A Summer Training Project Report On Comparison of BSNL service with its competitors

At Bharat Sanchar Nigam Limited - Lucknow. (As partial fulfillment of the award of MBA degree under G. B Technical University, Lucknow 2010)

Submited To: Mr. S.K Srivastava

Submited By: AjeetMaurya Roll No. - 0919670007

ACKNOWLEDGEMENT

Concentrating, dedication and application are necessary but not sufficient to achieve any goal. Therefore, it is our pleasant duty to offer our service of acknowledgement to those honorable personalities of the department who helped me to follow the path to success for thecompletion of this project. It was indeed an opportunity for me to be a part of BHARAT SANCHAR NIGAM LTD, LUCKNOW For my summer training, as a partial fulfillment of two year degree course of Master of Business Administration. It was an insightful experience where I was given an exposure in the field of human resource. It was during this training that I was able to apply my theoretical knowledge into practical one. It was great pleasure to extent my heartily thanks to Mr. T.P. SINGH for giving me an opportunity to learn the applicability of Human Resource Theories. I would like to express my special gratitude to various employees of all department, my friend and seniors, who are always a source of inspiration for me and played an important role in making my summer tranning a memorable one.

AJEET MAURYA

PREFACE
The MBA programme is well structured and integrated course of business studies. In every professional course training is an important factor. The main objective of practical training is to develop skill in student by supplement to the theoretical study of business management in general. Industrial training helps to gain real life knowledge about the industrial environment and business practices.

Professors give us theoretical knowledge of various subjects in the college but I practically exposed of such subjects when i get the training in the organisation.

During the whole training I got a lot of experience and came to know about the management practices in real that how it differs from those of theoretical knowledge and the practically in the real life. Intodays globalize world, where cutthroat competition is prevailing in the market, theoretical knowledge is not sufficient. Beside this one need to have practical knowledge, which would help an individual in carrier activities and it is true that, Experience is the Best Teacher

AJEET MAURYA

SUMMER TRAINING REPORT ON

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ON-LINE TRADING Submitted in partial fulfillment of the Requirement for the degree of

MASTER OF BUSINESS ADMINISTRATION

SUBMITTED BY:AVINASH KUMAR SONKAR MBA (2009-2010)

DEPERTMENT OF MASTEROF BUSINESS ADMINISTRATION

COLLEGE OF ENGINEERING SCIENCES AND TECHNOLOGY

(Affiliated to GautamBuddh Technical University)

CONTENTS
 Preface  Declaration  Acknowledgement 5 4 5 6

 Certificate

y Industry and company profile y Products & services22 y History of the firm y Objective y Mission y Vision y SWOT Analysis y Introduction y Online trading y Research Methodology y Comparative analysis79 y Analysis and Interpretation y Result and findings y Conclusion y Limitations & Suggestion 91 87 76 24 29 31 32 33

36 41

93 96

y Questionnaire y List of places y Bibliography 101

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PREFACE

For management career, it is important to develop managerial skills. In order to achieve positive and concrete results, along with theoretical concepts, the exposure of real life situation existing in corporate world is very much needed. To fulfill this need, this practical training is required. I took training in KARVY STOCK BROKING LTD. located in LUCKNOW. It was my fortune to get training in a very healthy atmosphere. I got ample opportunity to view the overall working of the stock exchange. This report is the result of my 45 days of summer training in KARVY STOCK BROKING LTD., as a part of M.B.A. The subject of my report isOnline trading

DECLARATION
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I HEREBY DECLARE THAT THIS PROJECT REPORT ENTITLED ONLINETRADING HAS BEENPREPARED BY ME IS AN ORIGINAL WORK SUBMITTED TO GAUTAMB UDDH T ECHNICAL UNIVERSITY
TOWARDSPARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE AWARD OFMASTER OF

BUSINESS ADMINISTRATION. I ALSO HEREBY

DECLARETHAT THIS PROJECT REPORT HAS NOT BEEN SUBMITTED AT ANY TIMETO ANY OTHER UNIVERSITY OR INSTITUTE FOR THE AWARD OF ANYDEGREE OR DIPLOMA.

AVINASH KUMAR SONKAR MBA (2009-2010)

ACKNOWLEDGEMENT
I would like to thank my project guide Mr. SandeepSrivastavais for guiding me through my summer internship and research project. His encouragement, time and effort are greatly appreciated.

I would like to dedicate this project to my parents. Without their help and constant support this project would not have been possible.

Lastly I would like to thank all the respondents who offered their opinions and suggestions through the survey that was conducted by me in Lucknow.

Once again my gratitude to the Brokers, Sub-Brokers and Investors of share market for their kind co-operation.

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CERTIFICATE
This is to certify that the project report entitled ONLINE TRADING submitted by Avinash Kumar Sonkar is a bona fide piece of work conducted under my direct supervision and guidance. No part of this work has been submitted for any other degree of any other university. It may be considered for evaluation in partial fulfillment of the degree of Masters in Business Administration.

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INDUSTRY AND COMPANY PROFILE

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About Us KARVY STOCK BROKING LIMITED

Member - National Stock Exchange (NSE), the Bombay Stock Exchange (BSE), and the Hyderabad Stock Exchange (HSE). Karvy Stock Broking Limited, one of the cornerstones of the Karvy edifice, flows freely towards attaining diverse goals of the customer through varied services. Creating a plethora of opportunities for the customer by opening up investment vistas backed by research-based advisory services. Here, growth knows no limits and success recognizes no boundaries. Helping the customer create waves in his portfolio and empowering the investor completely is the ultimate goal. It is an undisputed fact that the stock market is unpredictable and yet enjoys a high success rate as a wealth management and wealth accumulation option. The difference between unpredictability and a safety anchor in the market is provided by in-depth knowledge of market functioning and changing trends, planning with

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foresight and choosing one &risqu; s options with care. This is what we provide in our Stock Broking services. We offer services that are beyond just a medium for buying and selling stocks and shares. Instead we provide services which are multi dimensional and multifocused in their scope. There are several advantages in utilizing our Stock Broking services, which are the reasons why it is one of the best in the country.

Distribution of Financial Products

The paradigm shift from pure selling to knowledge based selling drives the business today. With our wide portfolio offerings, we occupy all segments in the retail financial services industry.

A 1600 team of highly qualified and dedicated professionals drawn from the best of academic and professional backgrounds are committed to maintaining high levels of client service delivery. This has propelled us to a position among the top distributors for equity and debt issues with an estimated market share of 15% in terms of applications mobilized, besides being established as the leading procurer in all public issues. To further tap the immense growth potential in the capital markets we enhanced the scope of our retail brand, Karvy the Finapolis, thereby

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providing planning and advisory services to the mass affluent. Here we understand the customer needs and lifestyle in the context of present earnings and provide adequate advisory services that will necessarily help in creating wealth. Judicious planning that is customized to meet the future needs of the customer deliver a service that is exemplary. The market-savvy and the ignorant investors, both find this service very satisfactory. The edge that we have over competition is our portfolio of offerings and our professional expertise. The investment planning for each customer is done with an unbiased attitude so that the service is truly customized. Our monthly magazine, Finapolis, provides updated market information on market trends, investment options, opinions etc. Thus empowering the investor to base every financial move on rational thought and prudent analysis and embark on the path to wealth creation.

KARVY INVESTOR SERVICES LIMITED

Recognized as a leading merchant banker in the country, we are registered with SEBI as a Category I merchant banker. This reputation was built by capitalizing on opportunities in corporate consolidations, mergers and acquisitions and corporate restructuring, which have earned us the reputation of a merchant

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banker. Raising resources for corporate or Government Undertaking successfully over the past two decades have given us the confidence to renew our focus in this sector.

Our quality professional team and our work-oriented dedication have propelled us to offer value-added corporate financial services and act as a professional navigator for long term growth of our clients, who include leading corporate, State Governments, foreign institutional investors, public and private sector companies and banks, in Indian and global markets.

We have also emerged as a trailblazer in the arena of relationships, both at the customer and trade levels because of our unshakable integrity, seamless service and innovative solutions that are tuned to meet varied needs. Our team of committed industry specialists, having extensive experience in capital markets, further nurtures this relationship.

Our financial advice and assistance in restructuring, divestitures, acquisitions, demergers, spin-offs, joint ventures, privatization and takeover defense mechanisms have elevated our relationship with the client to one based on unshakable trust and confidence.

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KARVY Computershare Private Limited

We have traversed wide spaces to tie up with the world s largest transfer agent, the leading Australian company, Computershare Limited. The company that services more than 75 million shareholders across 7000 corporate clients and makes its presence felt in over 12 countries across 5 continents has entered into a 50-50 joint venture with us.

With our management team completely transferred to this new entity, we will aim to enrich the financial services industry than before. The future holds new arenas of client servicing and contemporary and relevant technologies as we are geared to deliver better value and foster bigger investments in the business. The worldwide network of Computershare will hold us in good stead as we expect to adopt international standards in addition to leveraging the best of technologies from around the world.

Excellence has to be the order of the day when two companies with such similar ideologies of growth, vision and competence, get together.

KARVY GLOBAL SERVICES LIMITED

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The specialist Business Process Outsourcing unit of the Karvy Group. The legacy of expertise and experience in financial services of the Karvy Group serves us well as we enter the global arena with the confidence of being able to deliver and deliver well.

Here we offer several delivery models on the understanding that business needs are unique and therefore only a customized service could possibly fit the bill. Our service matrix has permutations and combinations that create several options to choose from.

Be it in re-engineering and managing processes or delivering new efficiencies, our service meets up to the most stringent of international standards. Our outsourcing models are designed for the global customer and are backed by sound corporate and operations philosophies, and domain expertise. Providing productivity improvements, operational cost control, cost savings, improved accountability and a whole gamut of other advantages.

