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1. INTRODUCTION

WEALTH MANAGEMENT is an investment-advisory discipline which incorporates financial


planning, investment portfolio management and a number of aggregated financial services offered
by a complex mix of asset managers, custodial banks, retail banks, financial planners and others.
There is no equivalent of a stock exchange to consolidate the allocation of investments and
promulgate fund pricing and as such it is considered a fragmented and decentralized
industry. High-net-worth individuals (HNWIs), small-business owners and families who desire
the assistance of a credentialed financial advisory specialist call upon wealth managers to
coordinate retail banking, estate planning, legal resources, tax professionals and investment
management. Wealth managers can have backgrounds as independent Chartered Financial
Consultants, Certified Financial Planners or Chartered Financial Analysts (in the United
States), Certified International Investment Analysts, Chartered Strategic Wealth Professionals (in
Canada), Chartered Financial Planners (in the UK), or any credentialed (such as MBA)
professional money managers who work to enhance the income, growth and tax-favored treatment
of long-term investors.

1.1. Identification of problem

Risk management is essential in financial planning and WEALTH MANAGEMENT. Risk


management is defined as, the process by which various risk exposures are identified,
measured and controlled (Jorion, 2002). Thus, risk management is concerned with three tasks
related to risk viz. identification, measurement and control. Identification is the process of
mapping the source of risk as well as the variables that are most closely connected with it.
Identification is a difficult issue and usually is tough to quantify. Origin of risk can be from
inflation, business cycles, government policies, wars, natural calamities and technological
innovation. In a highly integrated financial world, what is happening in one centre is liable to
have repercussions in other places as well. If prices go down, we will have problems: problems
in the sense of spillover to other areas (Greenspan, 2007). Hence, risk as emerging from foreign
market and spilling over to other markets is an important part of the identification of risk and
therefore the question whether volatility and return of a foreign market affect the domestic
market is an important one in the containment of risk. Therefore, taking all these risk factors
as one set and assuming them to be originating in one market and flowing to the others, risk
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can be thought of as taking the same route and mapped in a similar fashion. Thus, academicians
have found spillover of risk from one market to the other as a useful method of quantifying
and thereby identifying risk. The second factor in identification of risk is 2 concerned with the
variable or proxy that may truly reflect risk. In this regard, volatility has emerged as a standard
term to signify risk. It is nothing but the variation of return over a certain period of time. This
is amply captured by the variance of return. Hence, combining these two factors may be
thought of as a useful way of dealing with identification of risk.

Closely connected with this issue of spillover of volatility is the existence of risk premium. If
volatility is spilling over and causing asset prices to fluctuate in the domestic market thereby
leading risk levels to soar, investors should be paid a premium to hold these highly fluctuating
assets in their portfolio. This markup is called risk premium. Existence of risk premium is the
only rationale for investors preferring securities like stocks over safer bets like bonds, gold and
currency. Since measured volatility is equivalent to risk and because financial industry is
replete with risk lovers, theoretically, there should be a positive and healthy relation between
volatility and return. This study has therefore occupied a pivotal position in financial literature
form the 1950’s onwards.

Hence, selection of the model to be used is a very delicate task to be done only after a careful
empirical analysis and stringent back testing. Thus, the present study attempts an 3 exhaustive
and in-depth analysis in these areas and tries to uncover theoretical relations at empirical level
as also seeks to find a benchmark model that would be suitable for all the parties interested for
taking decisions at different levels of their operations.

1.2 STATEMENT OF THE PROBLEM

Today wealth management plays an important role in individual’s life. Therefore, the study
attempts to know the importance of wealth management and the effects of demographic
determinants on the preference for wealth management services.

1.3 Objectives of the Study

і) To study the risk-return dynamics in the Indian equity market by analyzing the existence of
risk premium.
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іі) To study the investment practices of individual investors.

іii) To analyze the volatility in various instruments of investment available for individual
investor in India.

As per theory it is expected that there is a positive spillover of volatility as well as return from
one market to the other. This is supported by a number of studies for other markets as well as
by the expectations prevalent in the industry. This comes under identification of risk as
originating in the foreign markets. The study seeks to verify the existence of a positive risk
premium as the investors need to be compensated adequately for the additional risk that they
are taking. The study analyzes 7 models and their different varieties and subjects them to back
testing against real world returns in the third objective. The study runs these models accounting
for asymmetric information as well with assumptions of fat tailed distribution. The study
includes both parametric and non-parametric models.

1.4 Scope and Limitations

1.4.1 Scope of the study

World Wealth report published by Capgemini and RBC WEALTH MANAGEMENT recently
says that India became home to 1.56 lakh millionaires in 2013, with 3000 more joining the
elite club in 2013, making the country 16th most populous, in terms of population, of super-
rich people worldwide !!!

This is huge potential and naturally will attract new entrants to the industry. This also means
that there is enough opportunity for each player on the table. However, 80:20 rule should apply
here. 80% of the wealth will be managed / advised by 20% of the advisors.

Another trend we clearly see is clients' involvement in decision making process, leading to
greater understanding of products. New age clients are financially savvy and willing to
experiment with new product types. For us, as advisors, it is an opportunity for product
innovation. In India, the current generation is well read, educated abroad and has a keener
understanding of capital markets. As a result, unlike say 15 years ago, today most of our clients
understand what they are buying into and will often ask us for product simulation or reiterations
or will ask for global track record of similar products. This is a really big transformation taking
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place in India's WEALTH MANAGEMENT industry. This brings in transparency and forces
product manufacturers to innovate faster.

