A PROJECT REPORT

ON
THE STUDY OF VARIOUS INVESTMENT OPTIONS
AND ANALYSIS OF INVESTMENT PATTERN OF
INVESTORS
FOR

AXIS BANK
SUBMITTED TO

SAVITRIBAI PHULE PUNE UNIVERSITY

IN PARTIAL FULFILLMENT OF THE
REQUIREMENT OF MASTER OF BUSINESS
ADMINISTRATION (MBA)
SUBMITTED BY

Miss. VISHAKHA SUHAS JAGTAP

UNDER THE GUIDANCE
OF

Mrs. SHUCHI GAUTAM

DEPARTMENT OF MANAGEMENT STUDIES

SANDIP FOUNDATION'S
SANDIP INSTITUTE OF TECHNOLOGY & RESEARCH
CENTRE, NASHIK- 422213.

2015-16

STUDENTS DECLARATION

I undersigned hereby declare that, the project entitled, The study of

various Investment options and Analysis of investment pattern of
investors with reference to Axis bank is executed as per the course
requirement of two year full time MBA program of University of Pune.
This report has not been submitted by me or any other person to any
other University or Institution for a degree or diploma course. This is my
own and original work.

Place: Nashik

Date:..

Vishakha Suhas Jagtap

ACKNOWLEDGEMENT

The satisfaction of completion of any successful task is incomplete

without mentioning the name of people who made it encouragement crowned
our efforts with success.
I am extremely grateful to Mr.Mahendrasing Jagtap, Branch manager at Axis
bank ,for identifying my worth and for giving me the opportunity to work on
the project at the Axis bank.
I would also like to thank all the employees of Axis bank for
helping me, for giving me the opportunity to learn different things, constant
encouragement, support& guidance.
I would express my gratitude to the Principal of Sandip Institute of
Technology and Research centre, Mr. S.T.Gandhe and also the Head of the
Department, Mr. Rakesh Patil who encouraged us to take up the valuable
experience in the corporate world. I express my heartily gratitude to my project
guide Mrs Shuchi Gautam ,for providing me all the facilities required in
completing this project
I have pleasure in submitting the project report & I take this opportunity
to express my sincere gratitude to all those who have helped me in this
completion of this project report. The MBA curriculum has given me a unique
opportunity to be in association with one of the largest banks in the country.
My heartily gratitude to all those who have directly or indirectly given
assistance in making this project easier & possible.

CONTENTS
Chapter
No.

TITLE
COLLEGE CERTIFICATE

COMPANYCERTIFICATE

II

STUDENTS DECLARATION

III

ACKNOWLEDGEMENT

IV

Executive Summary

II

Objectives of the Study

III

Company Profile

IV

Theoretical Background

Research Methodology

VI

Data Analysis and Interpretation

VII

Findings

VIII
IX

Page
No

Conclusions
Suggestions/ Recommendations
ANNEXURE
BIBLIOGRAPHY

1
6
8
41
47
52
75
79
82
84
87

LIST OF GRAPHS
Sr.
No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17

Grap
h
1
Age Distribution
N
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17

Title of Graph

Income Distribution(monthly)
Investment horizon as per age
Investment horizon as per Income
Investment made in products as per age group
Investment made in products as per income group
Influence on investment decisions
Use of maturity amount
Re-investment decisions as per age
Re-investment decisions as per income
Type of investors as per age
Type of investors as per income
Reason for Investment
Portfolio preference as per age
Portfolio preference as per Income
Risk taking capacity as per age
Risk taking capacity as per income

Page No.
53
54
55
56
57
58
59
60
61
62
63
65
66
67
68
69
70

LISTOFTABLES
Sr.
No.
1
2
3

Table
No.
1
2
3

Title of Table
Major Shareholders of Axis bank
Accounts offered by Axis bank
Risk profiles and product offering

Page No.
18
25
79

LIST OF FIGURES
Sr.
No.
1

Figure
No.
1

Title of Figure
Banking Structure in India

Page No.
13

LIST OF ABBREVIATIONS
Sr.
No.
1
2
3
4
5
6
7
8

Abbreviation
ULIP
FD
MF
TDS
PPF
ATM
RBI
SIP

Full Form of Abbreviation

Unit Linked Insurance product
Fixed Deposit
Mutual Funds
Tax Deduction System
Public Provident Fund
Automatic Teller Machine
Reserve bank of India
Systematic Investment Plan

CHAPTER-I

EXECUTIVE SUMMARY

1.1

Introduction
The title of the project is The study of various Investment options
and Analysis of investment pattern of investors with reference to
Axis bank wherein the objective is to find out the financial
planning by customers for Axis bank and to find the investment
behavior of investors which would help to analyze the investment
options and the need of investment along with the preferences
which is directly dependent on the risk taking capability of the
customer. The financial planner must opt for such type of products
and services which can satisfy his ultimate aim of investment. Also
suggestions regarding some strategic and innovative ideas for
improvement can be considered while making those decisions.
The Indian banking system deals with introduction of the
investment scenario in India and the investment process. Axis bank
deals with the history of the bank, products offered by it and
extensive study of the Investment products like fixed deposits,
ULIP, and Mutual fund.
From The Rational Edge: The first in a new series of articles on
portfolio management, this introduction expresses IBM's
viewpoint about the foundations and essentials of portfolio
management, and discusses ideas and assets that support and
enable effective portfolio management practices.
A good way to begin understanding what portfolio management
is (and is not) may be to define the term portfolio. In a business
context, we can look to the mutual fund industry to explain the
term's origins. Morgan Stanley's Dictionary of Financial Terms
offers the following explanation: If you own more than one
security, you have an investment portfolio. You build the
2

portfolio by buying additional stocks, bonds, mutual funds, or

other investments. Your goal is to increase the portfolio's value
by selecting investments that you believe will go up in price.
According to modern portfolio theory, you can reduce your
investment risk by creating a diversified portfolio that includes
enough different types, or classes, of securities so that at least
some of them may produce strong returns in any economic
climate.

