to constantly upgrade and improve systems
and procedures in operation as well as skill set has gained considerable importance.
Besides compliance with regulatory requirement both in letter and spirit has assumed
significance so as to mitigate risk and ensure adequate protection of investors’ interest.

And Rating objectives / benefits are rated entity would be in a position to brand its image and
capitalize the same for generating more business. In a nutshell, the product may accrue
significant benefits to all stakeholders including the investors, stock brokers themselves, the
regulator and others who will benefit from the transparency and the consequential focus on
efficiency According to SEBI and Intermediaries Regulation and Supervision Department,
different factors are consider for rating process Organization structure, Policy on Investors
interest, Risk Management Policy and System, Organization process and procedures,
Management policy on compliance, Financials, History/Background, Firm’s positioning.

According to Michal Parness, Founder & CEO

Investors don’t Make Money in the Stock Market. One reason the institutions make so much
money is that they are trading. They make money every time you buy or sell. They make
money whether you win or lose. That means that when you’re investing, you’re basically just
sitting there. You’re not going anywhere. You’re not making money as an investor

Trading the Trend: The Only Way to Make Money in the Market

If you don’t know this already, “Trend Trading” means trading trends based on human
emotions. Not lagging indicators. Not complex statistical analysis and not Ph.D. level
mathematical equations. With trend trading, you look for market movement. That could mean
stocks that are going to move up or down during the course of a day (intraday). You’ll play
the gaps up and down, often several days a week. The “Trend trading” means being aware
and taking advantage of trends like the run-ups that happen around earning sessions. These
are trends that have worked time and time again in the market. They consistently yield
results.

Dr. Jayanta Kumar Seal (2009) 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.

Ravinder Kumar & Nidhi Walia (2010) 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.

Ms. Nidhi Walia (2010) 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.

Mr. Ajay Kumar (2016) 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.

The COVID-19 pandemic increased uncertainty and risk around the globe and affected both
developed and emerging economies such as the United States, Italy, Spain, Brazil, and India.
Existing studies recorded diversified results. Ozili and Arun (2020) used major government
policies such as public health measures, restrictive measures, social distancing policies, and
fiscal monetary policies to elucidate the impact of COVID-19 on the global economy.
According to them, higher fiscal policy and restriction on movement had a negative impact
on the level of economic activities.

Adding to this result, Ramelli and Wagner (2020) analysed the international trade and
financial policies of individual firms and concluded that internationally oriented US firms,
especially those with exposure to the Chinese market, faced adverse impacts. Several studies
focused on analysing individual market economies.

In addition, Gormsen and Koijen (2020) documented that the lock-down in Italy due to the
COVID-19 pandemic caused a downward trend in the GDP growth and dividends of US and
European countries. Similarly, Zhang et al. (2020) examined the top 10 COVID19-infected
countries using a simple statistical analysis method and suggested that the pandemic created
greater risk and uncertainty in the global market. This is in line with the conclusions drawn
by Baker et al. (2020), who showed that the market swings due to COVID-19 were extremely
high when compared with the times of SARS, swine flu, MERS, Ebola and bird flu.

In the psychological literature, a vast body of research has examined the questions of attitude
formation. With the introduction of the Internet as an emerging tool for the delivery of
services, the issue of credibility and reliability has gained importance and attention of
researchers. Most brokerage firms offer services through Internet. Credibility and
reliability are two important determinants of investor satisfaction. Reliability and credibility
are among the two prominent factors in evaluating quality, in the online context (Yang
and Jun, 2002; Cox and Dale, 2001)

Investment analysis is a broad concept and comprises management of companies, the

economic scenarios, regulatory government environment and reforms, the industry outlook
and other macroeconomic indices that include inflation, foreign direct investment (FDI), up
to date stock market performance and gross domestic product (GDP) growth rate (Murphy &
Soutar, 2004)

A function of brokerage firm is to provide information to its customers on all stocks. The
key function that makes an individual a better investor is the availability of information
provided by the brokerage firm (Loibl & Hira, 2009). Good management of information
reduces behavioural irrationality (Hirshleifer, 2001; Ritter, 2003).

Jayen B Patel (2008) studied on calendar effect in the Indian stock market, he found two
calendar effects, April - May Effect and November – December Effect.

The increasing complexity of the financial markets documented by Goldstein and others,
suggests that specific broker’s typologies play a role in the emergence of the aforementioned
behavioral patterns. For example, Hagerty and McDonald, indicate that, in a market with
asymmetric information, informed traders earn a profit at the expense of uninformed traders,
and they face an incentive to serve as counterparty to the trade rather than just as a brokerage
conduit. There is also evidence of frictions related to the existence of how different types of
brokers affect the equilibrium of the stock market
 2.2 OBJECTIVES OF THE STUDY

Each research study has its own specific purpose. It is like to discover to Question
through the application of scientific procedure.

Research study has following objectives:-

1. To know investor’s perception regarding investment in stock market.

2. Switching over off Investor to different stock brokerage firms

3. To know investor’s behavior toward market trend on his investment.

4. To draw a comparative analysis of different stock broking firms (ICICI Direct,

Kotak securities, HDFC securities, Zerodha, Angel Broking, Upstox)

2.3 RESEARCH METHODOLOGY

Research is an art of scientific investigation. In other word research is a scientific and

systematic search for pertinent information on a specific topic. The logic behind
taking research methodology into consideration is that one can have knowledge about
the method and procedure adopted for achievement of objectives of the project. With
the adoption of this others can evaluate the results also. Its main aim is to keep the
researchers on the right track

TYPES OF RESEARCH

The research is based on Adaptive, Descriptive and Qualitative research.