We operate in the core market segments that have emerging requirements for specialized services. Our wide vertical market coverage includes Banking, Financial and Insurance Services (BFIS), Retail and Merchandising, Leisure and Entertainment, Energy and Utility and Healthcare.
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KarvyComtrade Limited
At Karvy Commodities, we are focused on taking commodities trading to new dimensions of reliability and profitability. We have made commodities trading, an essentially age-old practice, into a sophisticated and scientific investment option.

Here we enable trade in all goods and products of agricultural and mineral origin that include lucrative commodities like gold and silver and popular items like oil, pulses and cotton through a well-systematized trading platform.

Our technological and infrastructural strengths and especially our street-smart skills make us an ideal broker. Our service matrix is holistic with a gamut of advantages, the first and foremost being our legacy of human resources, technology and infrastructure that comes from being part of the Karvy Group.

Our wide national network, spanning the length and breadth of India, further supports these advantages. Regular trading workshops and seminars are conducted to hone trading strategies to perfection. Every move made is a calculated one, based on reliable research that is converted into valuable

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information through daily, weekly and monthly newsletters, calls and intraday alerts. Further, personalized service is provided here by a dedicated team committed to giving hassle-free service while the brokerage rates offered are extremely competitive.

Karvy Insurance Broking Limited

At Karvy Insurance Broking Limited., we provide both life and non-life insurance products to retail individuals, high net-worth clients and corporate. With the opening up of the insurance sector and with a large number of private players in the business, we are in a position to provide tailor made policies for different segments of customers. In our journey to emerge as a personal finance advisor, we will be better positioned to leverage our relationships with the product providers and place the requirements of our customers appropriately with the product providers. With Indian markets seeing a sea change, both in terms of investment pattern and attitude of investors, insurance is no more seen as only a tax saving product but also as an investment product. By setting up a separate entity, we would be positioned to provide the best of the products available in this business to our customers.

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Our wide national network, spanning the length and breadth of India, further supports these advantages. Further, personalized service is provided here by a dedicated team committed in giving hassle-free service to the clients.

KARVYREALTY&SERVICES (INDIA)Limited
KARVY Realty & Services (India) Limited (KRSIL) is engaged in the business of real estate and property services offering value added property services and offers individuals and establishments a myriad of options across investments, financing and advisory services in the realty sector.

KARVY Realty & Services (India) Limited Byte !!!

Take a Realty

Promoted by the KARVY Group of companies, India s largest integrated financial services company. KARVY Realty & Services India Limited carries forward its legacy of trust and excellence in investor and customer services delivered with a passion for services and the highest level of quality that align with global standards.

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KARVY Realty & Services (India) Limited welcomes you to take a reality check on realty options that you can be rest assured of and of course profit from.

Board Members

C Parthasarathy, Chairman & Managing Director

Mr. C Parthasarathy, a leader in the financial services industry in India is responsible for building KARVY as one of India's truly integrated Financial Services Provider; he is a fellow member of the Institute of Company Secretaries of India, a Fellow Member of the Institute of Chartered Accountants of India and a graduate
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in law. As Chairman and Managing Director, he oversees the group's operations and renders vision and business direction.His passion and vision for achieving leadership in the business made KARVY a leading financial intermediary ranking them as number one in the registrar, Share Transfer and IPO Distribution businesses. He also holds directorship in KARVY Securities Limited, KARVY Stock Broking Limited, KARVY Investor Services Limited,KARVY Computershare Private Limited, KARVY Commodities Broking Private Limited, EPR Pharmaceuticals Private Limited and Ocean Sparkles Limited.

M Yugandhar, Managing Director

Mr. M Yugandhar, Managing Director, founder member of KARVY Consultants Limited, has varied experience in the field of financial services spanning over 20 years. He is a Fellow Member of the Institute of Chartered Accountants of India and was involved in the statutory and branch audit of banks for 26 years.

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Mr. Yugandhar holds directorships in KARVY Securities Limited, KARVY Stock Broking Limited, KARVY Investor Services Limited, KARVY Computershare Private Limited, KARVY Commodities Broking Private Limited, Bizpro Technologies India Limited, Pokarna Limited, Ravindranath G E Medical Associates Private Limited, Everest Power Private Limited and Green Infrastructure Private Limited.

M S Ramakrishna, Executive Director

Mr. M S Ramakrishna, Director, founder member of KARVY Consultants Limited is the orchestrator of technology initiatives such as the call center in the service of the customer. Mr. Ramakrishna is a member of the Hyderabad Stock Exchange and is the director of KARVY Securities Limited, KARVY Stock Broking Limited, KARVY
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Investor Services Limited, KARVY Computershare Private Limited, KARVY Commodities Broking Private Limited, Nitya Labs Limited and SAB Nife Power Systems Limited. He has helped KARVY diversify into the field of medical transcription leveraging on the company's core competency of transaction processing. He has more than 20 years of experience in the financial services arena.

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Management Team:1) K Sridhar 2) V Mahesh 3) V Ganesh 4) S Gopichand 5) J Ramaswamy 6) M S Manohar 7) S Ganapathy Subramanian

Achievements:y y y y y y y y y

Among the top 5 stock brokers in India (4% of NSE volumes) India's No. 1 Registrar & Securities Transfer Agents Among the top 3 Depository Participants Largest Network of Branches & Business Associates ISO 9002 certified operations by DNV Among top 10 Investment bankers Largest Distributor of Financial Products Adjudged as one of the top 50 IT uses in India by MIS Asia Fully Fledged IT driven operations

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PRODUCTS &SERVICES PROVIDED BY KARVY STOCK LIMITED:1. Stock Broking. 2. Mutual Fund Services. 3. Depository Participant Services. 4. Financial product distribution. 5. Corporate Finance and Merchant Banking. 6. Commodities Broking. 7. Insurance 8. Income Tax enabled services. 9. Personal Finance Advisory services. 10. Registrars and Transfer Agent 11. Bonds
KARVY KARVERVICES AN OVERVIEW SERVICES AN OVERVIEW

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NUMBER OF BRANCHES IN DIFFERENT STATES

State Total Branches Total Franchisees Branches ANDHRA PRADESH 52 26 ASSAM 8 0 BIHAR 11 0 CHANDIGARH 2 0 CHHATTISGARH 7 0 GOA 2 0 GUJARAT 30 7 HARYANA 15 0 HIMACHAL PRADESH 3 0 JAMMU & KASHMIR 1 0 JHARKAND 8 2 KARNATAKA 55 0 KERALA 31 11 MADHYA PRADESH 22 1 MAHARASHTRA 34 6 MANIPUR 1 0 MEGHALAYA 1 0 NEW DELHI 12 0 ORISSA 12 0 PUNJAB 11 0 RAJASTHAN 10 0 SIKKIM 1 0 TAMIL NADU 69 6 TRIPURA 1 0 UNIONTERRITORY 1 0 UTTAR PRADESH 43 2 UTTARANCHAL 5 0 WEST BENGAL 28 3

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HISTORY OF THE FIRM

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About us:The Karvy group was formed in 1983 at Hyderabad, India. Karvy ranks among the top player in almost all the fields it operates. Karvy Computer share Limited is India s largest Registrar and Transfer Agent with a client base of nearly 500 blue chip corporate, managing over 2crore accounts. Karvy Stock Brokers Limited, member of National Stock Exchange of India and the Bombay Stock Exchange, ranks among the top 5 stock brokers in India. With over 6, 00,000 active accounts, it ranks among the top 5 Depositary Participant in India, registered with NSDL and CDSL. Karvy Comrade, Member of NCDEX and MCX ranks among the top 3 commodity brokers in the country. Karvy Insurance Brokers is registered as a Broker with IRDA and ranks among the top 5

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insurance agent in the country. Registered with AMFI as a corporate Agent, Karvy is also among the top Mutual Fund mobilizer with overRs.5,000crores under management. Karvy Realty Services, which started in 2006, has quickly established itself as a broker who adds value, in the realty sector. Karvy Global offers niche off shoring services to clients in the US. Karvy has 575 offices over 375 locations across India and overseas at Dubai and New York. Over 9,000 highly qualified people staff Karvy.

Organization:
Karvy was started by a group of five chartered accountants in 1979. The partners decided to offer, other than the audit services, value added services like corporate advisory services to their clients. The first firm in the group, Karvy Consultants Limited was incorporated on 23rd Jul1983. In a very short period, it became the largest Registrar and Transfer Agent in India. This business was spun off to form a separate joint venture with Computer share of Australia, in 2005. Karvy s foray
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into stock broking began with marketing IPO s, in 1993. Within a few years, Karvy began topping the IPO procurement league tables and it has consistently maintained its position among the top 5. Karvy was among the first few members of National Stock Exchange, in 1994 and became a member of The Stock Exchange, Mumbai in 2001. Dematerialization of shares gathered pace in mid-90s and Karvy was in the forefront educating investors on the advantages of dematerializing their shares. Today Karvy is among the top 5 Depositary Participant in India. While the registry business is a 50:50 Joint Venture with Computer share of Australia, we have equity participation by ICICI Ventures Limited and Barings Asia Limited, in Karvy Stock Broking Limited. For a snapshot of our organization structure, Karvy has always believed in adding value to services it offers to clients. A top-notch research team based in Mumbai and Hyderabadsupports its employees to advise clients on their investment needs. With the
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information overload today, Karvy s team of analysts help investors make the right calls, be it equities, mf, insurance. On a typical working day Karvy---

   

Has more than 25,000 investors visiting our 575 offices Publishes / broadcasts at least 50 buy / sell calls Attends to 10,000+ telephone calls Mails 25,000 envelopes, containing Annual Reports, dividend cheques / advises, allotment / refund advises  Executes 150,000+ trades on NSE / BSE  Executes 50,000 debit / credit in the depositary accounts  Advises 3,000+ clients on the investments in mutual funds.