This explanation contains a number of important ideas:

A portfolio contains many investment vehicles. Owning a
portfolio involves making choices -- that is, deciding what
additional stocks, bonds, or other financial instruments to buy;
when to buy; what and when to sell; and so forth. Making such
decisions is a form of management. The management of a
portfolio is goal-driven. For an investment portfolio, the specific
goal is to increase the value. Managing a portfolio involves
inherent risks.
Over time, other industry sectors have adapted and applied these
ideas to other types of "investments," including the following:
Application portfolio management: This refers to the practice of
managing an entire group or major subset of software
applications within a portfolio. Organizations regard these
applications as investments because they require development
(or acquisition) costs and incur continuing maintenance costs.
Also, organizations most constantly make financial decisions
about new and existing software applications, including whether
to invest in modifying them, whether to buy additional
3

applications, and when to "sell" that is, retire -- an obsolete

software application.
Project Product portfolio management: Businesses group major
products that they develop and sell into (logical) portfolios,
organized by major line-of-business or business segment. Such
portfolios require ongoing management decisions about what
new products to develop (to diversify investments and
investment risk) and what existing products to transform or retire
(i.e., spin off or divest). Project or initiative portfolio
management, an initiative, in the simplest sense, is a body of
work with:
A specific (and limited) collection of needed results or work
products. A group of people who are responsible for executing
the initiative and use resources, such as funding. A defined
beginning and end.
Managers can group a number of initiatives into a portfolio that
supports a business segment, product, or product line. These efforts
are goal-driven; that is, they support major goals and/or
components of the enterprise's business strategy. Managers most
continually choose among competing initiatives (i.e., manage the
organization's investments), selecting those that best support and
enable diverse business goals (i.e., they diversify investment risk).
They most also manage their investments by providing continuing
oversight and decision-making about which initiatives to
undertake, which to continue, and which to reject or discontinue

1.2 Selection of organization

The Axis Bank retail branch was chosen as the medium to carry out
the project for various reasons. Axis bank (formerly UTI bank) is
the third largest private sector bank in India.
Axis bank is the third largest private sector Bank with a network of
1674 branches (and growing) spread over 1080 centres through 26
Circle Offices, over 100 Asset Centres. Experienced professionals
and freshers alike can choose to build a career with us in Branch
Banking. Axis bank branches truly reflect the Bank's culture and
values while dealing with more than 13 million valued patrons.
Axis bank is a dominant player in the corporate banking space and
has been at the forefront in launching innovative products and
services in the space of Corporate Banking. It has its presence in 7
international locations.
Location: Axis Bank- Gangapur road Branch, Nashik
Duration: The duration of the study was 45 days.
The project has been carried out with the extensive help and
expertise of Bank officials, Interaction with the customers, and also
with the help of the technological support from the bank and its
official website.

CHAPTER-II

OBJECTIVES

Main Objectives:

1. To study the range of investment options offered by Axis bank.

2. To study the Investment pattern of the investors considering the
various factors such as age, monthly income, risk taking ability,
need horizon, etc.
3. To understand the basics of portfolio management
4. To study the investment portfolios of the customers

Hypothesis:
Ho: Age and Income has no impact on the portfolio preference of the
investors
Ha: Age and Income has impact on the portfolio preference of the
investors

CHAPTER-III

Introduction to
the Industry

Without a sound and effective banking system in India it cannot have a

healthy economy. The banking system of India should not only be hassle
free but it should be able to meet new challenges posed by the technology
and any other external and internal factors.
For the past three decades Indias banking system has several outstanding
achievements to its credit. The most striking is its extensive reach; it is no
longer confined to only metropolitans or cosmopolitans in India. In fact,
Indian banking system has reached even the remote comers of the
country. This is one of the main reasons of Indias growth process.
The governments regular policy for Indian bank since 1969 has paid rich
dividends with the nationalization of 14 major private banks of India.
Not long ago, an account holder had to wait for hours at the bank
counters for getting a draft or for withdrawing his own money. Today, he
has a choice, Gone are days when the most efficient bank transferred
money from one branch to other in two days. Now it is simple as instant
messaging or accessing through a convenient mobile application. Money
has become the order of the day.
The first bank in India, though conservative, was established in 1786.
From 1786 till today, the journey of Indian Banking System can be
segregated into three distinct phases.
They are as mentioned below:
i. Early phase from 1786 to 1969 of Indian banks.
ii. Nationalization of Indian Banks and up to 1991 prior to Indian banking
sector Reforms.

iii. New phase of Indian Banking System with the advent of Indian
Financial and Banking Sector Reforms after 1991.
To make this write-up more explanatory, I prefix the scenario as Phase I,
Phase II and Phase III.
Phase I:
The Genera; Bank of India was set up in the year 1786. Next came Bank
of Hindustan and Bengal Bank. The East India Company established
Bank of Bengal (1806), Bank of Bombay (1840) and Bank of Madras
(1843) as independent units and called them Presidency Banks. These
three banks were amalgamated m 1921 and imperial Bank of India was
established which started as private shareholders banks, mostly
Europeans shareholders.
In 1865 Allahabad Bank was established and first time exclusively by
Indians, Punjab National Bank Ltd. was set up in 1894 with headquarters
at Lahore. Between 1885 and 1913, Bank of India Central Bank of India,
Bank of Baroda, Canara Bank, Indian Bank, and Bank of Mysore were
set up Reserve Bank of India came in 1935.
During the first phase the growth was very slow and banks also
experienced periodic failures between 1913 and 1948. There were
approximately 1100 banks, mostly small. To streamline the functioning
and activities of commercial banks, the Government of India came up
with the Banking Companies Act, 1949 which was later changed to
Banking Regulation Act, 1949 as per amending Act of 1965 (Act No. 23
of 1965). Reserve Bank of India was vested with extensive power for the
supervision of banking in India as the Central Banking Authority.