Adaptive Research: -
Implementing the adaptations just explored, is likely to bring about more adaptations
to the research design. Research design thus becomes iterative, with a series of
adaptations as long as the fit between topic, theory, method, and empirics can be
reasonably improved. A simple and familiar model of research looks like a topic is
picked and literature is reviewed to get an understanding of what has previously been
studied on this particular topic and what not. Then one familiarizes oneself with
different available theories that could be useful and picks one. After or during these
steps research questions are formulated and finetuned, and a method is selected or
designed.

Descriptive Research: -

Descriptive research includes surveys and fact finding enquires of different kinds. The
major purpose of descriptive research is description of the state of affairs as it exists at
present. Researcher has no control over the variables of this type of research.

Qualitative Research: -

The research needs comparison between different stock brokers. So this is based on all
qualitative data. In short, Qualitative research is especially important in the behavioral
sciences where the aim is to discover the underline motives of human behaviour.
Through such research we can analyses various factors which motivate to people to
behave in a particular manner or which make people like or dislike a particular thing.

2.4 SAMPLE DESIGN

“A sample design is a definite plan for obtaining a sample from a given population. It
refers to the technique or the procedure the researcher would adopt in selecting
item for the sample”

SAMPLING AREA
Sampling area may be a geographical one, such as state, district, village etc. The
researcher will have to decide one or more of such area that he has to select for his
study. In this research study we have taken DELHI NCR as a sampling area .

SAMPLING UNIT

Sampling unit may be defined as an individual, pair or group of persons included as

respondent. In this research study General Investors are the sampling units .

SIZE OF SAMPLE
“This refers to the number of items to be selected from the universe to constitute a
sample” In the present research sample size is .

But the research also study the 6 stock broker companies related to security &
commodity market like ICICI direct, HDFC securities, Kotak Securities, Zerodha,
Upstox, Angel Broking for the appropriate collection of the information. The selection
of these firms were on the basis of the size of the firm and market share among the
companies.

2.5 SOURES OF DATA COLLECTION

While deciding about the method of data collection to be used for the study the
researcher should keep to types of data.

1. Primary Data.

2. Secondary Data.

PRIMARY DATA
My research is based on original primary data, for certain purpose of research project. For
this research project, I have to use some common research instrument or tool.
QUESTIONNAIRE
Survey is the most widely recognized and basic method for essential information
gathering strategy. For this I will set up a poll such that it will have the capacity to gather
all significant data with respect to the exploration extend. The survey was outlined with
the help of using Google forms. The information accumulation was done over a time of 1
week. This was done through an online overview entry and through sends. This Survey
Questionnaire will be adaptive from different other research projects as it is one of the
forms of Adaptive Research Methodology.

SECONDARY DATA
It will be collected to add the value to the primary data. This may be used to collect
necessary data and records by different websites, magazines, annual reports, journals,
reference books, newspapers and articles etc.

SURVEY METHOD

Survey refers to the method of securing information concerning phenomena under study
from all or selected number of respondents of the concerned area. In a survey the
investigator examines those phenomena which exist in the universe independent of his
action. Research uses the Questionnaire Method. Survey Questionnaire Method will be
adaptive from different other research projects as it is one of the forms of Adaptive
Research Methodology.
 2.6 LIMITATIONS OF STUDY

 As only DELHI/NCR region is dealt in the survey so it does not represent the

view of the total Indian market.

 Size of the research may not be substantial.

 There was lack of time on the part of respondents.

 The survey was carried through questionnaire and the questions were based

on perception.

 There may be biasness in information by market participant.

 Complete data was not available due to company privacy and secrecy.

 Customer dissatisfied with the services.

 Misguidance by agents.

 Lacks of motivation as false commitments were made to customer by the com-

pany.

 Misleading concepts

 Depending on one’s own experience, interest, will, and pleasure, some re-

spondents might have given biased information.

 The sample size is limited because many investors did not want to disclose

their income and investment details.

 The study is limited to investors who are residing in Delhi NCR

 CHAPTER 3
STOCK BROKERAGE ANALYSIS
 3.1 STOCK BROKERAGE FIRMS

A brokerage firm, or simply brokerage, is a financial institution that facilitates the buying and

selling of financial securities between a buyer and a seller.
Brokerage firms serve a clientele of investors who trade public stocks and other securities,
usually through the firm's agent stockbrokers. A traditional, or "full service", brokerage firm
usually undertakes more than simply carrying out a stock or bond trade. The staff of this type
of brokerage firm is entrusted with the responsibility of researching the markets to provide
appropriate recommendations, and in doing so they direct the actions of pension fund man-
agers and portfolio managers alike. These firms also offer margin loans for certain approved
clients to purchase investments on credit, subject to agreed terms and conditions.
Traditional brokerage firms have also become a source of up-to-date live stock
prices and quotes. When a brokerage firm, in addition to buying and selling for clients, trans-
acts for its own account, it is known as a broker-dealer.
Brokerage firms come in several different variations. Depending on the needs of the investor,
it is wise to choose the one that best matches your needs and financial goals. 

To get a better understanding of which type of brokerage firm may be right for you, here is a
breakdown of what to expect from each kind:
 BROKERAGE
FIRMS

CAPTIVE INDEPENDENT FULL SERVICE

BROKER BROKER BROKERAGE DISCOUNT
FIRM BROKERAGE

DISCOUNT
SERVICE
BROKERAGE FIRM

DEEP DISCOUNT
BROKERAGE
FIRM

ONLINE
DISCOUNT
BROKERAGE FIRM

1. CAPTIVE BROKER

This type of broker is relevant when investors are interested in mutual fund purchases.
Captive brokers are those whose firm owns part of the mutual fund company so they are
inclined to sell only their own funds rather than encourage investors to look into other
company’s funds.

2. INDEPENDENT BROKER

Unlike captive brokers, independent brokerage firms are not connected to any mutual fund
company nor are they part of a chain brokerage. Typically, the independent will be more
forthcoming with advice that suits your needs rather than catering to their own interests.

