ETHICAL ISSUES IN STOCK BROKING FIRMS

Presented by:
SHIVAM(01) SHAN (22) NISHANT(25) RAHUL (40) NAVNEET (48) PRANAY (57)

 The process of investing in the share market, either individually or

through a broker is known as stock broking.

Stock broker suggests investment ideas and strategies suiting individual requirements and based on his objective of investment. After the amount is invested, the broker tracks and monitors the investments, changes or reinvests depending on the performance

and generates reports for them.

ABOUT THE INDUSTRY

 Misleading the investors and the traders.

Brokerage plans.
Lack of transparency in trading on phone. Leveraging on Investors demat account. At the time of opening of account the brokers get the Power of Attorney signed but very less investors know about it. Trading on behalf of investors and not conveying the same to them.

ETHICAL ISSUES TO BE TRACKED IN STOCK BROKING FIRMS

 So called given Tips of stocks and getting the funds of investors blocked into the account. Not imparting proper knowledge to the investors about trading. It takes a person 4 years to complete Engineering,2 years to complete MBA,5 years to complete MBBS but brokers make any person trader just by getting bundle of papers signed.(without having any practical knowledge about it ). Is it Ethical ? How many Investors know these terms or brokers are willing to let them know : a). EPS b). P/E c). Fundamentals of any company.

ETHICAL ISSUES TO BE TRACKED IN STOCK BROKING FIRMS

 Brokers make investors turn into Traders . Just for the sake of increasing the volume of trade to earn brokerage . How ethical it is ?? Brokers take personal positions in the market with the help of Investors fund. We have seen the failures of many big brokerage firms of U.S in last 2-3 years. What Brokers have to say on this ??? At the time of IPO ,brokers make a hype of it. The grey market operators get active which at the end of the day results in the loss of huge money of the little informed or less informed investors. e.g. Reliance Power IPO 2008 , Facebook IPO 2012.

How ethical it is?

ETHICAL ISSUES TO BE TRACKED IN STOCK BROKING FIRMS

 There are N number of small companies which even exists or not but with the help of big brokers they get their company listed on the exchanges and raise funds from the market. At the end of the day the ultimate loser is General Public. Why brokers help them?

If we see the data of last year trading in the NSE and BSE the 60% of the total trading was done by 11 big brokers. These brokers having the back up huge fund of Investors are in the position to easily influence the market.
Why diversification is not done ? They cause loss of lakhs and crores of rupees of the general public. How ethical it is ?

ETHICAL ISSUES TO BE TRACKED IN STOCK BROKING FIRMS

Two stock broking firms in Ranchi

1. 2. Share Khan stock broking ltd. Karvy stock broking ltd.

SAMPLE

 Will design a questionnaire(tracker) based on the parameters mentioned before. Will take an appointment with the business development manager of the stock broking firms to fill up the questionnaire. Will analyze the questionnaire by using various statistical tools. Will do a comparative study of two different firms. I:e Share Khan stock broking ltd and Karvy stock broking ltd. RESEARCH METHODOLOGY

THANK YOU