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COMPANY OBJECTIVE
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OBJECTIVE OF COMPANY
The objective of the company is to get the maximum market share and to know the awareness of various financial product and services offer by the other different financial institution. The focus of is on individual thought about financial products and services offer by company and also find out the shortcoming and how these can be rectified in well manner.  To get maximum market share.  To compete the other similar companies.  To adopt unique strategies in the market.
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 To attract the customer through better service.  To find the growth aspect financial products.  The objective of Karvy global services is to help our customers achieve the best of out sourcing by becoming an extended arm to their business  The key objective of these model is to mitigate the business and Karvy The study conducted by me in financial products and services. My topic was ONLINE TRADING .

MISSION OF THE COMPANY

As we know that every people wants to get more and more return from the investment. Today competition is high. Every company wants to capture the maximum share from the market. There are many financial products available in the market. Financial products are categorized into private and public sector. In government sector, financial product as a treasury bill, commercial

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paper, certificate of deposit. This type of financial products is of one year or less than one year. Mutual fund, life insurance, general insurance, investment in stock market such as shares which of long term or may be of short-term. Many investors invest his money in financial products to the intention of saving tax.

So,the mission of the company is to provide the best facility to the investor an capture the maximum market share.

VISION OF THE COMPANY

Every company wants to know about how much people aware about the financial products. How much people Invest in these products after knowing about financial products. In India most of people do not want to invest in stock market because it may be possible of losses. An important implication of this framework is the idea of extended rivalry. To understand competition in the market. One must look beyond current competitors to include investor suppliers; firms provide similar services and potential entrants. Firms generally try to
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manipulate the competitive forces in their industry in order to achieve comparative advantage over competitors.

Banking sector also plays a very important role in different financial products.SBI life insurance; HDFC, ICICI and all these type of banks provide the services of financial products. Banks play an important role in the economy for two reasons: they provide a major source of financial intermediation and their checkable deposit liabilities represent the bulk of the nation s money stock. Evaluating their overall performance and monitoring their financial condition is important to depositors, owners, potential investors, managers and of course, regulators. Presently, financial ratios are often used to measure the overall soundness of a bank and the quality of its management. Bank regulators for example use financial ratios to help evaluate a bank s performance. Evaluating the economic performance of banks, however, is a complicated process. Often a number of criteria such as profits, liquidity, asset quality, attitude toward risk, and management strategies must be considered. The changing nature of the banking industry has made such evaluations even more difficult, increasing the need for more flexible alternative forms of financial analysis.
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SWOT ANALYSIS
Every company has some strength, weakness, opportunity and threat.

S- STRENGTH OF THE COMPANY

W-WEAKNESS OF THE COMPANY

O-OPPORTUNITY OF THE COMPANY

T-THREAT OF THE COMPANY

STRENGTH OF THE COMPANY

Karvy stock broking limited has some strength as

1. Quick service than other company 2. Provide best suggestion to the investor 3. Maximum branches in the main city 4. Approval in national stock exchange
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5. People awareness about the company 6. Maximum investor in this company

WEAKNESS OF THE COMPANY

Office is situated only in the main city not in the nearest area

1. Commission is high than the other company 2. Not follow their promise about investment 3. Problem resolution is not quick 4. Grievance handling is not better.

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OPPORTUNITY OF THE COMPANY

1. To capture the maximum market share 2. To attract more investor 3. To win the faith of the customer through the facility of knowing the account balance in anywhere also in home

THREAT OF THE COMPANY

1. Entry of the new companies 2. Less charge than the karvy 3. More invest on advertisement 4. Provide better similar services 5. New company desperate customers

So company should increase more strength that weakness is eliminated andanalyze his strategy of the competitors.

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Introduction to the capital market

The capital market is the market for securities, where companies and the government can raise long term funds. The capital market includes the stock market and the bond market. Financial regulators ensure that investors are protected against fraud. The capital markets consist of the primary market, where new issues are distributed to investors, and the secondary market, where existing securities are traded.

Capital market thus plays a vital role in channelizing the savings of individuals for Investment in the economic development of the country. As a result the investors are not constrained by their individual abilities, but by the abilities of the companies, which in turn enhance the savings and investments in the country, liquidity of capital market is an important factor affecting growth.

Since projects require long term finance, but on the other hand, the investor may not like to relinquish control over their savings for a long time. A liquid stock market ensures a quick exit without incurring heavy losses or costs. Thus development of efficient market system is

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necessary for creating conductive climate for investment and economic growth.

Capital market Segment Primary and Secondary

Broadly , the comprises of two segments the new issue market which is commonly known as primary market and the stock market which is known as secondary market. Primary A primary offering, such as with a corporate bond, means you are buying it directly from the issuer, at par value, usually. A secondary market is where you sell or buy existing issues. I.E. If you bought a bond last year, now need to get your principal, you can sell it in the secondary market. You may not get par value. If rates are up since you bought the bond, then you will likely have to sell it at a discount to be able to get rid of it. If rates have fallen since you bought it, you could get a premium for it. Secondary The market where securities are traded after they are initially offered in the primary market. Most trading is done in the secondary market. To explain further, it is trading in previously issued financial instruments. An organized market for used securities. Bombay Stock Exchange (BSE), National Stock Exchange NSE, bond markets, over-the-counter markets, residential mortgage loans, governmental guaranteed loans etc Secondary Market refers to a market where securities are traded after being initially offered to the public in the primary market and/or listed on the Stock Exchange. Majority of the trading is done in the secondary market. Secondary market comprises of equity markets and the debt
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markets. For the general investor, the secondary market provides an efficient platform for trading of his securities. For the management of the company, Secondary equity markets serve as a monitoring and control conduit by facilitating value-enhancing control activities, enabling implementation of incentive-based management contracts, andaggregating information (via price discovery) that guides management decisions.

INDIAN CAPITAL MARKET AT A GLANCE

1800 1850 1860
1875 1894 Trading of shares of east India company in Kolkata And Mumbai Joint stock company came into existence Speculation and feverish dealing in securities Formulation of stock exchange of Mumbai Formulation of Ahmadabad stock exchange

20th century
1908 1939 1940 1956 1957 1988 1991 1992 1993 1995 1995 1997 1998 Formulation of Calcutta stock exchange Formulation of Lahore and madras stock exchange Formulation of U.P and Delhi stock exchange Securities contract and regulation act enacted Scam of HaridasMundhra Securities and exchange board of India set up Scam of MS Shoes SEBI given power Under SEBI act,1992 Formation of National stock exchange HARSHAD MEHTA Scam SESA GOA Scam CRB scam BPL And Videocon Scam

21st century
2000 2001 2002 2002 2003 Depositories came into existence (electronic form of shares) Ketan Parekh scam Start of rolling settlement and banning of Badla trading Introduction of T+3 settlement in April Introduction of T+2 settlement in April 44

2005 2006 2007 2008 2008 2008 2009

BSE Sensex touches all time high 6954 in January BSE Sensex touches all time high 12500,the highest intraday fall of 1100 BSE reaches the level of BSE touches all time high in January 2008 Sensex saw its highest ever loss of 1,408 points at the end of the session. Sensex saw its 15 month low, from its all time high Sensex saw it s down trend &highest ever loss because of Satyam case.

BRIEF ABOUT THE STOCK EXCHANGES

Stock Exchange is a market like any other centralized market where both buyers and sellers come and conduct their business of purchase and sale of shares & securities. In other words, it is a market place for shares and securities where trading takes place in a controlled and protected environment.

MEANING OF STOCK EXCHANGE

A stock exchange, share market or bourse is a corporation or mutual organization which provides "trading" facilities for stock brokers and traders, to trade stocks and other securities. Stock exchanges also provide facilities for the issue and redemption of securities as well as other financial instruments and capital events including the payment of income and dividends. The securities traded on a stock exchange include: shares issued by companies, unit trusts and other pooled investment products and bonds. To be able to trade a security on a certain stock exchange, it has to be listed there. Usually there is a central location at least for recordkeeping, but trade is less and less linked to such a physical place, as modern markets are electronic networks, which gives them advantages of speed and cost of transactions. Trade on an exchange is by members only. The initial offering of stocks and bonds to investors is by definition done in the primary market and subsequent trading is done in the secondary
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market. A stock exchange is often the most important component of a stock market. Supply and demand in stock markets are driven by various factors which, as in all free markets, affect the price of stocks (see stock valuation). There is usually no compulsion to issue stock via the stock exchange itself, nor must stock be subsequently traded on the exchange. Such trading is said to be off exchange or over-the-counter. This is the usual way that bonds are traded. Increasingly, stock exchanges are part of a global market for securities.

CONCEPT OF SHARE TRADING

The concept of share broking emerged after the establishment of the joint stock companies. The ownership of the companies was divided into small parts and that every part was called share. So, the term Share denominates some part in the ownership of the company. The shares are freely transferable subject to the some certain restrictions. When the need was felt to sell the shares by the owner of the shares, it was difficult to find out the buyers of the shares who want to buy the shares at the price the seller want to sell. At that time a need was felt to bring the buyers and sellers on a common platform. To solve this problem, a group of persons came into picture, which used to bring the buyers and sellers together for the trade of the shares. These persons are called the share Brokers who find the persons who wish to buy or

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sell their securities. The whole process of finding the buyers and sellers of the securities by the brokers is called the Share Broking.

The origination of the Indian securities market may be traced back to 1975, when 22 enterprise brokers under a Banyan tree established the Bombay Stock Exchange (BSE). Over the last 130 years, the Indian securities market has evolved continuously to become one of the most dynamic, modern international standards both in terms of structure and in terms of operating efficiency.

