Investment Avenues Project Report

ABSTRACT
Savings form an important part of the economy of any nation. With the savings invested in various options available to the people, the money acts as the driver for growth of the country. Indian financial scene too presents a plethora of avenues to the investors. Though certainly not the best or deepest of markets in the world, it has reasonable options for an ordinary man to invest his savings.

The money you earn is partly spent and the rest saved for meeting future expenses. Instead of keeping the savings idle you may like to use savings in order to get return on it in the future. This is called Investment.

 One needs to invest to and earn return on your idle resources and generate a specified sum of money for a specific goal in life and  make a provision for an uncertain future One of the important reasons why one needs to invest wisely is to meet the cost of Inflation. Inflation is the rate at which the cost of living increases.

The cost of living is simply what it costs to buy the goods and services you need to live. Inflation causes money to lose value because it will not buy the same amount of a good or service in the future as it does now or did in the past. The sooner one starts investing the better. By investing early you allow your investments more time to grow, whereby the concept of compounding increases your income, by accumulating the principal and the interest or dividend earned on it, year after year.

OBJECTIVES OF THE PROJECT:
The purpose of the study was to determine the saving behavior and investment preferences of customers. Customer perception will provide a way to accurately measure how the customers think about the products and services provided by the company. Today’s trying economic conditions have forced difficult decisions for companies. Most are making conservative decisions that reflect a survival mode in the business operations. During these difficult times, understanding what customers on an ongoing basis is critical for survival. Executives need a 3rd party understanding on where customer loyalties stand. More than ever management needs ongoing feedback from the customers, partners and employees in order to continue to innovate and grow. The main objective of the project is to find out the needs of current and future customers. For this report , customer perception and awareness level will  be measured in many important areas like:  

=> To understand all about different investment avenues available in India.

=> To find out how the investors get information about the various financial instrument

=> To find out how the investor wants to invest i.e. on his own or through a broker.

=> To find out the saving habits of the different customers and the amount they invest in various financial instruments.

=> In which type of financial instrument they like to invest.

=> How long they prefer to keep their money invested.

=> What is the return that they expect from the investment.

=> What are the various factors that they consider before investing.

=> To find out the risk profile of the investor.

=> To give a recommendation to the investors that where they should invest.

=> To give a suggestion to my company where our fund lacks in the market & how it should be rectified.       

=> After all as a management trainee I will try to get some valuable knowledge from my seniors in the organization as well as from my faculty guide which will help me in the future.

=> To evaluate the consumer attitude towards saving and decision making regarding investments.

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Derivatives- Futures and Options Project Report

INTRODUCTION OF DERIVATIVES
The emergence of the market for derivative products, most notably forwards, futures and options, can be traced back to the willingness of risk-averse economic agents to guard themselves against uncertainties arising out of fluctuations in asset prices.  By their very nature, the financial markets are marked by a very high degree of volatility.  Through the use of derivative products, it is possible to partially or fully transfer price risks by locking-in asset Prices. As instruments of risk management, these generally do not influence the Fluctuations in the underlying asset prices. However, by locking-in asset prices, Derivative products minimize the impact of fluctuations in asset prices on the Profitability and cash flow situation of risk-averse investors.

Derivatives are risk management instruments, which derive their value from an underlying asset. The underlying asset can be bullion, index, share, bonds, Currency, interest, etc., Banks, Securities firms, companies and investors to hedge risks, to gain access to cheaper money and to make profit, use derivatives.  Derivatives are likely to grow even at a faster rate in future.

DERIVATIVE PRODUCTS (TYPES)
The following are the various types of derivatives.  They are:

Forwards:
A forward contract is a customized contract between two entities, where settlement takes place on a specific date in the future at today’s pre-agreed price.

Futures:
A futures contract is an agreement between two parties to buy or sell an asset at a certain time in the future at a certain price.  Futures contracts are special types of forward contracts in the sense that the former are standardized exchange-traded contracts.

Options:
Options are of two types-calls and puts.  Calls give the buyer the right but not the obligation to buy a given quantity of the underlying asset, at a given price on or before a given future date.  Puts give the buyer the right, but not the obligation to sell a given quantity of the underlying asset at a given price on or before a given date.

Warrants:
Options generally have lives of upto one year; the majority of options traded on options exchanges having a maximum maturity of nine months.  Longer-dated options are called warrants and are generally traded Over-the-counter.

Leaps:
The acronym LEAPS means Long-Term Equity Anticipation Securities. These are options having a maturity of upto three years.

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