1.4.2 Limitations of the study

 There are some things that are critical for a new entrant or a young player in the industry
- understand their client segment, revenue sources and the cost structure.
 This will determine the kind of products and services to be offered and the kind of fee-
structure to opt for.
 Challenges are in the form of a new segment of HNIs with very different investing
Behaviour, offering best-in-class products and innovation, changing revenue sources
and cost-income models, differentiated value proposition, as well as the role of ever
evolving technology.
 Over time, the industry will evolve and overcome these challenges. The importance of
advice will remain critical to success since at the core of WEALTH MANAGEMENT
lies the edge of knowledge translating to unbiased, quality advice.
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2. REVIEW OF LITERARTURE
2.1.Background Study
2.1.1 Theoretical framework
Private WEALTH MANAGEMENT
Private WEALTH MANAGEMENT is delivered to high-net-worth investors. Generally
this includes advice on the use of various estate planning vehicles, business-succession or
stock-option planning, and the occasional use of hedging derivatives for large blocks of
stock.
Traditionally, the wealthiest retail clients of investment firms demanded a greater level of
service, product offering and sales personnel than that received by average clients. With an
increase in the number of affluent investors in recent years, there has been an increasing
demand for sophisticated financial solutions and expertise throughout the world.
The CFA Institute curriculum on private-WEALTH MANAGEMENT indicates that two
primary factors distinguish the issues facing individual investors from those facing
institutions:
1. Time horizons differ. Individuals face a finite life as compared to the
theoretically/potentially infinite life of institutions. This fact requires strategies for
transferring assets at the end of an individual's life. These transfers are subject to laws and
regulations that vary by locality and therefore the strategies available to address this
situation vary. This is commonly known as accumulation and decumulation.
2. Individuals are more likely to face a variety of taxes on investment returns that vary
by locality. Portfolio investment techniques that provide individuals with after tax
returnsthat meet their objectives must address such taxes.
The term "WEALTH MANAGEMENT" occurs at least as early as 1933. It came into more
general use in the elite retail (or "Private Client") divisions of firms such as Goldman Sachs
or Morgan Stanley (before the Dean Witter Reynolds merger of 1997), to distinguish those
divisions' services from mass-market offerings, but has since spread throughout the
financial-services industry. Family offices that had formerly served just one family opened
their doors to other families, and the term Multi-family office was coined. Accounting
firms and investment advisory boutiques created multi-family offices as well. Certain
larger firms (UBS, Morgan Stanley and Merrill Lynch) have "tiered" their platforms – with
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separate branch systems and advisor-training programs, distinguishing "Private WEALTH


MANAGEMENT" from "WEALTH MANAGEMENT", with the latter term denoting the
same type of services but with a lower degree of customization and delivered to mass
affluent clients. At Morgan Stanley, the "Private WEALTH MANAGEMENT" retail
division focuses on serving clients with greater than $20 million in investment assets while
"Global WEALTH MANAGEMENT" focuses on accounts smaller than $10 million.
In the late 1980s, private banks and brokerage firms began to offer seminars and client
events designed to showcase the expertise and capabilities of the sponsoring firm. Within
a few years a new business model emerged – Family Office Exchange in 1990, the Institute
for Private Investors in 1991, and CCC Alliance in 1995. These companies aimed to offer
an online community as well as a network of peers for ultra high-net-worth individuals and
their families. These entities have grown since the 1990s, with total IT spending (for
example) by the global WEALTH MANAGEMENT industry predicted to reach $35bn by
2016, including heavy investment in digital channels.
WEALTH MANAGEMENT can be provided by large corporate entities, independent
financial advisers or multi-licensed portfolio managers who design services to focus on
high-net-worth clients. Large banks and large brokerage houses create segmentation
marketing-strategies to sell both proprietary and non-proprietary products and services to
investors designated as potential high-net-worth clients. Independent wealth-managers use
their experience in estate planning, risk management, and their affiliations with tax and
legal specialists, to manage the diverse holdings of high-net-worth clients. Banks and
brokerage firms use advisory talent-pools to aggregate these same services.
The Great Recession of the late 2000s caused investors to address concerns within their
portfolios. For this reason wealth managers have been advised that clients have a greater
need to understand, access, and communicate with advisers about their situation.

Family WEALTH MANAGEMENT


James E. Hughes Jr., in his book Family Wealth, defines the wealth of a family as the
human and intellectual capital of the family, with financial capital being used to support
the growth of the family’s human and intellectual capital.
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In the UK alone, an estimated £5.5 trillion is due to be passed between generations over
the next 30 years – according to Kings Court Trust – yet according to the Attitudes
Survey2019, only half of Ultra High Net Worth Individuals have a robust succession plan
in place. Passing on wealth is a major concern for wealthy families.
The four dimensions of family wealth
1. Human: The skill sets, talents, and emotional maturity of everyone in the family.
2. Cultural: The overall identity of a family, including communication skills,
collective values, and how decisions are made together.
3. Social: How a family is connected to its community, and the overall mission of how
they’ll contribute to the world.
4. Financial: Assets and financial strategy that make up the family’s portfolio and
resources for the future.
The 3 Forces of Family WEALTH MANAGEMENT
1. Wealth Creators – usually the first generation patriarch or matriarch who through
their entrepreneurial efforts created the money that is the basis of the family fortune and
legacy.
2. Wealth Inheritors – those family members who are not direct wealth creators, such
as a surviving spouse, children, extended family members, and other beneficiaries.
3. Various Wealth Advisers – those involved in the planning and execution of
investment strategies, tax strategies, trust and estate strategies and management, and day-
to-day transaction tracking and cash management.