10

During those days public has lesser confidence in the banks. As an

aftermath deposit mobilisation was slow. Abreast of it the savings bank
facility provided by the Postal department was comparatively safer.
Moreover, funds were largely given to traders.
Phase II:
Government took major steps in the Indian Banking Sector Reform after
independence. In 1955, it nationalised Imperial Bank of India with
extensive banking facilities on a large scale specially in rural and semi
urban areas. It formed State Bank of India to act as the principal agent of
RBI and to handle banking transactions of the Union and State
Governments all over the country.
Seven banks forming subsidiary of State Bank of India were nationalised
on 19th July 1959. In 1969, major process of nationalisation was carried
out. It was the effort of the then Prime Minister of India, Mrs. Indira
Gandhi 14 major commercial banks in the country was nationalised.
Second phase of nationalisation in Indian Banking Sector Reform was
carried out in 1980 with six more banks. This step brought 80% of the
banking segment in India under Government ownership.
The following are the steps taken by the Government of India to Regulate
Banking Institutions in the country.
i. 1949: Enactment of Banking Regulation Act.
ii. 1955: Nationalisation of State Bank of India.
iii. 1959: Nationalisation of SBI subsidiaries.
iv. 1961: Insurance cover extended to deposits.
11

v. 1969: Nationalisation of 14 major banks.

vi. 1971: Creation of credit guarantee corporation.
vii. 1975: Creation of regional rural banks.
viii. 1980: Nationalisation of 6 banks with deposits over 200 crore.
After the nationalisation the branches of the public sector banks in India
rose to approximately 800% and deposits and advances took a huge jump
by 11,000%.
Banking in the sunshine of Government ownership gave the public
implicit faith and immense confidence about the sustainability of these
institutions.
Phase III:
This phase has introduced many more products and facilities in the
banking sector in its reforms measure. In 1991, under the chairmanship of
M Narasimham, a committee was setup by his name which worked for
the liberalisation of banking practices.
The country is flooded with foreign banks and their ATM stations. Efforts
are being made to give a satisfactory service to customers. Phone banking
and net banking is introduced. The entire system became more
convenient and swift. Time is given more importance than money.
The financial system of India has shown a great deal of resilience. It is
sheltered from any crisis triggered by any external macro-economics
shock as other East Asian Countries suffered. This is all due to a flexible
exchange rate regime, the foreign reserves are high, the capital account is

12

not yet fully convertible, and banks and their customers have limited
foreign exchange exposure.

Fig.1: Banking Structure in India

13

Introduction to the Organisation

Axis Bank Ltd.

Vision 2015:
To be the preferred financial solutions provider excelling in customer
delivery through insight, empowered employees and smart use of
technology.

Mission:
ABF's mission is based on the classical theory of development wherein
sustainable livelihood is defined as the livelihood which can cope with
and recover from stress and shocks, maintains or enhances capabilities
and assets (social, physical and economic) and create conditions that are
suitable for better education, health and sanitation seeking behavior and
sustainable livelihood for the next generation.
It aims to support programs, projects and activities that focus on creating
conditions suitable for sustainable livelihood. For this endeavor, ABF
partners with civil society organizations and provide them with financial,
technical and capacity development support to make positive
contributions in the lives of the underprivileged and vulnerable
communities.

14

Core Values:
Customer Centricity
Ethics
Transparency
Teamwork
Ownership

Slogan:
Badhti ka naam zindagi

History:
Axis Bank established in 1993 was the first of the new private banks to
have begun operations in 1994 after the Government of India allowed
new private banks to be established. Axis Bank Ltd. has been promoted
by the largest and the best Financial Institution of the country, UTI. The
Bank was set up with a capital of Rs. 115 crore, with UTI contributing
Rs. 100 crore, LIC Rs. 7.5 crore and GIC and its four subsidiaries
contributing Rs. 1.5 crore each. Axis Bank is one of the first new
generation private sector banks to have begun operations in 1994. The
Bank was promoted in 1993, jointly by Specified Undertaking of Unit
Trust of India (SUUTI) (then known as Unit Trust of India),Life
Insurance Corporation of India (LIC), General Insurance Corporation of
India (GIC), National Insurance Company Ltd., The New India Assurance
Company Ltd., The Oriental Insurance Company Ltd. and United India
Insurance Company Ltd. The shareholding of Unit Trust of India was
subsequently transferred to SUUTI, an entity established in 2003.

15

Erstwhile Unit Trust of India was set up as a body corporate under the
UTI Act, 1963, with a view to encourage savings and investment. In
December 2002, the UTI Act, 1963 was repealed with the passage of Unit
Trust of India (Transfer of Undertaking and Repeal) Act, 2002 by the
Parliament, paving the way for the bifurcation of UTI into 2 entities,
UTII and UTIII with effect from 1st February 2003. In accordance with
the Act, the Undertaking specified as UTI I has been transferred and
vested in the Administrator of the Specified Undertaking of the Unit Trust
of India (SUUTI), who manages assured return schemes along with
6.75% US64 Bonds, 6.60% ARS Bonds with a Unit Capital of over Rs.
14167.59 crores.
The Bank has strengths in both retail and corporate banking and is
committed to adopting the best industry practices internationally in order
to achieve excellence.
Axis Bank entered a deal in November 2010 to buy the investment
banking and equities units of Enam Securities for $456 million. Axis
Securities, the equities arm of Axis Bank, will merge with the investment
banking business of EnamSecurities.As per the deal,Enam will demerge
its investment banking, institutional equities, retail equities and
distribution of financial products, and nonbanking finance businesses
and merge them with Axis Securities.

Services offered by the bank:

Personal Banking

Corporate Banking

NRI Banking

Priority Banking
16

VBV Online purchases using Credit Card

VBV / MSC Online purchases using Debit Card

Subsidiaries:
The Bank has set up eight wholly-owned subsidiaries:
Axis Capital Ltd.
Axis Private Equity Ltd.
Axis Trustee Services Ltd.
Axis Asset Management Company Ltd.
Axis Mutual Fund Trustee Ltd.
Axis Bank UK Ltd.
Axis Securities Ltd.
Axis Finance Ltd.

