KARVY

A REPORT ON
ORGANIZATIONAL STUDY
AT
KARVY CONSULTANT PVT LTD
Submitted in partial fulfillment of the requirements of
The M.B.A Degree Course of Bangalore University
Submitt ed By
G.R.Balaji
(REGD.NO:04XQCM6012)
Under the Guidance and Supervision
Of
Dr K.V. PRABHAKAR
Professor
M.P.BIRLA INSTITUTE OF MANAGEMENT

Associate Bharatiya Vidya Bhavan
# 43, Race Course Road, Bangalore-560001
August – September 2005
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CERTIFICATE
This to certify that this report titled “ AN ORGANIZATIONAL STUDY at

KARVY CONSULTANT PRIVATE LTD has been prepared by Mr.
G.R.Balaji bearing the registration no. 04XQCM6012 under the
guidance and supervision of Dr K.V. Prabhakar , Professor, MPBIM,
Bangalore.
Place: Bangalore (Dr.N.S.Malavalli)

Date: 30-09-2005
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CERTIFICATE
This is to certify that the internship Project Report entitled

“ORGANIZATIONAL STUDY at KARVY CONSULTANT PRIVATE LTD” ,
done by G.R.Balaji bearing Registration No.04XQCM6012 is a bonafide
work done carried under my guidance during the academic year 2004-06
in a partial fulfillment of the requirement for the award of MBA degree by
Bangalore University. To the best of my knowledge this report has not
formed the basis for the award of any other degree.
Place: Bangalore Dr K.V. Prabhakar

Date : 30-09-2005 (Professor )
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ACKNOWLEDGEMENTS
I am thankful to Dr.N.S.Malavalli, Principal, M.P.Birla institute of

management, Bangalore, who has given his valuable support during my
project.
I am extremely thankful to Mr. K.V Prabhakar, Professor, M.P.Birla

institute of Management, Bangalore, who has guided me to do this
project by giving valuable suggestions and advice.
I profusely thank Mr. Vasu, Marketing Manager KARVY CONSULTANT

PRIVATE LTD –CHENNAI, for all the support and guidance extended for
this project.
I equally thank all the Employees and Executives of KARVY

CONSULTANT PRIVATE LTD -Chennai have extended their suggestions
and helped me learn a lot about mutualfund.
Finally, I express my sincere gratitude to all my friends and well wishers
who helped me to do this project.
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CONTENTS
S.No PARTICULARS pg.no
1. EXECUTIVE SUMMARY 1
2. PROFILE OF THE INDUSTRY 1
3 COMPANY PROFILE 4
4. ORGANIZATIONAL STRUCTURE 18
5. PRODUCT PROFILE 21
6. SWOT ANALYSIS 62
7. FINDINGS 63
8. SUGGESTION 64
9. CONCLUSION 65
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EXECUTIVE SUMMARY
The MBA course offered by the Bangalore University has its own unique syllabus
which requires its MBA students to undertake an internship with any of the
leading business houses for a period ranging from 6 weeks to 8 weeks during the
second semester. The purpose of this internship is to enable the students to
appreciate and understand the nuances of the practical world vis-à-vis the
theoretical input administered during regular academic sessions. This helps in
creating Managers who are equipped with the experience of linking the theoretical
inputs with those of practical exposure and come out with creative solutions /
ideas in enhancing the business. In partial fulfillment of MBA degree of Bangalore
University I took up this organizational study. Experience and knowledge that I
gained from karvy consultant pvt Limited are elaborated in the following pages.
Investment is making the money work for you. Idle saved money will be eroded of
its value by reduction in purchasing power. Investing smartly makes money grow.
In other words one must involve funds available in such avenues that may counter
balance the reduction of real value. Assets whose value increases over time must
be chosen for such purpose. The investments must offer maximum advantages to
the investor. Now there are a number of investments avenues available to
common man. Recently all financial products investment opportunities come with
some or other innovations. It is at the behest of the consumer the investor
depending on the advantages in the investment is chosen.
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INDUSTRYPROFILE
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INDUSTRY PROFILE
The Indian middle class is large and growing; wages are low; many workers are well
educated and speak English; investors are optimistic and local stocks are up. Despite
political turmoil, the country presses on with economic reforms. The only cause of worry
that India could face is Infrastructural hassles.
The rapid economic growth of the last few years has put heavy stress on India's
infrastructural facilities. The projections of further expansion in key areas could snap the
already strained lines of transportation unless massive programs of expansion and
modernization are put in place. Problems include power demand shortfall, port traffic
capacity mismatch, poor road conditions (only half of the country's roads are surfaced),
low telephone penetration
(1.4% of population).
Indian Bureaucracy
Although the Indian government is well aware of the need for reform and is pushing
ahead in this area, business still has to deal with an inefficient and sometimes still slow-
moving bureaucracy.
Diverse Market
The Indian market is widely diverse. The country has 17 official languages, 6 major
religions, and ethnic diversity as wide as all of Europe. Thus, tastes and preferences differ
greatly among sections of consumers. Therefore, it is advisable to develop a good
understanding of the Indian market and overall economy before taking the plunge.
Research firms in India can provide the information to determine how, when and where
to enter the market. There are also companies which can guide the foreign firm through
the entry process from beginning to end --performing the requisite research, assisting
with configuration of the project, helping develop Indian partners and financing, finding
the land or ready premises, and pushing through the paperwork required.
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Check on Economic Policies
The general economic direction in India is toward liberalization and globalization. But
the process is slow. Before jumping into the market, it is necessary to discover whether
government policies exist relating to the particular area of business and if there are
political concerns which should be taken into account.
There are several good reasons for investing in India:

1. One of the largest economies in the world.
2. Strategic location - access to the vast domestic and South Asian market.
3. A large and rapidly growing consumer market up to 300 million people, constitute the
market for branded consumer goods – estimated to be growing at 8% per annum.
Demand for several consumer products is growing at over 12% per annum.
4. Foreign investment is welcome; approval is required but is automatic in sixty
categories of Industries.
5. Skilled man-power and professional managers are available at competitive cost.
6. One of the largest manufacturing sectors in the world, spanning almost all areas of
manufacturing activities.
7. One of the largest pools of scientists, engineers, technicians and managers in the world.
8. Rich base of mineral and agricultural resources.
9. Long history of market economy infrastructure
10. Sophisticated financial sector.
11. Vibrant capital market with over 9,000 listed companies and market capitalisation of
US$ 154 billion (March, 1996)
12. Well developed R&D infrastructure and technical and marketing services.
13. Policy environment that provides freedom of entry, investment, location, choice of
technology, production, import and export.
14. Well balanced package of fiscal incentives.
15. A sophisticated legal and accounting system.
16. English is widely spoken and understood.
17. Rupee is convertible on Current Account at market determined rate.
18. Free and full repatriation of capital, technical fee, royalty and dividends.
19. Foreign brand names are freely used.
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20. No income tax on profits derived from export of goods.
21. Complete exemption from Customs Duty on industrial inputs and Corporate Tax
Holiday for five years for 100 per cent Export Oriented units and units in Export
Processing Zones.
22. Corporate Tax applicable to the foreign companies of a country, with which
agreement for avoidance of Double Taxation exists, can be one which is lower between
the rates prevailing in any one of the two countries and the treaty rate.
23. A long history of stable parliamentary democracy.
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COMPANYPROFILE
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COMPANY PROFILE
KARVY, is a premier integrated financial services provider, and ranked among the
top five in the country in all its business segments, services over 16 million individual
investors in various capacities, and provides investor services to over 300 corporates,
comprising the who is who of Corporate India. KARVY covers the entire spectrum of
financial services such as Stock broking, Depository Participants, Distribution of
financial products - mutual funds, bonds, fixed deposit, equities, Insurance Broking,
Commodities Broking, Personal Finance Advisory Services, Merchant Banking &
Corporate Finance, placement of equity, IPO’s, among others. Karvy has a professional
management team and ranks among the best in technology, operations and research of
various industrial segments.|
Karvy early days:
The birth of Karvy was on a modest scale in 1981. It began with the vision and enterprise of a
small group of practicing Chartered Accountants who founded the flagship company …Karvy
Consultants Limited. We started with consulting and financial accounting automation, and carved
inroads into the field of registry and share accounting by 1985. Since then, we have utilized our
experience and superlative expertise to go from strength to strength…to better our services, to
provide new ones, to innovate, diversify and in the process, evolved Karvy as one of India’s
premier integrated financial service enterprise.
Thus over the last 20 years Karvy has traveled the success route, towards building a reputation as
an integrated financial services provider, offering a wide spectrum of services. And we have
made this journey by taking the route of quality service, path breaking innovations in service,
versatility in service and finally…totality in service.
Our highly qualified manpower, cutting-edge technology, comprehensive infrastructure and total
customer-focus has secured for us the position of an emerging financial services giant enjoying
the confidence and support of an enviable clientele across diverse fields in the financial world.
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Our values and vision of attaining total competence in our servicing has served as the building
block for creating a great financial enterprise, which stands solid on our fortresses of financial
strength - our various companies.
With the experience of years of holistic financial servicing behind us and years of complete
expertise in the industry to look forward to, we have now emerged as a premier integrated
financial services provider.
And today, we can look with pride at the fruits of our mastery and experience – comprehensive
financial services that are competently segregated to service and manage a diverse range of
customer requirements.
Karvy consultant is one of India’s premier investment consultancy firms offering personalized
investment planning, advisory and prompt facilitation services to retail investors, corporates and
institutions. It started in the year 1979 as karvy and company and later emerged as a karvy
consultant to cater to specialized and personal services. The company has a long track record and
history of being transparent and trust worthy with its customers.
Evolution of karvy:
1979-1980: karvy and company

1981-1982: karvy consultant ltd
1985-1986: Foray into capital market as registrars and transfer agent
1987-1988: first branch in Mumbai
1990 : entry in to retail broking
1994 : entry in to mutualfund services.
1995 : corporate finance and investment banking.
1996 : jardine fleming invests in group companies.
1997 : first registrar in the country to be awarded ISO 9002.
2002 : launch of private client group (PCG ) desk.
2004 : jv with computershare limited , Australia.
2004 : merger of karvy securities ltd with karvy stock broking ltd.
2005 : karvy insurance broking pvt ltd.
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VISION STATEMENT:
KARVY’S ASPIRATION OF ES TABLISHING ITSELF AS AN INTEGRATED

FINANCIAL SERVICES CO IS PROPELLED BYA VISION THAT IS SHARED BY
THE ENTIRE WORK FORCE. TOWARDS THIS END
KARVY IS DEDICATED ITSELF TO:
¾HAVING A SINGLE MINDED FOCUS ON INVESTOR SERVICES.

