Investment Pattern Based on Risk Profile

A
SUMMER INTERNSHIP PROJECT ON
INVESTMENT PATTERN ON THE BASIS OF RISK PROFILE OF
INVESTORS
Submitted in the partial fulfillment for the award of the degree of
BACHELOR OF BUSINESS ADMINISTRATION
PREPARED BY:- UNDER THE GUIDANCE OF :-
ROHIT TIWARI 1) VIJAY KUMAR
Roll Number: - ********** Assist.Professor (SHDCHE)
2) Mr. SACHIN KUMAR
Branch head (sharekhan ltd.)
SANT HARI DASS COLLEGE OF HIGHER EDUCATION
(Affiliated to GGSIP University)

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CERTIFICATE
This is to certify that ROHIT TIWARI a student of BBA(G) of SANTHARI DASS
COLLEGE OF HIGHER EDUCATION has undertaken the Summer Internship Project
under my guideance for the Project Title “InvestmentPatternon the basis of
Risk Profile of Investors”. This Project Reportis prepared in partial fulfillment
for the award of the degree of BACHELOR OF BUSINESS ADMINISTRATION.
To the best of my knowledge, this research work is original and no part of this
report has been submitted by the student earlier to any other institution / university.
Date:-……………… Faculty Mentor’s Name:
Ms. NEETUAGGRAWAL
(Signature)

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ACKNOWLEDGEMENT
The satisfaction of the successfulcompletion of any task wouldn’t be complete
without the expression of gratitude to the people who made it possible.
I express my gratitude to Mr. Sachin Kumar (Branch head) SHAREKHAN LTD,
for his supportand guidance during the survey.
I am very thankful to Ms. NEETUAGGRAWAL, Faculty, SANT HARIDASS
COLLEGE OF HIGHER EDUCATION, for the guidance and interest evinced
throughout the preparation of this project.
I take this opportunity, also to express my love and sincere thanks to my family
members and friends for their supportand advice during various stage of work.
I also extend my gratitude to the respondents of my survey for their kind co-
operation.
But last not the least I thank God almighty for giving me the supportfor the
completion of the task.
ROHIT TIWARI

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TABLE OF CONTENT
s.no. CONTENTS signature
1 Executive summary
2 Introduction of topic
3 Introduction of Company
4 Objectives of the study
5 Research methodology
6 Data analysis & interpretation
7 Findings & conclusions
8 Biblography
9 Quetionaire

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EXECUTIVE SUMMARY
People invest their money for generating good returns. But in this investment some
kind of risk is involved. All investors have different attitudes towards risk. When it
comes to investing, it is important to consider your risk profile or tolerance
carefully, including how comfortable you are with the possibility of losing money,
or that returns on your investments. The risk profile of investors depends upon
their demographic structures or characteristics.
The project deals with the analyzing the investment pattern on the basis of risk
profile of investors at Sharekhan Limited and what are the risk factors that
influence the type of investment made by individuals . As we all know that every
person who wants to gain better returns in future they must have to invest their
money in stock market or anywhere else. This study describes the investment
pattern use by different persons while doing investment in stock market keeping
different risk in mind.
The main reason to choose this research is to find out the investment pattern
behavior in respect of their risk bearing capacity and this research helps the
company to target the investors according to their risk ability. The research process
chosen by me is qualitative and quantitative research. Questionnaires in part help
me a lot in finding the actual position of the market under the survey method.
.A sample size of about 96 respondents which includes individual investors as well
as corporateinvestors was taken for purposefrom various parts of Delhi and N.C.R
. After the survey was completed, the data was first stored and then analyzed on the
chosen parameters. This analyzed data was later on converted into graphs. Such as

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pie chart, bar graphs, etc this was to make result easily comprehensible by any one
going through the report.
After analyzing the data, the problem which has been identified that most of the
investors are ready to bear risk in expectation of higher returns. There is a strong
relationship in investment pattern and risk bearing capacity of investors while
doing investment. For analyzing the data we used MS Excel 2007 for making
graphs.

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INVESTMENT PATTERN ON THE BASIS OF RISK PROFILE OF
INVESTORS
WHAT IS RISK?
The word ‘risk’ has a definite financial meaning. It refers to possibility of
incurring a loss in a financial transaction. In a broad sense, investment is
considered to involve limited risk and is confined to those avenues where the
principal is safe. ‘Speculation’ is considered as an involvement of funds of high
risk.
TYPES OF RISK
1. SYSTEMATIC RISK
2. UNSYSTEMATIC RISK
SYSTEMATIC RISK
Systematic risk refers to that portion of the total variability of the return caused by
common factor affecting the prices of all securities alike through economic,
political and social factors.
UNSYSTEMATIC RISK
Unsystematic risk refers to that portion of the total variability of the return caused
due to unique factors, relating that firm or industry, through such factors as
management failure, labour strikes, raw material scarcity etc.