Promoters:
Axis Bank Ltd. has been promoted by the largest Financial Institutions of
the country, UTI, LIC, GIC and its subsidiaries. The Bank was set up in
1993 with a capital of Rs. 115 crore, with UTI contributing Rs. 100 crore,
LIC - Rs. 7.5 crore and GIC and its four subsidiaries contributing Rs. 1.5
crore each

17

Sr No

Shareholder/ Category

A
1
2

Promoters
SUUTI
LIFE INSURANCE
CORPORATION OF
INDIA
GENERAL
INSURANCE
CORPORATION OF
INDIA
THE NEW INDIA
ASSURANCE
COMPANY LIMITED
NATIONAL
INSURANCE
COMPANY LIMITED
THE ORIENTAL
INSURANCE
COMPANY LIMITED
UNITED INDIA
INSURANCE
COMPANY LIMITED
Total promoter
shareholding A
Domestic shareholders
Indian FIs and Banks
Indian MFs
Indian bodies corporate
Indian residents
INSURANCE GROUP
Total domestic
shareholding B
Foreign shareholders
FIIS/FPI/QFI
FDI (GDR)
Foreign Bodies - DR
Foreign Banks/Foreign
Employees
Foreign Nationals
NRIs
Total Foreign
shareholding C
Total - A+B+C

4
5
6
7

B
8
9
10
11
12
C
13
14
15
16
17
18

Position for the quarter ended 31.03.2015

No. of shares
% shareholding
held
274840905
296075087

11.59
12.49

39321498

1.66

26607567

1.12

13675285

0.58

6230020

0.26

5342815

0.23

66,20,93,177

27.93

1377755
155510061
33825168
172744638
145074071
50,85,31,693

0.06
6.56
1.43
7.29
6.12
21.45

1105636277
88083025
312194
876800

46.64
3.72
0.01
0.04

500
4988533
1,19,98,97,329

0
0.21
50.62

2,37,05,22,199

100

18

Table 1:Shareholders of Axis bank

Business Performance Results at a Glance for the Financial

year 2014-2015:
Net Profit for Q4FY15 and FY15 grows 18% YOY to
`2,181 crores and `7,358 crores respectively
The Banks Retail franchise continues to show robust
growth in FY15
1. CASA, on a daily average basis, grew 15% YOY
in which Savings Bank Deposits grew 17% and
Current Account Deposits grew 11%
2. Daily Average CASA for FY15 constitutes 40% of
Total Deposits o Retail Term Deposits grew 27%
YOY & constitutes 60% of Term Deposits
3. CASA and Retail Term Deposits constitutes 78%
of Total Deposits
4. Retail Advances grew 27% YOY and accounts
for 40% of Net Advances
5. Retail Fee Income grew 30% YOY and
constitutes 38% of Total Fee Income
Asset Quality is healthy with Net NPAs at 0.44%
Bank is well capitalised with a healthy Capital
Adequacy Ratio (CAR). Under Basel III, Total CAR &
Tier I CAR stood at 15.09% & 12.07% respectively

Products offered by Axis bank :

19

Axis bank offers around 99 products out of which, some of

them are as follows
Considering some of the major accounts provided by Axis bank in brief:
Sr Accou
n nt
o:

Accoun
t
subtype

Description

Easy
Access
savings
account

The Easy
Access
Savings
Account is
the right ally
for those of
you who are
at the
beginning of
your savings
journey. This
account
allows
unparalleled
access to
your money,
and makes
tracking
account
activity really
easy.
The Prime
Savings
Account is
the account
for you if you
want extras
on your
account. This
account
comes with
enhanced
access and
higher
transaction
limits.

Savin
gs

Prime
savings
account

Minimu Features and

m
benefits
balance
(Rs)
10000
Low Average
Monthly
Balance
requirement of
Rs.10,000 in
metros.
High
withdrawal
limit of
Rs.40,000 at
ATMs and
shopping
transactions
limit of
Rs.100,000
daily.

Debit card

25000

A premium
Titanium
Prime Debit
Card at no
issuance cost
Avail of
higher
personal
accident
insurance
cover of upto
Rs.3 lakhs by
swiping your
card once
every 6
months

Enhanced
withdrawal
limits of
Rs.50,000 at
ATMs and
shopping
transactions of
Rs.100,000
daily
Higher Cash
transaction
limits
2 free DDs/POs
per month

20

Visa Classic
Debit Card at
a nominal fee
of Rs.150 for
issuance and
Rs.150
annually
thereafter.
Avail of
personal
accident
insurance
cover of upto
Rs.2 lakhs

Prime
plus
savings
account

Add Plus to
your banking
with the
Prime Plus
Savings
Account.
Avail high
transaction
limts at the
branch plus
added
entertainment
and reward
benefits

100000

Higher
transaction
limits at branch
- 20
transactions
every month for
free
Entertainment
Benefits - 10%
cash back* on
movie ticket
bookings
Account and
Fixed Deposits
(minimum
tenure of 6
months)
Preferential
pricing benefit
on lockers
25% discount
on 1st year
locker rent

YOUth
account

The
superloaded
supercool
YOUTH
debit card
isnt just your
key to
freedom. It
gives you lots
of awesome
deals and
amazing
offers too.
Whats more,
you get to
choose the
look of your
YOUTH
Card.
Customize it
with your
favourite
college gang
pic, or your
favourite

Shop using
your YOUTH
debit card at
any merchant
outlet for upto
100,000
First 5 free
transactions at
Axis Bank
ATMs and first
3/5 transactions
free at Non
Axis Bank
ATMs in
Metro/Non
Metro
Locations
respectively.

21

Prime Plus
Debit Card at
no issuance
cost
High daily
withdrawal
limits at
ATMs of Rs.
50,000 and
shopping
transactions
of Rs.100,000
First 10 free
transactions
at Axis Bank
ATMs and
first 3/5
transactions
free at Non
Axis Bank
ATMs in
Metro/Non
Metro
Locations
respectively.
Combined
Lost Card
Liability and
Purchase
protection
liability of up
to Rs 50,000
to protect
against
fraudulent use
of the debit
card or
damage/loss
of articles
purchased
using debit
card

band, or just
about any pic
which defines
YOU!

5.

Curre
nt
accou
nt

Normal
current
account

Our Normal
10000
Current
Account
gives you the
optimum
value for
your money.
This account
takes you into
an all-new
world of
banking.

Cash Deposit
Facility: Home
Branch-uptoRs
2 lacs per
month is free
Inter Branch-up
to Rs.1 Lac per
day. Cash
withdrawal
upto Rs.1 Lac
per day at other
than home
branch.Free up
to 25
transactions
(Cash /
Clearing /
Transfer) per
month. Free
collection
through NEFT
and RTGS

ATM cum
International
Business
Debit Card.
Daily free
account
statements
through email

Busines
s select
account

Select
50000
Current
Account is
the unique
current
account is the
first of its
kind which
has both
flexibility and
fungibility of
free limits as
its core
feature.

