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Project Report on
POTFOLIO MANAGEMNT AND FOREX
By
MUKUL KUJUR
MBA (2009-11)
University Roll no 093
Industry Guide Faculty Guide
Mr Nesar Ahmad Mr Anubhav Verma
Sales Manager Faculty Accounts/Finance
INTERNATIONL INSTITUTE OF BUSINESS STUDIES
NOIDA -Sec 63,U.P.
ACKNOWLEDGEMENTI would like to express my acknowledgement to those people, without whose contribution , constant support and guidance this report would not have seen the light of the day .
Notable among them are Mr.Purushottam Kumar (Area Sales Manager, Laxminagar), and Mr.Nesar Ahmed (Sales Manager, Laxmi Nagar) who was my Project Guide and who helped me in a lot.
I am also thankful to all other employees of Religare who guide me during my project .
I am also thankful and would like to express my Gratitude to the Mr Anubhav Verma (Faculty of Accounting and Finance) and the entire Institute for giving me a platform to have this wonderful opportunity an being able to get a glimpse of the corporate World.
With Regards,
Mukul Kujur
CONTENT
S.no TITLE Pg.no
1 INTRODUCTION
2 MISSION & VISION
3 STRUCTURE
4 BRAND IDENTITY
5 GLOBAL NETWORK
6 COMPANY PROFILE
7 LOGOS
8 LEADERSHIP TEAM
9 INVESTMENT
10 DEPOSITORY
11 MAJOR STOCK EXCHANGE IN INDIA
12 TYPES OF TRADING
13 RELIGARE TRADING PLAN
14 COMPETETORS OF RELIGARE
15 PORTFOLIO MANAGEMENT
16 FOREX
17 FOREIGN EXCHANGE
18 FOREX TRADING IN INDIA
19 FINDINGS
20 CONCLSION
21 BIBLIOGRAPHY
INTRODUCTIONReligare is a global financial services group with a presence across Asia, Africa, Middle East, Europe, and America. In India, Religare is the largest market the group offers a wide array of products and services ranging from insurance , assets management, broking and lending solutions to investment banking and wealth management.
Religare Securities Limited(RSL), a 100% subsidiary of Religare Enterprises Limited is a leading equity and security firm in India. The company currently handles sizeable volumes traded on NSE and in the realm of online trading and investments; it current holds a reasonable share of the market .The major activity and offerings of the company today are the equity Broking, Depository Participants Services, Institutional Broking and Research Services.
RSL is a member of the National Stock Exchange of India, Bombay Stock Exchange of India, Depository Participant with National Securities Depository Limited and Central Depository Services.
Religare has been constantly innovating in the terms of the product and services and to offer such incisive services to specify user segments it has also started the NRI, FII, HNI and Corporate Servicing groups. These groups take all the portfolio investment decisions depending upon a client’s risk/return parameter.
Religare has a very credible Research and Analysis division, which not only caters to the need of our Institutional clientele, but also gives their valuable inputs to investment dealers.
VISION AND MISSION
Vision
"To be the leading emerging markets financial services group driven by
innovation, delivering superior value for all stakeholders globally".
Mission
To be India’s first Multinational providing complete financial services
solution across the globe.
STRUCTURE
Religare Enterprises Limited
Religare AMC Limited Asset Management Business Portfolio Management
AEGON Religare Life Insurance Co. Ltd. Life Insurance Company, JV with Aegon(26%),
Religare(44%), and Bennett & Coleman(30%)
Religare Macquarie Wealth Mgmt. Ltd. JV with Macquarie for Wealth Management Business.
Religare Securities Limited Retail Equity Broking Online Investment Portal
Depository Services
Religare Commodities Limited Commodity Broking Business.
Religare Capital Markets Limited
PE and M&A Advisory Institutional Broking
Investment Banking
Religare Finvest Limited Lending and Distribution business.
Religare Insurance Broking Limited Life Insurance Broking Business. Non-Life Insurance Broking Business.
Religare Arts Initiative Limited Business of Art Art Gallery
Art Advisory
Religare Venture Capital Limited Private Equity and Investment Manager.
Vistaar Religare Capital Advisors Ltd. JV with Vistaar Entertainment Ventures for film fund. India's first ever film fund.
Religare - Milestone
JV with Milestone Capital to manage a healthcare and education fund.
Religare Finance Ltd.
Capital Market Financing
BRAND IDENTITY
Name
Religare is a Latin word that translates as 'to bind together'. This name has been chosen to reflect the integrated nature of the financial services the company offers.
Symbol
The Religare name is paired with the symbol of a four-leaf clover. Traditionally, it is considered good fortune to find a four-leaf clover as there is only one four-leaf clover for every 10,000 three-leaf clovers found.
For us, each leaf of the clover has a special meaning. It is a symbol of Hope. Trust. Care. Good Fortune.
For the world, it is the symbol of Religare.
The first leaf of the clover represents Hope. The aspirations to succeed. The dream of becoming. Of new possibilities. It is the beginning of every step and the foundation on which a person reaches for the stars.
The second leaf of the clover represents Trust. The ability to place one’s own faith in another. To have a relationship as partners in a team. To accomplish a given goal with the balance that brings satisfaction to all, not in the binding, but in the bond that is built.
The third leaf of the clover represents Care. The secret ingredient that is the cement in every relationship. The truth of feeling that underlines sincerity and the triumph of diligence in every aspect. From it springs true warmth of service and the ability to adapt to evolving environments with consideration to all.
The fourth and final leaf of the clover represents Good Fortune. Signifying that rare ability to meld opportunity and planning with circumstance to generate those often looked for remunerative moments of success.