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WHAT IS INVESTMENT?
Investment is the purchase of an asset or item with the hope that it will generate
income or appreciate in the future and be sold at the higher price.

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INVESTMENT RISKPROFILE
All investors have differing attitudes towards risk. When it comes to investing, it is
important to consider your risk profile or tolerance carefully, including how
comfortable you are with the possibility of losing money, or that returns on your
investments could vary widely from year to year.
Understanding your personal risk tolerance will help you choose an appropriate asset
allocation - the following points can help you to determine an investment mix that's
appropriate for your needs.
INVESTMENT EXPERIENCE
How would you describe your investment experience and understanding of financial
markets?
 Just started investing in the last year
 You understand the basics of investing
 You have been investing on your own for several years and are reasonably
confident of your knowledge of financial markets
 Your knowledge of financial markets is well above average and you make
investment decisions confidently
RISK TOLERANCE
To establish investment strategies that suit your profile of risk and will be
comfortable with, you need to consider the possibility that the value of your
investment may decline even though this may be temporary. Are you prepared to
acceptthe possibility of a negative return at any time in exchange for potentially
higher long term returns? What percentage of your money would you be prepared to

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invest in higher-risk investments?
Which of the following is important to you:
 Avoiding any short-term losses
 Receiving regular income from investments
 Long-term growth in the value of investments
 Protection against inflation
In October 1987 the stock market fell more than 20% in one day. If you owned
an investment that fell by 20% in a short time what would you do or what did
you do in 1987:Sell all of the remaining investment (Conservative)
 Sell a portion of the remaining investment (Conservative to Balanced)
 Hold the investment and sell nothing (Balanced or Aggressive)
 Buy more of the investment (Aggressive)
INVESTMENT GOALS AND OBJECTIVES
Why are you investing? Is it for something in the near future (new car, or down
payment on a home) or something farther off (a young child's education or your own
retirement)? If your investing goals are short term you want your money to be there -
with interest - when you need it. Therefore you will need to focus on relatively short
term investments like term deposits or a cash management trust. If on the other hand,
you are investing for the long term, you may be able to afford to take some risk in
pursuit of a higher return. Shares, property, and growth orientated managed which
historically have provided higher returns than fixed interest or cash over time, may be
more appropriate.

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INVESTMENT TIMEFRAME
When do you expect to need to access all or part of your investments:
 Less than 1 year (immediate access)
 Less than 2 years (short term)
 2 to 5 years (short to mid-term)
 6 to 10 Years (mid to long term)
 Over 10 Years (long term)
LIQUIDITY /CASH REQUIREMENTS
How much money do you need to keep available for emergencies such as
house repairs, a dental emergency or serious car repairs? These emergencies
can be a serious setback if you are not prepared. The amount of your
emergency fund will depend on your current lifestyle and expenses. As a
general rule you should have about 3 months of income set aside to meet
emergencies without needing to rely on credit cards. A cash management trust
that pays high interest can be a good place to keep emergency funds.

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Age and Income
Your age and your income - particularly the stability of your income - are
important factors to consider when determining your investment profile. If you are
young you can afford to take a longer term view and any short-term losses may
have minimal effect. If your income or employment is unstable you will need to
take this in to account when setting your investment goal

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SHAREKHAN LIMITED
INTRODUCTION
Sharekhan is one of the leading retail broking House of SSKI Group which was
running successfully since 1922 in the country. It is the retail broking arm of the
Mumbai-based SSKI Group, which has over eight decades of experience in the
stock broking business. Sharekhan offers its customers a wide range of equity
related services including trade execution on BSE, NSE, Derivatives, depository
services, online trading, investment advisory, Mutual Fund Advisory etc.
The firm’s online trading and investment site - www.sharekhan.com - was
launched on Feb 8, 2000. The site gives access to superior content and transaction
facility to retail customers across the country. Known for its jargon-free, investor
friendly language and high quality research, the site has a registered base of over
two lakh customers. The number of trading members currently stands More than 8
Lacs. While online trading currently accounts for just over 8 per cent of the daily
trading in stocks in India, Sharekhan alone accounts for 32 per cent of the volumes
traded online.
The content-rich and research oriented portal has stood out among its
contemporaries because of its steadfast dedication to offering customers best-of-
breed technology and superior market information. The objective has been to let
customers make informed decisions and to simplify the process of investing in
stocks.

