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A STUDY ON PERCEPTION OF INVESTORS TOWARDS EQUITY AND ALTERNATIVE

INVESTMENTS IN ANAND RATHI IN BIJAPUR CITY ( KARNATAKA)(54-62)

A STUDY ON PERCEPTION OF INVESTORS TOWARDS EQUITY AND ALTERNATIVE


INVESTMENTS IN ANAND RATHI IN BIJAPUR CITY ( KARNATAKA)
Prof. Dakshayani G.N, M. Com, M. Phil, (Ph.D)* Lecturer
Research Scholar: Research and Development Centre, Bharathiar University, Coimbatore-641 046
Candidates Institution: Assistant Professor. SMYK Government First Grade college, Telsang.
Email Id: dakshayanisuresh99@gmail.com,

Abstract- Investment is the current commitment of funds towards any financial or non-financial instruments in order to gain
profitable returns at any future date. An investment is always made with certain specific objectives in mind. An investor wit h or
without investment knowledge is always subconsciously alert and clear with his or her investment objectives. Therefore an investment
decision always includes the sacrifice of immediate benefits for better future returns. An investment process generally start s with an
understanding of the investment objectives and then framing out the investment policy. This will depend upon the investors
perception. But the perception of investors differs around on the basis of different factors like age, income, experience of investing,
investment objectives and individual social needs. This paper aspires to investigate the perceptions towards equity and other
alternative investment avenues in Anand Rathi in Bijapur city of Karnataka. The study employs on primary data as well as secondary
data and the data reveals different factors influencing of investment decisions of investors.

Key words: Investments, Investors, Avenues, Perceptions, data, Fund.

1 INTRODUCTION selected for him.

The economic development of any country depends upon


the existence of well organized financial system. The Investment alternatives in India
financial system is a broader term which brings under its
fold the financial markets and the financial institutions Non marketable financial assets: These are such
which support the system. The systems responsibility is financial assets which gives moderately high return
but can not be traded in market. They are Bank
to mobilized the savings in the form of money and
Deosits, post Office schemes, Company FDs and
monetary assets and invest them to productive ventures. PPF.
It promotes investments and savings which help faster Equity shares: These are shares of company and
economic development of the country. can be traded in secondary market. Investors get
benefit by change in price of share and dividend
Meaning of Investments: given by companies. Equity shares represent
ownership capital.
Investment is the sacrifice of certain present value for the Bonds: Bonds are the instruments that are
uncertain future reward. Investments are always considered as a relatively safer investment avenues
interesting, challenging and rewarding. Generally when like for eg. GOI relief funds, Govt. agency funds etc.
there is a high risk, more rate of return is assured. Risk Money market instrument: By convention, the
and reward go together. term "money market" refers to the market for short-
term requirement and deployment of funds. Money
An investment can be described as perfect if it satisfies market instruments are those instruments, which
all the needs of all investors. So, the starting point in have a maturity period of less than one year. They
searching for the perfect investment would be to examine are like T-Bills, Certificate of Deposit and
investor needs. If all those needs are met by the Commercial Paper
investment, then that investment can be termed the Mutual Funds- A mutual fund is a trust that pools
together the savings of a number of investors who
perfect investment. Most investors and advisors spend a share a common financial goal. The fund manager
great deal of time understanding the merits of the invests this pool of money in securities, ranging
thousands of investments available in India. Little time, from shares, debentures to money market
however, is spent understanding the needs of the investor instruments or in a mixture of equity and debt,
and ensuring that the most appropriate investments are depending upon the objective of the scheme. The

INTERNATIONAL JOURNAL OF RESEARCH IN COMPUTER SCIENCE AND MANAGEMENT


Vol. 1(2), July 2014 (ISSN: 2321-8088) Page 54
A STUDY ON PERCEPTION OF INVESTORS TOWARDS EQUITY AND ALTERNATIVE
INVESTMENTS IN ANAND RATHI IN BIJAPUR CITY ( KARNATAKA)(54-62)