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On Line Trading

Meaning of Online Trading

Change is the law of nature . There were times when man was a wanderer or a normal. He himself had to go place to place in search of food, water and now everything is available at your doorstep just at the click of the mouse. The growth of information technology has affected almost all sectors of life. Internet has enabled us to get every information at our doorstep. When Internet has affected all sectors he could stock markets the most important player of the economy, has
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remained far behind? Like all other sectors Internet has set its feet in the stock markets also. Internet trading commissions are clearly posted on the websites of the various services, and are typically a fixed rate charge, depending upon the type of security being traded and the size of trade. In theory, therefore, an Interest investor always knows what commission he is being charged on each trade. Internet investors can take as much time as they would like to take prior to placing a trade order. Similarly the online investor likely does not have to worry that his broker is making unauthorized trades. Since there is no individual broker making a commission, the only person who is authorized to trace in the account is the actual investor. Furthermore, the internet investor can never become a victim of excessive trading (where for the broker) since the investor maintains total control over the number of transactions which take place in the account. All of these positive features of internet trading may lead the unwary investor to believe that Internet trading is a way to take control of their finances and save more money in the process. Unfortunately, this is not always the case. The advantages of Internet stock trading have also its weaknesses and these weaknesses present significant drawbacks for the average investor.

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First and foremost, the average investor is not an expert in the financial markets. There is a danger for allowing the autonomy of online trading to hull you into the belief that you are an expert investor. An online investor sitting at home at a personal computer also foregoes proper investment advice and financial planning, perhaps among the most valuable services provided by traditional brokers. There are, of course, additional risks relative to performing transactions over the Internet especially on a shared computer. Those people whom investors have provided their account number and password can freely trade that account while the investor will have little, if any, resource against the brokerage firm for the breach of security.

When was online trading introduced in INDIA?

Online trading started in India in February 2000 when a couple of brokersstarted offering an online trading platform for their customers.

ONLINE TRADING BY NSE & BSE

The central computer located at the Exchange is connected to the workstations of the Brokers through satellite using Very Small Aperture Terminals (VSATs). Orders placed at the Brokers' workstations reach the central computer and are matched by the computer based on price and time priority. Both the exchanges have switched over from the open outcry trading system to a fully automated computerized mode of trading known as
50

BOLT (BSE OnLine Trading) and NEAT (National Exchange Automated Trading) System. It facilitates more efficient processing, automatic order matching, faster execution of trades and transparency. The scrips traded on the BSE have been classified into 'A', 'B1', 'B2', 'C', 'F' and 'Z' groups. The 'A' groupshares represent those, which are in the carry forward system (Badla). The 'F' group represents the debt market (fixed income securities) segment. The 'Z' group scrips are the blacklisted companies. The 'C' group covers the odd lot securities in 'A', 'B1' & 'B2' groups and Rights renunciations. key regulator governing Stock Exchanges, Brokers, Depositories, Depository participants, Mutual Funds, FIIs and other participants in Indian secondary and primary market is the Securities and Exchange Board of India (SEBI) Ltd. DIFFERENCE BETWEEN ONLINE AND OFFLINE TRADING Nevertheless, with all the convenience of online trading there are still investors who prefer the old fashion way of offline trading. Offline trading has lost some popularity but it is still the main form of investing. Offline trading offers many benefits as well. 1. The one benefit that an investor appreciates the most is that they are not alone when making investment decisions. 2. There are experienced and professional brokerage companies that handle their investments for them. 3. Investors are not faced with the challenge of making these vital investment decisions; especially, if they do not have the experience necessary to make the appropriate investments. 4. Also, there is someone there to answer any questions that may cause concerns. Not to mention, with offline trading mistakes are less likely to take place. No one wants to throw their money away or stand by and watch someone else throw their money away. It may be wise to hire a
51

professional to assist you in making the correct investment decisions if you feel you lack the knowledge necessary.

Points of difference between online trading and offline trading are as follows: 1. Online trading is very expensive as compare to manual trading or offline trading. 2. Online trading consumes less time as compare to manual trading. 3. Online trading has very helpful to finding the records easily but offline trading takes more time to finding the records. 4. In the help of online trading, there is no chance of any errors while doing the trading. in offline trading there are some errors exist like barriers of communication . 5. With the help of online trading, we know the international market rate of share very easily.

DEMATERIALISATION OF SHARES
Dematerialization is the process wherein shares certificates or other securities held in physical form are converted into electronic form and credited to demat account of an investor opened with a depository participant. SEBI has made compulsory trading of shares of all the companies listed in stock exchanges in demat form with effect from

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2ndJanuary 2002.The procedure of opening a demat account with DP is similar to opening an account with a bank.

ELECTRONIC SETTLEMENT OF TRADE

A. Procedure for purchasing dematerialized securities  The procedure for purchasing dematerialized securities is also similar to the procedure for buying physical securities.  Investor instructs DP to receive credits into his account in the prescribed form. There may be one time standing instruction or separate instruction each time to receive credits.  Investor purchases securities in any of the stock exchanges linked to depository through a broker.  Broker receives payment from investor and arranges payment to clearing corporation.  Broker receives credit to securities in clearing account on the payout day.  Broker gives instructions to DP to debit clearing account and credit client s account. Investor receives shares into his account by way of book entry. B. Procedure of selling dematerialized securities The procedure for selling dematerialized securities in stock exchanges is similar as selling physical securities. The only major difference is that instead of delivering physical securities to the broker, the investor instructs his DP to debit his demat account with the number of securities sold by him and credit the brokers clearing account. The procedure for selling dematerialized securities is given below:

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 Investor sells securities in any of the stock exchange linked to depository through a broker.  Investor instructs his DP to debit his demat account with the number of securities sold and credit the broker s clearing account.  Before the pay-in-day, broker of the investor transfers the securities to clearing corporation.  The broker receives payment from the stock exchange.  The investor receives payment from the broker for sale of securities in the same manner as received in case of sale of physical securities. REMATERILISATION OF SHARES Rematerialization is the process of conversion of electronic holdings of securities into physical certificate form. For rematerilisation of scrips, the investor has to fill up a remat request form (RRF) and submit it to the DP. The DP forwards the request to depository after verifying the investor s balances. Depository in turn initiates the registrars and transfer agent or the issuer company. RTA/ Company print the certificates and dispatches the same to the investor. Market timings: Trading on the derivatives segment takes place on all days of the week (except Saturdays and Sundays and holidays declared by the Exchange in advance). The market timings of the derivatives segment are: Normal Market / Exercise Market Open time Normal market close Set up cut of time for Position limit/Collateral value : 09:00 hours : 15:30 hours : till 15:30 hrs

Trade modification end time / Exercise Market : 16:15 hours

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History of online trading

The history of e-trading goes back to 1983, when a doctor in Michigan placed the first online trade using E-TRADE technology. What began with a single click over 16 years ago has now taken the world by storm. The concept was visualized by one bill porter, a physicist and inventor with more than dozen of patents to his credit, who provided online quotes and trading services to fidelity, Charles Schwab, and quick and Reilly. This led bill to wonder why, as an individual investor, he had to pay a broker hundreds of dollars for stock transactions. With incredible foresight, he saw the solution at hand, some day everyone would own computers and invest through them with unprecedented efficiency and control. And today his dream has become a reality.

Internet Based Trading through Order Routing Systems:Internet based trading on conventional exchanges, uses the Internet as a medium for communicating client orders to the exchange, through broker web sites. Broker s web sites may serve a variety of functions. These may include; y y y Allowing the clients to directly trade through investors; Advertise the broker dealers services to potential investors; Offer market information and investment tools similar to those offered by information vendor or SRO web sites;

55

Offer real-time or delayed quote information, continuously update quotes while the user visits other sites, or allow investors to create a personal stock ticker;

Provide market summaries and commentaries, analyst reports and trading strategies and market data on currencies, mutual funds, options, market indices and news; and

Offer investors access to portfolio management tools and analytic programs;

y y

Information on commission and fees; and Account information and research reports.

In an Order Routing system, a broker offering Internet trading facility provides an electronic template for the customer to enter the name of the security, whatever it is to be bought or sold, the quantity and whatever the order is a market or limit order. Once the broker s system receives this information. Use of Internet as Alternative Trading Systems (Provision for price discovery and matching outside conventional exchanges) In foreign jurisdiction, Alternative trading systems have been developing outside conventional securities markets, which provide investors with additional proprietary electronic trading facilities for securities that are traded principally on securities exchanges, or other organized markets. They have price discovery functions, matching
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systems and crossing systems. The systems that are currently in use in outside jurisdictions are closed systems and are not accessible to the general public through the Internet. The securities markets regulators abroad the maintained flexible and open policies designed to encourage innovation in the secondary securities markets. As a result, a number of market participants, usually broker-dealers, have developed computerized alternative trading systems by which the system

centralize, display, match, cross or otherwise execute trading interest.

Use of Internet for making Initial Public Offerings (IPO)

Issues of securities of using the Internet to communicate directly with their shareholders, potential investors and analysts by disseminatingcorporate information. In foreign jurisdiction, they are also using the Internet to communicate to the public for the following: y y y Public offerings; Private offerings; and Disclosure and communication

Issuers are using the Internet to market themselves to potential investors. The Internet is also being used for fulfilling necessary disclosure requirements, for disseminating the prospects in electronics form and even for receiving share applications in public issues electronically. In India, SEBI has taken initiative in permitting use of the

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network of stock exchange for collection of investor applications in public offerings by the issuer companies.

Investment Advisory Services

Brokers as well as other service providers such as investment firms, research outfits etc. are using the Internet for marketing and advertising purposes, for presenting information on portfolio analysis and market information, and for communicating with and receiving orders from potential investors. The services offered by the service providers to the investors are generally the following: y y y y y
y

Advertising Providing investment information and investment advice; Underwriting Communicating with the investors; Customer orders; and Record keeping

Working Groups set up by the Committee

Considering the present state of capital markets in India and keeping in view the ongoing developments in Internet based securities business, it was felt that SEBI as a regulator could strive to identify areas where use of Internet in the capital market is possible within the existing legal

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framework. One such area identified by the Committee, which is also the central within the existing legal framework. One such area identified by the Committee, which is also the central theme of this report, is the area of Internet trading on existing electronic exchange. In this area, through early introduction of Cyber Laws would be highly describe but their existence is not a necessary precondition. To look into the existing regulatory scenario and to bring out some ground rules for use of the medium of Internet, the Committee therefore constituted the following two working groups to look into the area of: i. Security protocols and standardization of interfaces for Interest based securities trading, chaired by Prof. Deepak B. Phatak, IIT, Pawai, Mumbai ii. Surveillance and monitoring related issues arising due to Interest based securities trading, chaired by Shri. L.K. Singhvi, Sr. ED, SEBI The committee also requested Ms D N Raval, Executive Director, SEBI to examine the legality of introduction of Internet trading and issue of Alternative trading systems. This report of the standing committee examines the regulatory and security requirements Internet Based Trading on Conventional Exchanges. Separate reports (s) will cover the other areas related to Internet applications in the securities markets.