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On April 17, 2002 Sharekhan launched Speed Trade, a net-based executable
application that emulates the broker terminals along with host of other information
relevant to the Day Traders. This was for the first time that a net-based trading
station of this caliber was offered to the traders. In the last six months Speed Trade
has become a de facto standard for the Day Trading community over the net.
On October 01, 2007 Sharekhan again launched his another integrated
Software based product Trade Tiger, a net-based executable application that
emulates the broker terminals along with host of other information relevant to the
Day Traders. It has another quality which differs it from other that it has the
combined terminal for EQUITY and COMMODITIES both.
In India, Sharekhan has over 3500 employees, and is present in over 500
cities through 154 branches, more than 2,300 business partners. The company has
14 lakh clients and on an average, executes more than 4 lakh trades per day.
With a legacy of more than 80 years in the stock markets, the SSKI group
ventured into institutional broking and corporate finance 18 years ago. Presently
SSKI is one of the leading players in institutional broking and corporate finance
activities. SSKI holds a sizeable portion of the market in each of these segments.
SSKI’s institutional broking arm accounts for 7% of the market for Foreign
Institutional portfolio investment and 5% of all Domestic Institutional portfolio
investment in the country. It has 60 institutional clients spread over India, Far East,
UK and US. Foreign Institutional Investors generate about 65% of the
organization’s revenue, with a daily turnover of over US$ 4 million. The Corporate
Finance section has a list of very prestigious clients and has many ‘firsts’ to its

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credit, in terms of the size of deal, sector tapped etc. The group has placed over
US$ 1 billion in private equity deals. Some of the clients include BPL Cellular
Holding, Gujarat Pipavav, Essar, Hutchison, Planetasia, and Shopper’s Stop.
Sharekhan business
1. Brokering business.
2. White feathering house
production.
Vision
To be the best retail broking brand in the retail business of the stock market.
Mission
To educate and empower the individual investor to make better investment
decisions through quality advices and superior services.

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Stock exchange Mumbai
 Share khan is the retail broking arm of SSKI, an organization with more then
eight decade of trust and credibility in the stockmarket.
 Amongst pioneers of investment research in the Indian market.
 In 1984 venture into institutional broking and the corporate finance.
 Leading domestic player in the Indian institutional business.
 SSKI group companies
 SSKI investor services ltd (Sharekhan)
 S.S. Kantilal Isharlal securities
 SSKI corporatefinance.

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SHAREKHAN PROFILE
SHAREKHAN RETAIL BROKING
 Among the top three (3) branded retail services providers (Rs 856 crs
average daily volume.
 NO. 2 player in online business
 Large network of branded broking outlets in the country servicing around 5,
45, 000 Clients
MANAGEMENT TEAM
Tarun P. Shah Mr. Jaideep Arora Shankar Vailaya
BOARD OF DIRECTORS

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BENEFITS
 Free Depository A/c
 Secure Order by Voice Tool Dial-n-Trade.
 Automated Portfolio to keep track of the value of your actual purchases.
 24x7 Voice Tool access to your trading account.
 Personalized Price and Account Alerts delivered instantly to your Cell Phone &
E-mail address.
 Special Personal Inbox for order and trade confirmations.
 On-line Customer Service via Web Chat.
 Anytime Ordering.
 NSDL Account
 Instant Cash Tranferation.
 Multiple Bank Option.
 Enjoy Automated Portfolio.
 Buy or sell even single share.
Branch - Head Office
A-206, Phoenix House, 2nd Floor, SenapatiBapatMarg, Lower Parel,
Mumbai- 400 013.
Telephone No:67482000
Email: myaccount@sharekhan.com

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Founded February 2000
Headquarters Mumbai, India
Country of origin India
CEO Jaideep Arora
Industry Financial Services
Parent BNP Paribas
Website Sharekhan.com

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PRODUCTS OF SHAREKHAN
CLASSIC ACCOUNT
This account allows the client to trade through the website www.sharekhan.com
and is suitable for the retail investor who is risk-averse and hence prefers to invest
in stocks or who do not trade too frequently.
It allows investor to buy and sell stocks online along with the following features
like multiple watch lists, Integrated Banking, De-mat and Digital contracts, Real-
time portfolio tracking with price alerts and Instant money transfer.
FEATURES
 Online trading account for investing in Equity and Derivatives via
www.sharekhan.com
 Live Terminal and Single terminal for NSE Cash, NSE F&O, BSE & Mutual
Funds (online and offline).
 Integration of On-line trading, Saving Bank and De-mat Accounts.
 Instant cash transfer facility against purchase & sale of shares.
 Competative transaction charges.
 Instant order and trade confirmation by E-mail.
 Streaming Quotes (Cash & Derivatives).
 Personlized market watch.
 Single screen interface for Cash and derivatives and more.
 Provision to enter price trigger and view the same online in market watch.