2.1.2 Review of literature

Shun-Yao &Chyan (2011) in their research on Influence of information on risky investment


preferences observed how the lack of essential financial knowledge to efficiently measure the level
of risk involved in a particular investment generates the need of the professional wealth managers
to provide them with an advice or manage their wealth on their behalf. Wealth managers provide
such investors with a service to directly interact their experienced professionals face to face while
taking any major financial decision or investing in any complex investment portfolio. Professional
wealth managers possess the knowledge of several investment portfolios available in the market.
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Lusardi & Mitchell (2014) they exhibit knowledge of how to efficiently balance risk and returns
from an investment and also possess special techniques to analyze company’s performance and
are also proficient in effectively managing a portfolio. Financial service managers provide a sound
advice that is based on in depth understanding of the customer’s requirements compared to their
actual behavior.

Funfgeid et al (2008) need of the wealth managers and their financial advice is more critical for
the anxious investors. The investors who possess such behavior tend to intuitively and
spontaneously take decisions and show less patience even while making huge investments.
Consequently, it is important for these investors to opt for personal advisory services offered by
wealth managers in order to avoid making big mistakes resulting in big losses because of their
behavioural issues.

O‟Donoghue and Rabin(1998)the investors who follow their gut feeling while making any
investments face potential problems in effectively managing their wealth and essentially need
professional advice and guidance in regards to their financial matters.

Lusardi &Mitchell(2014) investors who feel insecure in making financial decisions and
investments are also the primary candidates for the need to WEALTH MANAGEMENT services.
Past performance and future returns can be well determined by the financial institutions who hire
experienced financial advisors to comprehend the future state of market to take the right decisions.

Bahbah (2009) in a research on timeless strategies for building financial security in WEALTH
MANAGEMENT, elucidated that various measures to increase the awareness must be taken to
guide the people regarding the importance of WEALTH MANAGEMENT services to manage
their wealth. After gaining wealth, it is more important to safeguard it by managing in an effective
and diverse manner. By following a proper saving and investment plan; and correct utilization of
wealth in a planned way provides a secured future for a family.

Brennan and Xia (2002) to achieve this professional financial advisers are appointed to help their
clients through professional WEALTH MANAGEMENT. The customer centric solution is one of
the best solutions for the needs of WEALTH MANAGEMENT, definitely that would ease to
overcome several challenges faced by customers at every level of WEALTH MANAGEMENT
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business. The WEALTH MANAGEMENT business cycle includes covering acquisition,


identification, reporting and servicing.

A research conducted by Kabra, Mishra and Dash (2010) on factors influencing the investment
decisions of generations concluded that age and gender of an individual investor essentially
influences his risk appetite.

Chandra and Kumar (2011) in a study on determinants of individual investor behavior concluded
that five major factors that influence investment behavior of an individual investor are investor‟s
foresight, financial knowledge, cautious attitude, skewness in information and the confidence
level.

Riaz et al. (2012) in a study on impact of psychological factors on investment decision making
concluded that the availability of information to the investors and how the investor perceive and
interpret that information significantly impact and determines the risk tolerance, investor‟s
behavior and decision making in regards to their investments.

In a research conducted by Vincent F. Yu and Hsiu-I Ting (2011) on identifying key factors
affecting consumer’s choice of WEALTH MANAGEMENT services, the three main elements that
form the crucial factor in choosing a financial institution for the WEALTH MANAGEMENT are
image, product and services. Sub-elements of image are popularity, reliability, morality,
professionalism and recommendation. Sub-elements those come under products category are
diversification, fee, returns and risk. Key elements of services are convenience, confidentiality,
communications and attitude.

DebarshiBasu, Michael Gates, Vishal Karir and Andrew Ang


The Journal of WEALTH MANAGEMENT Spring 2019, 21 (4) 46-63; DOI:.2019.21.4.046 tells
that Model portfolios are constructed using passive and active vehicles to help meet specific
investment outcomes. We present a rigorous, repeatable framework for designing optimal model
portfolios, which (1) selects a benchmark portfolio that reflects a target level of risk; (2) constructs
a strategic model portfolio that reflects long-term capital market assumptions; and (3) potentially,
but not necessarily, incorporates tactical views in a final model portfolio, rotating positions around
the strategic model holdings to reflect short-term market views. Using the framework, we
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demonstrate the construction of model portfolios for multi-asset-class and factor-investing


applications.

W. Brian Barrett, Celine Moreno and Thomas B. Sanders


The Journal of WEALTH MANAGEMENT Spring 2008, 10 (4) 30-41; DOI: The authors present
the results of a survey of the 20 top American money-management firms that asks the reasons why
money managers move between firms. Such results should assist to devise methods for retaining
top-performing producers. Such efforts are essential to providing stability to the RM-client
relationship and, therefore, work toward making a happy customer. A number of variables as they
relate to the percentage of assets transferred were studied, such as years of experience, number of
job changes, performance of portfolio, movements between brokerages and private banks, and
proactivity of departure firm, among others.