Flexible Cash
deposit: Enjoy
free cash
deposit upto 12
times the
monthly
average balance
maintained in
the same cycle
with minimum
free limit of
Rs.6 Lacs per
month.
Fungible Free
limits: Enjoy
fungibility of

ATM cum
International
Business
Debit Card.
Daily free
account
statements
through email

22

Busines
s
advanta
ge
account

As your
25000
business
growth gains
momentum,
your banking
requirements
begin to
diversify
increasingly.
To cater to
your
diversified
banking
needs, we
offer you our
Business
Advantage
Account
which comes
with a host of
privileges..
Busines Business
100000
s classic Classic
account Account from
Axis Bank
helps you coordinate your
finances
perfectly with
total control
on your
funds. So
enjoy the
power.

Free limits
between Home
branch and Non
Home branch
cash
deposit.Freeupt
o 100
transactions
(Cash /
Clearing /
Transfer) per
month
Cash Deposit
Facility:
Home BranchFree upto Rs.3
Lacs per
month.
Inter BranchDeposit cash up
to Rs.1 Lac per
day at other
than home
branch for
instant credit
into your
account.Freeupt
o 50
transactions
(Cash /
Clearing /
Transfer) per
month
Cash Deposit
Facility:
Home BranchFree uptoRs 12
Lacs per
month.
Inter BranchInter branch
Cash Deposit
uptoatFreeupto
200
transactions
(Cash /
Clearing /
Transfer) per
month Rs 2.5
Lacs per
23

ATM cum
International
Business
Debit Card.
Daily free
account
statements
through email

ATM cum
International
Business
Debit Card.
Daily free
account
statements
through email

Busines
s
Privileg
e
Accoun
t

Enjoy the
500000
host of
privileges
with our
Business
Privilege
Account opt
for the great
facilities on
offer with this
account.

1
0

Channe
l One
Accoun
t

Channel One
Account is
the high end
Current
Account

100000
0

Prime
Salary
Accoun
t

Add prime
features to
your payroll
account and
experience
unparalleled
privileges
with our
Prime Salary

1
1

Salary
Accou
nt

month.
Cash Deposit
Facility:
Home BranchFree upto Rs.60
Lacs per
month.
Inter BranchDeposit cash up
to Rs.12.5 Lac
per day at other
than
homebranchfor
instant credit
into your
account. Free
upto 500
transactions
(Cash /
Clearing /
Transfer) per
month
Fungible Cash
depositfree
cash deposit
upto Rs.1.2
crores per
month across
any Axis Bank
branch, Free
Anywhere
Banking at Axis
bank
Locations.Free
upto 1000
transactions
(Cash /
Clearing /
Transfer) per
month
High
withdrawal
limits of
Rs.50,000 at
ATMs and
shopping
transactions of
Rs.100,000
daily
24

ATM cum
International
Business
Debit Card.
Daily free
account
statements
through email.

ATM cum
International
Business
Debit Card.
Daily free
account
statements
through email.

Free
MasterCard
Titanium
Debit Card
for
primary/joint
accountholder
. Free
Titanium

1
2

Priority
Salary
Accoun
t

Account.Savi
ngs Account
under Salary
scheme is a
special
account
offered to
customers
with regular
direct salary
credits
coming into
this account
Exclusive
premium
service
through
Banking
Privileges,
Lifestyle
privileges &
Investment
privileges
Access to
Premium
Banking
branches
Dedicated
Relationship
Manager for
all
bankingSavin
gs Account
under Salary
power
scheme is a
special
account
offered to
customers
with regular
direct salary
credits
coming into
this account

Free unlimited
online NEFT
transactions

Rewards Card

Unlimited free
Pay Orders /
Demand Drafts
drawn at Axis
Bank locations
per quarter
No commission
charged on
collection of
outstation
cheques drawn
on Axis Bank
locations.
Overdraft
facility with
extended limit
of 2/3 times of
the net salary
(average of 3
months) as per
eligibility. This
limit is capped
at Rs.1,00,000
which is
available for
tenure of 12
months

Free Visa
Priority
Platinum
Debit Card
for primary
accountholder
with annual
charges
waived
Unlimited
free cash
withdrawals
on all ATMs
(Axis Bank
ATMs and
Other Bank
ATMs)Enhan
ced limit of
Rs.1,00,000
on cash
withdrawals
Purchase
transaction
limit of Rs.4
lakhs in a day
Nil Fuel
Surcharge
Lounge
Access
Reward
Points
Occasion
based cash
back offers

Table 2: Accounts offered by Axis Bank

25

Some of the Investment Products available are as follows:

1) Fixed Deposits:
Concept:
Axis Bank offers multitudes of fixed deposit schemes for various
durations.
Reinvestment Deposits:
In a reinvestment fixed deposit scheme, the interest accrued on your
deposit at the end of each quarter is invested along with the principal. The
tenure of your deposit must be a minimum of 6 months. At the end of the
quarter, the interest and the principal are both rolled over, and the interest
is calculated on the total sum net of Tax Deducted at Source (TDS)
Automatic Rollover:
As a Fixed Deposit holder, you can avail of the facility for
automatic rollovers on maturity (for both the principal and
interest). You can select this option in the Account Opening
Document (AOD). The options available are:
i) Rollover only Principal:
Only the principal amount of your fixed deposit will be rolled
over. The interest will be either credited to your designated
account or paid out.
ii) Rollover Principal and Interest accrued in Reinvestment
Deposit scheme:
This will rollover both the deposit and the interest accrued for
the same tenure at the Interest Rates applicable on the maturity
date.
Liquidity:
26

The tenure of your fixed term deposit must be a minimum of 6 months.