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TRADE TIGER
TRADE TIGER is an internet-based software application which is the
combination of EQUITY & COMMODITIES, that enables you to buy and sell
share and well as commodities item instantly. It is ideal for every client of
SHAREKHAN LTD.
FEATURES
 Integration of EQUITY & COMMODITIES MARKET.
 Instant order Execution and Confirmation.
 Single screen trading terminal for NSE Cash, NSE F&O & BSE &
Commodities.
 Technical Studies.
 Multiple Charting.
 Real-time streaming quotes, tic-by-tic charts.
 Market summary (Cost traded scrip, highest value etc.)
 Hot keys similar to broker’s terminal.
 Alerts and reminders.
 Back-up facility to place trades on Direct Phone lines.
 Live market debts.
DIAL-N-TRADE

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Along with enabling access for your trade online, the CLASSIC and
TRADE TIGER ACCOUNT also gives you our Dial-n-trade services. With this
service, all you have to do is dial our dedicated phone lines which are 1800-22-
7500, 3970-7500.
PORTFOLIO MANAGEMENT SERVICES
Sharekhan is also having Portfolio Management Services for Exclusive clients.
1. PROPRIME - Research& Fundamental Analysis.
Ideal for investors looking at steady and superior returns with low to medium risk
appetite. This portfolio consists of a blend of quality blue-chip and growth stocks
ensuring a balanced portfolio with relatively medium risk profile. The portfolio
will mostly have large capitalization stocks based on sectors & themes that have
medium to long term growth potential.
2. PROTECH - TechnicalAnalysis.
Protech uses the knowledge of technical analysis and the power of derivatives
market to identify trading opportunities in the market. The Protech lines of
products are designed around various risk/reward/ volatility profiles for different
kinds of investment needs.
 THRIFTY NIFTY: Nifty futures are bought and sold on the basis of an
automated trading system that generates calls to go long/short. The exposure
never exceeds value of portfolio i.e. there is no leveraging; but being short in

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Nifty allows you to earn even in falling markets and there by generates
linear
 BETA PORTFOLIO: Positional trading opportunities are identified in the
futures segment based on technical analysis. Inflection points in the
momentum cycles are identified to go long/short on stock/index futures with
1-2 month time horizon. The idea is to generate the best possible returns in
the medium term irrespective of the direction of the market without really
leveraging beyond the portfolio value. Risk protection is done based on stop
losses on daily closing prices.
 STAR NIFTY: Trailing Stops Momentum trading techniques are used to
spot short term momentum of 5-10 days in stocks and stocks/index futures.
Trailing stop loss method of risk management or profit protection is used to
lower the portfolio volatility and maximize returns. Trading opportunities
are explored both on the long and the short side as the market demands to
get the best of both upwards & downward trends.
3. PROARBITRAGE- Exploit price analysis
- ONLINE IPO'S AND MUTUAL FUNDS ADVISORY IS AVAILABLE.
PROCESS OF ACCOUNT OPPENING
LEAD MANAGEMENT SYSTEM (LMS) / REFERENCES
CONTACT

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TELEPHONE AND PRESONAL VISIT
APPOINTMENT
DEMONSTRATION
AGREE DISAGREE (CLOSE)
DOCUMANTATION
FILLING THE FORM
SUBMISSION THE FORM
LOGIN OF THE FORM
SENDING THE ACCOUNT OPENING KIT TO THE CUSTOMER FOR TRADING

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CHARGE STRUCTURE
1)- PRE PAID OR AMC A/C: -
 Advance Amount which will be fully adjsted against your brokerage you paid in One
year.
Following Schemes Are Available: - Brokerage will be chagred -
1) - 750/- Scheme:- 0.05 / 0.50 %
2) - 1000/- Scheme 0.045 / 0.45 %
3) – 2,000/- Scheme: - 0.035 / 0.40 %
4) – 6,000/- Scheme: - 0.025 / 0.25 %
5) – 18,000/- Scheme: - 0.020 / 0.20 %
6) – 30,000/- Scheme: - 0.015 / 0.18 %
7) – 60,000/- Scheme: - 0.010 / 0.15 %
8) – 1,00,000/- Scheme: - 0.0075 / 0.10 %
Minimum Margine of Rs. 25000/- is Required for Account Opening.
Annual Maintanance Charges will NIL for 1st year and Rs. 400/- from 2nd year.
- EXPOSURE : 4 TIMES (ON MARGINE MONEY)
- EXPOSURE : 10 TIMES (ON MAX TRADING)
- ONLINE IPO'S AND MUTUAL FUNDS ADVISORY IS AVAILABLE.