¾ESTABLISH AS A HOUSE HOLD NAME FOR FINANCIAL SERVICES.
¾SET INDUSTRIAL STANDARDS.
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MISSION :
OUR MISISION IS TO BE A LEADING , PREFERRED, SERVICES PROVIDER TO

OUR CUSTOMER AND WE AIM TO ACHIEVE THIS LEADERSHIP POSITION BY
AN INNOVATIVE, ENTERPRISING AND TECHNOLOGY DRIVEN
ORGANIZATION, WHICH WILL SET THE HIGHEST STANDARDS OF SERVICE
AND BUSINESS ETHICS.
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VALUES:
¾Trust
¾Integrity
¾Dedication
¾Commitment
¾Transparency
¾Enterprise
¾Hard work and team play
¾Learning & innovation
¾Empathy and humility
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Quality policy:
To achieve and retain leadership, Karvy shall aim for complete customer satisfaction, by
combining its human and technological resources, to provide superior quality financial
services. In the process, Karvy will strive to exceed Customer's expectations.
Quality Objectives
As per the Quality Policy, Karvy will:
• Build in-house processes that will ensure transparent and harmonious

relationships with its clients and investors to provide high quality of services.
• Establish a partner relationship with its investor service agents and vendors that
will help in keeping up its commitments to the customers.
• Provide high quality of work life for all its employees and equip them with
adequate knowledge & skills so as to respond to customer's needs.
• Continue to uphold the values of honesty & integrity and strive to establish
unparalleled standards in business ethics.
• Use state-of-the art information technology in developing new and innovative
financial products and services to meet the changing needs of investors and
clients.
• Strive to be a reliable source of value-added financial products and services and
constantly guide the individuals and institutions in making a judicious choice of
same.
• Strive to keep all stake-holders (shareholders, clients, investors, employees,
suppliers and regulatory authorities) proud and satisfied.
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KARVY CONSULTANT LIMITED:
BOARD OF DIRECTORS:
Mr. C Parthasarathy, a leader in the financial services industry in

India is responsible for building Karvy as one of India's truly
integrated Financial Services Provider; he is a fellow member of the
Institute of Company Secretaries of India, a Fellow Member of the
Institute of Chartered Accountants of India and a graduate in law. As
Chairman and Managing Director, he oversees the group's operations and renders vision and
business direction. His passion and vision for achieving leadership in the business made KARVY
a leading financial intermediary ranking them as number one in the registrar, Share Transfer and
IPO Distribution businesses. He also holds directorship in Karvy Securities Limited, Karvy Stock
Broking Limited, Karvy Investor Services Limited, Karvy Computershare Private Limited, Karvy
Commodities Broking Private Limited, EPR Pharmaceuticals Private Limited and Ocean Sparkles
Limited.
Mr. Y Yugandhar, Managing Director, founder member of Karvy

Consultants Limited, has varied experience in the field of financial
services spanning over 20 years. He is a Fellow Member of the Institute of Chartered Accountants
of India and was involved in the statutory and branch audit of banks for 26 years. Mr. Yugandhar
holds directorships in Karvy Securities Limited, Karvy Stock Broking Limited, Karvy Investor
Services Limited, Karvy Computershare Private Limited, Karvy Commodities Broking Private
Limited, Bizpro Technologies India Limited, Pokarna Limited, Ravindranath G E Medical
Associates Private Limited, Everest Power Private Limited and Green Infrastructure Private
Limited.
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Mr. M S Ramakrishna, Director, founder member of Karvy Consultants Limited is orchestrator
of technology initiatives such as the call center in the service of the customer. Mr. Ramakrishna is
a member of the Hyderabad Stock Exchange and is the director of Karvy Securities Limited,
Karvy Stock Broking Limited, Karvy Investor Services Limited, Karvy Computershare Private
Limited, Karvy Commodities Broking Private Limited, Nitya Labs Limited and SAB Nife Power
Systems Limited. He has helped Karvy diversify into the field of medical transcription leveraging
on the company's core competency of transaction processing. he ahs more than 20 years of
experience in the financial services arena.
Key Personnel at Head office
G Gopalakrishnamachryulu
V Ganesh
V Mahesh
K Sridhar
S Gopichand
J Ramaswamy
M S Manohar
S Ganapathy Subramanian
T R Prashant Kumar 19
Ashok K Mittal
ACHIEVEMTNS:
Among the top 5 stock brokers in India (4% of NSE volumes)

India's No. 1 Registrar & Securities Transfer Agents

Among the to top 3 Depository Participants

Largest Network of Branches & Business Associates

ISO 9002 certified operations by DNV

Among top 10 Investment bankers

Largest Distributor of Financial Products

Adjudged as one of the top 50 IT uses in India by MIS Asia

Full Fledged IT driven operations

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The KARVY CREDO:
Our Clients. Our Focus

Clients are the reason for our being.
Personalized service, professional care; pro-activeness are the values that help us nurture
enduring relationships with our clients.
Respect for the individual

Each and every individual is an essential building block of our organization.
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We are the kiln that hones individuals to perfection. Be they our employees, shareholders or
investors. We do so by upholding their dignity & pride, inculcating trust and achieving a sensitive
balance of their professional and personal lives.
Teamwork
None of us is more important than all of us.
Each team member is the face of Karvy. Together we offer diverse services with speed, accuracy
and quality to deliver only one product: excellence. Transparency, co-operation, invaluable
individual contributions for a collective goal, and respecting individual uniqueness within a
corporate whole, is how we deliver again and again.
Responsible Citizenship
A social balance sheet is as rewarding as a business one.
As a responsible corporate citizen, our duty is to foster a better environment in the society where
we live and work. Abiding by its norms, and behaving responsibly towards the environment, are
some of our growing initiatives towards realizing it.
Integrity
Everything else is secondary.
Professional and personal ethics are our bedrock. We take pride in an environment that
encourages honesty and the opportunity to learn from failures than camouflage them. We insist
on consistency between works and actions.
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INVESTOR SERVICE : KEY FACTS
¾NO. OF IPO’S HANDLED : 720

¾FINANCIAL TRANSACTION PROCESSED : 100 MN
¾NUMBER OF INVESTOR ACCOUNTS SERVICES : 16 Mn
¾CORPORATE CLENTS AS R&T AGENTS : 300
¾ASSET MGMT,COMPANIES SERVICES : 11
¾MUTUAL FUND SCHEME SERVICES : 72
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INVESTOR SERVICE STRENGTHS:
¾Controlled and low-cost service culture.

¾Accent on investor service based transaction processing
¾Adherence to strict time-schedules
¾Pooling of group resources for peak-loads and also for one-time assignment.
Investor service network:
¾352 offices in 242 cities/towns

¾Mobile investor services centres at two locations.
¾Providing a human face
¾Catering to the retail base
¾Acceptance and acknowledgement of service request
¾Prompt response
¾Planned decentralized query handling.
Human resources:
No DEPARMENT NO
1 Transaction processing and 1283
Investor servicing
2 Global processing (BPO) 250
3 Financial product and distribution 350
Services
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4 Corporate finance group 14
5 e-business 38
6 Insurance 230
7 Secondary market division 1257
Support function
8 Technology 15
9 Accounts 76
10 HR&Administration 104
11 Training and quality 08
12 Others 30
Total 3655
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ORGANISATIONAL
STRUCTURE
MUTUALFUND DEPARMENT STRUCTURE:
MR C PARASARATHY (M.D)
MR. V SRIDHAR ( ALL OVER INDIA VP)

MR. RAJA (CHENNAI VP)
MR SHARATH
26 (DGM)
MR VASU (BRANCH MANAGER)
MR SOURABH (SALES EXECUTIVE,

CHENNAI SOWCARPET BRANCH)
KARVY GROUP
ORGANIZATIONAL STRUCTURE
BOARD OF DIRECTORS
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M.P.BIRLA INSTITUTE OF MANAGEMENT Karvy stock
broking ltd
Karvy karvy computer
Group share pvt ltd
Karvy Karvy Karvy Karvy

investor computer insurance insurance
service pvt ltd pvt ltd broking
ltd ltd
BPO
Mutualfund Share registry Issue registry
Stock broking research depository distribution personalclientgroup
Corporate affairs group HR finance &A/C TRG&DEV depository services corp

quality
The internship was undertaken at CHENNAI Branch of KARVY CONSULTANT. The

following was the organizational structure at this branch:
BRANCH MANAGER
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INSURANCE MUTUAL FUND EQUITIES
SENIOR EXECUTIVE SENIOR EXECUTIVE SENIOR EXECUTIVE
JUNIOR JUNIOR JUNIOR

EXECUTIVE EXECUTIVE EXECUTIVE
Karvy at a glance:
TRANSACTION
PROCESSING CORPORATE
GROUP FINANCE
GROUP
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TECHNOLOGY
RESOURCE GROUP
FINANCIAL
IT ENABLED E- BUSINESS PRODUCTS
SERVICE
DISTRIBUTION
GROUP GROUP
SUPPORT
HR & Admin SA&FC