different types of schemes are Balanced Funds, market. It was found that SPERTEL risk has an influence
Sector Fund etc. over the market price of the equity share. It was also
Life insurance: Now-a-days life insurance is also observed that except for the social factors between
being considered as an investment avenue. Insurance married and unmarried investors, political, regulatory
premiums represent the sacrifice and the assured and legal factors for age and occupation, all other factors
sum the benefit. Under it different schemes are were insignificant. The findings could be complemented
Endowment assurance policy, Money back policy, by further investigation in the areas of other internal
Whole life policy and Term assurance policy factors.
Real estate: One of the most important assets in Vanjeko (2010) examined the characteristics of investors
portfolio of investors is a residential house. In in the terms of their investments, strategies, expectations.
addition to a residential house, the more affluent The study based on the information collected from over
investors are likely to be interested in Agricultural thousand individual investors from eleven cities of India.
land, Semi urban land and Farm House Furthermore, the study revealed the increasing popularity
Precious things : Investors can also invest in the of equity as an investment option among individual
things which have value. These comprises Gold, investors. At last, the study suggested the use of
Silver, Precious stones and Art objects characteristics for a better understanding and financial
Financial Derivatives: These are such instruments product needs.
which derive their value from some other underlying
assets. It may be viewed as a side bet on the asset. 4. OBJECTIVES OF THE STUDY
The most important financial derivatives from the To understand the investors perception on various
point of view of investors are Options and Futures
investment alternatives.
2. OVERVIEW OF ANAND RATHI To analyze the investment pattern of people who
Anand Rathi is a leading full service investment bank reside in Bijapur city.
founded in 1994 offering a wide range of financial To study the investment decisions of different social
services and wealth management solutions to institutions, class people.
corporations, highnet worth individuals and retail. The To study the portfolio of various investments availed
firm has rapidly expanded its footprint to over 700
locations across India with international presence in at Anand Rathi.
Dubai, Hong Kong & New York. Founded by Mr. Anand To study the extent of popularity of various products
Rathi and Mr. Pradeep Gupta, the group today employs offered by Anand Rathi.
over 3,500 professionals through out India and its
international offices. 5. METHODOLOGY OF THE STUDY
SOURCES OF DATA
3. REVIEW OF LITERATURE
Bharati(2009) analyzed that an investment is Both primary data and secondary data are used for the
commitment of funds made in the expectation of some study. A questionnaire schedule was prepared and the
positive rate of return. Investments are made to reap primary data was collected. For the secondary data the
handsome return. Investors are interested or hope to researcher used company website, customer data base,
achieve higher reward. So, they carefully plan, evaluate company report, company books and records and related
and allocate funds in various investible outlets, which websites. The simple random techniques are used to
offer safety of principal and continuous return. select the respondents. Totally 100 respondents are used
Investment in equity shares is one of the avenues which to collect the information who are the clients of Anand
offer greater benefits, along with higher risks Rathi in Bijapur city.
Shanmugasundaram and Balakrishnan (2011), they
conducted research to analyse the factors influencing the
behaviour of investors in capital market. They concluded
that demographic factors influence the investors'
investment decisions.
Bennet and Salvam (2010) analyzed the investors
perception towards Social, Political, Economical,
Regulatory, Technological, Environmental and Legal
(SPERTEL) risks on the value of equity shares in the

INTERNATIONAL JOURNAL OF RESEARCH IN COMPUTER SCIENCE AND MANAGEMENT


Vol. 1(2), July 2014 (ISSN: 2321-8088) Page 55
A STUDY ON PERCEPTION OF INVESTORS TOWARDS EQUITY AND ALTERNATIVE
INVESTMENTS IN ANAND RATHI IN BIJAPUR CITY ( KARNATAKA)(54-62)

PERIOD OF STUDY
The period of the study has been taken-up from the year 2012- 2013
DATA ANALYSIS AND INTERPRETATIONS:

Income level of investors: Annual Income

Income level Frequency Percent Valid Cumulative


Percent Percent
Valid Below 1,50,000 40 40.0 40.0 40.0
1,50,001 to 3,00,000 30 30.0 30.0 70.0
3,00,001 to 4,50,000 26 26.0 26.0 96.0
4,50,001 and above 4 4.0 4.0 100.0
Total 100 100.0 100.0
Source: primary data

Annual Income Percent


50
26 4
0 30
40
Valid Below 150000 150001 to 300000 300001 to 450000 450001 and above

INTERPRETATION-1: From above table we can come to know that the investor whose income is below 1,50,000 has
invested more than compare to the other income level.