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We are having tie-up with Eleven banks for online fund transfering i.e. HDFC,
ICICI, IDBI, CITI, Union Bank of India, Oriental Bank of Commerce,
INDUSIND, AXIS, Centurian Bank of Punjab, Bank of India and Yes Bank.
Company Provide 4-6 E-mail to there customers per day.
Online Trade in Share
Sharekhan customers can online trade through there computers, through internet
during the market timings.
Online Fund Transfer
We have tie up with Eleven Banks for online fund transferring i.e. HDFC, IDBI,
CITI, UBI, OBC, INDSLANDAND and UTI BANK, Yes bank, Bank of India for
Online Money Transfer.
 Research based investment advice
 Investment and trading services
 Trading and seminars
 Technology based investment tools
 Integrated demat facility
 CUSTOMER CAN TRADE IN
o Equities
o Derivatives
o Commodities

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SWOT ANALYSIS OF SHAREKHAN
(My observation)
STRENGTHS
1. Big client base
2. In-house research house
3. online as well as offline trading
4. Online IPO/ MF services
5. Share shops
6. Transparent
7. User friendly tie ups with 10 banks
8. Excellent order execution speed and reliability
WEAKNESS
1. Lack of awareness among customer
2. Less focus on customer retention
3. Less Exposure
OPPORTUNITIES
1. Diversification
2. Productmodification
3. Improve Web based trading
4. Provide competitive brokerage
5. Concentrate on PMS

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6. Focus onInstitutional investors
7. Concentrate on HNI’s (high net worth investor)
THREATS
1. Aggressive promotional strategies by close competitor like Religare, Angel
Broking and India bulls.
2. More and more players are venturing into this domain, which can further reduce
the earning of Share Khan.
3. Stock market is very volatile, risk involves is very high.

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LITERATURE REVIEW
A number of academic studies have provided evidence of demographic and non
demographic characteristics related to the financial risk tolerance of individuals.
The most common variables researched by academics to determine their
relationship with financial risk tolerance are gender, age, marital status, number of
dependents, income, wealth, education and financial knowledge. We report the
main findings as well as a number of less-researched variables. Gender differences
have been widely examined, with a large number of studies reporting higher
financial risk tolerance for males (Grable, 2000; Grable and Joo, 2000; Bemasek
and Shwiff, 2001; Chaulk, Johnson, and Bulcroft, 2003; Yook and Everett, 2003;
Grable, Lytton, and O'Neill, 2004; Hallahan, Faff, and McKenzie, 2004; Yao,
Hanna, and Lindamood, 2004; Fan and Xiao, 2006; Van de Venter and Michayluk,
2007; Gilliam, Chatterjee, and Zhu,2010).
Studies have also argued that financial risk tolerance decreases with
age (Xiao, Alhabeeb, Hong, and Haynes, 2000; Chaulk, Johnson, and Bulcroft,
2003; Hallahan, Faff, and McKenzie, 2004; Yao, Hanna, and Lindamood, 2004;
Fan and Xiao, 2006; Van de Venter and Michayluk, 2007; Faff, Hallahan, and
McKenzie, 2009). Furthermore, a nonlinear aspect to age has been observed
(Hallahan, Faff, and McKenzie, 2004; Grable, Lytton, O'Neill, Joo, and Klock,
2006; Faff, Hallahan, and Mckenzie, 2009). The primary explanation for the
observation of a significantly negative coefficient for age and the nonlinear
relationship has been attributed to the time horizon to recover losses that is lower
with age and the higher reliance on investment funds as individuals’ age.

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Marital status has been widely studied, especially because of its
interaction with age and gender. Financial risk tolerance is higher for single
individuals (Grable and Joo, 2004; Hallahan, Faff, and McKenzie, 2004; Yao,
Hanna, and Lindamood, 2004; Fan and Xiao,2006). The main justification for this
result is that single individuals do not hold the same responsibilities as those that
are married and thus the single individuals are willing to accept more financial
risk. For example, Chaulk, Johnson, and Bulcroft (2003) propose that married
individuals tend to have a lower financial risk tolerance because of a greater need
for wealth protection. When gender and marital status are incorporated together,
Jianakoplos and Bemasek (1998) and Bemasek and Shwiff (2001) find that single
men tend to be more risk tolerant than single women. A negative relationship
between financial risk tolerance and the number of dependents is identified by
Chaulk, Johnson, and Bulcroft (2003) and Hallahan, Faff, and McKenzie (2004),
with Faff, Hallahan, and McKenzie (2009) proposing a statistically significant
nonlinear linkage. This negative relationship has been identified with marital status
and may exist because of the added responsibilities and more conservative outlook
to risk when dependents are considered.
Higher financial risk tolerance is reported for individuals in high income
and wealth categories (Grable, 2000; Chaulk, Johnson, and Bulcroft, 2003; Yook
and Everett, 2003; Chang, DeVaney, and Chiremba, 2004; Grable and Joo, 2004;
Grable, Lytton, and O'Neill, 2004; Hallahan, Faff, and McKenzie, 2004; Yao,
Hanna, and Lindamood, 2004; Fan and Xiao, 2006). In addition, Grable and Joo
(1999) indicate a significantly positive relationship between financial risk tolerance
and an individual's level of financial solvency.