Strategic planning COMPLIANCE
Corporate affairs LEGAL
Training and development FINANCE AND
Corporate quality ACCOUNTS
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PRODUCTPROFILES
MUTUAL FUNDS
A mutual fund is nothing more than a collection of stocks and/or bonds. You can think of
a mutual fund as a company that brings together a group of people and invests their
money in stocks, bonds, and other securities. Each investor owns shares, which represent
a portion of the holdings of the fund.
You can make money from a mutual fund in three ways:
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1) Income is earned from dividends on stocks and interest on bonds. A fund pays out
nearly all income it receives over the year to fund owners in the form of a distribution.
2) If the fund sells securities that have increased in price, the fund has a capital gain.
Most funds also pass on these gains to investors in a distribution.
3) If fund holdings increase in price but are not sold by the fund manager, the fund's
shares increase in price. You can then sell your mutual fund shares for a profit.
Funds will also usually give you a choice either to receive a check for distributions or to
reinvest the earnings and get more shares.
The competition among funds has led to the launch of newer products, tailor-made
to suit the requirements of investors. Mutual funds now offer products for the entire range
of needs of investors. The encouraging response to index funds and sector funds shows
the growing maturity among investors. Open-end funds, which provide liquidity to
investors at daily NAV related prices are growing in popularity. The funds have been
adopting technology to provide good service to investors and with the proposed
introduction of electronic funds transfer and the growing trend towards E-Commerce; the
efficiency of service will increase even further.
In the coming years mutual funds as saving intermediaries will play a greater role in
bringing the gap between investors and issuers, especially in the area of equity funds. At
present these funds represents 13% of BSE market capitalization. This is expected to go
up with increasing flows into financial savings, especially the mutual fund with the
growth and stability in the capital market flows into equity funds are expected to go up.
A Mutual Fund is a trust that pools the savings of a number of investors who share a
common financial goal. The money thus collected is then invested in capital market
instruments such as shares, debentures and other securities. The income earned through
these investments and the capital appreciation realized are shared by its unit holders in
proportion to the number of units owned by them. Thus a Mutual Fund is the most
suitable investment for the common man as it offers an opportunity to invest in a
diversified, professionally managed basket of securities at a relatively low cost.
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Mutual funds, also referred to as investment companies, offer an alternative investment
choice for individuals with a long-term horizon. The way they operate is that individual
investor money are pooled and invested in many different companies. Assets are
professionally managed to meet various investment objectives. They issue and sell shares
to share holders and also redeem them (buy them back) upon request. Prices of shares are
set daily at the close of business, based on the value of all investments in the mutual
fund’s portfo lio. Their major advantages are diversification and professional
management, which are not readily available to small investors outside the mutual fund
arena. Money market mutual funds are short-term funds. They invest in short-term cash
and cash equivalent instruments, such as Treasury bills, certificates of deposit, and short-
term notes. Mutual funds may own stocks and bonds of many different companies.
A mutual fund is the ideal investment vehicle for today’s complex and modern financial
scenario. Markets for equity shares, bonds and other fixed income instruments, real
estate, derivatives and other assets have become mature and information driven. Price
changes in these assets are driven by global events occurring in faraway places. A typical
individual is unlikely to have the knowledge, skills, inclination and time to keep track of
events, understand their implications and act speedily. An individual also finds it difficult
to keep track of ownership of his assets, investments, brokerage dues and bank
transactions etc.
History of Mutual Funds

In 1924 three Boston securities executives pooled their money together to create the first
mutual fund. The idea of pooling money together for investing purposes started in Europe
in the mid-1800s. The first pooled fund in the U.S was created in 1893 for the faculty and
staff of Harvard University on March 21st, 1924 the first official mutual fund was born. It
was called the Massachusetts Investors Trust.
However in India UTI was the first to introduce mutual funds in the Indian markets and it
commenced its operations from July 1964, Government allowed public sector banks and
institutions to set up mutual funds.
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In the year 1992, Securities and exchange Board of India (SEBI) Act was passed. The
objectives of SEBI are – to protect the interest of investors in securities and to promote
the development of and to regulate the securities market.
As far as mutual funds are concerned, SEBI formulates policies and regulates the mutual
funds to protect the interest of the investors. SEBI notified regulations for the mutual
funds in1993. Thereafter, mutual funds sponsored by private sector entities were allowed
to enter the capital market. The regulations were fully revised in 1996 and have been
amended thereafter from time to time. SEBI has also issued guidelines to the mutual
funds from time to time to protect the interests of investors.
All mutual funds whether promoted by public sector or private sector entities including
those promoted by foreign entities are governed by the same set of Regulations. There is
no distinction in regulatory requirements for these mutual funds and all are subject to
monitoring and inspections by SEBI. The risks associated with the schemes launched by
the mutual funds sponsored by these entities are of similar type. It may be mentioned here
that Unit Trust of India (UTI) is not registered with SEBI as a mutual fund (as on January
15, 2002. The end of millennium marks 36 years of existence of mutual funds in our
country. The ride through these 36 years is not been smooth. Investor opinion is still
divided. While some are for mutual funds others are against it.
Mutual fund schemes:

Mutual funds offer a variety of schemes to investor so as to provide steady income or
growth or both. They differ according to the investment policies. The funds like
individual investor , have a different goals. Of the investor who will first ascertain his
investment objectives , thinking that the units of a fund have an investment goal
paralleling his objectives
Fund Mutual Basics :
As you probably know, mutual funds have become extremely popular over the last 20
years. What was once just another obscure financial instrument is now a part of our daily
lives.
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In fact, to many people, investing means buying mutual funds. After all, it's common
knowledge that investing in mutual funds is (or at least should be) better than simply
letting your cash waste away in a savings account, but, for most people, that's where the
understanding of funds ends. It doesn't help that mutual fund salesp
eople speak a strange
language that, sounding sort of like English, is interspersed with jargon like MER,
NAVPS, load/no-load, etc.
Originally mutual funds were heralded as a way for the little guy to get a piece of the
market. Instead of spending all your free time buried in the financial pages of the
investment Journal, all you have to do is buy a mutual fund and you'd be set on your way
to financial freedom. As you might have guessed, it's not that easy. Mutual funds are an
excellent idea in theory, but, in reality, they haven't always delivered. Not all mutual
funds are created equal, and investing in mutuals isn't as easy as throwing your money at
the first salesperson who solicits your business.
Advantages of Mutual Funds:
• Professional Management - The primary advantage of funds (at least theoretically) is

the professional management of your money. Investors purchase funds because they do
not have the time or the expertise to manage their own portfolio. A mutual fund is a
relatively inexpensive way for a small investor to get a full-time manager to make and
monitor investments.
• Diversification - By owning shares in a mutual fund instead of owning individual stocks

or bonds, your risk is spread out. The idea behind diversification is to invest in a large
number of assets so that a loss in any particular investment is minimized by gains in
others. In other words, the more stocks and bonds you own, the less any one of them can
hurt you (think about Enron). Large mutual funds typically own hundreds of different
stocks in many different industries. It wouldn't be possible for an investor to build this
kind of a portfolio with a small amount of money.
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• Economies of Scale - Because a mutual fund buys and sells large amounts of securities
at a time, its transaction costs are lower than you as an individual would pay.
• Liquidity - Just like an individual stock, a mutual fund allows you to request that your
shares be converted into cash at any time.
• Simplicity - Buying a mutual fund is easy! Pretty well any bank has its own line of
mutual funds, and the minimum investment is small. Most companies also have
automatic purchase plans whereby as little as Rs 500 can be invested on a monthly basis
Disadvantages of Mutual Funds:
• Professional Management - Did you notice how we qualified the advantage of

professional management with the word "theoretically"? Many investors debate over
whether or not the so-called professionals are any better than you or I at picking stocks.
Management is by no means infallible, and, even if the fund loses money, the manager
still takes his/her cut. .
• Costs - Mutual funds don't exist solely to make your life ea

sier--all funds are in it for a
profit. The mutual fund industry is masterful at burying costs under layers of jargon.
Because funds have small holdings in so many different companies, high returns from a
few investments often don't make much difference on the overall return. Dilution is also
the result of a successful fund getting too big. When money pours into funds that have
had strong success, the manager often has trouble finding a good investment for all the
new money
• Taxes - When making decisions about your money, fund managers don't consider your
personal tax situation. For example, when a fund manager sells a security, a capital-gain
tax is triggered, which affects how profitable the individual is from the sale. It might have
been more advantageous for the individual to defer the capital gains liability
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Risk Involved in Mutual Funds
All investments involve some form of risk, which should be evaluated them potential
rewards when an investment is selected.
_ Managing risk
At times the prices or yields of all the securities in a particular market rise or fall due to
broad outside influences. When this happens, the stock prices of both an outstanding,
highly profitable company and a fledgling corporation may be affected.
This change in price is due to “market risk”.
Interest rate risk
Sometimes referred to as “loss of purchasing power”. Whenever inflation sprints
forward faster than the earnings on your investment, you run the risk that you will
actually be able to buy less, not more. Inflation risk also occurs when prices rise
faster than your returns.
Credit risk
In short, how stable is the company or entity to which you lend your money when you
invest? How certain are you that it will be able to pay the interest you are promised, or
repay your principal when the investment matures?
_ Inflation risk
Changing interest rates affect both equities and bonds in many ways. Investors are
reminded that “predicting” which way rates will go is rarely successful. A diversified
portfolio can help in offsetting these changes.
_ Effect of loss of key professional and inability to adopt