Flexibility:
All encashment or withdrawals of Fixed Deposits can only be made at the
branch where the deposit was booked.
Interest Calculations:
For fixed deposits with tenure of 6 months & above, interest is calculated
on a quarterly basis.
Interest earned during the previous quarter is added to the Principal for
calculation of interest. Fixed deposit interest rate on this amount is
calculated every quarter.
For fixed deposits schemes with tenure of below 6 months, interest is
calculated at Simple Interest. Please note that the period of Fixed Deposit
is considered in number of days.
In the event the depositor chooses to receive the periodic interest
payments on a quarterly basis, interested is calculated and paid on
quarterly rests.
Premature Encashment: deposit interest rate shall be rate applicable for
the period the deposit has remained with the bank or the contracted rate,
whichever is lower.
Tax at source is deducted as per the Income Tax regulations prevalent
from time to time.

Calculation of TDS in respect of interest on Fixed Deposits:

TDS in respect of interest earned on fixed deposits, is deducted on the
basis of thetotal interest projected on the aggregate of fixed deposits of
the customer, for the financial year.
27

Thus, if the total projected interest in a financial year crosses the

threshold limit which is presently Rs.10,000/-, TDS is deducted
proportionately from the existing fixed deposits at the time of interest
application.
This is in accordance with Section 194 A 3 (i) (a) of the Income Tax Act.

2) Recurring deposits:
Concept:
Recurring deposits are accepted in equal monthly installments of
minimum Rs 1,000 and above in multiples of Rs 500 thereafter.
Recurring Deposit accounts can be opened for a minimum period
of 12 months and in multiples of 12 months thereafter, upto a
maximum of 120 months.
The amount of installment once fixed, cannot be changed.
Installment for any calendar month is to be paid on or before the
last working day of the month. Where there is delay in payment of
installment, customer will be levied a penalty @ PLR plus 4 % for
the period of delay. Fraction of a month will be treated as full
month for the purpose of calculating the penalty.
The total amount repayable to a depositor, inclusive of interest,
depends on the amount of monthly installments and the period of
deposit.

Liquidity:
The tenure of the recurring deposit must be a minimum of 6 months.
Flexibility:
28

All encashment or withdrawals of Fixed Deposits can only be made at

the branch where the deposit was booked.
Interest Calculations:
For Rupee Term Deposits of a contracted amount less than Rs 5 Crores
opened/renewed on or after May 1, 2014 (including Flexi deposits),
interest rate shall be 1.00% below the card rate, prevailing as on the
date of deposit, as applicable for the period the deposit has remained
with the bank or 1.00% below the contracted rate, whichever is lower.
However, for Rupee Term Deposits closed within 14 days from the
date of booking of the deposit interest rate shall be rate applicable for
the period the deposit has remained with the bank or the contracted
rate, whichever is lower.
For Rupee Term Deposits of a contracted amount of Rs 5 Crores and
above, interest rate shall be 1% below the card rate prevailing as on the
date of deposit, as applicable for the period the deposit has remained
with the bank or 1% below the contracted rate, whichever is lower.
This would also be applicable on Rupee Term Deposits closed within
14 days from the date of booking of the deposit.
There would be no premature withdrawal penalty on NRE Term
Deposits.

3) Public Provident Fund (PPF):

Concept:

29

Public Provident Fund (PPF) is one of the most popular savings-cum-taxsaving instruments in India. The PPF scheme serves as an excellent long
term savings instrument which gives tax exemption on both the principal
as well as interest.
Now you can open a PPF account at Axis Bank. Axis bank is now
authorized by the RBI and Ministry of Finance for collecting
subscriptions under the Public Provident Fund Scheme, 1968 on behalf of
Central Government through 50 designated branches.
Features and benefits:
Attractive interest rate
High interest rate of 8.70% per annum with effect from 01 April13
(Subject to change as per govt. notification).
Interest is calculated on the lowest balance between the close of the
fifth day and the last day of every month
Safe long term investment
Extremely low risk investment with backing of Government of
India.
Tax benefits under section 80C
Investments (under section 80C) made under PPF scheme falls
under triple E regimen i.e. Principal, Interest and Withdrawal are
all tax exempted.
Online access to View PPF Account balance online
Transfer funds from linked Savings Bank Account to PPF Account
View, save and print Mini and Detailed statements
View and print subscription receipts for all the online payments
made to the PPF Account
30

 24x7 accessibility through Internet Banking

Option for loan facility and partial withdrawals
Loan facility can be availed any time between third financial year
to sixth financial year i.e. From third financial year up to end of
fifth financial year.
50% of the balance can be withdrawn after expiry of 5 years from
end of year of first subscription to the PPF Account.
4) Mutual Funds:
Concept:
Features & Benefits
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.
Axis bank Offering
As Axis Bank Financial Advisory team, we adopt a strong research
driven recommendation model to help you choose the best funds
based on qualitative and quantitative parameters.
Apart from this, a dedicated Relationship Manager can also be
assigned to you to ensure that your investment requirements are taken
care of, smoothly and efficiently. Our advisors understand your profile
and lead you through a structured financial planning process to devise
31

financial solutions best suited to you. The advisors will also help you
choose the right investment products in line with your investment
goals.
We offer a unique 'One Page Portfolio Snapshot' report across
investment products to our customers investing in Mutual Funds. This
report can be viewed through our Internet Banking module.
Types of Mutual Funds
*By Structure
Open Ended
These are schemes that do not have a fixed maturity. The mutual fund
ensures liquidity by announcing sale and repurchase price for the unit
of an open-ended fund.
Closed Ended
These are schemes that have a fixed maturity. The money of the
investor is locked in for the period. Occasionally, closed-end schemes
provide a re-purchase option to the investors, either for a specified
period or after a specified period. Liquidity in these schemes is
provided through listing in a stock market; however this option is not
yet available in India.
*By Investment Objective
Equity Schemes
Equity schemes primarily invest in shares. Based on the objective
investments could be in growth stocks where earnings growth is
expected to be high or value stocks where the view of the fund
manager is that current valuations in the markets do not reflect the
intrinsic value. Various kinds of equity schemes are:
32

o Equity Diversified:
All non-theme and non-sector funds can be classified as
equity diversified funds.
o Mid Cap:
These funds invest in companies from different sectors.
However they put a restriction in terms of the market
capitalization of a company, ie, they invest largely in BSE
Mid Cap Stocks.
o ELSS:
ELSS is an open-ended equity growth scheme that is offered
by mutual funds in line with existing ELSS guidelines. The
investments under this type of scheme are subject to a lockin period of 3 years and, as per the Finance Act 2005, are
allowed the benefit of income deduction up to Rs 1, 00,000.
o Thematic:
These schemes invest in various sectors but restrict
themselves to a particular theme eg, services, exports,
consumerism etc.
o Sector Specific:
These are schemes that invest in a particular sector for
example IT. They have a high degree of risk associated with
them as if that particular sectors does not perform then their
returns will suffer.
o Flexicap:
These kinds of schemes invest across market caps.
Debt or Income Schemes
Such a fund invests in interest bearing securities mainly government
securities and corporate bonds. This fund earns returns for its investors
from interest income on its investments and profits on trading
securities. In terms of risk, this type of fund is the least risky.
33