Hope. Trust. Care. Good Fortune. All elements perfectly combine in the emblematic and rare, four-leaf clover to visually symbolize the values that bind together and form the core of the Religare vision.
Accent usage The diacritical tilde mark ( ˜ ) over the letter A in the Religare
typeface indicates a palatal emphasis sound of the letter A. Pronunciation rel•i•ga•re (rel'i-gâir)
GLOBAL NETWORK
We operate across multiple locations & countries
COMPANY PROFILEIndustry : Finance - General BSE Code : 532915 Book Closure : 11/08/2010 Group : Religare NSE Code : RELIGARE Market Cap :
Rs. 6,529.50 Cr. ISIN No : INE621H01010 Market Lot : 1 Face Value : Rs. 10.00
Registered & Corporate Office Registrar & Share Transfer Agent
D3, P3B, District Centre, Saket, New Delhi, Delhi - 110017
Tel : +91 11 39125000Fax : +91 11 39126050Email : [email protected]: www.religare.in
D3, P3B, District Centre, Saket,New Delhi, Delhi - 110017 Tel : +91 11 39125000 Fax : +91 11 39126050 Email : [email protected]
Key Officials
Name Designation
Sunil GodhwaniRajesh Doshi
Chairman and Managing directorCo. Secretary & Compl. Officer
Other Details
Listings Incorporation Public Issue Date
BSE , NSE 30/01/1984 29/10/2007
Investor contacts
Name Address Office of Investor Relations Institutional and Investor Relations,
Religare Enterprises Limited,A3, A4, A5, GYS Global, Sector-125, Noida-201301 E-mail: [email protected]
For General inquiries E-mail: [email protected] and / or [email protected]
For Compliance matters Mr. Ravi BatraCompany Secretary & Compliance Officer 19, Nehru Place, New Delhi 110019E-mail: [email protected]
For Securities held in Physical form Karvy Computershare Private Limited Plot No. 17 to 24, Vithalrao Nagar,Madhapur, Hyderabad 500081, India E-mail: [email protected]
For Securities held in Demat form To the Investors' Depository Participant (s) and/or Karvy Computershare Private Limited
Industry :
Finance – GeneralBSE Code :
532915Book Closure :
11/08/2010
Group : ReligareNSE Code :
RELIGAREMarket Cap :
Rs. 6,717.65 Cr.
ISIN No : INE621H01010Market Lot :
1Face Value :
Rs. 10.00
Religare Enterprises Ltd. As of Feb 22, 201110:49AM IST
Exchange Current Prev Close
Todays High
Todays Low
52 Week High
52 Week Low
Volume
BSE 483.95 482.50 483.95 480.60 528.80 354.00 256
NSE 482.00 482.40 484.50 481.50 528.95 353.95 1,017
Exchange: BSE Start Date: 23-1-2011
End Date : 22-2-2011
LOGOS
LEADERSHIP TEAM
Mr. Sunil GodhwaniChairman and Managing Director,Religare Enterprises Limited
Mr. Sunil Godhwani, Chairman and Managing Director, Religare Enterprises Limited (REL), is the driving force behind the company. A man with a vision to create a global business of excellence, he is the inspiration to all as he spearheads the company’s management and global operations; strategizing and directing it through its next phase of growth.
Sunil brings to the table strong leadership skills, vigor and a passion for excellence. He believes in nurturing a culture that is entrepreneurial, result oriented, customer focused and based on teamwork. He has given strategic direction to Religare’s growth since his joining in 2001. He has been instrumental in establishing Religare’s vast network and shaping the Company’s strategies in India and abroad. He is on a constant lookout for taking the Company to new heights by managing various acquisitions, finding new partners for joint ventures and scouting new avenues for the business. Under his able leadership, REL is well poised to be a leading emerging markets financial services group, with a significant presence in more than 12 countries across Asia, Africa, Middle East, Europe and the Americas. With over 10,000 employees, Religare currently serves over a million customers.
Sunil has a diverse and wide-ranging experience of over two decades in managing large scale businesses, he also serves as Director on the Boards of various group companies like Dion Global Solutions (formerly Religare Technova Limited), Super Religare Laboratories Limited, Religare Macquarie Wealth Management Limited, AEGON Religare Life Insurance Company Limited, Religare Voyages Limited, Fortis Healthcare Limited and other subsidiaries/ Group companies of Religare.
A powerful orator and a great motivator, Sunil has been awarded with
many awards and accolades. Recently he has been awarded ‘India Business Leader of the Year’ award at the Global Indian Business Meeting hosted by Horasis, in Madrid, Spain and “CEO of the year Award” at CEO CLUBS INTERNATIONAL Awards.
Born in New Delhi, Sunil completed his schooling from the prestigious St. Columbas School post which he went abroad for higher studies. He holds a B. Sc. Degree in Chemical Engineering and a M.Sc. in Industrial Engineering & Finance from Polytechnic Institute of New York. He loves Chinese food and is an avid sports enthusiast with interests in Cricket, Table Tennis and Golf.
Mr. Anuj GulatiChief Executive Officer Religare Health Insurance Co. Ltd.
In his capacity of CEO, Anuj would be responsible for setting up this business and work towards making Religare as one of the dominant players in the Indian Health Insurance industry.
His last assignment was with ICICI Lombard General Insurance Co. Ltd., India as “Director - Service and Business Development”. He was reporting directly to the MD & CEO and was responsible for Product Development, Pricing, Underwriting, Claims, Operations, Technology, Administration , Marketing & Corporate Communications. Apart from heading these functions Anuj also had complete business responsibility for the online and rural business.