An industries’ key asset is often the personnel who run the business i.e. intellectual
properties of the key employees of the respective companies. Given the ever-changing
complexion of few industries and the high obsolescence levels, availability of qualified,
trained and motivated personnel is very critical for the success of industries in few
sectors. It is, therefore, necessary to attract key personnel and also to retain them to meet
the changing environment and challenges the sector offers. Failure or inability to
37
attract/retain such qualified key personnel may impact the prospects of the companies in
the particular sector in which the fund invests.
_ Exchange risks
A number of companies generate revenues in foreign currencies and may have
investments or expenses also denominated in foreign currencies. Changes in exchange
rates may, therefore, have a positive or negative impact on companies which in turn
would have an effect on the investment of the fund.
_ Investment risks
The sectoral fund schemes, investments will be predominantly in equities of select
companies in the particular sectors. Accordingly, the NAV of the schemes are linked to
the equity performance of such companies and may be more volatile than a more
diversified portfolio of equities.
_ Changes in government policy

Changes in Government policy especially in regard to the tax benefits may impact the
business prospects of the companies leading to an impact on the investments made by the
fund.
VARIOUS MUTUAL FUND SCHEME
Mutual Funds: Different Types of Funds
No matter what type of investor you are there is bound to be a mutual fund that fits your
style. According to the last count there are over 10,000 mutual funds in North America!
That means there are more mutual funds than stocks. It's important to understand that
each mutual fund has different risks and rewards. In general, the higher the potential
38
return, the higher the risk of loss. Although some funds are less risky than others, all
funds have some level of risk--it's never possible todiversify away all risk. This is a fact
for all investments.
Each fund has a predetermined investment objective that tailors the fund's assets, regions
of investments, and investment strategies. At the fundamental level, there are three
varieties of mutual funds:
1) Equity funds (stocks)
2) Fixed-income funds (bonds)
3) Money market funds
All mutual funds are variations of these three asset classes. For example, while equity
funds that invest in fast-growing companies are known as growth funds, equity funds that
invest only in companies of the same sector or region are known as specialty funds.
Let's go over the many different flavors of funds. We'll start with the safest and then
work through to the more risky.
Money Market Funds
The money market consists of short-term debt instruments, mostly T-bills. This is a safe
lace to park your money. You won't get great returns, but you won't have to worry about
losing your principal. A typical return is twice the amount you would earn in a regular
checking/savings account and a little less than the average certificate of deposit (CD).
We've got a wholetutorial on the money market if you'd like to learn more about it.
Bond/Income Funds
Income funds are named appropriately: their purpose is to provide current income on a
steady basis. When referring to mutual funds, the terms "fixed-income," "bond," and
"income" are synonymous. These terms denote funds that invest primarily in government
and corporate debt. While fund holdings may appreciate in value, the primary objective
of these funds is to provide a steady cashflow to investors. As such, the audience for
these funds consists of conservative investors and retirees.
39
Bond funds are likely to pay higher returns than certificates of deposit and money market
investments, but bond funds aren't without risk. Because there are many different types of
bonds, bond funds can vary dramatically depending on where they invest. For example, a
fund specializing in high-yield junk bonds is much more risky than a fund that invests in
government securities; also, nearly all bond funds are subject to interest rate risk, which
means that if rates go up the value of the fund goes down.
Balanced Funds
The objective of these funds is to provide a "balanced" mixture of safety, income, and
capital appreciation. The strategy of balanced funds is to invest in a combination of fixed-
income and equities. A typical balanced fund might have a weighting of 60% equity and
40% fixed-income. The weighting might also be restricted to a specified maximum or
minimum for each asset class.
A similar type of fund is known as an asset allocation fund. Objectives are similar to
those of a balanced fund, but these kinds of funds typically do not have to hold a
specified percentage of any asset class. The portfolio manager is therefore given freedom
to switch the ratio of asset classes as the economy moves through the business cycle.
Equity Funds
Funds that invest in stock represent the largest category of mutual funds. Generally, the
investment objective of this class of funds is long-term capital growth with some income.
There are, however, many different types of equity funds because there are many
different types of equities. A great way to understand the universe of equity funds is to
use a style box, an example of which is below.
40
The idea is to classify funds based on both the size of the companies invested in and the
investment style of the manager. The term "value" refers to a style of investing that looks
for high quality companies that are out of favor with the market. These companies are
characterized by low P/E ratios, price-to-book ratios, and high dividend yields, etc. The
opposite of value is growth, which refers to companies that have had (and are expected to
continue to have) strong growth in earnings, sales, and cash flow, etc. A compromise
between value and growth is "blend," which simply refers to companies that are neither
value nor growth stocks and so are classified as being somewhere in the middle.
For example, a mutual fund that invests in large-cap companies who are in
strong financial shape but have recently seen their share price fall would be placed in the
upper left quadrant of the style box (large and value). The opposite of this would be a
fund that invests in startup technology companies with excellent growth prospects. Such
a mutual would reside in the bottom right quadrant
Global/International Funds
An international fund (or foreign fund) invests only outside your home country.
Global funds invest anywhere around the world, including your home country.
It's tough to classify these funds as either riskier or safer. On the one hand they tend to be
more volatile and have unique country and/or political risks. But, on the flip side, they
can, as part of a well-balanced portfolio, actually reduce risk by increasing
diversification. Although the world's economies are becomingmore inter-related, it is
41
likely that another economy somewhere is outperforming the economy of your home
country.
Index Funds
The last but certainly not the least important are index funds. This type of mutual fund
replicates the performance of a broad market index such as the sensex and nifty. An
investor in an index fund figures that most managers can't beat the market. An index fund
merely replicates the market return and benefits investors in the form of low fees
Mutual Funds: Costs
Costs are the biggest problem with mutual funds. These costs eat into your return, and
they are the main reason why the majority of funds end up with sub-par performance.
What's even more disturbing is the way the fund industry hides costs through a layer of
financial complexity and jargon. Some critics of the industry say that mutual fund
ompanies get away with the fees they charge only because the average investor does not
understand what he/she is paying for.
Fees can be broken down into two categories:
1. Ongoing yearly fees to keep you invested in the fund.
2. Transaction fees paid when you buy or sell shares in a fund (loads).
The Expense Ratio
42
The ongoing expenses of a mutual fund are represented by the expense ratio. This is
sometimes also referred to as the management expense ratio (MER). The expense ratio is
composed of the following:
The cost of hiring the fund manager(s) - Also known as the management fee, this cost is
between 0.5% and 1.0% of assets on average. While it sounds small, this fee ensures that
mutual fund managers remain in the country's top echelon of earners. Think about it for a
second: 1% of 250 million (a small mutual fund) is 2.5 million--fund managers are
definitely not going hungry! It's true that paying managers is a necessary fee, but don't
think that a high fee assures superior performance.
• Administrative costs - These include necessities such as postage, record keeping,

customer service, cappuccino machines, etc. Some funds are excellent at minimizing
these costs while others (the ones with the cappuccino machines in the office) are not.
On the whole, expense ratios range from as low as 0.2% (usually for index funds) to as
high as 2.0%. The average equity mutual fund charges around 1.3%-1.5%. You'll
generally pay more for specialty or international funds, which require more expertise
from managers.
Buying and Selling

You can buy some mutual funds (no-load) by contacting the fund companies directly.
Other funds are sold through brokers, banks, financial planners, or insurance agents. If
you buy through a third party there is a good chance they'll hit you with a sales charge
(load).
That being said, more and more funds can be purchased through no-transaction fee
programs that offer funds of many companies. Sometimes referred to as a "fund
supermarket," this service lets you consolidate your holdings and record keeping, and it
still allows you to buy funds without sales charges from many different companies.
43
Popular examples are Schwab's OneSou
rce, Vanguard's FundAccess, and Fidelity's
FundsNetwork. Many large brokerages have similar offerings.
Selling a fund is as easy as purchasing one. All mutual funds will redeem (buy back) your
shares on any business day. In the United States companies must send you the payment
within seven days.
TheValueofYourFund
Net asset value (NAV), which is a fund's assets minus liabilities, is the value of a mutual
fund. NAV per share is the value of one share in the mutual fund, and it is the number
that is quoted in newspapers. You can basically just think of NAV per share as the price
of a mutual fund. It fluctuates everyday as fund holdings and shares outstanding change.
When you buy shares, you pay the current NAV per share plus any sales front-
end load. When you sell your shares, the fund will pay you NAV less any back-
end load.
Moses gave to his followers 10 commandments that were to be followed till

eternity. The world of investments too has several ground rules meant for investors who
are novices in their own right and wish to enter the myriad world of investments. These
come in handy for there is every possibility of losing what one has if due care is not
taken.
1. Assess yourself: Self-assessment of one’s needs; expectations and risk profile is