3. FULL SERVICE BROKERAGE FIRM

This type of brokerage firm offers customers the full scope of services including the profes-
sional advice to assist investors in understanding investment money options and trade assets.
Using this type of brokerage firm will cost the most for services but it will also provide the
most resources and tools necessary to make financial choices. They research various aspects
of the market to make investment recommendations to their clients.

4. DISCOUNT BROKERAGE
A discount brokerage is a business that charges clients significantly lower fees than a tradi-
tional brokerage firm but without providing financial advice. Discount brokers typically al-
low investors as well as consumers of financial services to buy and sell on-line while offering
comparatively fewer services and/or support.
In the securities industry, a brokerage helps clients buy and sell securities on an appropriate
exchange. Before the advent of discount brokers it used to be that only the wealthy could af-
ford a broker and access to the stock market. But discount brokers offered commissions at a
fraction of their full-service counterparts.
Discount brokerages usually allow their clients to trade for their own account with little or no
interaction with a live broker. In addition some brokers offer no-commission trades to their
clients that hold a balance greater than a specific amount with them.
All brokerage firms, including discount brokerage and full-service discount brokerage are
regulated in the same way and are licensed by each country's financial regulatory authority.

A. DISCOUNT SERVICE BROKERAGE FIRM

This type of brokerage firm offers service that only deals with the trading aspect of managing
investments for their customers. As not as many resources are provided through these
services, their cost is considerable less than a full service firm, with costs ranging 50% or
more lower.

B. DEEP DISCOUNT BROKERAGE FIRMS

This type of brokerage firm provides investment services that are even less costly than
regular discount firms because they only deal with specific aspects of investing, specializing
in one area of trading. Their services can cost nearly 90% less than a full service firm’s costs.

C. ONLINE DISCOUNT BROKERAGE FIRM

Brokerage firms that work online are much like the deep discount firms except their
investment resources and support are available for online trading only. Their costs are
typically low and for some, the immediate trading and other investment services they offer
are a definite pro of using online services.
 3.2 STOCK BROKERS

Investing in the stock market requires the assistance of a stockbroker to execute your orders

even if you don’t feel like you need their advice. Many investors today don’t remember a
time when you had no choice about the type of stockbroker to use. Full-service brokers con-
trolled the market and their high commissions were the standard.

A stockbroker is licensed and regulated financial firm that facilitates buying and selling
transactions in various financial instruments- stocks, derivatives, bonds, and IPOs for both
retail and institutional investors. Basically, all financial market transactions have to be
executed through a broker and they charge commission or brokerage charge for their services.

Money Manager

Money managers take over the responsibility for investing and managing the entire portfolio
in exchange for a percentage of the assets they manage. This is expensive, however, a good
money manager is worth their weight in gold.

There are two main types of stock brokers exist.

 Traditional Brokers
 Discount Brokers
 Discount/Online broker
 Discount/Online with assistance broker
The Discount Brokers usually charge much less, while full-service broker or traditional
broker can be very expensive but provides customized service. We advise investors and
traders to go through both discount and traditional brokers and get awareness of each of these
types of brokers before opening an account.

Full-Service Broker/ Traditional broker

The traditional full-service broker provides recommendations of specific stocks for your con-
sideration. The broker begins with a financial assessment of your personal situation to de-
termine your needs and suitability for various investments. The broker puts together an in-
vesting plan that you review periodically and make adjustments. Since traditional brokers of-
fer personalized investment or trading recommendations and services, brokerages charges can
be expensive. Take a look at some of the Leading Traditional Brokerage firms that let cus-
tomers invest and trade in stocks, futures, options, currencies, bonds in the Indian Stock Mar-
ket.

A full-service broker offers a range of add-ons in addition to trading at stock exchanges. This
includes research reports, advisory and a relationship manager apart from helping you buy
and sell shares. They also offer a wide range of products including Mutual Funds, IPO, Debt,
Insurance and Loans.

On the other side, a Discount Broker leverages technology to reduce the operation cost and
offer low-cost online brokerage services. Discount brokers do not offer add-ons usually
offered by a full service broker.

A full-service broker is good for following investors/traders:

 A beginner investors need to have their hand held by some in initial days of trading.
  Traders who are looking for higher margin or margin funding. A trader can get signi-
ficantly higher margin based on his personal relationship with the broker or sub-
broker.

 Traders planning to use Call & Trade a lot or visit the branch in person. Most discount
brokers charge extra for call & trade and do not have local branches.

 Investors looking for a verity of financial products for investment through the broker
i.e. Mutual Funds, IPO, Debt, Insurance, FD etc.

The most popular full-service brokers include ICICI, HDFC and Sharekhan.

The 3-in-1 account (a combination of bank saving account, a trading account and a demat ac-
count) is one the best offering by the top full service brokerage firms. The 3-in-1 account
helps in the seamless transaction between these 3 accounts. It is the most convenient way to
trade online.

Apart from the standard % based brokerage structure, most traditional brokerages also offer
volume-based plans where the brokerage varies according to the size of transactions on a
periodic basis. At higher turnovers, the brokerage can come down to as low as 0.05-0.15%.

ICICI is the 2nd largest and most famous full-service broker with over 10 lakh customers.

Discount/Online broker

The traditional discount/online broker is an order taker.

They will take your order either over the phone or online. If it is over the phone, you usually
will find they are to the point and not interested in chit-chat, which is good. You won’t get
any help from them unless you stumble over the technical aspects of an order.
On the other hand, if you are dealing with them online, you may never actually talk to one of
their employees. Some online brokers offer access to research, however, it is often third
party. They may have account management tools, either online or that you can download.