Kirk Loury:The Journal of WEALTH MANAGEMENT Fall 2008, 11 (2) 19-28; DOI: For both
wealth managers and investors, a disconnect can result over time as to how the performance of a
wealth plan meets the client's short-, mid-, and long-term needs. Failing to fund these needs can
create life-changing consequences that may not appear for years into the future, until it is often too
late to change course. The use of the structural principles of a balance sheet enables wealth
planning to proceed methodically and efficiently by matching pro-forma after-tax cash flows
across various time horizons. The sequential matching of cash flows drives a number of different
insights into portfolio management tactics, such as need hierarchies, asset allocation, and
rebalancing.

Joachim Klement Fidante Partners Date Written: July 9, 2006 Here we present three alternative
ways to deal with parameter uncertainty when constructing optimal portfolio allocations. The
portfolio resampling is a heuristic method to achieve less concentrated portfolios that deliver stable
results out-of-sample. Bayesian estimators provide a mathematical framework to update prior
beliefs with estimation uncertainty to derive more stable portfolios. The naïve equal weighted
portfolio assumes that there is no knowledge about the future. We show that these portfolios
outperform the traditional mean variance efficient portfolios and recommend using such
techniques or a combination of these techniques to construct passive investment benchmarks.
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2.2. Company Profile

Tag Line says……… “Delivering Prosperity”

Wallet4wealth is a specialist in Private WEALTH MANAGEMENT & Distributor Firm set up by


experienced persons from the Industry, to provide a professional platform of Private WEALTH
MANAGEMENT services.

Wallet4wealth is a comprehensive source of Investment Knowledge, Financial Planning, Mutual


Funds India Research, Authorised Online trading services and Investing in India.

If you are looking to avail the services of credible Mutual Fund Advisors, Life Insurance Agents,
General Insurance Agents, Income Tax Return, Certified Financial Planners, Income Tax
Consultants, Share & Stock Brokers, Income Tax e-filing, Investment Financial Planning, Fixed
Deposit and Tax Return Preparer Scheme (TRPS) or any other service in personal finance domain
in your neighborhood, then you have come to the right place.

The reason for creating Wallet4wealth is to bridge the gap between all the stakeholders, Investors
- Advisors. While the investor can search the most suitable financial advisor for fulfillment of his
financial goals, the advisor can establish him as an aid to that with the help of innovative solutions
offered by the manufacturer. As a bridge, our endeavor would be to collaborate, converge and
create.

We believe financial planning should be affordable, accessible, and even delightful. Whether you
want to budget better, save for big trips, maximize your investments, or something in between,
we’re here to help you make progress on your money.

For Client’s interests: What is good for our clients is good for us

Delivering prosperity to our valued clients by advising and guiding according to their financial
goals and also offering the better out of best products which is suitable for them by taking robust
risk taking measures.

We strive to have the most diverse set of choices for clients in terms of investment options; each
client has different needs and each optimal asset allocation mix will be different. Client interest is
supreme for us.
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For Aligned Partners/Stake Holders/Employees….

Delivering prosperity to our partners, stake holders and employees. Gifting ownership of the
business with absolutely stress free environment. People will be looked as entrepreneur as always.
Transferring out people from employees to entrepreneurship.

We have cordial relations with all product partners and they respect us for our keeping our client’s
interests first. We also value the contribution of our partners in technology, marketing, and
organization building and strive to be fair in our dealings with them – they, too, are completely
soaked in our Clients-first culture.

Compliance and Ethics

Ethics and compliance at Wallet4wealth are non-negotiable areas. We uphold them to the highest
degree in all our interactions.

Integrity

To be true and honest with everyone and have the ability to fearlessly voice opinions without
biases.

Orientation for excellence

To have benchmarks that compare with the best in class globally and strive towards a work output
that significantly exceeds client expectations.

Professionalism

To have the highest standards of conduct in dealing with all stakeholders and have systems,
policies and behavior which encourage organizational effectiveness.

Product Profile
Mutual funds
Mutual funds announce the investment objective for every scheme they float, and seek investments
from the public. When a scheme is open for investment for a limited period, initially, it is called a
New Fund Offer (NFO). Depending on how it is structured, the scheme may be open to accept
money from investors only during the NFO (closed-end scheme), or it may accept money post-
NFO too (open-end scheme).
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Product List

Mutual Funds are classified as Open-end, Closed-end and Interval Funds

Open-end schemes are open for investors to enter or exit at any time, even after the NFO.
Although some unit-holders may exit from the open-end scheme, wholly or partly, the scheme
continues operations with the remaining investors. The scheme does not have any kind of time
frame in which it is to be closed

Closed-end funds have a fixed maturity. Investors can buy units of a closed-end scheme, from the
fund, only during its NFO. The fund makes arrangements for the units to be traded, post-NFO in
the stock exchange/s. This is done through a listing of the scheme in one or more stock exchanges.
Such listing is compulsory for closed-end schemes

Interval funds combine features of both open-end and closed-end schemes. They are largely
closed-end, but become open-end during pre-specified time periods. For instance, an interval
scheme might become open-end between January 1 to 15, and July 1 to 15, each year. The benefit
for investors is that, unlike in a purely closed-end scheme, they are not completely dependent on
the stock exchange to be able to buy or sell units of the interval fund. There is a transaction period
(January 1 to 15 and July 1 to 15, in this example), when both subscription and redemption may
be made to and from the scheme). Transaction period has to be of minimum 2 working days, as
per SEBI Regulations. The gap between two successive transaction periods (January 15 to July 1,
in this example) is called interval period. The minimum duration of an interval period is 15 days.
Subscription and redemption is not permitted during the interval period.