of prime importance failing which, one will make more mistakes in putting
money in right places than otherwise. One should identify the degree of risk
bearing capacity one has and also clearly state the expectations from the
investments. Irrational expectations will only bring pain.
2. Try to understand where the money is going: It is important to identify the
nature of investment and to know if one is compatible with the investment. One
can lose substantially if one picks the wrong kind of mutual fund. In order to
avoid any confusion it is better to go through the literature such as offer document
and fact sheets that mutual fund companies provide on their funds.
44
3. Don't rush in picking funds, think first: one first has to decide what he wants
the money for and it is this investment goal that should be the guiding light for all
investments done. It is thus important to know the risks associated with the fund
and align it with the quantum of risk one is willing to take. One should take a look
at the portfolio of the funds for the purpose. Excessive exposure to any specific
sector should be avoided, as it will only add to the risk of the entire portfolio.
Mutual funds invest with a certain ideology such as the "Value Principle" or
"Growth Philosophy". Both have their share of critics but both philosophies work
for investors of different kinds. Identifying the proposed investment philosophy of
the fund will give an insight into the kind of risks that it shall be taking in future.
4. Invest. Don’t speculate: A common investor is limited in the degree of risk that
he is willing to take. It is thus of key importance that there is thought given to the
process of investment and to the time horizon of the intended investment. One
should abstain from speculating which in other words would mean getting out of
one fund and investing in another with the intention of making quick money. One
would do well to remember that nobody can perfectly time the market so staying
invested is the best option unless there are compelling reasons to exit.
5. Don’t put all the eggs in one basket: This old age adage is of utmost
importance. No matter what the risk profile of a person is, it is always advisable
to diversify the risks associated. So putting one’s money in different asset classes
is generally the best option as it averages the risks in each category. Thus, even
investors of equity should be judicious and invest some portion of the investment
in debt. Diversification even in any particular asset class (such as equity, debt) is
good. Not all fund managers have the same acumen of fund management and with
identification of the best man being a tough task, it is good to place money in the
hands of several fund managers. This might reduce the maximum return possible,
but will also reduce the risks.
6. Be regular: Investing should be a habit and not an exercise undertaken at one’s
wishes, if one has to really benefit from them. As we said earlier, since it is
extremely difficult to know when to enter or exit the market, it is important to
beat the market by being systematic. The basic philosophy of Rupee cost
averaging would suggest that if one invests regularly through the ups and downs
45
of the market, he would stand a better chance of generating more returns than the
market for the entire duration. The SIPs (Systematic Investment Plans) offered by
all funds helps in being systematic. All that one needs to do is to give post-dated
cheques to the fund and thereafter one will not be harried later. The Automatic
investment Plans offered by some funds goes a step further, as the amount can be
directly/electronically transferred from the account of the investor.
7. Do your homework:
It is important for all investors to research the avenues available to them

irrespective of the investor category they belong to. This is important because an
informed investor is in a better decision to make right decisions. Having identified
the risks associated with the investment is important and so one should try to
know all aspects associated with it. Asking the intermediaries is one of the ways
to take care of the problem.
8. Find the right funds
Finding funds that do not charge much fees is of importance, as the fee charged
ultimately goes from the pocket of the investor. This is even more important for
debt funds as the returns from these funds are not much. Funds that charge more
will reduce the yield to the investor. Finding the right funds is important and one
should also use these funds for tax efficiency. Investors of equity should keep in
mind that all dividends are currently tax-free in India and so their tax liabilities
can be reduced if the dividend payout option is used. Investors of debt will be
charged a tax on dividend distribution and so can easily avoid the payout options.
9. Keep track of your investments
Finding the right fund is important but even more important is to keep track of the
way they are performing in the market. If the market is beginning to enter a
bearish phase, then investors of equity too will benefit by switching to debt funds
as the losses can be minimized. One can always switch back to equity if the equity
market starts to show some buoyancy.
46
10. Know when to sell your mutual funds: Knowing when to exit a fund too is of
utmost importance. One should book profits immediately when enough has been
earned i.e. the initial expectation from the fund has been met with. Other factors
like non-performance, hike in fee charged and change in any basic attribute of the
fund etc. are some of the reasons for to exit. For more on it, read "When to say
goodbye to your mutual fund."
Investments in mutual funds too are not risk-free and so investments warrant some
caution and careful attention of the investor. Investing in mutual funds can be a dicey
business for people who do not remember to follow these rules diligently, as people are
likely to commit mistakes by being ignorant or adventurous enough to take risks more
than what they can absorb. This is the reason why people would do well to remember
these rules before they set out to invest their hard-earned money.
SOME OF THE EXISTING AMC(ASSET MANAGEMENT COMPANY)
¾Alliance Mutual Fund

¾Birla Mutual Fund
¾BOB Mutual Fund
¾BOI Mutual Fund
¾Canbank Mutual Fund
¾Chola Mutual Fund
¾DSP Merrill Lynch Mutual Fund
¾Dundee Mutual Fund
¾Escorts Mutual Fund
¾First India Mutual Fund
¾Franklin Templeton Investments
¾GIC Mutual Fund
¾HDFC Mutual Fund
¾IDBI Principal Mutual Fund
¾IL & FS Mutual Fund
47
¾Indian Bank Mutual Fund
¾ING Mutual Fund
¾JF Mutual Fund
¾JM Mutual Fund
¾Kotak Mahindra Mutual Fund
¾LIC Mutual Fund
¾Morgan Stanley Mutual Fund
¾Pioneer ITI Mutual Fund
¾PNB Mutual Fund
¾Prudential ICICI Mutual Fund
¾Reliance Capital Mutual Fund
¾SBI Mutual Fund
¾Standard Chartered Mutual Fund
¾SUN F&C Mutual Fund
¾Sundaram Mutual Fund
¾Tata TD Waterhouse Mutual Fun
¾Taurus Mutual Fund
¾Unit Trust of India
INSURANCE:
48
It is a system to make large financial losses more affordable by pooling the risks of many
individuals and business entities and transferring them to an insurance company or other
large group in return for a premium.
At KARVY, the company has tie-ups with many insurance companies nsurance are of
two types:
a) Life Insurance
b) General Insurance
Further these could be for a) Individuals or b) Corporates
The list of products that KARVY has to offer as follows:
Product Range for Individual
LIFE INSURANCE
Term Plan:
¾ICICI Prulife Single Premium Without Returns.
¾ICICI Prulife Regular Premium Without Returns
¾ICICI Prulife Regular Premium With Returns
¾LIC`s Bima Kiran Regular Premium With Returns
¾LIC`s Anmol Jeevan Regular Premium Without Returns
¾LIC`s Anmol Jeevan Single Premium Without Returns
Endowment Plan:
¾ICICI Prulife Endowment Plan
¾LIC`s Endowment Plan Table –14.
49
¾LIC`s Jeevan Mitra. Double Cover Table–88.
¾LIC`s Jeevan Mitra. Triple Cover Table–133
¾LIC`s Jeevan Sathi Table– 89
Money Back Plans:
¾ICICI Prulife Cash Bak – 15 yrs & 20 yrs

¾LIC`s Money Back 20 yrs & 25 yrs
¾LIC`s Jeevan Surabhi 15 yrs, 20 yrs & 25 yrs
¾LIC`s Jeevan Samriddhi 12 yrs, 15 yrs, 20 yrs & 25 yrs.
Pension Plan:
¾ICICI Prulife Forever life

¾ICICI Prulife Life Time
¾ICICI Prulife Life Link
¾LIC`s Jeevan Suraksha-1
¾o LIC`s Jeevan Dhara- 1
¾LIC`s Jeevan Akshay–1
¾LIC`s Varishtha Pension Bima Yojana
Investment Plans:
¾ICICI Prulife Life Time

¾ICICI Prulife Life Link
¾LIC`s Bima Nivesh
¾LIC`s Bima Plus
Child Care Plans:
50
¾ICICI Prulife Smart Kid
¾LIC`s Jeevan Chhaya
¾LIC`s Komal Jeevan
¾LIC`s Jeevan Kishore
¾LIC`s Children`s Money Back.
Whole Life:
¾LIC`s Ltd.Premium Whole life
¾LIC`s Jeevan Anand
¾LIC`s Jeevan Rekha
GENERAL INSURANCE
¾Personal Accident:
¾Bajaj Allianz Personal Accident cover.
¾ICICI Lombard Personal Care
¾Royal Sundaram Accident Shield Classic
¾Tata AIG Accident Guard
¾Tata AIG Voluntary accident guard
¾Tata AIG Family Guard.
Travel Insurance:
¾Bajaj Allianz Travel Companion
¾ICICI Lombard Globetrotter - Overseas Leisure Travel
¾Royal Sundaram GroupTravel
Mediclaim:
¾Bajaj Allianz Health Guard
¾Bajaj Allianz Critical Illness
¾Bajaj Allianz Hospital Cash
¾ICICI Lombard Mediclaim
¾Royal Sundaram Health Shield
51
House Holders:
¾Bajaj Allianz House Holders.

¾ICICI Lombard Home Insurance
¾Royal Sundaram Home Shield Classic
¾Tata AIG Home Secure
Product Range for Corporates/ Small Scale Industries/Offices

LIFE INSURANCE
¾ICICI Prulife Group Term plan

¾ICICI Prulife Group Gratuity
¾ICICI Prulife Group Superannuation.
¾LIC`s Group Term Cover
¾LIC`s Group Gratuity
¾LIC`s Group Superannuation.
GENERAL INSURANCE
Professional Indemnity
Mediclaim:
¾Bajaj Allianz Health Guard
¾ICICI Lombard Group Mediclaim
¾ICICI Lombard Group Critical Illness
¾Royal Sundaram Group Health
Office / Shop Package:

¾Bajaj Allianz Office Package.
¾Bajaj Allianz Shop Keepers
¾ICICI Lombard Merchant Cover
¾Royal Sundaram – Office, Shop, Hotel
52
¾Tata AIG Business Jyoti
¾Tata AIG Business Sanjeevani
Personal Accident:
¾Bajaj Allianz Personal Accident cover.
¾ICICI Lombard Group Accident Policy
¾Royal Sundaram Group Accident
¾Tata AIG Executive Guard
¾Tata AIG Group Accident
Travel Insurance:
¾Bajaj Allianz Over seas

¾ICICI Lombard Globetrotter - Overseas Corporate Travel
¾Insurance.
¾Royal Sundaram Group Travel
Corporate Cover
Fire, Burglary, Plate glass, Electronic Equipment cover, Baggage, Public
Liability, Fidelity guarantee Consequential Loss (Fire) Insurance, Industrial
All Risk Motor (includes private cars, two wheelers and commercial vehicles), Money
Insurance, Contractors All risk Policy, Workmen’s
Compensation Engineering, Machinery Breakdown and others.
EQUITIES:
53
Equity participation of clients is the daily earning of the company. People
participate in intraday trades, Short, Medium and Long term investing to plan for their
financial goals. The company is listed member of National Stock Exchange (NSE). It has
terminals at all outlets and helps it customers participate in the stock market trades.
The equities can be traded in
a) Primary Markets
b) Secondary Markets
Indian Stock Market Overview:

The Bombay Stock Exchange (BSE) and the National Stock Exchange of India Ltd
(NSE) are the two primary exchanges in India. In addition, there are 22 Regional Stock
Exchanges. However, the BSE and NSE have established themselves as the two leading
exchanges and account for about 80 per cent of the equity volume traded in India. The
NSE and BSE are equal in size in terms of daily traded volume. Most key stocks are
traded on both the exchanges and hence the investor could buy them on either exchange.
The primary index of BSE is BSE Sensex comprising 30 stocks. NSE has the S&P NSE
50 Index (Nifty) which consists of fifty stocks. The BSE Sensex is the older and more
widely followed index. Both these indices are calculated on the basis of market
capitalization and contain the heavily traded shares from key sectors. The markets are
closed on Saturdays and Sundays.
Both the exchanges have switched over from the open outcry trading system to a fully
automated computerized mode of trading known as BOLT (BSE On Line Trading) and
NEAT (National Exchange Automated Trading) System. It facilitates more efficient
processing, automatic order matching, faster execution of trades and transparency. The
key regulator governing Stock Exchanges, Brokers, Depositories, Depository
participants, Mutual Funds, FIIs and other participants in Indian secondary and primary
market is the Securities and Exchange Board of India (SEBI) Ltd.
54
Working of a stock market:
A person desirous of buying/selling shares in the market has to first place his order with a
broker. When the buy order of the shares is communicated to the broker he routes the
order through his system to the exchange. The order stays in the queue exchange's
systems and gets executed when the order logs on to the system within buy limit that has
been specified. The shares purchased will be sent to the purchaser by the broker either in
physical or demat format.
DERIVATIVES:
55
A derivative is a product whose value is derived from the value of an underlying
asset, index or reference rate. The underlying asset can be equity, forex, commodity or
any other asset. For example, if the settlement price of a derivative is based on the stock
price of a stock for e.g. Infosys, which frequently changes on a daily basis, then the
derivative risks are also changing on a daily basis. Very often, the variables underlying
the derivative securities are the prices of traded securities
Derivatives and futures are basically of 3 types:
¾Forwards and Futures

¾Options
¾Swaps
Forward contract
A forward contract is the simplest mode of a derivative transaction. It is an agreement to
buy or sell an asset (of a specified quantity) at a certain future time for a certain price. No
cash is exchanged when the contract is entered into. It is an agreement between two
parties to buy or sell an asset at a certain time in the future at a certain price.
Index futures permits speculation and if a trader anticipates a major rally in the market he
can simply buy a futures contract and hope for a price rise on the futures contract when
the rally occurs. We shall learn in subsequent lessons how one can leverage ones position
by taking position in the futures market.
In India we have index futures contracts based on S&P CNX Nifty and the BSE Sensex
and near 3 months duration contracts are available at all times.
Each contract expires on the last Thursday of the expiry month and
simultaneously a new contract is introduced for trading after expiry of a contract. The
permitted lot derivatives for future size is 200 or multiples thereof for the Nifty.
Spot price:
56
The price at which an asset trades in the spot market.
Futures price:
The price at which the futures contract trades in the futures market.
Contract cycle:
The period over which a contract trades. The index futures contracts on the NSE as well
as BSE have one-month, two-months and three-months expiry cycles which expire on the
last Thursday of the month. Thus a July expiration contract would expire on the last
Thursday of July. On the Friday following the last Thursday, a new contract having a
three-month expiry would be introduced for trading.
Expiry date:
It is the date specified in the futures contract. This is the last day on which the contract
will be traded. It will cease to exist by the end of that day.
Contract size:
The amount of asset that has to be delivered under one contract. The contract size of the
stock index futures on NSE Nifty is 200 and the contract size of the stock index futures
on BSE Sensex is 50.
Basis:
Basis is usually defined as the spot price minus the futures price. There will be a different
basis for each delivery month for the same asset at any point in time. On 19th June 2001
Nifty closed at 1096.65. August 2001 Nifty futures closed at 1098.90. Therefore the basis
for the August Nifty futures is –2.25 index points. In a normal market, basis will be
negative. This reflects the fact that the underlying asset is to be carried at a cost for
delivery in the future.
Cost of carry:
The relationship between futures prices and spot prices can be summarized in terms of
what is known as the cost of carry. This measures the storage cost plus the interest that is
57
paid to finance the asset less the income earned on the asset. In the case of stocks,
dividend will be the income earned on the asset. The storage cost will be negligible.
Initial Margin:
The amount that must be deposited in the margin account kept with the broker at the time
a futures contract is first entered into is known as initial margin. Margins are to be strictly
collected in the futures and options markets by brokers as per the exchange regulations.
Otherwise the exchange cannot guarantee the trades to all participants in the market.
Marking-to-market:
In the futures market, at the end of each trading day, the margin account is a adjusted to
reflect the investor’s gain or loss depen ding upon the futures closing price or settlement
price. This is called marking-to-market.
Options:
Options give the holder or buyer of the option the right to do something. If the option is a
call option, the buyer or holder has the right to buy the number of shares mentioned in the
contract at the agreed strike price. If the option is a put option, the buyer of the option has
the right to sell the number of shares mentioned in the contract at the agreed strike price.
The holder or the buyer does not have to exercise this right. Thus on the expiry of day of
the contract
the option may or may not be exercised by the buyer. In contrast, in a futures contract, the
two parties to the contract have committed themselves to doing something at a future
date. To have this privilege of doing the transaction at a future only if it is profitable, the
buyer of options has to a premium to the seller of options.
Option Basic Terminology:

Stock options:
58
Stock options are options on individual stocks. A contract gives the holder the right to
buy or sell shares at the specified price.
American option:
American options are options that can be exercised any time up to the expiration date.
This name is only a classification and does not imply that they are available only in
America.
European options:
European options are options that can be exercised only on the expiration date. European
options are easier to analyze than American options, and properties of American options
are frequently deducted from those of its European counter part.
Call option
A call option gives the holder the right but not the obligation to buy an asset by a certain
date for a certain price.
Put option
A put option gives the holder the right but not the obligation to sell an asset by a certain
date for a certain price.
Buyer of an option
The buyer of the option, either call or put, pays the premium and buys the right but not
the obligation to exercise his option on the seller/writer.
Writer of an option:
The writer of a call/put option is the one who receives the option premium and is thereby
obliged to sell/buy the asset if the buyer exercises on him. Option writer is the seller of
the option contract.
Strike price
59
The price specified in the option contract at which buying or selling will take place is
known as the strike price or the exercise price.
Option price
Option price is the premium which the option buyer pays to the option seller or writer.
Black and Scholes formula is widely used for determining the fair value of options.
Expiration date It is the date on which the European option is exercised. It is also called
as exercise date, strike date or maturity date.
Beta:
It is a measure of systematic risk of a security. Beta (or beta coefficient) is a means of

measuring the volatility of a security or portfolio of securities in comparison with the
market as a whole. Beta is calculated using regression analysis. A beta of 1 indicates that
the security's price will move with the market. A beta greater than 1 indicates that the
security's pric
e will be more volatile than the market. A beta which is less than will mean
that the stock will be less volatile than the market.
60
COMMODITIES:
About Karvy Commodities Broking Private Limited
Commodities market, contrary to the beliefs of many people, has been in existence in
India through the ages. However the recent attempt by the Government to permit Multi-
commodity National levels exchanges has indeed given it, a shot in the arm. As a result
two exchanges Multi Commodity Exchange (MCX) and National Commodity and
derivatives Exchange (NCDEX) have come into being. These exchanges, by virtue of
their high profile promoters and stakeholders, bundle in themselves, online trading
facilities, robust surveillance measures and a hassle-free settlement system. The futures
contracts available on a wide spectrum of commodities like Gold, Silver, Cotton, Steel,
Soya oil, Soya beans, Wheat, Sugar, Channa etc., provide excellent opportunities for
hedging the risks of the farmers, importers, exporters, traders and large scale consumers.
They also make open an avenue for quality investments in precious metals. The
commodities market, as it is not affected by the movements of the stock market or debt
market provides tremendous opportunities for better diversification of risk. Realizing this
fact, even mutual funds are contemplating of entering into this market.
Karvy Commodities Broking Private Limited is another venture of the prestigious Karvy
group. With our well established presence in the multifarious facets of the modern
Financial services industry from stock broking to registry services, it is indeed a pleasure
for us to make foray into the commodities derivatives market which opens yet another
door for us to deliver our service to our beloved customers and the investor public at
large.
With the high quality infrastructure already in place and a committed Government
providing continuous impetus, it is the responsibility of us, the intermediaries to deliver
these benefits at the door-steps of our esteemed customers. With our expertise in financial
services, existence across the lengths and breadths of the country and an enviable
technological edge, we are all set to bring to you, the pleasure of investing in this
burgeoning market, which can touch upon the lives of a vast majority of the population
61
from the farmer to the corporate alike. We are confident that the commodity futures can
be a good value addition to your portfolio.
The company provides investment, advisory and brokerage services in Indian

Commodities Markets. And most importantly, we offer a wide reach through our branch
network of over 225 branches located across 180 cities.
To open a commodities trading account, click here else contact the nearest Karvy branch.
Registered Office:
Karvy Commodities Broking Private Limited.