The discount brokers (flat fee brokers or budget brokers) are online stock brokers offering
low-cost brokerage services. They are technology driven brokers with low operations cost.
Most discount brokers do not offer add-ons like research, advisory (trading tips), PMS,
Wealth Management, dedicated relationship manager and local branch support. This allows
them to offer trading at a very low brokerage charges.

The discount brokerage firms charge over 60% lower brokerage fees in comparison to full-
service brokers. They offer free online trading software to all the customers.

The most popular discount brokers include Zerodha, 5paisa and Upstox.

Most discount brokers including Zerodha and Upstox offer brokerage free equity delivery
trading and direct mutual funds. For all other segments, they charge a flat rate brokerage i.e.
Rs 20 per executed order irrespective to the size of the trade.

A discount broker like 5paisa also offers free research and advisory to all customers.

Some discount stock brokers like ProStocks also offer fixed monthly unlimited trading plans.
These plans allow the customer to trade literally unlimited time in a month for a fixed low
monthly cost.

Zerodha is the most famous discount broker with over 10 lakh customers. They are the most
popular broker in India with excellent product and services.

3.3 Types of Investor

Pre-investors

This is a catch-all term for people who have not yet begun investing. It excludes all profes-
sional investors but includes friends, family, and close personal contacts. These are people
who may have capital that they are willing to invest in your business but are otherwise new to
investing.

Businesses in their earliest stages may only have access to pre-investment funding from close
personal contacts. At this point in the business lifecycle, you probably don’t have hard evid-
ence or any solid indicator that your business will be successful in the long run. Pre-investors
are investing in you personally because they know you, trust you, and believe in you.

These types of investors generally don’t provide a lot of money up-front. Depending on the
amount of capital your pre-investor has available, it could be as little as 100.

Passive Investors
Passive investors limit the amount of hands-on management they personally provide to assets
they own, adopting a buy-and-hold mentality that they expect to pay off in the long run. In-
stead of playing an active role in the management of a company, a passive investor will defer
to the management team’s operational and financial decisions.

This is commonly the case for investors who do not own a controlling stake in the company
they invest in. Passive investors usually invest in companies with management teams they be-
lieve in and rely on those teams for expertise and guidance.

Angel investors

Angel investors are one kind of passive investor. These are high net-worth individuals look-
ing for brand-new businesses and startups that they believe will perform well in the long run.
Often, these businesses are so small and new that they have not yet started producing any
profits. As a result, angel investors can make hundreds of times their initial investment when
they choose a successful asset.

However, angel investing comes with a great deal of risk. Angel investors often don’t have
any real control over how companies are run, and there are no guarantees that a startup will
ever become an industry leader. Beyond informal influence over company leadership, angel
investors have little say in whether a startup succeeds or fails.

Active Investors

Active investors take a hands-on approach to managing their portfolios. These are investors
who want to exert influence on the way their assets are run. In a private equity context, active
investors may bring in new people to help bolster management teams and assertively make
structural changes to the way a company works.

Active investors look for opportunities to make operational, financial, and administrative
changes based on their own knowledge and experience. As a result, active investing usually
involves greater risk, but it can also deliver greater returns when successful.

Venture Capital Firms

Venture Capital firms are a type of active investor. These firms invest in businesses a little
later in the development life cycle than angel investors. In the typical venture capital case, the
business already has a proven business model in place and may already be generating rev-
enue. However, it needs more resources to scale its operations sufficiently for generating sig-
nificant profits.

Because venture capital firms come into the picture later than angel investors do, they typic-
ally earn lower multiples on their successful investments. While an angel investor might
make 100 times their initial investment in a successful company, a venture capital firm may
earn ten times their initial investment.

Private Equity Firms

Private equity firms look for mature, well-established businesses to invest in. In many cases,
they seek a majority stake in a business and use proven leadership skills to improve business
performance over time. This strategy is usually less risky than venture capital or angel invest-
ment, especially when the private equity firm takes a majority stake and brings its own man-
agement experience to the table.

3.4 INVESTOR ANALYSIS

Value investing is an investment style, which favours good stocks at great prices over great
stocks at good prices. Hence, it is often referred to as ‘price-driven investing’. A value in-
vestor will buy stocks that may be undervalued by the market, and avoid stocks that he be-
lieves the market is overvaluing. Warren Buffet, one of the world's best-known investment
experts, believes in value investing.

For example, if a stock of a company growing at 10% is selling at Rs 100 with a PE ratio of
10 and another stock of company that also grows at 10% is selling at Rs 150 with a PE ratio
of 15, the value investor would select the first stock over the second. This is because the first
stock is undervalued in comparison with the second.

Value investors see the potential in the stocks of companies with sound financial statements
that they believe the market has undervalued. They believe the market always overreacts to
good and bad news, causing stock price movements to not move in tandem with long-term
fundamentals. For this reason, they are always on the hunt for undervalued companies.

Fundamental Analysis

This method aims to evaluate the value of the underlying company. It takes into account the
intrinsic value of the share keeping in mind the economic conditions and the industry along
with the company’s financial condition and management performance. A fundamental analyst
would most definitely look at the balance sheet, the profit and loss statement, financial ratios
and other data that could be used to predict the future of a company. In other words, funda-
mental share market analysis is about using real data to evaluate a stock's value. The method
uses revenues, earnings, future growth, return on equity, profit margins and other data to de-
termine a company's underlying value and potential for future growth.

The basic belief is that as the company grows so will the value of the share increase. This in
turn will benefit the investor in the long run.
Technical Analysis

Unlike fundamental analysis, technical analysis has nothing to do with the financial perform-
ance of the underlying company. In this method, the analyst simply studies the trend in the
share prices.

The underlying assumption is that market prices are a function of the supply and demand for
the stock, which, in turn, reflects the value of the company. This method also believes that
historical price trends are an indication of the future performance.