 Money Market Schemes

These schemes invest in short term debt instruments issued by the
government, corporate or banks. These are typically investments in
short term papers like the CPs and CDs etc.
Hybrid Schemes
o Balanced Schemes:
Balanced schemes invest in a mix of equity and debt. The
debt investments ensure a basic interest income, which the
fund manager hopes to top with a capital gain from the
investment in equities. However loses can eat into basic
interest income and capital.
o Monthly Income Plans:
MIPs are suitable for conservative investors who along with
an exposure to debt do not mind a small exposure to equities.
These funds aim to provide consistency in returns by
investing a major part of their portfolio in debt market
instruments with a small exposure to equities. Thus an MIP
would be suitable for conservative investors who along with
protection of capital seek some capital appreciation as MIPs
have an exposure to equities. However the monthly income
is not assured.
Liquidity:
Open-ended schemes offer liquidity through on-going sale and repurchase
facility. Thus the investor does not have to worry about finding a buyer
for their investments.

34

Flexibility:
Mutual Funds offer flexibility in terms choosing a scheme that matches
the investment to an investor's investment objective.
Tax Benefits:
For equity funds, dividends received from equity schemes of Mutual
Funds (i.e. schemes with equity exposure of more than 65%) are
completely tax-free. Neither does the Mutual Fund have to pay dividend
distribution fee nor does the investor have to pay income tax

5) ULIP Funds:
Concept:
A Unit-Linked Insurance Plan or a ULIP is a hybrid type of plan offered
insurance companies that gives you the benefit of both Insurance as well
as Investments. In a ULIP, a part of the premium that you pay is allocated
towards insurance and the remaining is utilized for investment in funds
available within the plan. In this way, ULIP gives you both insurance
cover as well as returns on investment through a singular medium.
MaxLife Fast Track Plan by Axis Bank is a good example of a ULIP
where you get to select from six funds and shorter payment terms for
quicker accumulation of returns through investment along with the
insurance cover.
Types of Funds under ULIP
While the specific nature of a fund varies from one plan to the other,
the investment plans under ULIPs are generally of three types:
Equity Funds These funds are focused towards
towards investment in stock market where the risk-return ratio is

35

high. The Fund performs in tune with the volatility present in the
stock market.
Debt Funds These funds invest in debt instruments like Bonds
where the returns are comparatively lower as compared to equity
but the risk is low as well.
Balanced Funds Hybrid funds which give you adequate exposure
to stock market as well as debt instruments. The risks accompanied
by the equity portion are balanced out by the safer investment in
the debt portion.

Features of Unit Lined Insurance Plan (ULIP):

ULIPs initially had a lock-in period of 3 years but in 2012, IRDA
(Insurance Regulatory and Development Authority) intervened and
defined new guidelines which changed the lock-in period to 5 years.
From a tax saving angle, ULIPs provide deduction under section 80C of
the Income Tax Act, 1961. ULIPs also have surrender options but it is
important to note here that if you have availed tax deduction from ULIP
and surrendered it before the lock-in period matures, then the deduction
availed in the previous years will be considered as a part of the income
and will be taxed accordingly.
Like any other financial product, this insurance-cum-investment product
has its own features, some of which are very unique. The first such
feature is the Top-Up in ULIP. What that means is that you can invest
over and above your annual premium amount. This top-up can be directed
towards the insurance component which results in the insurance cover
being increased or towards the investment component if the selected Fund
is performing well.

36

The second important feature is switching between funds. At the time you
bought a ULIP, you would have selected the best fund according to
market conditions. However, it may happen sometimes that the Fund
doesnt perform as well as anticipated or that the market conditions
change. In such an instance, you have the option to switch to a better
performing Fund and this is generally facilitated free of charge by most
products upto a certain number of switches in a year.
Some of the products under ULIP are:
1) Max Life Maxis:
Concept:
A unit-linked life insurance plan
Max Life Maxis, a unit-linked life insurance plan that helps in
planning the finances better by balancing the equity and debt
exposure automatically, so that the future years are the best years
of life.
Key Benefits
Wealth Creation with safety of funds:
Invest as per the risk appetite. Choose between six funds with the
option to switch or redirect savings between funds, free of charge
Unique feature of Dynamic Fund Allocation which automatically
rebalances your portfolio depending upon years to maturity
Shorter Premium Payment Terms.
Option to choose Premium Payment Term from 7 years or 10 years
as per your need
Flexibility of Protection Cover:
Option to choose insurance cover of 10/15/20 times the annual
premium depending upon your age
How dynamic fund allocation works for you?

37

Balances equity and debt exposure by automatic allocation of fund

value as per predetermined percentages. Please refer to the Table
below
Higher allocation to equities in the initial policy years helps in
generating potentially higher returns
Higher allocation to debt as the policy nears maturity helps in
protecting maturity value.
2) Max Life Fast Track Super Plan:
Concept:
A Non-Participating Unit Linked Insurance Plan
Overview
The investments need a product that helps to achieve the goals, by
providing with portfolio strategies and multiple Fund options.
Max Life Fast Track Super is a product that helps in planning your
finances better so that the future years are the best years of life.
Key Benefits
Financial security for the family.
The plan offers a Maturity Value equal to Fund Value, Death
Benefit equal to higher of (Fund Value, Sum Assured, 105% of
Premiums Paid) and also provides Partial Withdrawal flexibility
Options of Premium Payment Term and Policy Term to cater to the
need
option available to Choose Single Pay or 5 Pay for 10 year Policy
Term or Regular Pay for 20 year Policy Term as per your need
Increase the funds with Guaranteed Loyalty Additions
Additional units will get added to the Fund every year starting from
11th policy year.