46, Avenue 4, Street No. 1,
Banjara Hills, Hyderabad – 500 034.
Andhra Pradesh, India.
Mail : commodity@karvy.com
Telephone : +91 – 40 – 2331 2454 / 2332 0751
Fax : +91 – 40 – 2331 1968
Commodity Derivatives
A commodity derivative derives its value from an underlying asset which is necessarily a
commodity. To understand the commodity derivatives markets it’s necessary to clear
about ‘commodities’.
Commodities, in simple words are any goods that are common and unbranded. Gold,
silver, rubber, pepper, jute, wheat, sugar, cotton etc., are some of the common
commodities. For e.g. apple juice can be a commodity whereas the ‘Real’ apple juice
cannot be called a commodity. You may be surprised to know that in the US commodities
markets there are futures available even on cattle. Another feature of commodities is that
they are commonly available.
62
Commodity markets represent the formal system for the interplay of demand for and
supply of commodities. These markets can be broadly classified into spot market and
futures market. Commodities for immediate delivery are traded through the spot market.
The players in the spot market are the actual producers and the consumers of the
commodities.
The other type of market called the ‘Futures market’ is for facilitating contracts for future
delivery. (Please go through the material on ‘Futures and Options’ to understand about
futures) These markets make available for trading, the various derivatives based on
commodities. Usually traded ones are the futures and options. However in India options
on commodities are not available and are expected to be introduced soon. The players in
the futures markets are Hedgers, Arbitragers and investors.
Hedgers are those who hold simultaneous positions in the spot market also. These are
generally the actual consumers or the producers of the commodities. For eg: A wheat
farmer who expects his harvest to be over in 3 months time may sell a futures contract
with an expiry of three months, so that even if the prices happen to fall after three
months, he can still manage to sell at the price at which the contract was struck.
The large scale consumers of the products can also make use of the futures to secure their
purchase. For eg: A cooldrinks can manufacturing company may buy tin futures, so that
even if the prices happen to rise later, thy can be assured of the supply of raw materials at
the pre-determined price.
The other major group of participants in the commodity futures market are the importers
and the exporters. Since they have confirmed obligations to export/import fixed quantity
of commodities at a particular period of time, they can take opposite positions in the
futures market.
Arbitrage is a process of making profits using the price differences between two markets
without exposing oneself to any risk. Arbitraging is a very profitable business. It is
possible to arbitrage between two different futures markets or between the futures market
63
and the spot market. However in an ‘efficient’ market arbitraging is not possible, because
any price gap is closed immediately as soon the arbitragers enter the market.
Investors are those who participate in the market for profits and are ready to face the risk
involved in the market. An investor can be anyone from an individual who has a small
surplus income to the treasury desks of banks and corporate.
Most commonly traded derivatives around the world are futures, options and option
futures. Some of the most popular commodity exchanges in the world are listed below:
London Metals Exchange, London

New York Mercantile Exchange, New York
Chicago Mercantile Exchange, Chicago
Chicago Board of Trade, Chicago
London International Financial Futures and Options Exchange (LIFFE), London
Tokyo Commodity Exchange, Tokyo
Winnipeg Commodity Exchange, Canada
Indian Commodities Market
In India commodity markets have been in existence for decades. However in 1975 the
Government banned forward contracts on commodities. Later in 2003 the Government of
India again allowed forward contracts in commodities. There have been over 20
exchanges existing for commodities all over the country. However these exchanges are
commodity specific and have a strong regional focus. The Government, in order to make
the commodities market more transparent and efficient, accorded approval for setting up
of national level multi commodity exchanges. Accordingly three exchanges are there
which deal in a wide variety of commodities and which allow nation-wide trading. They
are
1. Multi Commodity Exchange (MCX)

2. National Commodities Derivatives Exchange (NCDEX)
64
3. National Multi Commodity Exchange (NMCE)
The MCX is Mumbai-based and is promoted by Financial Technologies Pvt Ltd. MCX
allows trading on a host of commodities ranging from bullion to grains. Please check the
‘Commodities traded’ menu’. MCX has become the first exchange in the world to launch
futures on steel. Recently on 11th August 2004, MCX crossed a peak daily turnover of
Rs.950 Crores.
NCDEX is promoted by an elite group of financial institutions including NSE, LIC, SBI,
UBI etc., NCDEX also allows trading of futures on a host of commodities
The following tables indicate the various commodities traded in both exchanges and also
the critical information regarding the various contracts.
National Commodities and Derivatives Exchange, NCDEX
TIC
UNIT OF YIELD/TIC
UNIT OF YIELD/Re. SIZE TRADING
COMMODITY PRICE or TIC
TRADING MOVEMENT or SESSION
QUOTATION VALUE
TIC
PRECIOUS METALS
10:00AM-
4:00PM &
GOLD 10gm 100gm 10.00 1.00 10.00
5:00PM-
11:00PM
10:00AM-
4:00PM &
KILO GOLD 10gm 1000gm 100.00 1.00 100.00
5:00PM-
11:00PM
10:00AM-
4:00PM &
SILVER 1KG 5KG 5.00 1.00 5.00
5:00PM-
11:00PM
65
10:00AM-
4:00PM &
MEGA SILVER 1KG 30KG 30.00 1.00 30.00
5:00PM-
11:00PM
AGRICULTURAL PRODUCTS
10:00AM-
4:00PM &
SOYA 1QT 10QT 10.00 0.05 0.50
5:00PM-
11:00PM
10:00AM-
4:00PM &
SOYA OIL 10KG 10000KG 1000.00 0.10 100.00
5:00PM-
11:00PM
10:00AM-
4:00PM &
COTTON-M 1QT 11 bales 18.70 0.05 0.935
5:00PM-
11:00PM
10:00AM-
4:00PM &
COTTON-L 1QT 11 bales 18.70 0.05 0.935
5:00PM-
11:00PM
10:00AM-
4:00PM &
MUSTARD 10KG 1000KG 100.00 0.05 5.00
5:00PM-
11:00PM
10:00AM-
MUSTARD 4:00PM &
20KG 1000KG 50.00 0.05 2.50
OIL 5:00PM-
11:00PM
10:00AM-
PALMOLEIN 4:00PM &
10KG 1000KG 100.00 0.05 5.00
OIL CRUDE 5:00PM-
11:00PM
66
10:00AM-
PALMOLEIN 4:00PM &
10KG 1000KG 100.00 0.05 5.00
OIL RBD 5:00PM-
11:00PM
10:00AM-
4:00PM
PEPPER 1QT 1000KG 10.00 1.00 10.00
&5:00PM-
11:00PM
10:00AM-
4:00PM &
CHANA 1QT 10000KG 100.00 1.00 100.00
5:00PM-
11:00PM
10:00AM-
4:00PM &
GAUR SEEDS 1QT 10000KG 100.00 1.00 100.00
5:00PM-
11:00PM
10:00AM-
4:00PM &
RUBBER 1QT 1000KG 10.00 1.00 10.00
5:00PM-
11:00PM
Multi-Commodity Exchange, MCX
TIC
UNIT OF YIELD/TIC
UNIT OF YIELD/Re. SIZE TRADING
COMMODITY PRICE or TIC
TRADING MOVEMENT or SESSION
QUOTATION VALUE
TIC
PRECIOUS METALS
10:00AM-
4:00PM &
GOLD-M 10gm 100gm 10.00 1.00 10.00
5:00PM-
11:00PM
GOLD 10gm 1000gm 100.00 1.00 100.00 10:00AM-
4:00PM &
67
M.P.BIRLA INSTITUTE OF MANAGEMENT 5:00PM-
11:00PM
4:00PM &
5:00PM-
11:00PM
10:00AM-
4:00PM &
SILVER-M 1KG 5KG 5.00 1.00 5.00
5:00PM-
11:00PM
10:00AM-
4:00PM &
SILVER 1KG 30KG 30.00 1.00 30.00
5:00PM-
11:00PM
10:00AM-
4:00PM &
SOYA 1QT 10QT 10.00 0.05 0.50
5:00PM-
11:00PM
10:00AM-
4:00PM &
SOYA OIL 10KG 1000KG 100.00 0.05 5.00
5:00PM-
11:00PM
PALMOLEIN 10:00AM-
10KG 1000KG 100.00 0.05 5.00
OIL CRUDE 4:00PM
PALMOLEIN 10:00AM-
10KG 1000KG 100.00 0.05 5.00
OIL RBD 4:00PM
10:00AM-
CASTOR 100KG 1MT 10.00 0.25 2.50
4:00PM
10:00AM-
CASTOR OIL 10KG 1MT 100.00 0.10 10.00
4:00PM
GROUND 10:00AM-
10KG 1MT 100.00 0.10 10.00
NUT OIL 4:00PM
10:00AM-
GAUR SEED 100KG 5MT 50.00 1.00 50.00
4:00PM
68
BLACK 10:00AM-
100KG 1MT 10.00 1.00 10.00
PEPPER 4:00PM
10:00AM-
KAPAS 20KG 4MT 200.00 0.10 20.00
4:00PM
INDUSTRIAL METALS
10:00AM-
STEEL LONG 1MT 25MT 25.00 0.50 12.50
4:00PM
10:00AM-
STEEL FLAT 1MT 25MT 25.00 0.50 12.50
4:00PM
10:00AM-
4:00PM &
COPPER 1KG 1MT 1000.00 0.05 50.00
5:00PM-
11:15PM
10:00AM-
4:00PM &
NICKEL 1KG 250KG 250.00 0.50 125.00
5:00PM-
11:15PM
10:00AM-
4:00PM &
TIN 1KG 500KG 500.00 0.25 125.00
5:00PM-
11:15PM
Note: NCDEX introduced trading on Saturdays in all eligible contracts with effect from May 15,
2004.
DEPOSITORY:
69
what is a depository?
A Depository is a Company where the shares of an individual are held in the electronic
form, at the request of the shareholder. This eliminates the physical form of holding. The
National Securities Depository Limited (NSDL) was promoted by IDBI, UTI, SBI and
NSE. The Central Securities Depository Limited (CDSL) was promoted by BSE .
What is the Depository System?
Your money may be held in the form of liquid cash at your home or may be deposited in
a bank. The bank holds your funds in the electronic form and subsequently debits or
credits the account. Depending on your issuance of cheques or deposit of cheques. The
advantages of safety and convenience of dealing with a Bank overweigh the reasons for
holding liquid cash in your home. Your financial assets such as Equity Shares may be
compared to the above example. You may hold physical share certificates in your home
and be exposed to the various risks of lack of safety, mutilation, loss etc.Alternatively,
you may deposit your shares in an organization called a Depository, which holds your
shares in the electronic form.
The advantages of the Depository System can be further compared with physical shares
as below:
¾The risk of loss, mutilation is common for physical certificates and completely
removed in electronic shares. Handling of a large number of physical certificates
is ended in the Depository mode.
¾In the electronic segment, there are no bad delivers as in physical segment.
¾There is no stamp duty payable in electronic shares compared to the duty of
0.50% in the physical segment while transferring ownership. In loans against
shares, banks usually charge a lower interest rate and margin money than in the
physical share certificates. Settlements in the Stock exchanges has commenced in
the electronic segment and has proven to be far more efficient and convenient
compared to physical shares.
70
How can I Deal with the Depository directly?
You cannot deal with the Depository directly. However, if you have any unresolved
grievances against your DP, you can make a complaint to the Depository at the below
mentioned address.
What are the obligations of a Depository?
The Depository is obligated to maintain the Client Holdings, enable demat and remat of
eligible securities, disbursement of corporate benefits,effect settlement of securities
traded on the exchanges as well as Off-market trades through book entry transfers,
provide for Pledging/Hypothecation of eligible securities.
How many DPM's are there in Karvy?
Karvy Consultants Ltd. have four DPMs as on date. They are:
1. Hyderabad - IN300394
2. Lucknow - IN301557
3. Bangalore - IN301926
4. Mumbai - IN302470
What is NSDL?
National Securities Depositories Limited is a Depository promoted by UTI, IDBI, SBI &
NSE who hold the securities in electronic form on behalf of the beneficiary holder.
Tell me about the Insurance Policy by NSDL ?
Shares in the electronic segment are 100 percent secure. The agreement between you and
the DP indemnifies you against misuse of your electronic holdings by any party, in any
manner whatsoever. You may legally invoke such indemnity and be 100 percent
compensated. A comprehensive Insurance Policy has been taken by NSDL which covers
your DP account so as to protect you against any losses, breach of security etc.
71
What is CDSL?
Central Depositories Securities Limited is a Depository promoted by BSE.
How does the Depository curtail Forgeries / Fakes in Duplicate Distinctive