Thus, instead of assessing the health of the company by relying on its financial statements, it
relies upon market trends to predict how a security will perform. Analysts try to cash in on
the momentum that builds up over time in the market or a stock.

Technical analysis is often used by short-term investors and traders, and rarely by long-term
investors, who prefer fundamental analysis.

Technical analysts read and make charts of prices. Some common technical share market ana-
lysis measures are the day-moving averages (DMAs), Bollinger bands, Relative Strength In-
dices (RSI) and so on.
3.5 COMPANIES ANALYSIS
 3.6 ICICI DIRECT

ICICIdirect is one of the largest retail stock brokers in India. It is part of the ICICI Group. It
offers online trading and investment services to over 50 lakhs customers. The services offered
include equity, commodity, and currency trading at BSE, NSE, and MCX. The company also
offers Mutual Fund & IPO, Fixed deposits, Bond, NCD, wealth products, Home Loans,
Loans against Securities, etc.

ICICIdirect's most popular service is its 3-in-1 account, which includes ICICI Bank Account,
ICICI Trading Account, and ICICI Demat Account. The 3 in 1 account offers a seamless
trading experience.

ICICIdirect offers multiple brokerage plans i.e. I-Secure Plan, ICICIdirect Prime

Plan, Lifetime Prepaid Brokerage Plan, and Neo Plan.

ICICI Neo Plan is a flat rate brokerage plan. It offers brokerage-free equity futures trading.
It charges flat Rs 20 per executed order brokerage for Equity Intra-day and Options trading
and 0.55% brokerage for equity delivery. This plan offers access to trading tips and research,
30 minutes payout when selling shares, and margin funding at a low-interest rate.

ICICIdirect offers a unique and wide range of Products and features like One Click
Equity, Margin Trading Funding (MTF),Smart Trading features and ease of investing in
equity with Systematic Equity Plan and much more. 

ICICI Minimum Brokerage Charges

1. ICICIdirect Minimum Brokerage

o The minimum brokerage in I-Secure plan for delivery segment is Rs 35 per
trade or 2.5% of the trade value whichever is lower.
o The minimum brokerage in Prime plan and Prepaid plan for delivery segment
is Rs 25 per trade or 2.5% of the trade value whichever is lower.
2. ICICI charges flat 5 paisa per share (Rs 0.05) brokerage on stocks priced less then Rs
10 per share.

ICICIdirect (Advantages)

1. 3-in-1 account integrates your banking, broking and demat accounts. All accounts are
from ICICI and very well integrated. This feature makes ICICI the most interesting
player in the online trading facility. There is absolutely no manual interfere require.
This is truly online trading environment.
2. Unlike most of the online trading companies in India which require transferring
money to the broker's pool or towards deposits, at ICICIDirect you can manage your
own demat and bank accounts through ICICIdirect.com. Money from selling stock is
available in ICICI bank account as soon as the ICICIDirect receive it.
3. Trading is available in both BSE and NSE.
4. Low bandwidth website is available for slow internet connection or for trading from
mobile devices.
5. Through VTC Feature (Valid Till Cancelled), customers can place buy or sell limit or-
ders which will remain valid for 45 days.
ICICIdirect (Disadvantages)

1. ICICI minimum brokerage charge as per the standard I-Secure Plan is Rs 35 per trade
which is very high for traders who does small trades.
2. ICICI charges flat Rs 0.05 per share brokerage on stocks quoting upto Rs 10. This
makes it very difficult to trade in penny stocks.
3. ICICIdirect charges Rs 25 per call for call & trade after first 20 free calls in a month.

3.7 KOTAK SECURITIES

Kotak Securities Ltd, a subsidiary of Kotak Mahindra Bank was founded in 1994. They offers
stock broking services and distributes financial products in India. They have 1209 branches,
franchisees and satellite offices offers services to 11.95 Lakh customers. They corporate
members with the Bombay Stock Exchange and the National Stock Exchange. They are also
a depository participant with National Securities Depository Limited (NSDL) and Central
Depository Services Limited (CDSL).
Kotak securities offers three-in-one account which allows investor to open demat, trading as
well as a bank account together with Kotak Mahindra Bank Limited. So it's easy to manage.
Once your;- account open you can trade in Equity, IPO, Mutual Fund, ETF, Tax free bonds,
Currency Derivatives, Gold ETF etc.

Kotak Securities is a corporate member of both the Bombay Stock Exchange and the National
Stock Exchange of India. It is also a depository participant with National Securities
Depository Limited (NSDL) and Central Depository Services Limited (CDSL). The company
also has a research division to study the macroeconomic indicators, sectors, company-specific
equity research, which regularly publishes stock market analysis.

Specialize in Fundamental and Technical analysis backed by a team of highly trained and
qualified individuals. Our full-fledged research division is involved in Macro Economic
studies, Sectorial research and Company Specific Equity Research which publishes in-depth
stock market analysis. This is combined with a strong and well networked sales force which
helps deliver current and up to date market information and news. We are also a depository
participant with National Securities Depository Limited (NSDL) and Central Depository
Services Limited (CDSL).

Kotak Mahendra Bank offers trinity account, a 3-in-1 account which is a combination of

saving bank, trading and demat account. It offers convenient investment in Equity,
Derivatives, Mutual Funds, IPO and ETF.

Main areas of business Kotak Securities are:

• Institutional broking business

• Private client group

• Client money management

• Retail distribution of financial products

• Depository services

• Online trading
Kotak Securities Brokerage Plans

1. Trade Free Plan

Kotak Securities Trade Free plan is for online traders who can trade by themselves with little
or no assistance from the broker. This plan offers brokerage-free intraday trading across
Equity (Cash), Equity Derivatives (F&O), Currency, and Commodity. Brokerage for delivery
trades in Equity (Cash) and Commodity segment is charged at 0.25% of the transaction value.
This brokerage is subject to a minimum brokerage of Rs 20 per executed order.