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The report of the first working group on security protocols and standardization of interfaces has since been submitted and incorporated in the report. The committee would like to place on record its sincere thanks to Dr. D.B. Phatak, Ms. D.N. Raval and their team members. The global financial market is undergoing a transformation due to rapid technological developments. It thus becomes imperative that for developing in effective regulatory framework developments in other parts of the world should be studies and analyzed. With nearly who million on-line investors, Internet trading in the United States is growing by leaps and bounds. Internet trading is being facilitated by large brokerage houses, thus changing the total concept of securities trading. A team comprising of members from stock exchanges and SEBI visited the United States to these development and had interactions with brokerages houses, Internet service providers and other agencies involved in facilitating Internet trading. The team also discussed the developments in the emerging regulatory and supervisory framework in United States with the Securities and Exchange Commission officials. They were also tripped of the various initiatives taken by SEC in this regard. These inputs have been utilized while drafting this report.

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Recommendations of the Committee

Application for Permission by Brokers: SEBI registered Stock Brokers interested in providing Internet based trading services will be required to apply to the respective stock exchange for a formal permission. The stock exchange should grant approval or reject the application as the case may be, and communicate its decisions to the number within 30 calendar days of the date of completed application submitted to the exchange. The stock exchange, before giving permission to brokers to start Internet based services shall ensure the fulfillment of the following minimum conditions.

Net worth Requirement: The broker must have a minimum net worth of Rs. 50 lacs if the broker is providing the Internet based facility on his own. However, if some brokers collectively approach a service provider for providing the interest trading facility, net worth, criteria as stipulated by the stock exchange will apply. The net worth will be computed as per the SEBI circular no FITTC/DC/CIR-1/98 dated June 16, 1998.

Operational and System Requirements:

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 Operational Integrity: The stock Exchange must ensure that the system used by the broker has provision for security, reliability and confidentiality of data through use of encryption technology. This stock exchange must also ensure that records encryption technology. The stock Exchange must also ensure the records maintained in electronic from by the broker are not susceptible to manipulation.  System Capacity The stock Exchange must ensure that the brokers maintain adequate backup systems and data storage capacity. The stock Exchange must also ensure that the workers have adequate system capacity for handling data transfer, and arranged for alternative means of communications in case of Internet link failure.

 Qualified Personnel: The stock Exchange must lay down the minimum qualification fro personnel to ensure that the broker has suitably qualified and adequate personnel to handle communication including instructions as well as other back office work which is likely to increase because of higher volumes.  Written Procedures:

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Stock Exchange must develop uniform written procedures to handle contingency situations and for review of incoming and outgoing electronic correspondence.  Signature Verification/ Authentication: It is desirable that participants use authentication technologies. For this purpose is should be mandatory for participants to use certification agencies as and when notified by Government/SEBI. They should also clearly specify when manual signatures would be required.

 Client Broker Relationship Know Your Client: The stock Exchange must ensure that brokers have sufficient, verifiable information about clients, which would facilitate risk evaluation of clients.

Broker- Client Agreement: Brokers must enter into an agreement with clients spelling out all obligations and rights. This agreement should also inter alia, the minimum service standards to be maintained by the broker for such service specified by SEBI/Exchange for the internet based trading from time to time. Exchange will prepare a model agreement for this purpose. The broker agreement with clients should not have any clause
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that is less stringent/contrary to the conditions stipulated is the model agreement.

Investor Information: The broker web site providing the internet based trading facility should contain information meant for investor protection such as rules and regulations affecting client broker relationship arbitration rules, investor protection rules etc. The broker web site providing the Internet based trading facility should also provide and display prominently, hyper link to the web site/page on the web site of the relevant stock exchange (s) displaying rules/ regulations/ circulars. Ticker/quote/order book displayed on the web-site of the broker should display the time stamp as well as source of such information against the given information.

Order/Trade Confirmation: Order/Trade confirmation should also be sent to the investor through email at client s discretion at the time specified by the client in addition to the other made of display of such confirmation of real time basis on the broker web site. The investor should be allowed to specify the time interval on the web site itself within which he would like to receive this information through email. Facility for reconfirmation of orders which
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are larger than that specified by the member's risk management system should be provided on the internet based system.

Handling Complaints by Investors: Exchanges should monitor complaints from investors regarding service provided by brokers to ensure a minimum level of service. Exchange should have separate cell specifically to handle Internet trading related complaints. It is desirable that exchanges should also have facility for on-line registration of complaints on their web site.

Risk Management: Exchanges must ensure that brokers have a system-based control on the trading limits of clients, and exposures taken by clients. Brokers must set predefined limits on the exposure and turnover of each client. The broker systems should be capable of assessing the risk of the client as soon as the order comes in. The client should be informed of acceptance/rejection of the order within a reasonable period. In case system based control rejects an order because of client having exceeded limits etc., the broker system may have a review and release facility to allow the order to pass through.

Contract Notes:
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Contract notes must be issued to clients as per existing regulations, within 24 hours of the trade execution. Cross Trades: As a matter of abundant precaution, the committee seeks to reiterate that as III the case of existing system, brokers using Internet based systems for routing client orders will also not be allowed to cross trades of their clients with each other. All orders must be offered to the market for matching. It is emphasized that in addition to the requirements mentioned above, all existing obligations of the broker as per current regulation will continue without changes. Exchanges may also like to specify more stringent standards as they may deem fit for allowing Internet based trading facilities to their brokers.

Enforcement: A separate working group has been set to look into the surveillance and enforcement related issues arising due to Internet based securities trading. However, general anti-fraud provisions (SEBI Fraudulent and Unfair Trade Practices Regulations, 1995) would apply to all transactions involving securities or financial services, regardless of the medium.

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FEATURES OF ONLINE TRADING:

The Online Trading is having many features which make it most suitable for the investors to go for. Some of these features are as follows:

The Internet can provide a new sense of control over your financial future. The amount of investment information available online is truly astounding. It's one of the best aspects of being a wired investor. For the first time in history, any individual with an Internet connection can: y Know the price of any stock at any time y Review the price history of any stock in chart format y Follow market events in-depth y Receive a wealth of free commentary and analysis about stock markets and the global economy y Conduct extensive financial research on any company

One of the great appeals of using an online trading account is the fact that the account belongs to you, and is under your direct control. When you want to buy or sell stock, you no longer need to call your broker on the phone; hope that he is in the office to place your order; possibly argue with the broker about the order; and hope that the transaction is executed instantly.
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At the most basic level, an online trading account gives you more agility in buying and selling stocks. This is through sophisticated information streams, dedicated trading platforms and sophisticated tools for accessing the markets.

Every broker house aims at providing the investor with the best price available. Also due to the high level of transparency with regard to display of information relating to the specific stocks and company profiles, you will be able to get the best quote for your orders.

Online trading offers you greater transparency by providing you with an audit trail. This involves a complete integrated electronic chain starting from order placement, to clearing and settlement and finally ending with a credit into your depository account. All these stages are subject to inspection, thus bringing in transparency into the system.

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Online trading integrates your bank account, your trading account and your demat accounts, which leads to easy and paperless trading for you.

You as an Investment online customer will be able to execute the entire trading transaction, right from logging on to our site, to the execution and settlement of your bank account, in a very short period of time.

Trading on the net, gives even the smallest retail investor access to information that earlier was available only to the big traders. This provides a level playing field for all investors in the securities market.

This method of trading reduces the settlement risk for the investor, as in this case all short sell orders are squared off at the specified cut-off time and not allowed to be carried forward. In the case of a demat account, your demat account is checked by us before executing your sell transaction. This reduces the settlement risk for the buyer, who is assured of the delivery of the securities and for you as a seller of the securities
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Every trade is confirmed immediately and you will receive an on-screen confirmation following every trade with full details for your records. This avoids costly errors that would have been discovered when it is too late.

Your Bank, Depository and online account are integrated for your convenience. Various broking houses provide access to many of the popular banks.

Broking houses work hard to keep our account and personal information secure. From updated security technology to advanced fraud prevention measures, they have the people and tools in place to provide a strong defense against electronic scams and fraud.

BENEFITS OF ONLINE BROKING

1) Less Costly: The most significant advantage of the online broking is the cost reduction in the brokerage. Due to the power of the Internet one has the privilege of becoming the clients of really large brokerages
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with the benefits of enjoying the low charges hithelio before enjoyed only by the big players. As the DP account has got linked to the trading account most players do not charge a minimum transaction cost thus truly allowing one to buy a single share and achieve meaningful rupee price averaging whatever be your buying power.

2) Peace of Mind: One can never have complete peace of mind but online investing does away with the hassles of filling up instruction slips, visits to the broker for handing over these slips and consequent costs.

3) Keeping Records: The site one trades on keeps a record of all transactions down to unexecuted orders and cancelled orders thus keeping one abreast of all your transactions 24 hours a day. No paperwork means more time at one s disposal for research and analysis.

4) Access to Information and investment Tools: Most online investing sites have a wealth of information for their registered members. This includes research reports, results, analysis and even gossip and the buzz in the market.
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5) Unparalleled Liquidity: The bank account linked with the trading account invariably has an A TM free. Most partner banks offer Internet banking as well. This results in one s money becoming available to him whenever he like from his trading account. Conversely in case he spot an opportunity in the market he can immediately allocate money from his savings account to his trading account and make profits.