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A positive relationship has been identified between financial risk tolerance and
education (Grable, 2000; Chang, DeVaney, and Chiremba, 2004; Grable and Joo,
2004; Hallahan, Faff, and McKenzie, 2004; Yao, Hanna, and Lindamood, 2004;
Fan and Xiao, 2006). Hallahan, Faff, and Mckenzie (2004) also observe high
positive correlations between income, wealth, and education, suggesting that
financial risk tolerance could be a function of income and wealth rather than
education.
Financial or investment knowledge has a positive relationship with financial risk
tolerance (Grable, 2000; Grable and Joo, 2000, Grable and Joo, 2004; Van de
Venter and Michayluk, 2007). However, Davey (2004) challenges the view that
educating individual investors about financial markets and instruments will
necessarily increase their financial risk tolerance.
Although the financial education of an advisor's clients is considered best practice,
it will most likely not have any direct influence on the risk preference of an
individual as even the most knowledgeable and educated could potentially have a
low financial risk tolerance.
When advising clients about investment decisions, financial advisors have to
consider both their financial goals and financial risk tolerance. In many cases these
two could conflict, leading advisors to recommend that individuals take on more
risk than they are comfortable with to meet their financial goals. Bemasek and
Shwiff (2001) report that individuals generally tend to increase the level of risk of
their retirement savings after they have consulted a financial advisor. Furthermore,
this increase was found to be statistically significant for both the respondent and
the spouse or partner consulting a financial advisor, possibly suggesting the
existence of a relationship between gender and marital status as well.

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In contrast to the earlier finding. Van de Venter and Michayluk (2007) find no
statistically significant effect on financial risk tolerance when a financial advisor is
consulted. When examining whether a financial advisor has any impact on
investment behavior. Hung and Yoong (2009) conclude that unless financial
guidance is actively sought by the individual, consulting a financial advisor has no
impact on investment behavior. This finding highlights the difficulty when
interpreting survey questions that encompass financial advisors, and whether their
advice is undertaken.
Finally, Grable (2000) reports that individuals with positive economic expectations
have higher financial risk tolerance scores than those with less positive
expectations, with Van de Venter and Michayluk (2007) also finding evidence that
financial risk tolerance is positively related to both future expectations and
previous investment performance. These previous findings identify many factors
that might influence risk tolerance on their own or in combination with others.

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OBJECTIVES OF THE STUDY
1. To understand the risk profile of investors.
2. To study risk bearing capacity on the basis of gender, education,
occupation, age, family income and number of dependents.

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RESEARCH METHODOLOGY
Research methodology is way to systematically solve the research problem.
Research, in common terms refers to a search for knowledge. Research
methodology consists of different steps that are generally adopted by a researcher
to study the research problem along with the logic behind them.
RESEARCH DESIGN:
 Research design is the plan, structure and strategy of investigation
conceived so as to obtain answers to research question.
 There are two types of research design. One is exploratory research and
other is descriptive research
EXPLORATORY RESEARCH:
 We studied the company report, talked to the customers and employee of
the company. We identified that inspite of providing various
opportunities customers may not be aware of derivative and commodity
products.
DESCRIPTIVE RESEARCH
Survey method was adopted for this research
DATA SOURCES:
The study is mainly based on the data collection from primary as well as
secondary sources.
Primary data: Data collected for specific purposes in the form of questionnaire
Secondary data: Data existing in the form of Books, Internet, Catalogues etc.

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SAMPLING DESIGN:
Definition of population: All the customers of share khan.
Sampling procedure: A non probability sampling technique i.e. convenient
sampling procedure was adopted.
Sampling size: A sample of 96 customers was selected from the target population
for the study.
RESEARCH METHODOLOGY:
Research design : descriptive in nature.
Data source : data collected from primary and secondary sources.
Primary data : primary data is collected from the respondent through
these structured questionnaires.
SAMPLING DESIGN:
Sample size : 96
Sampling procedure : Convenience sampling
Statistical tool : Percentage method, mean, chi-square test.
STATISCAL TOOLS:
For the purpose of analysis, Mean and percentage methods are used for the
calculation and the result was interpreted. This test was used to minimize the error
of the data collected.

