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Comparative Analysis Investment Options

Available In The Market And Customer


Buying Preferences

School of Management Sciences


Varanasi

Under Supervision of : By:


Mrs. Anju Singh Smriti Gupta
Designation : Roll N0:
Assistant Professor MBA 06/103
Introduction
• Investment is the employment of funds on assets with the
aim of earning income or capital appreciation.

• The dictionary meaning of investment is to commit money


in order to earn financial return or to make use of the
money for future benefits or advantages.

• All investments have some risk, whether in stock, capital


market, banking, financial sector, real estate, bullion, gold
etc. The degree of risk however varies on the basis of the
features of the assets, investments instrument, the mode
of investment, time frame or the issuer of the security etc.
Elements of Investment
• Reward
• Risk and Return
• Time

Why Should we Investment?


• To generate on your idle resources
• To earn returns
• To protect and increase capital
• To have money for important events
• Make a provision for future uncertainties
• Tax Savings
Literature Overview
• Preethi Singh (1986) disclosed the basic rules for selecting
the company to invest in. She opined that understanding
and measuring return and risk is fundamental to the
investment process. According to her, most investors are
'risk averse'. To have a higher return the investor has to
face greater risks. She concludes that risk is fundamental to
the process of investment.

• CRISIL Report on Risk Management (2000) stated that the


loss potential from market risk will increase in the absence
of strong risk management tools. The banks which adopt a
pro-active approach to upgrading risk management skills
which are currently unsophisticated as compared to
internationally best practices, would have a competitive
edge in future.
Research Methodology
• Research Methodology is a way to systematically solve
the research problem.

• The Research Methodology includes the various


methods and techniques for conducting a research.

• The logic behind taking research methodology into


consideration is that one can have knowledge about
the method and procedure adopted for achievement of
objective of the project.
Schematic diagram for the theoretical framework
including a moderating variable

• Independent Variable : Income, Age, Education, Gender


• Dependent Variable : Investment in Banking & Share Market
• Moderate Variable : Economical Environment
Sampling Design
• Sampling unit – The target population must be defined
that has to be sampled. The sampling unit of research
included students and professionals residing in Indore
city.

• Sample size – This refers to number of respondents to


be selected from the Indore city to constitute a sample.
The sample size of 50 Investors will be taken.

• Sampling Technique – In this project, Questionnaire


Method will be used for the collecting the data.
Tools For Data Collection:

In this research two types of data were used


 Primary data
 Secondary data

• Primary data: Primary data is that data which has been collected
especially for the purpose of this newly taken research. This preliminary
data for this research project has been collected by the means of a
questionnaire designed to determine those factor which are designated by
the various investors which were important to them in the decision
making process.

• Secondary Data : secondary information was obtained from trade journal,


magazines, Newspaper and from the internet.

Tools For Data Analysis:

Appropriate Statistical tools (like Percentage, charts, etc) have been used for data
analysis.
Data Analysis Results &
Interpretation
Demographic Profile of investors
Demographics No. of respondents Percentage of
respondents (%) Analysis & Interpretation:
• It was found that the major
Age
Less than 20 years 0 0 population of investors was greater
20-40 20 40 than 40yrs and 60% was of 20-40
Greater than 40 30 60
Total 50 Total 50 yrs.
Qualification • 50% respondents were graduate
Metric 0 0
Graduate 25 50
and 50% were post graduate.
Post Graduate 25 50 • 35% of respondents were doing
Total 50 Total 100 service.
Occupation
Service 19 38 • Majority of respondents i.e. 50%
Profession 6 12 earn income between Rs.20000-
Business 15 30
Student 10 20
40000 per month. It means
Total 50 Total 100 majority of investors was greater
Income (per
month) 10 20
than 40 years having income in
Less than Rs.20000 25 50 between Rs 20000-40000
Rs.20000-40000 15 30
Greater than 40000
Total 50 Total 100
Data Analysis Results
To know whether respondents know about stock market

Analysis & Interpretation:


Yes no From the survey it was found that 100%
respondents know about the stock market
and 0% who were unknown because share
market consists of good instruments of
money investment.
To know whether respondents invest

No. of Respondents Analysis & Interpretation:

From the survey it was


found that only 40%
Yes respondents invest in the
40%
stock market and majorly
60% who were non-
No investors. Because of its
60%
feature of high risk.
The percentage of income that respondent invest
annually in share market
Annual Income Invested No. of Respondents Percentage of
Respondents(%)
0 to 10% 40 14
10-20% 6 22
20-40% 4 40
More than 40% 0 24
Total 50 100

Analysis & Interpretation:


Chart Title
From the above table & chart, it
was found that 40%
respondents invest 0-10% of
their annual income, 6%
0 to 10%
40% respondents invest 10-20% of
Total
50% their annual income, 4%
respondents invest 20-40% of
their income and majority 40%
respondents not invest in share
More than
40%
20-40% 10-20%
4% 6%
market.
0%
The percentage of income that respondent invest
annually in bank
Annual Income Invested No. of Respondents Percentage of
Respondents(%)
0 to 10% 7 14
10-20% 6 12
20-40% 30 60
More than 40% 7 14
Total 50 100