TYPE OF INVESTOR

Type of investors Frequency Percent Valid Cumulative


Percent Percent

Short term investors 16 16.0 16.0 16.0

Long term investors 32 32.0 32.0 48.0

Both 52 52.0 52.0 100.0

Total 100 100.0 100.0

100
short term investor or long term investor
52
50 32
16
0
Short term investment Long term investment Both

INTERPRETATION-2: The survey reveals that 16% investors invest for short term period. And 32% investors invest in
long term securities. And remaining 52% invest in both. The survey has shown that most of the investors are investing
for both i.e. short and long term.

INTERNATIONAL JOURNAL OF RESEARCH IN COMPUTER SCIENCE AND MANAGEMENT


Vol. 1(2), July 2014 (ISSN: 2321-8088) Page 56
A STUDY ON PERCEPTION OF INVESTORS TOWARDS EQUITY AND ALTERNATIVE
INVESTMENTS IN ANAND RATHI IN BIJAPUR CITY ( KARNATAKA)(54-62)

Investors investment per annum:

Amount of investment Frequency Percent Valid Cumulative


Percent Percent
Below 25,000 38 38.0 38.0 38.0
25,001 to 50,000 33 33.0 33.0 71.0
50,000 to 1,00,000 29 29.0 29.0 100.0
Total 100 100.0 100.0
Source: primary data

50 38 33
investors investment per annum 29

0
Below 25000 25001 to 50000 50000 to 100000
INTERP
RETATION-3:The survey reveals that 38% investors invest below 25000pa, 33% investors invest between 25001 to 50000
and 29% investors invest between 50001 to 100000pa. The survey has shown that most of the people invest below
25000pa compare to other investment level.

Investment frequency:

Frequency of investment Frequency Percent Valid Cumulative


Percent Percent
Daily 2 2.0 2.0 2.0
Weekly 16 16.0 16.0 18.0
Monthly 28 28.0 28.0 46.0
Quarterly 26 26.0 26.0 72.0
Half yearly 16 16.0 16.0 88.0
Yearly 12 12.0 12.0 100.0
Total 100 100.0 100.0
Source: Primary data

Frequency of investment
40 28 26
16 16 12
20 2
0
Daily Weekly Monthly Quarterly Half yearly Yearly
INTE
RPRETATION-4: From the above graph we came to know that 2% of investors are investing daily. 16% investors are
investing weekly, 28% investors are investing monthly, 26% are investing quarterly, 16% investors are investing half
yearly and 12% investors investing yearly. It shows most of investors are investing money either monthly or quarterly i.e.
28% & 26%.Stock market follower:

Stock market follower Frequency Percent Valid Cumulative


Percent Percent
Valid Yes 56 56.0 56.0 56.0

INTERNATIONAL JOURNAL OF RESEARCH IN COMPUTER SCIENCE AND MANAGEMENT


Vol. 1(2), July 2014 (ISSN: 2321-8088) Page 57
A STUDY ON PERCEPTION OF INVESTORS TOWARDS EQUITY AND ALTERNATIVE
INVESTMENTS IN ANAND RATHI IN BIJAPUR CITY ( KARNATAKA)(54-62)

No 44 44.0 44.0 100.0


Total 100 100.0 100.0

Source: Primary data

100
56 Stock market follower 44
0
Yes No
INTERPRETATION-5:-From the above graph we come to know that 56% of investors personally follow the market and
44% of investors doesnt follow market personally.

Investors frequently watching market:

Frequency of watching Frequency Percent Valid Cumulative


market Percent Percent
Daily 41 41.0 70.7 70.7
Twice Week 11 11.0 19.0 89.7
Weekly 6 6.0 10.3 100.0
Total 58 58.0 100.0
System 42 42.0
Missing -- ---
Total 100 100.0
Source: primary data

If yes,
41
then how frequently do you watch market?
50 11 6
0
Daily Twice Week Weekly

INTERPRETATION-6

From the above graph we come to know that 41% of investors personally follow the market daily and 11% of investors
twice a week follow the market and 6% investors follow the market weekly and 42% investors doesnt follow market
personally.