Prior to ICICI Lombard his key assignments have been: As a financial analyst with Procter & Gamble India Ltd Strong entrepreneurship experience as CEO of Labprocure India Pvt Ltd.
Anuj is a Chemical Engineer from IIT Delhi and is an MBA from IIM Bangalore.
Mr. Amit Sarup President –Religare Art & Family OfficeReligare Enterprises Limited
Mr. Amit Sarup currently carries the overall responsibilities of leading Religare Art business and managing the Family Office function. Mr. Sarup joined the group in September 2005 and has since then worked in various capacities with the firm. In his previous role as President – Private Equity, he has been instrumental in strategizing and launching the group’s private equity business. He serves as a member of the Board of Directors for Milestone Religare Investment Advisors Pvt. Ltd and is a permanent invitee on the investment committee of the fund. Earlier to that, as Head of Wealth Management, he has been responsible for setting up and running the wealth management vertical and post the joint venture with Macquarie, has served as the whole time director on the board of Religare Macquarie Wealth Management till recently.
Prior to joining Religare, he was Vice-President, Wealth Management at the Kotak Mahindra Bank Ltd and held several key positions there from 2000 to 2005. Earlier to that he has worked with institutions such as IL&FS Investmart, Vickers Ballas Securities Ltd and Ranbaxy. He has over 18 years of experience in the equity capital markets and financial services industry in areas of equity research, funds management, equity broking and sales.
Amit has received a bachelor’s degree in commerce from the University of Delhi and a master’s degree in business administration from the Institute of Management Technology, Ghaziabad, India.
INVESTMENTThe dictionary meaning of investment is to commit money in order to earn a financial return or to make use of the money for future benefits or advantages. People commit money to investments with an expectation to
increase their future wealth by investing money to spend in future years. For example, if you invest Rs. 1000 today and earn 10 %over the next year, you will have Rs.1100 one year from today. An investment can be
described as perfect if it satisfies all the needs of all investors. So, the
starting point in searching for the perfect investment would be to
examine investor needs. If all those needs are met by the investment,
then that investment can be termed the perfect investment. Most
investors and advisors spend a great deal of time understanding the merits of the thousands of investments available in India. Little time, however, is spent understanding the needs of the investor and ensuring that the most appropriate investments are selected for him.
THE INVESTMENT NEED OF AN INVESTOR
By and large, most investors have eight common needs from theirinvestments:1. Security of Original Capital;2. Wealth Accumulation;
3. Comfort Factor;
4. Tax Efficiency;
5. Life Cover;
6. Income;
7. Simplicity;
8. Ease of Withdrawal;
9. Communication.
Security of original capital: The chance of losing some capital has been
a
primary need. This is perhaps the strongest need among investors in
India,
who have suffered regularly due to failures of the financial system
Wealth accumulation: This is largely a factor of investment
performance,
including both short-term performance of an investment and long-
termperformance of a portfolio. Wealth accumulation is the ultimate
measure ofthe success of an investment decision.
Comfort factor: This refers to the peace of mind associated with an
investment. Avoiding discomfort is probably a greater need than
receivingcomfort. Reputation plays an important part in delivering the
comfort factor.
Tax efficiency: Legitimate reduction in the amount of tax payable is an
important part of the Indian psyche. Every rupee saved in taxes goes
towards wealth accumulation.
Life Cover: Many investors look for investments that offer good return
with adequate life cover to manage the situations in case of any
eventualities.
Income: This refers to money distributed at intervals by an investment,
which are usually used by the investor for meeting regular
expenses.Income needs tend to be fairly constant because they are
related to lifestyle and are well understood by investor.Simplicity: Investment instruments are complex, but investors need tounderstand what is being done with their money. A planner should alsodeliver simplicity to investors.Ease of withdrawal: This refers to the ability to invest long term but
withdraw funds when desired. This is strongly linked to a sense
ofownership. It is normally triggered by a need to spend capital,
changeinvestments or cater to changes in other needs. Access to a long-
terminvestment at short notice can only be had at a substantial cost.Communication: This refers to informing and educating investors aboutthe purpose and progress of their investments.The need to communicateincreases when investments are threatened
DEPOSITORYRSL provides depository services to investors as a Depository Participant with NSDL and CDSL.
The Depository system in India links issuers, Depository Participants, Depositories National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) and clearing houses / clearing Corporation of Stock Exchanges. These facilitate
holding of securities in dematerialized form and securities transactions are processed by means of account transfers.
Our customer centric account schemes have been designed keeping in mind the investment psychology. With a competent team of skilled professionals, we manage over 5,00,000 accounts and have a dedicated customer care centre, exclusively trained to handle queries from our customers. With our country wide network of branches, you are never far from Religare depository services.
Religare’s depository service offers you a secure, convenient, paperless and cost effective way to keep track of your investment in shares and other instruments over a period of time, without the hassle of handling physical documents. Your DP account with us takes care of your depository needs like dematerialization, rematerialisation, transfer and pledging of shares, stock lending and borrowing.
Your demat account is safe and absolutely secure in our hands, every debit instruction is executed only after its authenticity is established. Our hi-tech in-house capabilities cater to the needs of software maintenance,
database administration, network maintenance, backups and disaster recovery. This extra cover of security has gained the trust of our clients.
MAJOR STOGK EXCHANGE IN INDIA
NSE
The National Stock Exchange (NSE) is a stock exchange located at Mumbai, 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%.
BSE
The Bombay Stock Exchange (BSE) (Marathi Bombay Śhare Bāzaār) (formerly, The Stock Exchange, Bombay) 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. It has also been cited as one of the world's best performing stock market.