Finally the schemes are classified on the basis of their Asset Class : Equity, Debt & Hybrid Funds

Online trading

Online trading is the procedure of engaging buy/sell orders for financial securities and/or
currencies with the use of a broker's internet-based exclusive trading platforms. The use of online
trading has increased dramatically since 1980s. In India stock trading gained popularity after 1995
with the introduction of affordable high-speed computers and internet connections.
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Stock trader

A stock trader or equity trader or share trader is a person or company involved in trading equity
securities. Stock traders may be an agent, hedger, arbitrageur, speculator, stockbroker or investor.
A stock investor is an individual or company who puts money to use by the purchase of equity
securities, offering potential profitable returns, as interest, income, or appreciation in value (capital
gains). This buy-and-hold long term strategy is passive in nature, as opposed to speculation, which
is typically active in nature. Many stock speculators will trade bonds (and possibly other financial
assets) as well.

Stock speculator

The stock speculator is usually anexpert. Folks can call themselves jam-packed or casual stock
traders/investors while maintaining other professions. When a stock speculator/investor has
clients, and acts as a money manager or guru with the intention of adding value to their clients’
finances, he is also called a financial advisor or manager. In this case, the financial executive could
be an independent expert or a large bank professional employee.

Investor or a stockholder

On the other side, stock investors are companies or persons who buy stocks with the purpose of
keeping them for an extended period, usually several months to years, for passive income
objectives like dividend accumulation. They depend primarily on fundamental analysis for their
investment decisions and completelyidentify stock shares as part-ownership in the company. Many
stockholders believe in the buy and hold strategy, which as the name suggests, implies that
investors will buy stock ownership in a corporation and hold onto those stocks for the very long
term, generally measured in years.

De-mat account

A De-mat account is opened by the investor while registering with an investment broker (or sub-
broker). The Dematerialized account number is quoted for all transactions to enable electronic
settlements of trades to take place. Every shareholder will have a Dematerialized account for
transacting.
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Life Insurance

We prioritize insurance planning is a must because it is protection to the life cover risk. It will help
you understand whether you are under-insured or over-insured and the existing policies can be
earmarked in the financial planning structure.

Life insurance is important to people who want to protect their family from financial distress after
their death. It can be used to provide financial security for loved ones.

Health Insurance

Medical expenses are sky high these days, but was never cheap ever. Even a small treatment or an
appointment with a doctor might consume a lot of money. Health insurance is a must, it saves
money and covers unexpected calamities. Health insurance comes in handy to meet emergencies
of severe ailment or accident. Sometimes it is associated with covering disability and custodial
needs. Life is unpredictable, insurance can make it safe and secure from bearing huge loss. Health
insurance is affordable and carries the assurance and freedom from insecurities that threaten life
now and then.

Car Insurance

Car insurance technically provides protection against the losses incurred as a result of unavoidable
instances. It helps cover against theft, financial loss caused by accidents and any subsequent
liabilities. The cover level of Car insurance can be the insured party, the insured vehicle, third
parties (car and people). The premium of the insurance is dependent on certain parameters like
gender, age, vehicle classification, etc. Car insurance gives confidence to drive fearlessly but at
the same time should follow the traffic rules. In emergencies it acts like a boon to the insurer.

Travel Insurance

Be it business or pleasure travel, having a trouble free trip is what everyone looks forward to.
Illness is uncertain, it can spoil the planned trip. But with insurance in hand, medical bills are taken
care of. Other difficult situations like loss of passport or baggage while traveling can also add on
financial difficulties. These are all covered by travel insurance. Travel insurance usually covers
medical expenses, financial or any other looses incurred while traveling. Travel insurance is
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arranged at the booking of a trip to cover exactly the duration of that trip. Travel insurance offers
coverage for Student travel, business travel, leisure travel, adventure travel, cruise travel, and
international travel. Irrespective of the nature of uncertainties, a suitable travel insurance fulfilling
the requirements can offer the coverage needed while away from home.

Home Insurance

Home insurance, also commonly called hazard insurance or homeowner's insurance (often
abbreviated in the real estate industry as HOI), is the type of property insurance that covers private
homes. It is an insurance policy that combines various personal insurance protections, which can
include losses occurring to one's home, its contents, loss of its use (additional living expenses), or
loss of other personal possessions of the homeowner, as well as liability insurance for accidents
that may happen at the home or at the hands of the homeowner within the policy territory. It
requires that at least one of the named insureds occupies the home. The dwelling policy (DP) is
similar, but used for residences which don't qualify for various reasons, such as vacancy/non-
occupancy, seasonal/secondary residence, or age.

Corporate Insurance

Our corporate Insurance Advisory, is capable to include end-to-end Insurance Solutions and
Services to corporates. We cater to the Corporate Insurance and Risk Management needs for Large
Industrial Houses, Medium Scale Companies and SMEs.Provide Comparative and Competitive
Quotes from Insurance Companies Assist in Policy Administration Personalized Claims
Assistance.