Various investment alternatives selected by the investors:

Alternatives Frequency Percent Valid Percent Cumulative


Percent
Equity 52 52.0 52.0 52.0
Real Estate 8 8.0 8.0 60.0

INTERNATIONAL JOURNAL OF RESEARCH IN COMPUTER SCIENCE AND MANAGEMENT


Vol. 1(2), July 2014 (ISSN: 2321-8088) Page 58
A STUDY ON PERCEPTION OF INVESTORS TOWARDS EQUITY AND ALTERNATIVE
INVESTMENTS IN ANAND RATHI IN BIJAPUR CITY ( KARNATAKA)(54-62)

Gold/Silver 10 10. 10. 70.0


Bank Deposits 22 22.0 22.0 92.0
Mutual Fund 2 2.0 2.0 94.0
Insurance 6 6.0 6.0 100.0
Total 100 100.0 100.0
Source: primary data

various investment alternatives


60 52
40 22
20 8 10 6
2
0
Equity Real Estate Gold/Silver Bank Deposits Mutual Fund Insurance

INTERPRETATION-7

From the above table it is analyzed that equity is the most preferred investment avenue among all investment options.
Second most preferred investment avenue among various alternative are bank deposits.

Preferred basis of Investment:

Basis of investment Frequency Percent Valid Cumulative Percent


Percent
Valid Self analysis 24 24.0 24.0 24.0
Financial advise 18 18.0 18.0 42.0
Brokers advise 36 36.0 36.0 78.0
Friends/relatives advise 20 20.0 20.0 98.0
Chartered accountant 2 2.0 2.0 100.0
Total 100 100.0 100.0
Source: primary data

Prefered basis of Investment


36
40 24 20
18
20 2
0
Self analysis Financial advise Brokers advise
Friends/relativesChartered
advise accountant

INTERPRETATION-8: From this we can come to know 36% investors go through brokers advise and 24% of investors are
self analysis the stocks and 20% investors take advice from friends/relatives and 18% investors take from financial
advisers suggestions and rest from others like chartered accountants.

Preferred source of study:

Source of study Frequency Percent Valid Percent Cumulative Percent

INTERNATIONAL JOURNAL OF RESEARCH IN COMPUTER SCIENCE AND MANAGEMENT


Vol. 1(2), July 2014 (ISSN: 2321-8088) Page 59
A STUDY ON PERCEPTION OF INVESTORS TOWARDS EQUITY AND ALTERNATIVE
INVESTMENTS IN ANAND RATHI IN BIJAPUR CITY ( KARNATAKA)(54-62)

Business channels 32 32.0 32.0 32.0


Business papers 14 14.0 14.0 46.0
Business magazines 12 12.0 12.0 58.0
Internet 40 40.0 40.0 98.0
Self Study 2 2.0 2.0 100.0
Total 100 100.0 100.0
Source: primary data

Prefered source of study


60
40
40 32
20
14 12
2
0
Business Business papers Business Internet Self Study
channels magazines

INTERPRETATION-9:From the graph we can observe that source of information for majority of investors is internet and
business channels, but business magazine and business papers are also important sources of study.

Choosing of various investment alternatives, by ranking:

Base for choosing Frequency Percent Valid Percent Cumulative Percent


investment alternatives
Risk involved 42 42.0 42.0 42.0
Return that you get 38 38.0 38.0 80.0
Future growth 12 12.0 12.0 92.0
Past performance 8 8.0 8.0 100.0
Total 100 100.0 100.0
Source: primary data

Ranking of various alternatives


50 42 38
12 8
0
Risk involved Return that you get Future growth Past performance

INTERPRETATION-10: From the chart we can see that for 42% of investors the most important factor considered for
investment decision is risk involved, second important factor is return that you get and then future growth. For 8% of
investors important factor considered for investment is past performance

INTERNATIONAL JOURNAL OF RESEARCH IN COMPUTER SCIENCE AND MANAGEMENT


Vol. 1(2), July 2014 (ISSN: 2321-8088) Page 60
A STUDY ON PERCEPTION OF INVESTORS TOWARDS EQUITY AND ALTERNATIVE
INVESTMENTS IN ANAND RATHI IN BIJAPUR CITY ( KARNATAKA)(54-62)

Basis for choosing equity investments:

Base for equity selection Frequency Percent Valid Cumulative


Percent Percent
Performance 16 16.0 16.0 16.0
Dividend record 24 24.0 24.0 40.0
Bonus/Right issue 16 16.0 16.0 56.0
Growth rate of a firm 24 24.0 24.0 80.0
Past record of a firm 20 20.0 20.0 100.0
Total 100 100.0 100.0
Source: primary data

Base for equity selection


30 24 24 20
16 16
20
10
0
Performance Dividend record Bonus/Right Growth rate of a Past record of a
issue firm firm

INTERPRETATION-11: By seeing above table and chart we come to know that the most important factor considered for
choice of equity investment is dividend record and growth rate of the firm. And other important factors are past record of
the firm and its performance.