As of December 2010, there are over 5,034 listed Indian companies and over 7700 scrips on the stock exchange, the Bombay Stock Exchange has a significant trading volume. TheBSE SENSEX (SENSitive indEX), also called the "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.
TYPES OF TRADING
INTRADAY:- refers to the practice of buying and selling financial instruments within the same trading day such that all positions are usually closed before the market close for the trading day. Traders that participate in day trading are called active traders or day traders.
Some of the more commonly day-traded financial instruments are stocks, stock options, currencies, and a host of futures
contracts such asequity index futures, interest rate futures, and commodity futures.
Day trading used to be an activity exclusive to financial firms and professional investors and speculators. Indeed, many day traders are bankor investment firm employees working as specialists in equity investment and fund management. However, with the advent of electronic trading and margin trading, day trading has become increasingly popular among at-home traders.
DELIVERY: Delivery based trading means buying shares and holding them for certain period of time is called delivery based trading.The shares you bought will be in your demat account. Once you take delivery of shares you can hold them as long as you want. To take delivery of shares, you must have sufficient funds in your account. You don’t get any margin to buy shares in delivery.If you have Rs.5000 means you can buy shares worth of Rs.5000 and not more than this.
DERIVATIVES:- A derivative is a financial instrument (or, more simply, an agreement between two parties) that has a value, based on the expected future price movements of the asset to which it is linked called the underlying asset such as a share or a currency. There are many kinds of derivatives, with the most common being swaps, futures, and options. Derivatives are a form of alternative investment.
A derivative is not a stand-alone asset, since it has no value of its own. However, more common types of derivatives have been traded on markets before their expiration date as if they were assets. Among the oldest of these are rice futures, which have been traded on the Dojima Rice Exchange since the eighteenth century.
Common derivative contract types
There are three major classes of derivatives:
1.Futures/Forwards are contracts to buy or sell an asset on or before a future date at a price specified today. A futures contract differs from a forward contract in that the futures contract is a standardized contract written by a clearing house that operates an exchange where the contract can be bought and sold, whereas a forward contract is a non-standardized contract written by the parties themselves.
2.Options are contracts that give the owner the right, but not the obligation, to buy (in the case of a call option) or sell (in the case of aput option) an asset. The price at which the sale takes place is known as the strike price, and is specified at the time the parties enter into the option. The option contract also specifies a maturity date. In the case of a European option, the owner has the right to require the sale to take place on (but not before) the maturity date; in the case of an American option, the owner can require the sale to take place at any time up to the maturity date. If the owner of the contract exercises this right, the counter-party has the obligation to carry out the transaction.
3.Swaps are contracts to exchange cash (flows) on or before a specified future date based on the underlying value of currencies/exchange rates, bonds/interest rates, commodities, stocks or other assets.
More complex derivatives can be created by combining the elements of these basic types. For example, the holder of a swaption has the right, but not the obligation, to enter into a swap on or before a specified future date.
COMPETETORS OF RELIGARE
Company Background:
India Infoline was founded in 1995 and was positioned as a research firm. In 2000 e-broking was started under the brand name of 5 paisa.com. A part from offering online trading in stock market the company offers mutual fund online. It also acts as a distributer of various financial services i.e. GOI securities ,Company Fixed Deposits, Insurance. It has a limited ground network, present in 20 cities.
Online Account Type
Investor Terminal: Investors /Students
Trader Terminal: Day Traders/HNI’s
Pricing for retail clients
Investor Terminal:-
Account Opening: Rs 500
Demat 1st year: Rs 250
Initial Margin: Rs 2500(Compulsory)
Min Margin Retainable: Rs 100
Brokerage:
Trading 0.10% each side + ST
Delivery 0.50% each side + ST
Kotak Securities
Company Backround
Kotak Securities limited is a joint venture between Kotak Mahindra bank and Goldman Sachs.
Online Account Type
Free Way: Flat Rs 999 Cover Charges p.m. 0.03% per transaction
High Trader: 6 Times Exposure Cash & Derivatives, Auto sq off 2:55
Pricing of Kotak
Account opening: Rs 500
Demat: Rs 22.5 p.m.
Initial Margin: Rs 5000(Compulsory)
Min Margin Retainable: Rs 1000
Brokerage Slab wise: Higher the Volume, Lower the brokerage. Even older customers (on 0.25% & 0.40% ) have been moved to the slab wise structure.
India Bulls
Company Background
India Bulls is a retail financial services company present in 70 locations covering 62 cities. It offers a full range o financial services and product ranging from Equities to Insurance. 450+ Relationship Managers who act as personal financial advisors.
Online Account Type
Signature Account: Plain Vanilla Account with focus on Equity Analysis. The equity analysis is a paid service even for A/c holders.
Power India bulls: Account with sophisticated trading tools, low commission and priority to RM.
Pricing of IB Accounts
Signature Account
Account Opening: Rs 250
Demat : Rs 200 if POA is signed, No AMC for this DP
Initial Margin: NIL
Brokerage: Negotiable
Power India Bulls
Account Opening: Rs 750
Demat: Rs 200 if POA is signed, NO AMC for this DP
Initial Margin: NIL
Brokerage: Negotiable
ICICI DIRECT
Company Background
ICICI Web Trade Limited (IWTL) maintains ICICI direct.com. IWTL is an affiliated of ICICI Bank Limited and the Website is owned by ICICI Bank Limited.
Account Type:
ICICI Direct e-invest Account:
Premium trading interface of ICICI Direct Link is giving to DBC partners and HNI’s Plain Vanilla Account with focus on 3 in 1 advantage. Differentiated in services within the account.
Cash on Spot
Margin Plus
Account Opening: Rs 750
Schemes: For short periods Rs 750 is refundable against brokerage generated in a qtr. These schemes are introduced 3-4 times a year.