Debenture

Debentures have no collateral. Bond buyers generally purchase debentures based on the belief that
the bond issuer is unlikely to default on the repayment. An example of a government debenture
would be any government-issued Treasury bond (T-bond) or Treasury bill (T-bill). T-bonds and
T-bills are generally considered risk free because governments, at worst, can print off more money
or raise taxes to pay these type of debts
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3. METHODOLOGY

Primary source is being used for carrying out the research. The Software Used for Data Analysis
is: - MS-Excel & MS-Word.

3.1. Sample Design: -Sampling:In market research, sampling means getting opinions from a
number of people, chosen from a specific group, in order to find out about the whole group.

The Sampling technique used in my research was Convenience Sampling, which involves the
sample being drawn from that part of the population which is close to hand. That is, a population
is selected because it is readily available and convenient. It is also known as
Grab/Accidental/Opportunity Sampling. It is a type of non-probability sampling.

3.1.1 Sample Size:

This involves figuring out how many samples one need.

Sample size is 63 individuals.

The sample size is influenced by the investors.

3.1.2 Sample Description:

The samples are 63 investors from Bhubaneswar market. They are of various income groups, age
structure, different personalities and gender.

3.2. Data Collection:

Only primary data is collected from the investors who visits the organization

3.2.1 Instrumentation Technique:

The instrumentation technique used in the research is Structured Questions (Single response and
multiple response).

Close-ended questions are framed in the survey questionnaire for the research.
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3.2.2 Collection of Data:

 Primary Data: The data collected for a purpose or for a particular problem in original
known as primary data.
 Collection of Primary Data: In my research the data was collected through personal
interview. Here, questionnaire was used as a data collection tool.
 Questionnaire: A questionnaire consists of a set of questions presented to a respondent
for answers. The respondents read the questions, interpret what is expected and then write
down the answers themselves.

It is called an Interview Schedule when the researcher asks the questions (and if
necessary, explain them) and record the respondent’s reply on the interview schedule. There are 3
types of questionnaire:

i. Open-ended

ii. Closed-ended

iii. Combination of both.

In this study questionnaire method of data collection has been used.

• Closed-ended questionnaire- Closed ended questions include all possible answers/prewritten


response categories, and respondents are asked to choose among them.

E.g. multiple choice questions, scale questions.


19

4. Analysis and interpretation

Demographic Analysis:

Analysis of gender:

Table no 4.1

Female 24
Male 39

SOURCE- Author’s compilation

38%

62%

female male

SOURCE- Author’s compilation

From the above table shows that 38% respondents are females and 62% are male.

Fig. 4.1
20

Family structure:
Table 4.2

Nuclear 39
Joint 34
SOURCE- Author’s compilation

Fig. 4.2

38%

62%

nuclear joint

SOURCE- Author’s compilation

From the above graph shows that 38% respondents belong to joint family and 62% respondents
belong to nuclear family.
21

Annual Income (in Rs.)

Table no 4.3

Upto 2,00,000 16

2,00,000-5,00,000 23

5,00,000-10,00,000 16

10,00,000-25,00,000 7

More than 25,00,000 1

SOURCE- Author’s compilation

Fig. 4.3

7
16

16

23

upto 2,00,000 2,00,000-5,00,000 5,00,000-10,00,000


10,00,000-25,00,000 more than 25,00,000

SOURCE- Author’s compilation

The above graph shows that 25% respondents earn around upto Rs. 2,00,000 per year. 37%
respondents earns Rs. 2,00,000 to Rs. 5,00,000 per year. 25% respondents earns Rs. 5,00,000 to
Rs. 10,00,000 per year.
22

Stage of life cycle

Table 4.4

Young and unmarried 27


Young and married with no children 6
Married and having young children 21
Married and having older children 6
Retirement 3
SOURCE- Author’s compilation

Fig. 4.4

3
6

27

21

young and unmarried Young and married with no children


Married and having young children Married and having older children
Retirement

SOURCE- Author’s compilation

From the above graph 43% of respondents are from young and unmarried. 33% of respondents are
married and having young children. 9% respondents are young and married, with no children. 10%
are married and having older children.
23

Sector in which they are employed

Table 4.5
Government sector 14
Private sector 26
Business 11
Professionals 5
Homemakers 4
Others 3
SOURCE- Author’s compilation

Fig. 4.5

3
4
14
5

11

26

govt sector private business professionals homemakers others

SOURCE- Author’s compilation

The above graph says 41% works in private sector. 18% work in their own business. 22% are govt.
employees. 11% are homemakers and others.
24

Years they are working in profession

Table 4.6

Less than 2 years 24


2 -5 years 13
5 – 10 years 8
10- 20 years 4
20 – 30 years 5
More than 30 years 9
SOURCE- Author’s compilation

Fig. 4.6

5 24

13

less than 2 years 2 - 5 years 5 - 10 years 10 - 20 years 20 - 30 years more than 30 years

SOURCE- Author’s compilation


25

1. Which of the following investment avenues you have invested?


(Please rank them in your preference)

Table 4.7
Rank Saving Bank fixed Public Stock Mutual Shares Gold Real
accounts deposits/RD provident Market Funds and Estate
fund Govt.
securities
1 26 19 10 0 4 1 6 6
2 8 9 7 3 2 1 6 2
3 5 9 5 3 2 1 3 6
4 6 3 3 2 5 0 3 4
5 4 3 1 2 1 1 6 9
6 2 4 1 1 1 3 0 1
7 3 0 1 0 0 2 2 2
8 1 0 0 2 0 0 1 1
9 1 0 0 1 1 1 1 0
10 0 1 0 0 0 1 1 1
Not 7 15 35 49 47 52 34 31
answered