6) Unparalleled Safety: Most sites are secure using 128-bit algorithms -highest available commercially anywhere in the world. Moreover even if somebody broke in and tampered with one s account the money from the stocks he sold or the stock bought from the money in his account is in his account only.

8) Reduces the settlement risk: This method of trading reduces the settlement risk for the investor, as in this case no Short sale is possible i.e. the seller will not be able to sell the securities unless he has their actual possession. In the case of a demat account (required for an online transaction), when a seller wants to sell the securities, his demat account is checked by the Depository Participant before executing
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the sale transaction. This reduces the settlement risk for the buyer, who is assured of the delivery of the securities.

9) Offers greater transparency: Online trading gives greater transparency to the investors by providing them an audit trail. This involves a complete integrated electronic chain starting from order placement, to clearing and settlement and finally ending with a credit to the depository account of the investor. All these stages are subject to inspection, thus bringing in transparency into the system. 10) Ease of trade: It is the ease of doing the trade through net, with a click of mouse; one can buy or sell any share that is dematerialized.

Other than the above-mentioned advantages, Internet trading provides some additional advantages to the investors, brokers and also helps the nation to channelize the resources. Net trading would increase competition in the market hence increase in the bargaining power of the investors. The entire communication between the investor, broker and exchange would take place within milliseconds.

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PROBLEMS OF ONLINE BROKING

There is a flip side to everything and online trading is no exception.
4%

14%

21%

More Costly

Lack Of Knowledge

11%

Loyalty to Traditional Broker

Lack of Trust
23%

Slow Speed
27%

Other

Source: -www.karvy.com

 27% Loyality is of traditional broker  23% people says that online trading is more costly than manual trading.  21% people not prefer online trading because of lack of knowledge. So, the main problems of online trading are as follows:

1.) "Server not found": This may appear on one s screens when he is desperately trying to get out of an unprofitable position. Some of the online sites are providing a
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telephone number for use in case their sites are overloaded or their server down. 2.) Connectivity of the Broker with NSE: Recently ICICI Direct had a connectivity problem with the NSE for two and halfhours during trading hours. This problem is rare but be alive to its possibility. 3.) Cyber attack: In the event of a malicious attack on the systems of one s broker he is protected only if the company is taking proper precautions against such attacks and if proper backup is regularly been taken. He may like to choose a brokerage that has a stated security policy and contingency plan in place. 4.) Non-availability of a seamless interface: As a client one will access the NSE through a server of the online brokerage and this may involve queuing delays. If a number of client access the server the server takes its own time sending the ordersto the NSE server. He must check out the seamlessness of this interface before selecting an online brokerage. The faster the orders are processed the more seamless is the interface. 5.) Non- availability of personalized advice:

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If one likes to ask his broker "Aajkyaachcha lag rahahai" he may not be able to do so. If he wants advice on a particular stock in his portfolio he may not even be able to get that.

6.) Margin: If Internet trading alone is not fast and furious enough; many people are trading on margin. That is where the brokerage firm lends you money by leveraging his account, allowing him to buy a large amount of securities by putting up only a small amount of money. He may have forgotten what he read in the small print of his agreement, but the brokerage firm has the right to change the maintenance margin requirements without any warning or notice to him. In fact, the firm has the right to liquidate his securities holdings (and it can pick and choose which ones) without any notice to one if he fails to meet the margin call. And there he was leveraged to the hilt, hoping to hit a home run when he discovered that he is required to make a large deposit that he cannot make. The next thing one knows, the firm is selling off his securities at a point in time that is not the best for him. These are the perils of trading on margin. 7.) Little use of advisory services:

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The advisory services being promised by the brokers would be of little use to investors looking for an insight into the market. Many would not like to rely on research reports, which are there for all. So, net investors will have to do their own research and take their own decision, whether wild or wise. 8.) Increased charges: Some of the brokers are of the view that they would have to provide advisory services to the customers. But with increased volumes, they will have to follow the international practice of charging a little more than the normal charges from a customer looking for personal advice.

WHY PEOPLE ARE BENDING TOWARDS ONLINE TRADING?

Several broking houses now offer online trading facilities. You can trade online with e-brokerages such as KSBL, ICICI Direct, Kotakstreet, India bulls, India info line s 5paisa.com and HDFC securities. If you are already comfortable trading with your regular broker, here are few reasons why you may consider switching to trading online, or at least another avenue of trading. An obvious advantage of online trading is that your transaction would be virtually paperless. Your trading account would be linked to your demat and bank account, ensuring a smooth transaction process. This is especially helpful in the extent T+2

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settlement system, where you have just two days to settle your transaction. The normal process of issuing of delivery note, in case of a sale, or arranging for a payment in case of purchaser of shares, is all taken care of the minute your order is executed online. The absence of manual intervention ensures that you are completely in control of all transaction. There is also little room for error, as your order is always confirmed before it is executed. You can also make better decision as you have a clear record of all your previous transaction. When you trade offline, a demat statement is normally sent to you only on a quarterly basis .keeping track of your portfolio can be a hassle in such a case. The internet can provide a new sense of control over your financial future. The amount of investment information available online is truly astounding. Its one of the best aspect of being a wired investor for the first time in history, any individual with an internet connection can: y Know the price of any stock at any time y Review the price history of any stock in chart format y Follow market events in-depth y Receive a wealth of free commentary and analysis about stock markets and globe economy. y Conduct extensive financial research on any company
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y Talk with other investors around the world At investment you can get real-time stock quotes, daily roundups of the stock market, expert s commentary, and a deep community of fellow investors. Convenience is probably the greatest advantage online trading offers investors. If don t have time to trade during market hours, perhaps you are at work, you can log on the web-trading site and place your order offline, during off market hours. Your order would join the queue and be expected the next day. You would need to enjoy a good relationship with your broker, for you to be able to reach him in the late hours. For non-resident Indians (NRI), trading online is perhaps their easiest option to invest in the Indian stock markets. What is more, the time difference, in some cases, can work to their advantage .Antony, an NRI-based in New York, places his order in the evening after work, when it is day time India and the markets are open. We also have access to considerable information online. By just logging on to ICICI direct online, for instance, we can get the latest news, market information and company research. Moreover, if our connection is maddeningly slow and we want to get your order executed immediately, most e-brokerages also provide a facility to trade offline by placing our order via the phone.

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PROCESS OF ONLINE TRADING

An investor interesting in trading through Internet shall have to; firstly register himself with an Internet brokerage firm. Some formalities such as filling the account opening form of the e-broker, copies of identity proof, copy of residence proof are made to register him with the etrader. Secondly, the investor would be required to open a bank account with a scheduled bank and sufficient balance should be kept in the account. Thirdly he would be required to open account with a depository participant because only dematerialized shares can be traded on Internet.

The client places order via the net by logging on to his

The broker accepts and executes the order and places it with the exchange

The exchange accepts the order after checking the share limit for the day.

The broker makes the payment either directly via the client bank account or pays through its own account and recovers it later from the client.

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The exchange receives money and completes the settlement.

The client is intimated about the settlement either through the demat or via e-mail.

So, generally following steps are followed while doing the trading through the Internet: Step-I: Those investors interested in doing the trading over Internet system, that is, NEAT - ISX (NSE), should approach the brokers and register with the Stock Broker. Step-2: After registration, the broker will provide to them a login name, password and a personal identification number (PIN). Step-3: Actual placement of an order, using the place order window as under can then place an order: (a) First by entering the symbol and series of stock and other parameters such as quantity and price of the scrip on the place order window.
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(b) Second, fill in the symbol, series and the default quantity.

Step-4: It is the process of review. Thus, the investor has to review the order placed by clicking the review option. He may also re-set to clear the values.

Step-5: After the review has been satisfactory; the order has to be sent by clicking on the send option.

Step-6: The investor will receive an "Order Confirmation" 'message along with the order number and the value of the order.

Step- 7: In case the order is rejected by the Broker or the Stock Exchange for certain reasons such as invalid price limit, an appropriate message will appear at the bottom of the screen. At present, a time lag of about ten seconds is there in executing the trade.

Step-8:
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It is regarding charging payment, for which there are different modes. Some brokers will take some advance payment from the, investors and will fix their trading limits. When the trade is executed, the broker will ask the investor for transfer of funds by the investor to his account.

Rolling Settlement Cycle:

In a rolling settlement, each trading day is considered as a trading period and trades executed during the day are settled based on the net obligations for the day. At NSE and BSE, trades in rolling settlement are settled on a T+2 basis i.e. on the 2nd working day. For arriving at the settlement day all intervening holidays, which include bank holidays, NSE/BSE holidays,Saturdays and Sundays are excluded. Typically trades taking place on Monday are settled on Wednesday, Tuesday's trades settled on Thursday and so on.

Concept of Buying Limit

Suppose you have sold some shares on NSE and are trying to figure out that if you can use the money to buy shares on NSE in a different settlement cycle or say on BSE. To simplify things for ICICI Direct customers, we have introduced the concept of Buying Limit (BL). Buying Limit simply tells the customer what is his limit for a given settlement for the desired exchange. Assume that you have enrolled for a ICICI Direct account, which requires 100% of the money required to fund the purchase, be available. Suppose you have Rs 1,00,000 in your Bank A/C and you set aside Rs 50,000 for which you would like to make some purchase. Your Buying Limit is Rs 50,000. Assume that you sell shares worth Rs 1,00,000 on the NSE on Monday. The BL therefore for the NSE at that point of time goes upto Rs 1,50,000. This means you can buy
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shares upto Rs 1,50,000 on NSE or BSE. If you buy shares worth Rs 75,000 on Tuesday on NSE your BL will naturally reduce to Rs75, 000. Hence your BL is simply the amount set aside by you from your bank account and the amount realized from the sale of any shares you have made less any purchases you have made. Your BL of Rs 50,000, which is the amount set aside by you from your Bank account for purchase is available for BSE and NSE. As you have made the sale of shares on NSE for Rs.100000, the BL for NSE & BSE rises to 1,50,000. The amount from sale of shares in NSE will also be available for purchase on BSE. ICICI Direct.

