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APPENDIX - I
INVESTORS PERCEPTION TOWARDS DERIVATIVES WITH REFERENCE TO
FUTURE AND OPTIONS AT TANJORE DISTRICT

QUESTIONNAIRE
A. GENERAL INFORMATION
1. Name of the Investor

2. Gender

Male

3. Age

Up to 30

4. Educational Qualification

Up to Secondary
Post Graduate

5. Occupation

Self Employed
Govt./Private Employee
Others

6. Area of Domicile

Rural

7. Marital Status

Married

8. Monthly Income of Family

Up to Rs. 30000

Female
31-40

Degree
Professional

Semi-Urban

Urban

Unmarried

> Rs. 50000.

9. What is your Total Annual Investment?
< Rs.50000
Rs.50001 100000

> 40

Above Rs.100000

10. Rank the following investments in the order of your preference:

Fixed Deposit
Mutual Fund
Equity (Share) Market
Commodity Market
Financial Derivative (Future / Option) Market
Insurance
Real Estate
Gold

Rs.31000 50000

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11. Give you opinion about the Level of Risk Associated with Following Investments (Tick
the appropriate box) [1 = Very Low (VL), 2 = Low (L), 3 = Moderate (M), 4 = High (H),
5 = Very High (VH)]

1
2
3
4
5
6
7
8

Investment Options
Fixed Deposit
Mutual Fund
Equity (Share) Market
Commodity Market
Financial Derivative (Future / Option) Market
Insurance
Real Estate
Gold

12. What type of Investor you are?

Medium Term (1-5 years)

VL

VH

Long Term (> 5 Years)

13. How long have you been associated with Capital Market?
< 1 Year
1 2 Years
3 5 Years

> 5 Years

14. How long have you been investing (trading) in Derivative Market?
< 1 Year
1 2 Years
>2 Years
15. Give your level of Awareness about following Derivative products (Tick appropriate
box) [1 = Very Low (VL), 2 = Low (L), 3 = Moderate (M), 4 = High (H), 5 = Very High (VH)]

1
2

Derivative Products
Equity (Stock) Futures
Equity (Stock) Options

3
4
5
6
7

Index Futures
Index Options
Commodity Derivatives
Forward Market
Swaps

VL

VH

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16. What attracts you to invest in Derivative market? (Rank the Factor)
Factor
1 Low Risk
2 Low Investment
3 High Return
4 High Liquidity
5 Speculation

Rank

17. What percentage of your total investment is invested in Derivative market?

< 50%
51- 75%
> 75%
18. What is the frequency of Trading in Derivative market Financial Derivatives?
Daily
Weekly
Monthly
Occasionally

19. What Method of Analysis you undertaken for Investments in Derivative Market? (more
than one can be chosen)
Tick
Method
1 Fundamental Analysis
2 Technical Analysis
3 Fundamental and Technical Analysis
4 Experts Advice
5 All the above
20. Which is the best source to get advice for investment in Derivative market? Give your
rank in the order of preference
Rank
Source
1 Newspapers
2 Television
3 Friends & Relatives
4 Stock Brokers
5 Magazines meant for capital market
21. What technique do you use to manage the risks in Derivative market

1
2
3
4
5
6
7

Technique
Avoidance
Exit with minimum loss
Diversification
Average Down
Ignore the risk
Hedging
Invest with the trend in the market

Rank

22. What are the advantages of Derivative market? (Rank the Factor)
Factor
1
2
3

Transferability of Risk
Low Investment
High Return

4
5

High Liquidity
Price Discovery

Rank

23. What are the disadvantages of Derivative market? (Rank the Factor)
Factor
1
2
3
4
5
6

Rank

Volatile
Returns not assured
Risky
Complexity
Standardized contracts
High contract size (lot size)

24. Rank the advantages of investing in F&O Segment:

Advantages
1

Certainty of performance

High liquidity

Low margin deposit

Transparency in pricing

Rank

25. Rank the limitations of F&O Segment:

Limitations
1

Obligatory nature

The holder is exposed to risk

Stock price variation

Margin deposit

High contract size

Lack of flexibility

Highly Standardized

Rank

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26. What extent do your objectives match with the investment in F & Os (Tick appropriate
box) [1 = Not at all (N), 2 = Little Extent (LE), 3 = Some Extent (SE), 4 = Moderate Extent
(ME), 5 = Large Extent (LE)]

Derivative Products
1

Speculation

Arbitrage

Hedging

Risk Management

LE

SE

ME

LE

27. How frequently you invest in the following derivative products [1 = Never (N), 2 = Rarely
(R), 3 = Sometimes (S), 4 = Often (O), 5 = Very Often (VO)]

Derivative Products
1

Equity Futures (on Individual stocks)

Equity Options (on Individual stocks)

Stock Index Futures

Stock Index Options

VO

28. Give your level of Agreement with various characteristics (Status) of Derivative/
Financial Derivative Market [1 = Strongly Disagree (SD), 2 = Disagree (D), 3 = Neither
Disagree nor Agree (N), 4 = Agree (A), 5 = Strongly Agree (SA)]

Services
1
2
3
4
5
6
7
8

Derivatives are new, complex and high-tech financial

products
Derivatives are purely speculative and highly leveraged
instruments
Only big institutions / investors have a purpose for using
derivatives
Financial derivatives are simply the latest risk management
fashion
Only risk seeking organizations / investors should use
derivatives
The risks associated with financial derivatives are new and
unknown
Derivatives trading is an unsafe and risky

Derivatives trading increasing systematic risk

Because of the risk associated with derivatives, regulators
9 should ban their use
10 Derivative market is less speculative than equity market

11 Brokerage fee is very low

12 Volatility in derivative market is less than equity market

SD

SA

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29. Level of satisfaction with various aspects associated with trading / investments in
Derivative Market [1 = Highly Dissatisfied (HD), 2 = Dissatisfied (D), 3 = Neutral (N),
4= Satisfied (S), 5 = Highly Satisfied (HS)]

Services
1
2

Return earned
Level of Risk

3
4
5
6
7
8

Diversification of investments
Liquidity aspects
Information provided by the brokers
Investors protection measures
Guidance of the experts (through media)
Settlement of the contracts

9
10
11
12

Size of the contract

Role of Stock Exchange
Role of the brokers
Role of SEBI

HD

HS

30. Give your suggestions, if any, for improving the operation of Derivative / Financial
Derivative market

Thank you for your kind cooperation