SOURCE- Author’s compilation


26

1 2 3 4 5 6 7 8 9 10 Not
answered

Saving accounts Bank fixed deposits/RD Public provident fund Stock Market
Mutual Funds Shares and Govt. securities Gold Real Estate

SOURCE- Author’s compilation

Fig. 4.7

Interpretation:

After studying all the investment avenues, we can say that saving account has given first rank by
41% of respondents followed by bank fixed deposits, public provident funds, life insurance gold.
Many respondents didn’t diversify very much with their requirements with minimum risk they
want to diversify most.
27

2. What is your risk profile?

Fig. 4.8

30

25

20

15

10

0
Aggressive Moderate Conservative

SOURCE- Author’s compilation

Interpretation:

The above data shows that around 20% of respondents are having aggressive risk profile while
there is maximum of conservative investing people i.e., 46%.
28

3. Do you consult any financial planner

Fig. 4.9

60

50

48

40

30

20

15
10

0
yes no
Series 1 15 48

SOURCE- Author’s compilation

Interpretation:

By the above data shows that around 23.8% respondents consult financial planner whereas 77.2%
proportion of respondents don’t consult any financial planner which might lead to insufficient
WEALTH MANAGEMENT.
29

4. What kind of financial planning you opt for

Fig. 4.10

35

34
34
33

32

31

30

29
29
28

27

26
goal based financial plan comprehensive financial plan
Series 1 34 29

SOURCE- Author’s compilation

Interpretation:

This graph can be interpreted as 54% of respondents prefer goal based financial planning whereas
46% respondents opts for comprehensive plan as their financial plan.
30

5. Do you have systematic approach to investing

Fig. 4.11

26
25

12

yes no not sure

SOURCE- Author’s compilation

Interpretation:

This graph show that how much respondents knows about systematic approach of investment.
60%of respondents said that either they are not sure about it or they don’t know anything on
systematic investment approach, whereas 40% of respondents know about systematic investment
approach.
31

If yes, then in which plan you have invested

Fig. 4.12

30

25
24
20

15

10

2 0
0
SIP SWP STP
Series 1 24 2 0

SOURCE- Author’s compilation

Interpretation:

In this graph only those respondents who said yes in previous question are examined in this and
98% responses have SIP as their systematic approach to invest and remaining 2% investor in SWP,
there is no responses in STP which means people either don’t know about it or didn’t invest in
this.
32

6. What percent of income you invest

Fig. 4.13

20

18 19

16

14 15

12 13

10
10
8

6
6
4

0
less than 5% 5% - 15% 15% - 25% 25% - 30% more than 30%
Series 1 10 19 15 13 6

SOURCE- Author’s compilation

Interpretation:

The graph shows that 30% of respondents save around 5% to 15% of their total income. Only 15
respondents saved around 15% to 25% and only 9% respondents save more than 30%.
33

7. Are you aware of WEALTH MANAGEMENT?

Fig. 4.14

60

50

48

40

30

20

15
10

0
yes no
Series 1 48 15

SOURCE- Author’s compilation

Interpretation:

76% of respondents know about WEALTH MANAGEMENT whereas only 24% respondents are
not aware of WEALTH MANAGEMENT.
34

8. What kind of asset allocation you will prefer?


Fig. 4.15
30

25
25

20
19
15 17

10

2
0
strategic asset
tactical asset allocation fixed asset allocation flexible asset allocation
allocation
Series 1 17 2 25 19

SOURCE- Author’s compilation

Interpretation:

This graph explains that 40% respondents prefer fixed asset allocation on the same side flexible
asset allocation is preferred by 30% of respondents. 25% of respondents prefer strategic asset
allocation.
35

9. Duration you prefer for investment

Fig. 4.16

35

30
31

25

20
20

15

10 12

0
short term medium term long term
Series 1 12 31 20

SOURCE- Author’s compilation

Interpretation:

Horizon is very important while investing in an investment; here 50% of the respondents prefer
medium term investment, on same hand 31% investors prefer long term investments but 19%
investors invest for short term.
36

10. Do you know about portfolio management services

Fig. 4.17

32.2

32
32
31.8

31.6

31.4

31.2

31
31
30.8

30.6

30.4
yes no
Series 1 31 32

SOURCE- Author’s compilation

Interpretation:

By this graph we can say that 50% of the respondents know about portfolio management services
whereas half don’t know about it.
37

11. Have you read any material on WEALTH MANAGEMENT

Fig. 4.18

50

45

40 43

35

30

25

20
20
15

10

0
yes no
Series 1 20 43

SOURCE- Author’s compilation

Interpretation:

43 respondents haven’t studied any material on WEALTH MANAGEMENT whereas only 20


respondents who belongs to basically to related field of WEALTH MANAGEMENT.
38

12. Do you balance uncertainty with various asset mix investments


Fig. 4.19
40

38
35

30

25
25
20

15

10

0
yes no
Series 1 38 25

SOURCE- Author’s compilation

Interpretation:

In this graph 61% respondents know how to balance uncertainty with various assets mixes in
investment whereas only 39% know how to manage uncertainty.
39