Future Agenda:
Under the existing legal and regulatory framework, SEBI registered brokers can offer trading on Internet through order is routing systems. However, with the rapid development of the technology, we have to evolve fisher steps in this direction it is therefore proposed that as the next step link between the depositories and banks shall be established after the necessary regulations have been passed. This would reduce the clearing and settlement time and would also minimize the risk of all the participants involved in the transactions. We have to look forward towards achieving an ideal scenario where all the services related to securities markets including marketing of initial public offers on internet, providing investment advisory services to the clients, broking, clearing and settlement etc., are provided on the Internet by an intermediary. In a nutshell it can be said that we are moving towards a one-stop service center.

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RESEARCH METHODOLOGY

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RESEARCH METHODOLOGY
OBJECTIVES OF THE STUDY:
 It is to analyze the changes in trading after the exchange shifted from outcry to online trading system.  It is to study the functions of KSBL through various departments.  To know the online screen based trading system adopted by KSBL and about its communication facilities. The appropriate configuration to set the network, which would link the KSBL to individual / members.  To know about the latest and future development in the stock exchange trading system.

METHODOLOGY OF THE STUDY:

The basic task of research is to generate accurate information for use in decision making. Research can be defined as the systematic and objective process of gathering, recording and analyzing data for aid in making business decisions. There are basically two techniques adopted for obtaining information:

1) Primary Data. 2) Secondary Data. Primary Data: -is gathered specifically for the project at hand through
personal interviews with authorized members of KSBL.

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Secondary data: - The brochures and material provided by KSBL.

The data collected from the magazines of the NSE, economic times, etc. Various books relating to the investments, capital market and other related topics.

Scope of study:
The study is limited to Karvy Stock Broking Ltd, Lucknow.

Sources of data collection are:

1) www.karvyonline.com 2) www.nseindia.com 3) www.bseindia.com 4) www.on-linetrading.com For the successful research the manipulation of certain things, concepts, and symbols for the purpose of generalization is inevitable. Research is simply the pursuit of truth with the help of the study.

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Comparative Analysis
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THE MAJOR PLAYERS IN ONLINE TRADING

1. 2. 3. 4. 5. SHAREKHAN.COM 5PAISA.COM INDIABULLS.COM ICICIDIRECT.COM HDFCSEC.COM HDFC SECURITIES:

Company Background:
HDFC Securities Ltd is promoted by the HDFC Bank, HDFC and Chase Capital Partners and their associates.Pioneers in setting up Dial-a-share service with the largest team of Tele-brokers. Online Account Type:  HDFC Online Trading A/c: Plain Vanilla Account with focus on 3 in1advantage. Pricing of HDFC Account
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 Account Opening: Rs 750  Demat: NIL, 1st year charges included in Account Opening  Initial Margin: Rs 5000/- for non HDFC Bank Customers (AQB)  Brokerage: Trading 0.15%* each side + ST Delivery 0.50%** each side + ST *Rs 25 Min Brokerage per transaction **Rs 8 Min Brokerage per transaction

ICICI Direct:

 Account Opening: Rs 750  Schemes: For short periods Rs 750 is refundable against brokerage generatedin a qtr. These schemes are introduced 3-4 times a year.  Demat: NIL, 1st year charges included in Account Opening Plus a facility to openadditional 4 DP s without 1st yr AMC. Only Rs 100 as linking charges per DP  Initial Margin: Nil  Brokerage: ICICI s brokerage rates are inclusive of Stamp duty (0.002%) fortrading and 0.010% for delivery while service tax (10.2%) on BROKERAGE landturnover tax is EXTRA.
Delivery Volper QTRBrokerageSquare Vol P.M.Brokerage < 10 lakhs 0.75% < 50 lakhs .10% Both Sides

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10 25 lakhs 0.70% 50 lakhs 2 Cr .08% Both Sides 25 50 lakhs 0.55% 2Cr-5Cr .05% Both Sides 50 lakhs - 1 Cr 0.45% 5Cr- 10 Cr .04% Both Sides 1 Cr 2 Cr 0.35% 10Cr -20 Cr .035% Both Sides 2 Cr 5 Cr 0.30% > 20 Cr .03% Both Sides > 5 Cr 0.25% ---- --------

INDIABULLS:

Company Background: India Bulls is a retail financial services company present in 70 locations covering 62 cities. It offers a full range of financial services and products 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 Indiabulls: Account with sophisticated trading tools, low commissions and priority access to R.M.
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Pricing of Indiabulls Accounts: Signature Account Power India Bulls * Account Opening: Rs 250 * Account Opening: Rs 750 * Demat: Rs 200 if POA is signed, No AMC for this DP * Initial Margin: NIL * Initial Margin: NIL * Brokerage: Negotiable PAID Research: SCHEME
WebBased-1-Month-500: WebBased-1-Month-6000: PrintReport-1-Month-750: + 10 Reports Delivered PrintReport-1-Month-9000: + 10 Reports Delivered 5paisa:

FACILITY
View & Print on Website View & Print on Website View & Print on Website View & Print on Website

Company Background Indiainfoline was founded in 1995 and was positioned as a research firm. In 2000 e-broking was started under the brand name of 5paisa.com.
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Apart from offering online trading in stock market the company offers mutual funds online. It also acts as a distributor of various financial services i.e. GOI securities,Company Fixed Deposits, Insurance. Limited ground network, present in 20 cities Online Account Types  Investor Terminal : Investors / Students  Trader Terminal : Day Traders / HNI s PRICING FOR RETAIL CLIENTS Investor Terminal
 Account Opening: Rs 500  Demat 1st Yr: Rs 250  Initial Margin: Rs 2500 (Compulsory)  Min Margin Retainable: Rs 1000  Brokerage:Trading 0.10% each side + ST Delivery 0.50% each side + ST

PRICING FOR HNI CLIENTS Trader Terminal

 Account Opening: Rs 500  Demat 1st Yr: Rs 250  Initial Margin: Rs 5000(Compulsory)  Min Margin Retainable: Rs 1000  Brokerage: Trading 0.10% each side + ST Delivery 0.50% each side + ST (Negotiable to 0.05% each side & 0.25%)  Account Access Charges: Monthly Rs 800, adjustable against Brokerage Yearly Rs 8000, adjustable against brokerage

Share khan:
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Company Background:  Sharekhan is the retail broking arm of SSKI Securities Pvt Ltd. SSKI owns 56%in Sharekhan, balance ownership is HSBC, First Caryle, and Intel Pacific  Into broking since 80 years  focused on providing equity solutions to every segment.  Largest ground network of 210 Branded Share shops in 90 cities. Online Account Types:  Classis Account / Applet: Investor in equities  Speed Trade: Trader in equities & derivatives PRICING FOR HNI CLIENTS Speed Trade  Account Opening: Rs 1000 (Refundable against brokerage in Month + 1)  Demat 1st Yr : Incl in Account Opening  Initial Margin : Nil  Min Margin Retainable : NIL  Brokerage :Trading 0.10% each side + All Taxes Delivery 0.50% each side + All Taxes (Negotiable based on volume)  Account Access Charges:Monthly Rs 500, adjustable qtrly against brokerage of Rs 9000/- for qtr.  No access charges for gold customers (Above 1 lac brokerage p.a) Pricing for Retail Customers Classic / Applet  Account Opening : Rs 750
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 Demat 1st Yr : NIL  Initial Margin : NIL  Min Margin Retainable : NIL  Brokerage:Trading 0.10% each side + All Taxes Delivery 0.50% each side + All Taxes

CLASSIC/WEBSITE FEATURES  Facility to integrate choice of 4 Banks/DP/Trading Account  Instant credit for shares sold from DP  Automatic pick-up of shares from linked DP for pay in  Automatic deposit of shares into linked DP after pay-out  4 Times leverage on Margin Trades  Margin Trading available for entire marker session  Slab wise brokerage structure for delivery and margin trades, shortly  Free calls for order placement on Toll-Free  Trusted, Professional advice of Tele-brokers  Facility to enter After Market Orders online & via Phone

SPEEDTRADE EXE FEATURES ALL THE FEATURES OF CLASSIC *Real time streaming quotes using 2 Marker Watches *Trade Execution in 2-3 seconds * Instant Order/trade confirmations in the same window *Hot keys similar to a Broker s Terminal *MULTIPLE Tic-by-Tic Intra-day charts with multiple indicators * Availability of 2 ISP & 6 Servers ensuring maximum uptime * Customized alerts based on multiple parameters
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* Cancel All/Square off All Facility * Window for Top Gainers, Top Losers, and Most Active updated Live

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Analysis andInterpreta tion

Analysis and Interpretation

(Sample size 100)
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1.For how long you have been trading with on line-trading? (a)1 year (b) 2 year (c) 3 year (d) 4 year According to this survey we find that 44% people says that weare investing the money online from one year and 26% peoplesays that we are investing the money online from 2 years and19% to 11% people says that we are investing money onlinefrom 3 to 4 year. So we can say that now online trading is verypopular in the modern market. 2. How will you describe your experience with on-line trading till date? (a) Veryeasy to operate (b) verydifficult tooperate (c) not secure (d) any other

According to this survey we find that 60% of people find very easy tooperate and 15% people find diffcuilt two operate and 10% and 15%people find no secure and any other. so we can say that online tradingis very simple to operate and easy to understand. 3.What amount of money you invest normally? (a) 50000 (b) 100000 to 150000 (c) 150000 to 2000000 (d) Any other amount According to this survey we find that 35% of people investmoney normally 50000 and 28% of people invest money100000to150000 and 23% and 14% of people invest moneybetween 150000to200000 and
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any other. So we can say that thepeople are not invest more money in the share market becausethere is a great risk involved while doing the trading. 4. How often do you trade? (a)Daily (b) Weekly (c) Monthly (d) More than one month According to this survey we find that 10% of people do trade Dailyand 40% people do trade weekly and 32% and 18% people do trademonth and more than month. So we can say that people aregenerally invested in stock market weekly basis. 5.Which trading you prefer? (a) On line trading (b) Manual trading (c) Both According to this survey we find that 20% people prefer online trading and 32% people prefer offline trading rest of 48% peopleprefers both. So we can say that mostly people are awareness aboutthe on line trading and because of this reason the mostly people areoptimizing offline trading. 6. Whether online trading settled in Indian investor psyche (a) Yes (b) No According to this survey we find that 30% people says yes and 70%people says no. so we can find that on line trading is not settled
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inthe Indian psyche because some people are not experience towardsonline trading. 7. What shortcomings do you feel in Indian On-Line trading? (a) Lack of awareness the investors about on-line trading (b) Shortage of domestic technical expertise (c) Shortage of Infra structure (c) any other According to this survey we find that 15% of people says lack ofawareness 49% says Shortage of expertise and 14% people saysShortage Of Infra structure and 22% says any other. So we cansay that mostly people are shortage of experience about theIndian derivatives market or share market.