2. Dealer Assisted Plan

Kotak Securities Dealer Assisted Plan is for the trader who needs in-person assistance. This
plan offers a dedicated dealer to plan, discuss & strategize your trades & investments. This
plan charges Rs. 39 per lot for Equity & Commodity options, Rs. 5 per lot for Currency op-
tions, and 0.39% for all delivery trades.

Kotak Securities (Advantages)

1. Kotak Securities website provides wide range of investment options. This includes in-
vestment in equity, IPO's, Bonds, FD's, ETF's, Mutual Funds, Currency Derivatives
etc.
2. Along with the online trading facility, customer gets access to 1400+ branches for
help on investment and issue resolution.
3. Kotak Securities provide daily SMS alerts, market pointers, periodical research re-
ports, stock recommendations etc. to help the customers.
4. Online Chat facility is available to support customer.
5. Kotak security offers easy integration of trading account with Citibank, HDFC Bank,
UTI Bank and Kotak Mahindra Bank.

Kotak Securities (Disadvantages)

1. High Investments in Research and Development

2. Tax Changes and Tax Laws

3.8 HDFC SECURITIES

HDFC securities Limited is a financial services intermediary and a subsidiary of HDFC

Bank, a private sector bank in India. It is one of the leading stock broking companies in India
and have completed 15 years in operation. HDFC securities was founded in the year 2000 and
is headquartered in Mumbai with branches across major cities and towns in India.

HDFC Securities(HDFCsec) is Equity Trading Company of HDFC Bank. HDFC Securities

provide both online trading and trading on phone. The HDFC Securities trading account has a
unique 3-in-1 feature that integrates your HDFC Securities trading account with your existing
HDFC bank savings account and existing Demat account. Funds / shares are seamlessly
moved from the linked Demat/Bank account to execute the transactions.

HDFCsec provides Cash-n-Carry on both NSE and BSE, Day trading on both NSE and BSE,
Trade on Futures & Options on the NSE and Online IPO Investment.

Features on HDFC Securities Online trading

 Seamless Transactions - By integrating your accounts, we ensure minimal waste of

time during movement of your funds and shares.

 Speed - Orders are placed electronically, so proceeds are available instantly.

 No manipulation - To prevent any mismanagement, we will send you an email con-

firmation, the minute your order is executed.

 Safety and Security - HDFC Securities offer the highest level of security such as 128-
bit encryption technology.

 Dedicated and Separate contact numbers - for trading over the phone as well as for
customer care.

HDFC Bank's 3-in-1 Account offers seamless investment opportunity. It is combination of a

bank account, a trading account and a demat account. All these account are linked together
and operate seamless as 1 account.

When a customer buy a stock, the money is withdrawn from bank account and shares are de-
posited in demat account. In the same way when shares are sold using trading account, the
shares are withdrawn from demat account and money gets deposited in HDFC Bank account.

HDFC Securities (Advantages)

1. Integrated 3-in-1 account (banking, broking, and demat accounts) is available. This
makes HDFC extremely convenient trading platform.
2. Investment online in IPOs, Mutual Funds, GOI Bonds, Insurance and Postal Savings
Schemes all from one website.
3. Trading is available in both BSE and NSE.
4. Excellent trading platform for beginners.

HDFC Securities (Disadvantages)

1. HDFC Sec brokerage is very high and not negotiable.
2. HDFC doesn't offer commodity trading. You cannot trade at MCX or NCDEX through
HDFC.
3. In the 3-in-1 account, the Demat Account has to be opened with HDFC Bank Ltd as
the Depository Participant (DP) and the Bank Account has to be opened with HDFC
Bank as the Banker.
4. HDFC minimum brokerage charge is Rs 25 per trade which is very high. The most dis-
count broker doesn't have a minimum brokerage.
5. HDFC charges flat Rs 0.05 per share brokerage on stocks quoting up to Rs 10. This
makes it very difficult to trade in penny stocks.

3.9 ZERODHA
Zerodha is an Indian financial service company (member of NSE, BSE, MCX, MCX-SX)
that offers brokerage-free equity investments, retail and institutional broking, currencies
and commodities trading, and mutual funds. Founded in 2010, Zerodha is known for its
discount pricing model and innovative use of technology. It is headquartered
in Bangalore and has physical presence in all major Indian cities.  As of 2017, it is the
largest discount broker in India. And contributes up to 5% of retail trading volumes on Indian
stock exchanges, generating daily trading turnovers crossing $2 billion.

Zerodha is India's No. 1 stockbroker. It is largest and most popular broker offering online flat
fee discount brokerage services to invest in Equity, Currency, Commodity, IPO and Direct
Mutual Funds.

Zerodha charges Rs 0 brokerage for equity delivery trades and direct mutual funds. For
intraday and F&O, it charges flat Rs 20 or 0.03% (whichever is lower) per trade. With
Zerodha, the maximum brokerage you pay for any transaction is Rs 20 for an order (of any
size, amount or segment).

The company claims to be "India's first discount brokerage" having debuted the "discount
broking" model in India that is popular in developed markets. The model exempts customers
from any broking charges on trades and transactions, and favours traders who take
large futures and options provisions. Instead, a flat fee of a maximum of Rs: 20 is applied to a
trade, irrespective of its size. In December 2015, Zerodha became the first Indian stock
broker to offer brokerage and commission-free equity investments.