Effect of market movement on investment pattern:

Effect of movement of Frequency Percent Valid Percent Cumulative Percent


market
Valid Yes 58 58.0 58.0 58.0
No 42 42.0 42.0 100.0
Total 100 100.0 100.0
Source: primary data

Does the market movement affect your


investment pattern?
5
4.3
2.5

Yes No

INTERPRETATION-12::-From the chart we can come to know that for 58% investors investment pattern will affected on
market if there are changes in market movement (BSE index, Nifty etc), and 42% investors investment pattern will affect
on market. Market movement is very important factor for changing in investment pattern.

INTERNATIONAL JOURNAL OF RESEARCH IN COMPUTER SCIENCE AND MANAGEMENT


Vol. 1(2), July 2014 (ISSN: 2321-8088) Page 61
A STUDY ON PERCEPTION OF INVESTORS TOWARDS EQUITY AND ALTERNATIVE
INVESTMENTS IN ANAND RATHI IN BIJAPUR CITY ( KARNATAKA)(54-62)

6 MAJOR FINDINGS
REFERENCES
1. The investor whose income is below Rs. 1, 50,000
those are invested more than other income level. [1] Prasanna Chandra, Financial Management, 6th Edition.
2. 16% of investors prefer to invest in short term [2] Fischer and Jordan, Secutiries Anaysis and Portfolio
avenues where as 32% of investors prefer to invest Management.
in long-term and remaining 58% invest in both the [3] Bharathi, N. (2009), A Study on Motives of Equity
avenues. Investors, Rai Management Journal, Vol.7, Issue 3,
3. 38% investors invest below 25000 p.a, 33% June, pp.4-15.
investors invest between 25001 to 50000 and 29% [4] Keerthi, P. (2009), Investors Perception towards
investors invest below between 50001 to 1,00,000 Capital Market Investments- With special reference to
Coimbatore District, PCTE Journal of Business
p.a.
Management, Vol.2, Issue2, Jun-Dec, pp.41-49.
4. 54% of the investors prefer to investing in either [5] Vanjeko, R. (2010), Indian Investors Investment
monthly or quartly, and 2% investors investing Characteristics, Finance India, Vol.XXIV, No.4, Dec,
daily basis and 16% in weekly. pp.1275-1294.
5. 56% investors are personally allow the market and [6] www.anandrathi.com
44% investors are not personally follow the market. [7] www.nseindia.com
6. Investors various investment alternatives are equity,
band deposits ,gold and silver, real estate and AUTHOR
insurance.
8. Internet and business channels are important source
Prof. Dakshayani G.N has
of study for investors.
Master degree and M.Phil
9. Dividend record, growth rate of a firm, past record
degree in Commerce.
of the firm and performance of firms are important
Presently, she is working as a
for those who are interested to invest in equity.
10. Generally those investors who are invested in Assistant Professor in the
equity, are personally follow the stock market Department of Commerce,
frequently. SMYK Government First
Grade College, Telsang
7. SUGGESTIONS (Belgaum).
1. It is to be suggested to the Anand Rathi that client
awareness programme like investor meet has to be She is known for her contribution in teaching and
conducted because most of the clients are unaware research over a period of twelve years. Her areas of
about the stock market. interests include Finance, Marketing and Accounting. In
2. Since the internet and web based telecommunication addition, she has published many articles in international
is getting popular there is need to update website journals. She has also presented many papers in State,
frequently. National & International seminars and conferences. At
3. Since investors expect better services from the present she is pursuing her research study in Research
company it should provide more value added and Development Centre, Bharathiar University,
services to its customers. Coimbatore under the guidance of Dr.R.M. Patil.
4. It is suggested that Anand Rathi should start giving
advertisement in business newspaper and in
business magazine.
5. It is suggested that it should expand its business by
setting up of new branches in various locations.
6. Investor should follow the regular price movements
of stock and should regularly update of stock
market.
7. Investor should also study the source of investments.
8 Before investing it suggested that consider the
growth rate of the firm and past record of the firm.

INTERNATIONAL JOURNAL OF RESEARCH IN COMPUTER SCIENCE AND MANAGEMENT


Vol. 1(2), July 2014 (ISSN: 2321-8088) Page 62

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