8.Which media would you prefer the most for investment? (a) T.V (b) Newspaper (c) Magazines (d) Journals According to this survey we find that 55% people Prefer T.V and 25%people prefer newspaper and 10% people prefer magazines and 10%people prefer journals. So we can suggest that mostly people are veryeasily grapped the knowledge through T.V.

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FINDINGS
1.For how long you have been trading with on line-trading? According to this survey we find that 44% people says that we are investing themoney online from one year.11% people say that we are investing money online from 4 year. So we can say that now online trading is very popular in the modern market.

2. How will you describe your experience with on-line trading till date? According to this survey we find that 60% of people find very easyto operate. and15% people find no secure. So we can say that onlinetrading is very simple to operate and easy to understand

3.What amount of money you invest normally? According to this survey we find that 35% of people investmoney normally 50000. 14% of people invest money between150000to200000. So we can say that the people are not investmore money in the share market because there is a great riskinvolved while doing the trading.

4.How often do you trade? According to this survey we find that 10% of people do trade Daily.18% people do trade more than month. So we can say that peopleare generally invest in stock market weekly basis.

5.Which trading you prefer?

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According to this survey we find that 20% people prefer online trading and 32% people prefer offline trading. So we can say thatmostly people are awareness about the on line trading and becauseof this reason the mostly people are optimizing offline trading. 6. Whether online trading settled in Indian investor psyche? According to this survey we find that 30% people says yes and 70%people says no. so we can find that on line trading is not settled inthe Indian psyche because some people are not experience towardsonline trading.

7.What shortcomings do you feel in Indian derivatives market? According to this survey we find that 37% of people says lack ofawareness 49% says Shortage of expertise and 14% people saysany other. So we can say that mostly people are shortage ofexperience about the Indian derivatives market or share market.

8.Which media would you prefer the most for investment? According to this survey we find that 41% people Prefer T.Vand 39% people prefer newspaper and 20% people prefer magazines.So we can suggest that mostly people are very easily grapped theknowledge through T.V.

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Conclusions & Recommendations

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RECOMMENDATIONS:1.Things have changed for the better with the KARVY STOCK BROKING LTD. going on-line coupled with endeavor to stream line the whole trading system, things have changed dramatically over the last 3 to 4 years. New and advanced technologies have breached geographical and cultural barriers, and have brought the countrywide market to doorstep. 2. In the present scenario to compete with the Broker s would require soundinfrastructure and trading as per international standards. 3. The introduction of on-line trading would influence the investors resulting in an increase in the business of the exchange. It has helped the brokers handling a vast amount of transactions and this can be an efficient trading, delivering, settlement system with adequate protection to investors. 4. Due to invention of online trading there has been greater benefit to the investors as they could sell / buy shares as and when required and that to with online trading. 5. The broker s has a greater scope than compared to the earlier times because of invention of online trading.

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6. The concept of business has changed today, this is a service oriented industry hence the survival would require them to provide the best possible service to the clients. 7. I recommend the exchange authorities to take steps to educate Investors about their rights and duties. I suggest to the exchange authorities to increase the investors confidences. 8. I recommend the exchange authorities to be vigilant to curb wide fluctuations of prices. 9. The speculative pressures are responsible for the wide changes in the price, not attracting the genuine investors to the greater extent towards the market. 10. Genuine investors are not at all interested in the speculative gain as their investment is based on the future profits, therefore the authorities of the exchange should be more vigilant to curb the speculation. 11. Necessary steps should be taken by the exchange to deal with the situations arising due to break down in online trading.

CONCLUSION:Online trading is the new concept in the stock market. In India, online trading is still at its infancy stage. Online trading has made it easy to trade in the stock market as now people can trade while sitting at their home. Now stock market is easily accessible by the people. There are some problems while doing the trade through the internet. Major problem faced by online trader is that the investors are loyal to their traditional brokers; they rely upon the suggestions given by their
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brokers. Another major problem is that the people don't have full knowledge regarding online trading. They find it difficult to trade them, as a wrong entry made by them, can bring them huge losses. Nevertheless to say that online trading has the bright future as the percentage of the trade done through online trading is increasing day by day.

LIMITATIONS:Despite of the training my level best, there were still some limitation which I think remains there to draw fruitful conclusion. There were some practical problem which come across and could not be properly death with  The advisory services being promised by the brokers would be of little use to investors looking for an insight into the market.  As a client one will access the NSE through a server of the online brokerage and this may involve queuing delays.


If one likes to ask his broker "Aajkyaachcha lag rahahai" he may not be able to do so. If he wants advice on a particular stock in his portfolio he may not even be able to get that.

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Suggestions
The introduction of the Internet has surprisingly changed our way of life as a society. It has defined the way we do business and the way we correspond. The Internet has opened many opportunities for online trading. The financial industry revolves around the Internet. Everything is just a few clicks away. This makes online trading most convenient. But there are still investors who prefer the old fashion way of offline trading and they mainly prefer offline trading for security reasons. Internet has introduced a way for consumers to manage their money online. Not to mention, Internet has transformed the way investment companies operate their business and has made it easy for private investors to gain straight access to a range of different markets and online tools that were at one point only reserved by the use of investment professionals. Consumer investing and online trading has dramatically changed over the last decade. Online trading dynamically continues to be redefined. Services have expanded to include integrated management of additional financial accounts. Not to mention, it has subsequently expanded in conjunction with groundbreaking improvements to the traditional trading interface, such as telephone interface systems. Of course, online trading has many pros. There are several wonderful reasons to invest online and consider online trading. 1. Money saving opportunities the amount of money you save depends primarily on the online brokerage firm that you choose. No two firms are the same. There may be different regulations, similar to bank regulations. There are minimum deposits required that must be maintained. As mentioned above, this will depend on the online brokerage firm.

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2. Instant online access you can gain instant access to your account, the value of your portfolio updates immediately before your eyes. 3. Enter online trades at anytime you can enter online trades at anytime and from anywhere. This is very convenient if you live in a different time zone than the country you are trading in. Not to mention, it is especially fit for investors with busy schedules. 4.With online trading you are in charge you are in control of your investments. No sales pitches and no hassle. You decide where to invest your money.

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Questionnaire

Questionnaire:Dear respondent, I am student of MBA. I am working on the project of OnLine trading . You are requested to fill the questionnaire to enable, to undertake the study on the said Project. Name . Occupation Address Phone no ... 1. For how long you have been trading with on line-trading? (a)1 year (b) 2 year (c) 3 year (d) 4 year
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2. How will you describe your experience with on-line trading till date? (a) Very easy to operate (b) Very difficult to operate (c) Not secure (d) Any other 3. What amount of money you are invested normally? (a) 50000 (b) 100000 to 150000 (c) 150000 to 2000000 (d) any other amount 4. How often do you trade? (a)Daily (c) Monthly

(b) Weekly (d) More than one month

5. In which trading you will prefer? (a) Online trading (b) offline trading (c) Both 6. According to you online trading settled in Indian investor psyche? (a) Yes (b) No 7. What shortcomings do you feel in Indian On-line Trading? (a) Lack of awareness the investors about on-line trading (b) Shortage of domestic technical expertise (c) Shortage Of Infra structure (d) If any other 8. Which media would you prefer the most for investor? (a) T.V (b) Newspaper (c) Magazines (d) Journals
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9.Do you believe that your trader/broker is very successful in trading? (a)Strongly Agree (b) Agree (c)Moderate (d) Disagree (e)Strongly Disagree 10.Reasons for preferring Karvy stock broking Ltd. for trading?

11.What is your expectation about your trader?

LIST OF PLACES VISITED FOR CONDUCTING SURVEY:-

1) INDIAINFOLINE
Address: 4TH Floor,DTL Plaza 19 Way Road, Adjacent to P.K. Complex, Lucknow-226001

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2)

HDFC Securities Limited

Address:-56 - 57, Chander Nagar, 2nd Floor, Alambagh, Lucknow - 226005

3) INDIABULLS
Address:-8 & 9 Ground Floor, Saran Chamber - 2, Park Road, Lucknow - 226 001

4) SHAREKHAN LTD.
Address: 4, 1St Floor, Marie Gold ShahnajafRoad Lucknow-226001

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BIBLIOGRAPHY

BIBLIOGRAPHY: BOOKS:y Kothri C.R. , Research Methodology, VishwaPrakshan.

 Newspapers:y The Times of India y The Economic Times

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 MAGAZINES:
y Business World

 INTERNET SITES:-

y www.nseindia.com y www.bseindia.com y www.on-linetrading.com y www.sebi.gov.in y www.karvy.com y www.thefinapolis.com y www.moneycontrol.com

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