5.1. FINDINGS

1. After studying all the investment avenues, we can say that saving account has been
considered as an investment option (Although it is not an instrument of investment)
followed by bank fixed deposits, public provident funds, life insurance gold. Many
respondents didn’t diversify very much with their requirements with minimum risk they
want to diversify most.
2. 54% of respondents prefer goal based financial planning whereas 46% respondents opts
for comprehensive plan as their financial plan.
3. 60% of respondents said that either they are not sure about it or they don’t know anything
on systematic investment approach, whereas 40% of respondents know about systematic
investment approach.
4. Among those who said yes in previous question are examined in this and 98% responses
have SIP as their systematic approach to invest and remaining 2% investor in SWP, there
is no responses in STP which means people either don’t know about it or didn’t invest in
this.
5. The graph shows that 30% of respondents save around 5% to 15% of their total income.
Only 15 respondents saved around 15% to 25% and only 9% respondents save more than
30%.
6. This graph explains that 40% respondents prefer fixed asset allocation on the same side
flexible asset allocation is preferred by 30% of respondents. 25% of respondents prefer
strategic asset allocation.
7. Horizon is very important while investing in an investment; here 50% of the respondents
prefer medium term investment, on same hand 31% investors prefer long term investments
but 19% investors invest for short term.
8. By this graph we can say that 50% of the respondents know about portfolio management
services whereas half don’t know about it. 76% of respondents know about wealth
management whereas only 24% respondents are not aware of wealth management.
40

9. 43 respondents haven’t studied any material on wealth management whereas only 20


respondents who belongs to basically to related field of wealth management. In this graph
61% respondents know how to balance uncertainty with various assets mixes in investment
whereas only 39% know how to manage uncertainty.

5.2. CONCLUSION

The WEALTH MANAGEMENT industry in India is Poised for significant expansion, given the
favorable market landscape and expected regulatory boosts for the sector. This provides exciting
growth opportunities which will drive rapid market expansion, couple with an increase in the
number of industry of participants. To successfully tap into these potential, financial services
organizations must undertake a customized approach, taking into account the specific variables of
the Indian market. This will need to be supported by cost effective business model focused on
improved transparency and compliance, partnerships and efficient technology solutions.

 By survey we can say that many individual don’t know the real meaning of WEALTH
MANAGEMENT as they interpret it as financial planning. Out of 63 respondents, 58
respondents say that they are aware about WEALTH MANAGEMENT.
 Respondents prefer risk free asset to be in their portfolio like PPF, FD’s, life insurance,
gold, etc. thus we can say that these are some popular sources other than the saving account.
 On an average saving percentage give an outlook of risk that person can bear. Low saving
ratio lead to lower risk and higher saving ratio leads to higher risk.
 Higher the return, higher the risk will be. Mutual funds though given the higher return in
long run than any other asset mix but yet not been preferred by many of respondents,
nowadays SIP is more popularizing in mutual fund.

In recent years, the proliferation of WEALTH MANAGEMENT products and innovative financial
services have contributed to the study growth of WEALTH MANAGEMENT as an attractive and
lucrative service sector within the financial industry around the world. The constant forward march
of technology is opening new markets in WEALTH MANAGEMENT. At the same time, rapid
product development and changing needs of the investors and globalization of businesses are
posing new challenges for the professionals in WEALTH MANAGEMENT.
41

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3 Becker, B. E. 1987. Concession bargaining: The impact on shareholders' equity. Industrial
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4 Becker, B. E. 1995. Union rents as a source of takeover gains among target shareholders.
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42

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43

QUESTIONNAIRE

NAME:-
Gender:-
Male Female

Family structure:
Joint Nuclear

Annual income (in Rs.):-


Upto 2,00,000-5,00,000 5,00,000-10,00,000 10,00,000-25,00,000 More than
2,00,000 25,00,000

Which stage of life you are:


a) Young and unmarried
b) Young and married with no children
c) Married and having young children
d) Married and having older children
e) Retirement
In which sector you are employed:
a) Government sector
b) Private sector
c) Business
d) Professionals
e) Homemaker
f) Others
For how many years are you in this profession:
a) Less than 2 years
44

b) 2 – 5 years
c) 5 – 10 years
d) 10 – 20 years
e) 20 – 30 years
f) More than 30 years

1. Which of the following investment avenues you have invested?(till date)(please rank them
in your preference)
Saving account Bank fixed deposit/RD
Public provident fund Stock Market
Mutual Funds Share and securities
Gold Real Estate
If others, please specify

2. Whatis your risk profile?


a) Aggressive
b) Moderate
c) Conservative

3. Do you consult any financial planner


a) Yes
b) No

4. What kind of financial planning you opt for


a) Goal based financial planning
b) Comprehensive financial planning

5. Do you have systematic approach to investing


a) Yes
b) No
c) Not sure
If yes, then in which plan you have invested
i. SIP
ii. SWP
iii. STP
45

6. What percent of income you invest


a) Less than 5%
b) 5% – 15%
c) 15% - 25%
d) 25% - 30%
e) More than 30%

7. Are you aware of WEALTH MANAGEMENT?


a) Yes
b) No

8. What kind of asset allocation you will prefer?


a) Strategic asset allocation
b) Fixed asset allocation
c) Tactical asset allocation
d) Flexible asset allocation

9. Duration you prefer for investment


a) Short term
b) Long term
c) Medium term

10. Do you know about portfolio management services?


a) Yes
b) No

11. Have you read any material on WEALTH MANAGEMENT?


a) Yes
b) No

12. Do you balance uncertainty with various asset mix investments?


a) Yes
b) No

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