 The largest stockbroker by active clients, market volume and new customer acquisi-
tion.
 One of the safest, most reliable & trustworthy brokers.
 Offers the most advanced online trading tools.
 Charges zero brokerage fees for Equity Delivery and Mutual Funds.
 The maximum brokerage charged is Rs 20 per trade. You save 60% to 90% on
brokerage in comparison to traditional brokers.
 Offers up to 20x leverage on intraday trading.
 Offers Zero Commission Direct Mutual Funds.
 Suitable for all kinds of investors including active and passive investors, beginners,
active traders and algo traders.

Zerodha has a client base of 6, 00,000+ customers, and handles average daily turnovers of
₹10000 – ₹12000 crores in equities and ₹1000 crores in commodities.  The company offers
commodities trading via its wholly owned subsidiary, Zerodha Commodities Pvt. Ltd. It is
also an official member of NSE's consultative committee for growing business.
In early 2017, Zerodha launched "The Rupee tales", a Box set of five illustrated financial lit-
eracy books for children. Authored by Karthik Rangappa, the books have received critical ac-
claim.
Zerodha is the most technologically advanced stock broker in India. Zerodha has built its own
trading software Zerodha Kite (web and mobile trading app), Coin (mutual fund investment
platform), Varsity (investor education program), Trading Q&A and many other tools.
Zerodha also offers Smallcase (thematic investment platform), Streak (algo & strategy plat-
form), Sensibull (options trading platform) and GoldenPi (bonds trading platform).

Zerodha (Advantages)

1. Most popular Broker - Zerodha is the largest stock broker in India (by the number of active
clients and daily trading volume).
2. Safest, most reliable & trustworthy broker in India
3. Brokerage free Equity Delivery Trades - You don't pay any brokerage when you buy shares
using cash-and-carry (CNC). Delivery trade has no leverage. Once bought, shares get de-
livered to your demat account and if sold, shares will get debited from your demat account.
4. Cheapest share broker in India - They offer services under a simple pricing model. They
charge 0.03% or Rs 20 per executed order, whichever is lower, regardless of the trade size.
The maximum brokerage paid by the customer is Rs 20 per trade.
5. Self-Clearing Broker - Zerodha is a self-clearing broker. They don't charge clearing charges
from customers.
6. Online IPO Application - You can apply for new IPOs (Initial Public Offerings) directly with a
Zerodha account.

Zerodha (Disdvantages)

1. Doesn't provide stock tips, research reports or recommendations.

2. Monthly unlimited trading plans are not available.
3. An additional charge of Rs 50 per executed order for MIS/BO/CO positions which are not
square off by the customer.
4. Call & Trade is available at an additional fee of Rs 50 per executed order.
5. 3-in-1 trading account is not available as Zerodha doesn't provide banking services.
6. Unlike most 3-in-1 accounts providers, Zerodha Back Office (console) is not integrated with
its trading platform. The data in the back office gets updated overnight.
7. BSE NSE IPOs are not available. NSE SME IPOs are available.

3.10 UPSTOX
Upstox is a tech-first low cost broking firm in India providing trading opportunities at unbeat-
able prices. Company provide trading on different segments such as equities, commodities,
currency, futures, options which are available on its Upstox Pro Web and Upstox Pro Mobile
trading platforms.
Upstox is backed by a group of investors including Kalaari Capital, Ratan Tata and GVK
Davix.
The New York-based investment fund is in talks to lead a $150-200 million funding round in
Upstox, according to people briefed on the matter. Tiger Global is an existing investor in the
company with 31% stake.
If the funding round goes through, it will not only make Upstox a unicorn — a privately held
company valued at $1 billion or more—but also ascribe it a valuation that will be signific-
antly higher than in the previous round. Sources privy to the deal details said the Mumbai-
based in .
Upstox trading platform offers trading, analysis, charting and many more rich trading fea-
tures. This platform makes it easy to place orders through mobile phones and web browser.
Upstox trading platform is built on Omnisys NEST OMS (Order Management System) and
Omnisys NEST RMS (Risk Management System).
Trading in Equity F&O, Equity Indra-day, Commodities and Currency Derivatives is avail-
able through Upstox Pro. Upstox Pro is the paid service of Upstox for traders.

Upstox Account Opening Charges: Rs 249

Upstox Demat AMC: Rs 0 (Free)

Upstox Equity Delivery & Intraday Charges

Upstox equity delivery brokerage is Rs 20 or 0.1% whichever is lower per order. Upstox
equity intraday brokerage is Rs 20 per executed order or 0.05% (whichever is lower).

Upstox Equity F&O Charges

Upstox Equity F&O brokerage is Rs 20 per executed order or 0.05% (whichever is lower).

Upstox Currency Charges

Upstox Currency brokerage is Rs 20 per executed order or 0.05% (whichever is lower).

Upstox Commodity Charges

Upstox Commodity brokerage is Rs 20 per executed order or 0.05% (whichever is lower).

Upstox (Advantages)
1. Rs 0 Demat account maintenance charges.
2. Flat Rs 20 per trade brokerage across all segment including delivery, intraday and
F&O at BSE, NSE and MCX.
3. Trailing-Stop/Stop-Loss (SL) is available in both web and mobile.
4. Upstox Pro Web Trading Platform offers multiple indicators to monitor markets on-
the-go.
5. Upstox Option Chain Tool helps traders find out Spot, Future prices, vertical compar-
ison of rates, get details such as circuit levels, Open High Low Close and market
depth.
6. Upstox MF Platform offers 1000's of Mutual Funds to invest in. Customers can
choose Lumpsum or SIP pattern of investing.
7. Margin Against Shares is available.

Upstox (Disadvantages)
1. Equity delivery brokerage is Rs 20 per trade. Most other brokers offer brokerage free
investment in stock market.
2. Good Till Cancelled (GTC) and Good Till Date/Time (GTD) Orders are not available
in Equity Segment. GTC/GTD orders are available in commodity trading.
3. Upstox doesn't offer unlimited monthly trading plans.
4. Additional Rs 20 per executed order is charged for Intraday square MIS/BO/CO or-
ders when they are not square off by the customer.
5. Doesn't provide stock tips or recommendations.