Demat: NIL, 1st year charges including in Account Opening Plus a facility to open additional 4 DP’s without 1st year AMC.
Initial Margin: NIL
Brokerage: All brokerage is inclusive of stamp duty and exclusive of other taxes. Slab wise brokerage ranges from 0.75% to 0.25% depending on volume.
Sharekhan
Company Background
Sharekhan is online stock trading company of SSKI Group, provider of India-based investment banking and corporate finance services. Sharekhan is one of the largest broking houses in the country. S.S. Kantilala Ishwarlal Securities Limited (SSKI) has been among India’s leading broking houses for more than a century.
Types of Account:
Sharekhan Classic account
Sharekhan SpeedTrade account
Brokerage: Some stock trading charges direct percentage while others a fixed amount per Rs 100. Sharekhan charges 0.50% for inter day and 0.10% for intra day .
Comparison Table of Brokerage in India
Online Broker Brokerage for DeliveryBrokerage for Intraday
tradingMMC*
SBICAP Securitiesbrokerage charges
0.50% 0.10% NIL
Sharekhanbrokerage charges
0.03% - 0.50% 0.03% - 0.10% NIL
Motilal Oswalbrokerage charges
0.30% - 0.50% 0.03% - 0.15%
5 paisabrokerage charges
0.25% - 0.85% 0.07%
Angel Brokingbrokerage charges
0.50% 0.02% - 0.03%
ICICI directbrokerage charges
0.75% 0.15%
Indiabullsbrokerage charges
0.25% - 0.50% 0.05% - 0.10%
HDFC Securitiesbrokerage charges
0.50% 0.15%
UTI Securitiesbrokerage charges
0.80% 0.15%
Religarebrokerage charges
0.20% - 0.30% 0.02% - 0.03%
Reliance Moneybrokerage charges
0.01% 0.01% card system
Geogitbrokerage charges
0.30% 0.03%
Indiainfolinebrokerage charges
0.50% 0.10% -
MMC=Minimum monthly commitment.
Brokerage is usually negotiable: Several of you trying to choose an online broker and open an online trading account must have been frustrated trying to search for the exact brokerage charges charged by various online brokers. But the fact is the brokerage charged by the same broker varies and in several cases is negotiable. For example if you go and tell a brokerage house that you are going to deposit 2 lakh rupees and try to convince them you are going to trade heavily, they might consider reducing your brokerage. That is why in the above table you will find only a range for the brokerage charges in some cases. But that should be enough to get an idea.
Effective brokerage with taxes is more: In addition to the above brokerage charges you will have to pay STT (Securities Transaction Tax) at the rate or 0.02% of the total transaction amount. You will also be charged 12.5% Service Tax on the brokerage amount (and not on the transaction amount). For example, if your brokerage is 0.50% for delivery and you do a delivery transaction of Rs.100/- then the total brokerage you pay is0.50 (brokerage) + 0.02 (stt) + 0.063 (service tax) = 0.58 .Thus your effective brokerage (including all taxes) will be 0.58%. Similarly for brokerage on intraday transactions.
PORTFOLIO MANAGEMENT
What Does Portfolio Management Mean?The art and science of making decisions about investment mix and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing risk against. performance.
Portfolio management is all about strengths, weaknesses, opportunities and threats in the choice of debt vs. equity, domestic vs. international, growth vs. safety, and many other tradeoffs encountered in the attempt to maximize return at a given appetite for risk.
There are few points that shoud be kept in Mind before making Portfolio:1.Never make Portfolio on one group of companies.2. Never let one industry dominate the portfolio.3.The third rule is to have mixed instrument Many people prefer keeping only stock on their portfolio .This is done with the hopes of earning super normal returns on their investments.4. The last rule is to put a circuit breaker on the number of instruments.
Religare Portfolio Management Services Religare Portfolio Management Service is offered by Religare Asset Management Company Limited, promoted by the Religare Group, one of the leading integrated financial services groups in India. The businesses of the Religare Group extend across three key verticals; the Retail, Institutional and Wealth spectrums, catering to a diverse and wide base of clients. Religare, with its pan India and global footprint,offers a diverse bouquet of investment offerings and financial services.
PORTFOLIO CONSTRUCTION
Idea GenerationBased on the fund objective, we start filtering down the possible investment universe to more attractive opportunities. The process involves Company, Industry, Economic and Technical analysis in alignment with the investment objective of the underlying fund. The fund's investment objective has implications for definition of the universe, company selection, industry and asset allocation
Matrix AnalysisAs part of the Matrix approach we analyze, bottom up, the fundamentals of the companies that are part of the universe. We use external research and find it useful as a source of information and financial models. However, we believe our direct and in-depth interaction with a company and its competitors, suppliers and buyers - wherever feasible and possible, helps us arrive at our own unique insight into the company. The maximum inefficiency in the markets is at the company level, and an in-depth research effort can generate a knowledge advantage and superior performance.
To this, we add our top down economic views and industry views - leading to industry and asset allocation decisions. The economic and industry analysis also has its implications on company selection. Technical analysis is another input for asset allocation decisions. All of this is in keeping with the investment objective of the specific fund
Security SelectionTo help select stocks for the portfolio, we use a proprietary stock categorization system. The objective of our stock categorization system is to enable us to identify stocks that are likely to be the best investments from within our universe. Each category of stock has a description of fundamental attributes that we expect the company to possess.
The categorizations are as follows:Stock Descriptions Growth Company Financial
Category (eg.)Prospects
(eg.)Attribute (eg.)
Parameter
(eg.)