Numbers?
Physical share certificates with duplicate distinctive numbers are essentially forged
certificates. The R&T would identify and reject the certificates.The concerned Stock
Exchanges are informed of the details.
What are the services offered by Depository Participant?
Our Electronic Custodial Services are:
• Convert your physical holding into electronic holding (which is called

"dematerialisation" of securities)
• Keep custody of your holdings in electronic form.
• Transfer the shares in the electronic form from one account to another.
• Facilitate pledge of your electronic securities.
• Give electronic credit of new share allotments such as public issues, bonus , rights
etc.
• Convert your electronic holding into physical holding (which is called
"rematerialisatoin of securities")
72
SWOT ANALYSIS
73
SWOT ANALYSIS:
Strength:
¾Good research team.
¾Dedicated employees.
¾Strong customer relationship.
¾Strong brand name.
¾Wide spread branches and brokers network..
Weakness:
¾Technology need to be upgraded.
¾
Not enough advertisement.
Opportunity:
¾Growing IPO issues.
¾Positive outlook of people towards financial products.
¾Growing consumer awareness about equity related product.
Threat :
¾Market uncertainty.
¾Galloping competition.
¾Broad economic factors like inflation etc
74
FINDINGS
75
FINDINGS:
KARVY IS ONE OF THE LEADING BROKING HOUSE IN THE EQUITY

MARKET.
KARVY HAS GOOD SUCCESS RATE AS LEAD MANAGERS.
IT HAS BRANCHES ALL OVER COUNTRY.
ITS BIGGEST STRENGTH IS THER PRESENCE IN THE FIELD OF
FINANCE FOR A LONG TIME.
76
SUGGESTIONS AND
RECOMMENDATIONS
77
SUGGESTIONS AND RECOMMENDATIONS
Karvy has achieved a lot in the field of finance. Not much can be suggested in regard to
the policies and principles it has. The good success rate is a clear reflection about the
company’s strong rules, coupled with dedicated work put in by its employees.
The following could help the company to become a pioneer in its field.
1) Karvy offered IPO’s but found it not quite profitable. The present year has seen a
boom in equities and a large number of IPO’s are being issued by a umber of companies.
This could be a good segment to tap with. Entry into the IPO allotment procedure could
be quite helpful and profitable.
2) Competitors like share khan, Geojit, etc. are known better than karvy. The company
lacks publicity. A good portion of the general public is not quite aware of the existence of
such an investment firm like karvy, which caters to most of the available investing
instruments. The company could undertake promotional activities with the general public
as the target group. They could make aware of the services they render to the public. This
could attract new customers which can be transformed into a long lasting relationship.
This could be put into action by having print advertisements in papers like The Economic
Times, Business Line, Financial Express etc. Advertisement
in CNBC-India could give a very good brand image to the company.
3) The company acts as a mediatory for most of the investment options. It gives people
access to a wide variety of mutual funds, Insurance schemes etc for third party
companies. The company can start its own mutual fund and start investing in stocks,
debts and government securities. It has a special and dedicated Research Desk who are
into constant monitoring of the share markets. It can take advantage of this and start a
separate mutual fund. People will have good confidence in this and the business can also
be profitable.
78
CONCLUSION
79
CONCLUSION:
Investment in India has become more of a security necessity than a business lifestyle. As
the interest rates all over are dropping, people are switching to other avenues which fetch
better results. The risk band that initially existed as been eased out and people are on the
lookout for new and better stuff. In olden days, one could invest only in a few companies,
but the present day has given people to try a wide range of companies. The decision in
regard to investments is based on the sector performance as well as the strong
fundamentals of the company. The act of speculation has considerably been reduced due
to the statistical data and its analysis that companies like karvy do and people have
become intelligent investors rather than mere speculators.
It was a very fruitful experience working in karvy as a management trainee. It offered

exposure to the wide range of investment options available. The risk factors involved
could be understood easily. Not only did it give a learning experience but also gave an
idea on how we could incorporate the various investment options, discovered by the
economists, into a good planning package.
80
BIBLIOGRAPHY
Understanding Organizations by Madhukar Shukla

www.mutualfundindia.com

Statistics.com

Business Line Newspaper

Economic Times Newspaper

81

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A REPORT ON

Submitted in partial fulfillment of the requirements of

The M.B.A Degree Course of Bangalore University

M.P.BIRLA INSTITUTE OF MANAGEMENT

This to certify that this report titled “ AN ORGANIZATIONAL STUDY at

Place: Bangalore (Dr.N.S.Malavalli)

This is to certify that the internship Project Report entitled

Place: Bangalore Dr K.V. Prabhakar

I am thankful to Dr.N.S.Malavalli, Principal, M.P.Birla institute of

I am extremely thankful to Mr. K.V Prabhakar, Professor, M.P.Birla

I profusely thank Mr. Vasu, Marketing Manager KARVY CONSULTANT

I equally thank all the Employees and Executives of KARVY

Finally, I express my sincere gratitude to all my friends and well wishers

who helped me to do this project.

S.No PARTICULARS pg.no

2. PROFILE OF THE INDUSTRY 1

There are several good reasons for investing in India:

Karvy early days:

1979-1980: karvy and company

KARVY’S ASPIRATION OF ES TABLISHING ITSELF AS AN INTEGRATED

KARVY IS DEDICATED ITSELF TO:

¾HAVING A SINGLE MINDED FOCUS ON INVESTOR SERVICES.

OUR MISISION IS TO BE A LEADING , PREFERRED, SERVICES PROVIDER TO

As per the Quality Policy, Karvy will:

• Build in-house processes that will ensure transparent and harmonious

Mr. C Parthasarathy, a leader in the financial services industry in

Mr. Y Yugandhar, Managing Director, founder member of Karvy

Key Personnel at Head office

Among the top 5 stock brokers in India (4% of NSE volumes)

Among the to top 3 Depository Participants

Largest Network of Branches & Business Associates

ISO 9002 certified operations by DNV

Among top 10 Investment bankers

Largest Distributor of Financial Products

Adjudged as one of the top 50 IT uses in India by MIS Asia

Full Fledged IT driven operations

Our Clients. Our Focus

Respect for the individual

¾NO. OF IPO’S HANDLED : 720

¾Controlled and low-cost service culture.

Investor service network:

¾352 offices in 242 cities/towns

MUTUALFUND DEPARMENT STRUCTURE:

MR. V SRIDHAR ( ALL OVER INDIA VP)

MR SOURABH (SALES EXECUTIVE,

Karvy Karvy Karvy Karvy

Stock broking research depository distribution personalclientgroup

Corporate affairs group HR finance &A/C TRG&DEV depository services corp

The internship was undertaken at CHENNAI Branch of KARVY CONSULTANT. The

SENIOR EXECUTIVE SENIOR EXECUTIVE SENIOR EXECUTIVE

JUNIOR JUNIOR JUNIOR

HR & Admin SA&FC

You can make money from a mutual fund in three ways:

History of Mutual Funds

Mutual fund schemes:

Fund Mutual Basics :

Advantages of Mutual Funds:

• Professional Management - The primary advantage of funds (at least theoretically) is

• Diversification - By owning shares in a mutual fund instead of owning individual stocks

Disadvantages of Mutual Funds:

• Professional Management - Did you notice how we qualified the advantage of

• Costs - Mutual funds don't exist solely to make your life ea

_ Effect of loss of key professional and inability to adopt

_ Changes in government policy

KARVY IS ONE OF THE LEADING BROKING HOUSE IN THE EQUITY