Analysis & Interpretation:


Chart Title
0 to 10% 10-20% 20-40% More than 40% Total From the above table & chart, it
was found that 7% respondents
7% invest 0-10% of their annual
6%
income, 6% respondents invest
50%
10-20% of their annual income,
30%
30% respondents invest 20-40%
of their income and 7%
7%
respondents invest more than
40% in share market.
While investing in share market respondent are mostly
concerned about
Investment Factors No. of Respondents Percentage of
Respondents
Safety of Principal 14 28
Risk 11 22
Return on investment 20 40
Tax benefits 5 10
Total 50 100
Analysis & Interpretation:
Chart Title
From the survey it was found that
Safety of Principal Risk Return on investment Tax benefits Total
the maximum respondents 20%
considered return on investment
14% was most important factor, 14%
11% respondents considered Safety of
50% principal as an important factor and
20% 11% respondents considered risk as
5% an important factor. It can be stated
that majority of investors were
consider return as an important
factor while investing.
Why respondent prefer bank for investment
over share market
Investment Factors No. of Respondents Percentage of
Respondents
Low risk appetite 8 16
Convenient 16 32
Safety of principal 21 42
Tax benefits 5 10
Total 50 100

Analysis & Interpretation:


Chart Title From the survey it was found that
Tax benefits
10%
the maximum respondents 42%
considered Safety of principal was
Low risk
appetite most important factor, 32%
16% respondents considered convenient
as an important factor and 16%
respondents considered Low risk
Convenient
Safety of
principal 32%
appetites an important factor. It can
42% be stated that majority of investors
were consider safety of principal s
an important factor while investing
in bank.
Why respondent don’t prefer share market for
investment
Investment Factors No. of Respondents Percentage of
Respondents
High Risk 20 40
Not convenient 11 22
Brokerage & Fraud 10 20
Lack of awareness 9 18
Total 50 100

Analysis & Interpretation:


Chart Title
From the survey it was found that the
High Risk Not convenient Brokerage & Fraud Lack of awareness
maximum respondents 40% considered
high risk was most important factor,
18% 22% respondents considered not
40% convenient as an important factor and
20% 20% respondents considered Brokerage
& fraud an important factor. It can be
22% stated that majority of investors were
consider High Risk an important factor
while investing in share market.
To know whether respondents know the
procedure to invest in share market
Investment Decision No. of Respondents Percentage of
Respondents (%)
Yes 20 40
No 30 60
Total 50 100

No. of Respondents Analysis & Interpretation:

From the survey it was found


Yes
that only 40% respondents
40% knows the procedure to
No
invest in the share market
60% and majorly 60% don’t know
the procedure due to lack of
awareness
Important Factors That Was Considered While
Investing.
Particul Highly Dissatis Neut Satisfi Highl Summat
Range: ars Dissatis fied ral ed y ed
• Max. Score=100*5=500 (Highly Satisfied) fied Satisfi Core
• Avg. Score=100*3=300 (Neutral) ed
• Min. Score=100*1=100 (Highly Dissatisfied) Return 0 0 4 30 66 462
on
Investm
ent
Tax 0 0 18 48 34 416
benefits
Capital 0 0 20 40 40 420
Appreci
ation
Analysis & Interpretation: Liquidity 15 15 20 30 20 325

Most of the respondents have given the highest summated score to Return
on investment. And the second most important factor is Capital appreciation
which influenced the decision regarding investment. Other important factor is
Tax benefit which has the 416 summated score.
Conclusion
• Financial Advisor should encourage to investor for investment in share
market.
• Share Market has given a new direction to the flow of personal saving and
enables investors in semi urban areas to reap the benefits of the stock
market investment. Indian share market is playing a very important
developmental role in allocation of scares resources in the emerging
economy.
• The awareness level of investor is low in advisors are interested in dealing
in share market
• The Regulator of share market SEBI should make some efficient policy so
that investor can encourage for investment.
• Very less advisors know about services provided by their group.
Recommendations
• There is high potential In share market for respondent of Indore city, but this market needs to
be explored as respondent are still hesitated to invest their money in Share market.

• Most of respondent are not interested in dealing in share market because they don’t want to
expand their services due to lack of time, so company should provide them knowledge about
single window services by which investor can get all financial services from one place.

• Company should also provide knowledge about the growth rate and the expected growth
rate of investment in share market

• Most of people aware of life insurance, NSC and PPF for tax saving so, company should
market various tax saving schemes through share market and their benefits.

• The interface among the investors and the share market is the broker, so the broker should
have proper knowledge about investment schemes as well as market so that they can help
investors in their investment decisions. The quality of agents performance and investors
trust on them can be improved only if they are permanent in nature.