Star Young companies High growthEntrepreneur
vision, scalability
Operating
Leverage
LeaderEstablished
companies
In line or
better than
industry
Track record of
leadership, globally
competitive
Industry
leading margin
/ ROE
Warrior
Young /
established
companies
Better than
industry
Unique proposition
and / or right place,
right time
Margin & ROE
expansion
DiamondCompany with
valuable assetsLow growth
Management intent
to unlock value
Value of
asset /
business
Frog Prince
Company in a
turnaround
situation
Back to
growth
Intrinsic strengths
in core business
P2P, ROE
expansion
ShotgunOpportunistic
investment
Positive
surprise
Corporate event,
restructuring,
earnings news
Event visibility
CommoditiesCall on the cycle
is paramountPositive
Integration, cost
efficiency, globally
competitive
Profit leverage
* P2P - Path to Profit, ROE - Return on Equity
Stocks that fit into one of these categories typically display superior return profiles, but more importantly this enables fund managers to focus on the attributes that drive stock price performance and keep a watch for red flags.
Portfolio ConstructionThe fund manager has the primary responsibility for portfolio construction based on the investment objective of the Fund. Portfolio construction guidelines are laid down for each fund and reviewed on a need basis and otherwise regularly on a quarterly
basis. Every investment decision we make is by keeping in mind the investment objective of the fund and how the security will affect the overall portfolio. In addition, we also look into the current Economic / Industry views that impact industry and asset allocation decisions for the fund. Technical views which are relevant to asset allocation, if applicable are also taken into consideration. Our preference is for companies with the characteristics as defined in our stock categorization framework.
Sell DisciplineWe may sell a stock because the fundamentals of a company, industry or economy have changed or a company's competitive advantage appears to have deteriorated. It could also be a function of alternative opportunities being available at a more attractive valuation or an inability to justify prevailing valuations.
OversightThe role of monitoring and reviewing is undertaken by the investment committee consisting of Chief Executive Officer , Head - Equity Funds, Head- Fixed Income and Head- Compliance and by any additional member which may be included/ nominated to the committee which meets on a periodic basis. The committee is empowered to establish internal norms such as industry allocation, asset allocation etc for each fund and to monitor and review this on an ongoing basis.
Fixed Income
Fund ObjectiveThe fund objective is the basis for investment management for all schemes. The mandate of the fund including asset allocation framework, duration limit etc. as defined in the offer document of the fund acts as the building blocks for portfolio construction and maintenance activities.
Interest Rate ViewOur views on the interest rate are based upon extensive fundamental research by adopting a Top-Down approach. Fundamental analysis has a thorough coverage on the macro variable of the economy, relative value analysis within the asset class and between asset classes, portfolio stress testing and scenario analysis and scheme’s performance monitoring vis-à-vis its defined benchmark.
Security SelectionSelection of the security for the purpose of portfolio construction would greatly depend on the asset allocation pattern of the scheme as defined in the offer document. Security would be selected based on asset allocation optimization to deliver superior returns.
Duration ManagementThe duration of each portfolio is actively managed depending on the interest rate view.
Portfolio PerformanceThe endeavor of each fund is to deliver superior returns. Duration
management, Asset Allocation optimizing and relative value analysis would be the key to delivering superior returns.
FOREX
FOREX — the foreign exchange (currency or Forex, or FX) market is the biggest and the most liquid financial market with the daily volume of more than $3.2 trillion. Trading on this market involves buying and
selling world currencies taking the profit from the exchange rates difference. Forex trading can yield high profits, but it is also very risky.
ADVANTAGES OF FOREX:
1. Low margin2. No commission and no exchange fees
3. Limited Risks and guaranteed stops
4. Rollover of positions
5. 24-hour marketplace
6. Free market place
FOREIGN EXCHANGEThe foreign exchange market is worldwide decentralized over the counter financial market for the trading of currencies. The primary purpose of the foreign exchange market is to assist international trade and investment, by allowing businesses to convert one currency to another currency. The forex market is the largest , most liquid market in the world with an average traded value that exceeds $1.9 trillion per day and included all of the currencies in the world.
CURRENCIES AND THEIR SIGNIFICANCE:
USD
The United States dollar (USD) is the official currency of the United States. The U.S. dollar is normally abbreviated as the dollar sign $, or as USD or US $ to distinguish it from other dollar- denominated currencies and from others that use the $ symbol. It is divided into 100 cents. The U.S. dollar is the currency most used in international transactions. Several countries use it as their official currency, and in many others it is the de factor currency, and is also used as the sole currency in some British Overseas Territories.
GBP
The pound sterling (GBP), commonly called the pound, is the currency of the United Kingdom, its crown dependencies (The Isle of Man and the Channel Islands) and the British Overseas Territories of South Georgia and the South Sandwich Island, British Antarctic Territory and Tristan da Cunha. It is subdivided into 100 pence. Sterling is the third largest reserve currency, after the US dollar and the Euro. The Pound Sterling is also the fourth most traded currency in the foreign exchange market.
EURO
The Euro (EUR) is the official currency of the Euro zone: 16 of the 27 Members States of the European Union (EU) and is the currency used by the EU institutions.
The Euro zone consists of Austria, Belgium, Cyprus , Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain. The currency is also used in a further five European countries, with and without formal agreements, and is consequently used daily by some 327 million Europeans. Over 175 million people worldwide use currencies, which are pegged to thye euro, including more than 150 million people in Africa.
The Euro is the second largest reserve currency ( a status it inherited from the German mark) as well as the second most traded currency in the world after the US dollar.