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1. To understand the risk profile of investors
Q1. What do you expect when you invest ?
CHART-1
Interpretation:- This chart-1 shows, out of 96 respondents 40 people are ready to
bear nominal risk and 36 people don’t want to take any risk. This shows that
around 79% respondents are conservative in terms of taking risk and only 21%
respondents are ready to bear risk and out of these 21 % only 3% are ready for high
risk situation.
NO RISK NOMINAL RISK
MODERATE
RISK
HIGHER RISK
Series1 36 40 18 2
0
5
10
15
20
25
30
35
40
45
AxisTitle
RISK

43
Q2 . How long do you normally hold investment?
CHART -2
Interpretation:- As per Chart-2,most of the respondents invest for a longer time
period i.e. around 32% and rest of the respondents have very less variability
regarding holding of investment as all other respondents are equally interested in
daily, weekly or monthly holding of investment i.e. around 20% go for each kind
of investment holding.
FOR A DAY FOR A WEEK FOR A MONTH FOR A YEAR
Series1 22 25 18 31
0
5
10
15
20
25
30
35
AxisTitle
TIME PERIOD

44
Q3. If your investments were to fall in value by 15 per cent over a one-year period, you
will
Chart -3
.
Interpretation:- Chart-3 is giving the overview regarding respondents reaction
related to their investment, if market falls in value. We can see here the
respondents /investors are neither very conservative nor aggressive in market
condition i.e. only 15% investors are willing to withdraw all money or invest more
money in such situation. Most of the respondents are aware & ready for such
condition. They want to be in the market in expectation of money of market.
WITHDRAW
ALL MONEY
FROM
SHARE
MARKET
TAKE OUT
SOME
MONEY
AND MOVE
IT TO SAFER
INVESTM…
WAIT UNTIL
MARKET
RECOVERS
THE LOSS
AND THEN
CONSIDER…
STICK TO
THE
INVESTMEN
T
INVEST
MORE
MONEY IN
THE SAME
INVESTMEN
T AS IT IS…
Series1 13 21 26 23 13
0
5
10
15
20
25
30
AxisTitle
INVESTMENT FALL BY 15%

45
Q4. You are ready for limited losses inexpectation of higher long-term returns?
Chart-4
Interpretation:- Chart-4 is about that whether investors are ready to bear limited
loss in expectation of high returns we find that only around 30% investors are not
agree for this but around 70% are considering the idea i.e. most of the respondents
are aware about the ups & downs of stock market & ready for risks involved in it
in expectation of getting higher returns.
STRONGLY
DISAGREE
DISAGREE
NEITHER
AGREE OR
DISAGREE
AGREE
STRONGLY
AGREE
Series1 14 16 24 36 6
0
5
10
15
20
25
30
35
40
AxisTitle
LIMITED LOSSES IN EXPECTATION OF
HIGHER RETURNS

46
Q.5. I am willing to experience the ups and downs of the market for the potential of
greater returns.
Chart-5
Interpretation:- Chart-5 is about that whether investors are ready to experience
ups and downs of market we find that only around 16% investors are not agree for
this but around 84% are considering the idea i.e. most of the respondents are aware
about the ups & downs of stock market & want to experience that.
STRONGLY
DISAGREE
DISAGREE
NEITHER
AGREE OR
DISAGREE
AGREE
STRONGLY
AGREE
Series1 5 11 39 35 6
0
5
10
15
20
25
30
35
40
45
AxisTitle
EXPERIENCE UPS AND DOWNS OF
MARKET

47
Q6. My main concern is security; keeping money safe is more important than earning
high returns.
Chart-6
Interpretation:- This chart -6 shows the investors are aware about the highs and
lows of security market and want to experience that also they are quite positive
towards market as they expect after a low market will recover & give them higher
return still the safety is major concern of investors. Out of total 96 respondents
only less than 10% disagree with the fact.
STRONGLY
DISAGREE
DISAGREE
NEITHER
AGREE OR
DISAGREE
AGREE
STRONGLY
AGREE
Series1 2 4 24 32 34
0
5
10
15
20
25
30
35
40
AxisTitle
MAIN CONCERN IS SAFETY

48
Q7. I am fairly experienced in investment.
Chart-7
INTERPRETATION:-As we can see in the chart-7, most of the respondents i.e.
around 50% are not sure about their investment capabilities. They are not very sure
that their expectation of decision is fair enough. Here I want to mention that the
market is so volatile in India that very less investors find themselves fairly enough
experienced & don’tbear losses.
STRONGLY
DISAGREE
DISAGREE
NEITHER
AGREE OR
DISAGREE
AGREE
STRONGLY
AGREE
Series1 4 15 43 29 5
0
5
10
15
20
25
30
35
40
45
50
AxisTitle
FAIRLY EXPERIENCED IN INVESTMENT

49
Q8. I am very secure related to my future income (such as from salary, pension or other
investments)?
Chart-8
Interpretation:- Chart-8 shows that most of people involve in security market are
quite secured related to their future income. We can also understand the statement
that the people who have fair enough income resources, comes in security
investment as they consider all the pros. & cons. Of the market they know that the
market is good place to get better returns but it also contain risk so losses bearable
only in the case of secured future returns.
STRONGLY
DISAGREE
DISAGREE
NEITHER
AGREE OR
DISAGREE
AGREE
STRONGLY
AGREE
Series1 2 4 15 23 52
0
10
20
30
40
50
60
AxisTitle
SECURE RELATED TO FUTURE INCOME