3.11 ANGEL BROKING

Angel Broking's tryst with excellence in customer relations began in 1987. Today, Angel has
emerged as one of the most respected Stock-Broking and Wealth Management Companies in
India. With its unique retail-focused stock trading business model, Angel is committed to
providing ‘Real Value for Money’ to all its clients.

Angel Broking is one of the largest full-service retail brokers in India offering online discount
brokerage services. The company offers a wide range of investment and trading services
including stock and commodity broking, investment advisory services, margin funding, loans
against shares, and financial products distribution.

Angel Broking is a strong neighborhood presence with 110 branches and 11,000 sub-broker
offices in 1800+ cities in India as of June 30, 2018.

In Nov 2019, Angel Broking revamped its brokerage plans to compete with the discount
stock brokers like Zerodha. Angel Broking now offers flat rate brokerage plan 'Angel iTrade
PRIME'. This plan offers to trade in all segments (Intraday, F&O, Currencies &
Commodities) at fixed Rs 20 per trade except Equity Delivery, for Equity Delivery there are
no charges, it is provided for free to all users. The same simple rate is applicable across
exchanges and segments.

Angel ARQ

Angel ARQ is the company's flagship investment advisory tool. It is a rule-based investment
engine (robot) suggesting investment idea to the customers. ARQ offers recommendations for
Equity Stocks and Mutual Funds. It uses advanced technologies like Expert Insights, Machine
Learning, Cognitive Algorithms and Teraflops of processing power.

ARQ is integrated into the trading software offered by Angel. It works as a personal fund
manager for the investors. ARQ is just an advisory tool. It doesn't have any fees or minimum
investment commitments. It is up to the customer to follow ARQ advice.

Angel Broking is famous for its excellent trading software's and investment advisory. Angel
is the first large-size full-service broker offering discount brokerage rates to its customer.

Angel broking offers one simple trading plan 'Angel iTrade' plan. This online trading plan
offers full-service brokerage services with very low brokerage charges which are in line with
discount stock brokers in India.

Angel Broking (Advantages)

 1. Full-service brokerage services are available at ultra-low brokerage fees.
2. Flat fee stockbroker charging Rs 20 per order across segments and exchanges.
3. Free research and advisory. Comprehensive daily, weekly and specialized research re-
ports from Expert.
4. Free trading software (website, mobile, and trading terminal).
5. Verity of investment options like Equity trading, F&O, Commodities, PMS, Mutual
Funds, Insurances.
6. Training and hand holding is available for beginners.
7. Margin trading facility.
8. Securities as collateral.
9. No charges for any fund transfer.

Angel Broking (Disadvantages)

1. Angel Broking doesn't offer 3-in-1 account.

2. Broker assisted trades (Call & Trade) are charged extra Rs 20 per executed order.
 CHAPTER 4
ANALYSIS OF SURVEY FINDINGS
 CHAPTER 5
SUMMARY OF FINDINGS AND
RECOMMENDATIONS

BIBLIOGRAPHY
BOOKS: -
(1) Pandiyan Punithawati, “Security Analysis & Portfolio Management”, Vikas Publishing
House, New Delhi, 2013

(2) E. Fisher Donald and J. Jordan Ronald, “Security Analysis & Portfolio Management”,
Prentice Hall of India, New Delhi, 2012

(3) Sigmund Loral, “Business Research Methodology”, Tunicae House, New Delhi, 2009

(4) Kothari C.R., “Research Methodology: Methods and Techniques”, Wishwa Prkashan,
New Delhi, 2010

MAGAZINES:-
(1) Omkar Goswami, “New Entrants in Sock Trading”, Business Week, October, 2015, page
13.

(2) Rajesh Gajra, “Sebi’s Wake Up call”, Business World, June 2014, page20.

(3) Srikanth Srinivasan, “Increasing competition in Online Trading”, Business Today, March,
2016, page 21.
(4) Abdul Wahid, “High time for brokerage firms”, Mint, September, 2017 page 07

(5) Ankit Singh, “BNP Paribas market now”, Business Today, August, 2016, page 16

JOURNALS:-

(1) Nidhi Walia and Ravinder Kumar, “Online Stock Trading in India: an empirical
investigation”, Indian Journal of marketing, April 2007, page 34-39.

(2) Jayanta Kumar Seal, “Changing Dynamics of Stock Trading”, Portfolio Organizer, Oct.
2007, page 17-25.

(3) Aggarwal Sanjiv, “Stock Trading o Net”, Business Line, Aug. 2000, page 31-37.

(4) Mr. Ajay Kumar, “Comparison of stock Brokers in India”, Indian Journal of Business,
June 1999, page 93-96.

(5) Nidhi Walia, “Online Stock Trading in India: on the road of progress”, Applied finance,
March 2004, page 21-26.
(6) Nay-Fu Chen, Richard Roll and Stephen A. Ross, “Economic Forces and the Stock
Market”, the Journal of Business, Vol. 59, No. 3,383-403, Jul.1986.

INTERNET:-

http://en.wikipedia.org/wiki/Stock_Market

http://surfindia.com/finance/stock-market.html

http://www.moneycontrol.com

http://www.sebi.gov.in

http://nseindia.com

http://bseindia.com

http://www.adigitalblogger.com/trading/zerodha-reviews/

https://www.chittorgarh.com/report/top_10_full_service_brokers_by_clients_at_nse/5/
#:~:text=Zerodha%20(%E2%82%B920%2Ftrade),trade)%20More%20Brokers...

https://corporatefinanceinstitute.com/resources/knowledge/finance/secondary-market/

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7414361/