YEN
The Yen (JPY) is the currency of Japan. It is the third most-traded currency in the foreign exchange market after the US dollar ant the Euro. It is also widely used as a reserve currency after the US dollar, the Euro and the pound sterling. As is common when counting in East Asia, large quantities of yen are often counted in multiples of 10,000 in the same way as values in western countries are often quoted in thousands.
EXCHANGE RATE OF Indian Rupee 3/2/2011
3/2/2011 3/1/2011
U.S. Dollar / Indian Rupee 0.0223 0.0221
Indian Rupee / U.S. Dollar 44.8632 45.2694
Exchange Rate of the Indian Rupee versus other key currencies:
Currency Per Indian Rupee To Indian Rupee
Argentine Peso 0.0898 11.1350
Australian Dollar 0.0220 45.5002
Bahraini Dinar 0.0084 119.0004
Bermudan Dollar 0.0223 44.8632
Brazilian Real 0.0371 26.9771
British Pound 0.0137 72.9484
Buglarian New Lev 0.0317 31.5940
Canadian Dollar 0.0217 46.0606
Chilean Peso 10.6143 0.0942
Chinese Renminbi 0.1464 6.8286
Colombian Peso 42.7011 0.0234
Czech Koruna 0.3947 2.5339
Danish Krone 0.1206 8.2894
Egyptian Pound 0.1314 7.6128
European Euro 0.0162 61.7950
Filipino Peso 0.9674 1.0336
Hong Kong Dollar 0.1737 5.7582
Hungarian Forint 4,413.8614 0.0002
Icelandic Krona 2.5919 0.3858
Indonesian Rupiah 197.2566 0.0051
Israeli Shekel 0.0810 12.3419
Jamaican Dollar 1.9003 0.5262
Japanese Yen 1.8256 0.5478
Jordanian Dinar 0.0158 63.3661
Korean Won 25.1014 0.0398
Kuwaiti Dinar 0.0062 161.3782
Malaysian Ringgit 0.0677 14.7820
Mexican Peso 0.2704 3.6981
Moroccan Dirham 0.1820 5.4944
New Zealand Dollar 0.0298 33.5550
Nigerian Naira 3.4187 0.2925
Norwegian Krone 0.1249 8.0072
Pakistani Rupee 1.9068 0.5245
Peruvian Sol 0.0619 16.1436
Polish Zloty 0.0646 15.4859
Russian New Rouble 0.6407 1.5608
Saudi Riyal 0.0836 11.9605
Singapore Dollar 0.0284 35.2144
Slovak Koruna 0.0162 61.7950
South African Rand 0.1560 6.4092
Sri Lankan Rupee 2.4684 0.4051
Swedish Krona 0.1413 7.0749
Swiss Franc 0.0207 48.2921
Taiwanese Dollar 0.6585 1.5186
Thai Baht 0.6808 1.4688
Turkish Lira 0.0360 27.7712
U.S. Dollar 0.0223 44.8632
Venezuelan Bolivar 95.7269 0.0104
Note: All cross rates are computed through the US Dollar.
List of states by foreign exchange reservesThe list below is based on IMF data - when available; Otherwise - CIA data are indicated. For consistency, forward currency swap contracts are not included in this list until they mature,
figures that include them may be higher or lower than those listed here. IMF or other outstanding loans are not shown here, and if accounted for many nations would list lower.
RankCountry/Monetary Authority
Foreign exchange reserves(Millions of USD)
Figures as of
— World (sum of all countries) N/A --
1 People's Republic of China 2,622,000 Dec 2010
2 Japan 1,096,185 Dec 2010
-Eurosystem
(EU member states which have adopted the euro, incl. ECB)789,891 Dec 2010
3 Russia 484,158 Jan 2011
4 Saudi Arabia 456,200 Dec 2010
5 Republic of China (Taiwan) 382,800 Dec 2010
6 Brazil 297,696 Jan 2011
7 India 297,334 Dec 2010
8 Republic of Korea 295,956 Jan 2011
9 Switzerland 271,667 Jan 2011
- Hong Kong 273,176 Jan 2011
10 Singapore 227,110 Jan 2011
11 Germany 208,704 Jan 2011
12 Thailand 172,129 Dec 2010
13 France 166,319 Dec 2010
14 Italy 158,926 Dec 2010
15 Algeria 150,100 Dec 2010
16 United States 132,933 Feb 2011
17 Mexico 117,413 Nov 2010
18 United Kingdom 107,853 Jan 2011
19 Libya 107,300 Dec 2010
20 Malaysia 106,498 Dec 2010
21 Indonesia 95,332 Jan 2011
22 Poland 95,743 Jan 2011
23 Turkey 87,846 Jan 2011
24 Denmark 76,529 Dec 2010
—European Central Bank
(ECB, not owned by any single EU member)75,887 Dec 2010
25 Iran 75,060 Dec 2010
26 Israel 73,337 Jan 2011
27 Philippines 63,541 Jan 2011
28 Canada 58,707 Jan 2011
29 Argentina 52,190 Dec 2010
30 Romania 49,218 Jan 2011
31 Sweden 48,295 Dec 2010
32-33 Netherlands 45,738 Jan 2011[
32-33 Norway 45,738 Nov 2010
34 Iraq 45,680 Dec 2010
35 Hungary 44,996 Dec 2010
36 Peru 44,388 Feb 2011
37 South Africa 45,471 Jan 2011
38 Nigeria 43,360 Dec 2010
39 Australia 42,268 Dec 2010
40 Lebanon 41,570 Dec 2010
41 Czech Republic 41,314 Jan 2011
42 United Arab Emirates 39,100 Dec 2010
43 Egypt 36,194 Dec 2010
44 Ukraine 35,139 Jan 2011
45 Spain 31,538 Jan 2011
46 Venezuela 29,490 Dec 2010
47 Kazakhstan 28,291 Dec 2010
48 Colombia 28,572 Jan 2011
49 Belgium 26,850 Dec 2010
50 Chile 26,006 Nov 2010
51 Morocco 22,885 Nov 2010
52 Kuwait 22,420 Dec 2010
53 Qatar 22,410 Dec 2010
54 Austria 22,132 Jan 2011
55 Portugal 20,156 Jan 2011
56 Macau 18,730 Mar 2010
57 New Zealand 18,452 Jan 2011
58 Bulgaria 16,737 Jan 2011
59 Vietnam 16,300 Dec 2010
60 Pakistan 16,100 Dec 2010
61 Croatia 14,139 Dec 2010
62 Jordan 13,637 Dec 2010
63 Bangladesh 10,790 Dec 2010
64 Finland 10,403 Jan 2011
65 Tunisia 9,462 Jan 2011
66 Trinidad and Tobago 9,659 Dec 2010
67 Bolivia 8,739 Dec 2010
68 Uruguay 7,744 Dec 2010
69 Latvia 7,605 Dec 2010
70 Lithuania 6,650 Jan 2011
71 Greece 6,453 Jan 2011
72 Azerbaijan 6,330 Dec 2010