51
FINDINGS :-
 Most of the respondents are ready to take either no risk or nominal risk
while doing the investment.
 Most of the respondents are generally go for longer time horizon.
 There is a situation of investment fall by 15% then most of the respondents
are neither conservative nor aggressive.
 Most of the respondents are agree to take limited losses in expectation of
higher returns.
 Most of the respondents are give their opinion in the favor of experiencing
the ups and downs of the market.
 Most of the respondents are agreeing with this there main concern is safety.
 Most of the respondents are said that they are not sure about fairly
experienced in investment.
 Most of the respondents are in favors of they are very much concern with
security related to future income.
 This study shows most of the respondents either go for conservative risk
profile or balanced risk profile.
 This study helps in describing the risk profile of investors.

52
CONCLUSION
This study describes the strong relationship between demographic data in the
respect of different parameters. A good financial plan balances our goals with our
capacity to take investment risk and our risk tolerance.
However Risk Profiling is extremely useful for all investors, but even
more so for beginners, as it helps set the right investors expectation and gives an
excellent opportunity for advisors to get a glimpse of their client’s aspirations,
attitude and tolerance.

54
BIBLOGRAPHY:-
 https://www.sharekhan.com/market/market-dashboard/market-
summary/market-snapshot
 https://www.sharekhan.com/market/market-dashboard/market-
summary/market-snapshot
 https://www.slideshare.net/nikipatel23/sharekhan-ppt
 http://www.moneycontrol.com/stocksmarketsindia/
 https://www.ncdex.com/MarketData/LiveFuturesQuotes.aspx
Books
 Banerjee Bhabatosh , ”Fundamentals of Management” PHI Learning PVT.
TTD. 2008,3rd edition 2010
 Iyer Hariharan Chandra ,”Financial Management” ,International Book
House PVT. LTD., 1st edition 2012

56
QUETIONAIRE
Investment Pattern on the basis of Risk profile of Investors
I am a final year student currently pursuing my Bachelor Degree in management
(B.B.A.). I am conducting a research study on “An analysis on investor behavior
on various investment avenues”. This research (project) is taken as a partial
requirement for the completion of my B.B.A. I seek your kind assistance in
completing the attached questionnaire which would take few minutes from your
valuable time. Your responses will be treated as Strictly Confidential.
PersonalInformation
1. Gender
a) Male b) Female
2. Occupation
i) Business ii) Service iii) Students iv) House wife
3. Age
i) 20-30 ii) 30-40 iii) 40-50 iv) Above 50
4. Education
i) Under Graduate ii) Graduate iii) PostGraduate iv) Ph. D.
5. Income
a) < 3 Lakh b) 3-5 Lakh c) 5-10 lakh
d) 10-20 Lakh e) > 20 Lakh
6. No. of dependents in Family
a) No dependent b) 1-2 c) 3-4 d) 5-7 e) >7

57
7. Family Income
a) <5 Lakh b) 5-15 lakh c) 15-25 Lakh d) > 25
Lakh
8. How much percentage of total income he/she invests?
a) Below 20% b) 20 % - 40 % c) 40 % - 60% d) > 60 %
The risk-profile questionnaire
1. What do you expect when you invest?
a) no risk
b) nominal risk
c) moderate risk
d) higher risk
2. How long do you normally hold investments?
a) For a day
b) For a week
c) For a month
d) For a year
3. If your investments were to fall in value by 15 per cent over a one-year
period, you will
a) withdraw all money from share market
b) Take out some money and move it to a safer investment.
c) Wait until market recovers the loss and then consider other
investments.
d) Stick to the investment.
e) Invest more money in the same investment as it is 15 per cent cheaper
4. You are ready for limited losses in expectationof higher long-term
returns?
a) Strongly disagree
b) Disagree
c) Neither agree nor disagree
d) Agree
e) strongly agree

58
5. I am willing to experience the ups and downs of the market for the
potential of greaterreturns.
a) Strongly disagree
b) Disagree
c) Neither agree nor disagree
d) Agree
e) Strongly agree
6. My main concernis security; keeping money safe is more important than
earning high returns.
a) Strongly disagree.
b) Disagree.
c) Neither agree nor disagree.
d) Agree.
e) Strongly agree.
7. I am fairly experiencedin investment.
b) Disagree.
d) Agree.
e) Strongly agree.
8. I am very secure related to my future income (such as from salary, pension
or other investments)?
b) Disagree.
d) Agree.
e) Strongly agree.

Investment Pattern Based on Risk Profile

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