73 Iceland 6,312 Jan 2011
74 Belarus 4,343 Jan 2011
75 Sri Lanka 5,630 Dec 2010
76 Costa Rica 4,627 Dec 2010
77 Paraguay 4,082 Dec 2010
78 Cambodia 3,840 Dec 2010
79 Myanmar 3,762 Dec 2010
80 El Salvador 2,883 Dec 2010
81 Honduras 2,782 Jan 2011
82 Estonia 2,568 Dec 2010
83 Slovakia 2,166 Dec 2010
83 Georgia 2,413 Jan 2011
85 Ireland 2,120 Dec 2010
86 Armenia 1,817 Jan 2011
87 Moldova 1,718 Dec 2010
88 Kyrgyzstan 1,701 Jan 2011
89 Cyprus 1,141 Dec 2010
90 Slovenia 1,055 Jan 2011
91 Luxembourg 845 Jan 2011
92 Laos 576 Dec 2010
93 Malta 541 Dec 2010
FOREX TRADING IN INDIAIndia has a rather strict foreign currency exchange policy - even though many liberalization measures have been taken recently, it's still an economically isolated, or highly protected country. Indian currency - rupee, is highly regulated by the national banking authority - Reserve Bank of India, and so Indian citizens still cannot freely exchange rupee to other currencies, they have to prove their need and there are annual limits for different needs. Even popular money transfer systems such as Western Union - which is spread worldwide and available to everyone, are forbidden in India - residents can only receive money, but not send.
However, because of the globalization there is a definite need to open the economy, so Reserve Bank of India has been softening rules and
regulations in recent years.
One of the important changes in regards to Forex trading is that in year 2008 Reserve Bank of India has finally allowed currency futures trading. Speculative trading became a permissible operation too - since it became impossible to ask for a proof of a hedging need.
We at Forex4you are happy that one of the biggest and the most perspective country in the world is finally joining the world of opportunities of Forex trading market!
More details are available on the official website of RBI
Note that Indian brokers are only allowed to provide USD/INR pair at the moment. Since we're located outside India, in British Virgin Islands, we do provide customers with many more pairs, many of which are much more interesting for traders because of their nature. Rupee, being a highly regulated currency, is not as volatile as other currencies and doesn't allow as much analysis since movements depend on RBI decisions and not on market events.
Our another advantage over brokers registered inside India is that we don't have any fees or minimum transactions/deposits. Services are much more affordable at our company!
Even though we're registered outside India, we do have an office in Mumbai where an Indian company that has a contract with us, provides our Indian stakeholders with support and consultations.
FINDINGSOn analyzing all the information collected through investors, articles
from economic surveys and journals and discussions with faculty and
experienced professionals in details, I find some very crucial things
about investors thinking and perceptions (Consumer Behaviors)
regarding their investment decisions.
Some of these findings are as follows:
Investors of FD and depositors with Banks and Post Office’s are
not very much satisfied with their returns and the kind of services
they get from them. So we (stock broking company) should must
try to capture this market investors. For that we have to create
awareness, advertise more, and approachability to customers. The biggest advantage of derivative trading is that you can buy
stocks in future trading by paying only 20%or 30% of the price. That means if you are buying a stock of Rs.10 each and the lot contains 1000 stocks youcan pay only Rs.2000 to Rs.3000 to buy the lot. Whereas, the stock price in that cases would have beenRs.10000. So, you are gaining more profit at a time without investing more money.
In case of derivative trading you can short sell the stocks. That means you can first sell the lot of stock andthen buy them back within the stipulated time to honor the contract. In case of an overvalued stock that aresure to fall in near future, you can gain from short selling. This is an option that you can not get in equitytrading unless you are doing intraday trading.
In future trading the brokerage is usually lower than the equity
trading. As you are buying the stocks in a lotthe brokerage is
calculated not on the unit of the stocks but on the unit of the lot.
CONCLUSIONIn the current scenario, investing is very important and investing in stockmarkets is a major challenge ever for professionals.The young people should start investing earlier so that they can reap thebenefits of investing in future.People should keep their eye open and keep updating themselves aboutvarious investment avenues so that they can get safe return
BIBLIOGRAPHY
Religare website, www.Religare.com Religareonline website, www.Religareonline.com Security Analysis and Portfolio Management – By Punithavathy
Pandian Economics Times Times of India www.google.com
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