38

Investment Flexibility to Choose from 5 Fund Options

The plan offers 5 fund options that can chose from, basis risk
appetite
Safeguarding your Fund against market volatilities with Systematic
Transfer Plan and Dynamic Fund Allocation
Choose from the two investment strategies to protect your Fund
against market volatilities
Maturity Benefit
On maturity, you will be eligible to receive an amount, provided
settlement option has not been exercised, equal to the Fund Value,
where the Fund Value will be calculated as:
Fund Value = Accumulated Units in Fund(s) X NAV of respective
Fund(s) as on the Maturity Date
Death Benefit
In case of Death of the Life Insured anytime during the term of the
Policy, higher of Sum Assured or Fund Value (as on the date of
death), subject to a minimum of 105% of all premiums paid, shall
be payable.
Guaranteed Loyalty Additions
0.30% of fund value shall be added to the fund by creation of
additional units, at the end of every policy year starting from 11th
policy year. The loyalty additions increase by 0.02% (absolute)
each year thereafter. The additional units shall be created in
different funds in proportion of Fund Value at the time of credit.
Loyalty additions will be payable only on Regular Pay for
premium paying policies. In case of revival of policies, the loyalty
additions for previous years will be paid based on the Fund Value
prevailing at the revival date.
Systematic Transfer Plan
39

Systematic Transfer Plan helps you replicate a rupee cost averaging

method on your Annualized Premium. Where you have chosen the
Systematic Transfer Plan option, the Annualized/Single Premium
received net of Premium Allocation Charge shall be allocated first
to the Secure Plus Fund to purchase Units. Immediately thereafter
and on each subsequent monthly anniversary, Fund Value of [1/(13month number in the policy year)] of the Units available at the
beginning of the month shall be Switched to Growth Super Fund
automatically by cancelling Units in the Secure Plus Fund, and
purchasing Units in the Growth Super Fund.
Dynamic Fund Allocation
Dynamic Fund Allocation option is an investment strategy which in
early part of your policy term invests in equity oriented funds and
as your policy term progresses it shifts the fund allocation towards
more conservative funds. You can opt for Dynamic Fund
Allocation option only at the inception of policy. Under this option,
assets under management shall be maintained amongst Growth
Super Fund and Secure Fund in a pre-defined proportion that
changes depending upon the years left to maturity
Settlement Option
You may, at least fifteen (15) days prior to the Maturity Date, opt
for a Settlement Option, pursuant to which the Company will
continue to manage the Funds for you for a maximum period of
five (5) years from the Maturity Date and make periodic payments.
Surrender
At any time during the Policy Term, you have the right to surrender
the policy by advising the Company in writing.
Discontinuance Terms
In case the premium is not paid by the premium due date, a Grace
40

Period of 30 days from the due date of first unpaid premium will be
allowed. During this Grace Period, the risk cover will continue and
all charges under the policy will continue to apply

41

CHAPTER-IV

THEORETICAL
BACKGROUND

MEANING OF PORTFOLIO MANAGEMENT

Portfolio is a collection of asset. The asset may be physical or
financial like Shares Bonds, Debentures, and Preference Shares etc.
42

The individual investor or a fund manager would not like to put all his
money in the shares of one company, for that would amount to great
risk. Main objective is to maximize portfolio retum and at the same
time minimizing the portfolio risk by diversification. Portfolio
management is the management of various financial assets, which
comprise the portfolio. According to Securities and Exchange Board
of India (Portfolio manager) Rules, 1993; " portfolio" means the total
holding of securities belonging to any person; Designing portfolios to
suit investor requirement often involves making several projections
regarding the future, based on the current information. When the
actual situation is at variance from the projections portfolio
composition needs to be changed. One of the key inputs in portfolio
building is the risk bearing ability of the investor. Portfolio
management can be having institutional, for example, Unit Trust,
Mutual Funds, Pension Provident and Insurance Funds, Investment
Companies and non-Investment Companies.
Institutional e.g. individual, Hindu undivided families, Noninvestment Company's etc. The large institutional investors avail
services of professionals. A professional, who manages other people's
or institution's investment portfolio with the object of profitability,
growth and risk minimization, is known as a portfolio manager. The
portfolio manager performs the job of security analyst. In case of
medium and large sized organization, job function of portfolio
manager and security analyst are separate. Portfolios are built to suit
the return expectations and the risk appetite of the investor.

BASIC CONCEPTS AND COMPONENTS FOR PORTFOLIO

MANAGEMENT
Now that we understand some of the basic dynamics and inherent
43

challenges organizations face in executing a business strategy via

supporting initiatives, lets look at some basic concepts and
components of portfolio management practices.
1. The Portfolio
First, we can now introduce a definition of portfolio that relates more
directly to the context of our preceding discussion. In the IBM view, a
portfolio is: One of a number of mechanisms, constructed to actualize
significant elements in the Enterprise Business Strategy.
It contains a selected, approved, and continuously evolving, collection
of Initiatives which are aligned with the organizing element of the
Portfolio, and, which contribute to the achievement of goals or goal
components identified in the Enterprise Business Strategy. The basis
for constructing a portfolio should reflect the enterprise's particular
needs. For example, you might choose to build a portfolio around
initiatives for a specific product, business segment, or separate
business unit within a multinational organization.

2. The Portfolio Structure

As we noted earlier, a portfolio structure identifies and contains a
number of portfolios. This structure, like the portfolios within it,
should align with significant planning and results boundaries, and
with business components. If you have a product-oriented portfolio
structure, for example, then you would have a separate portfolio for
each major product or product group. Each portfolio would contain all
the initiatives that help that particular product or product group
contribute to the success of the enterprise business strategy.
3. The Portfolio Manager
This is a new role for organizations that embrace a portfolio
44

management approach. A portfolio manager is responsible for

continuing oversight of the contents within a portfolio. If you have
several portfolios within your portfolio structure, then you will likely
need a portfolio manager for each one. The exact range of
responsibilities (and authority) will vary from one organization to
another,1 but the basics are as follows:
One portfolio manager oversees one portfolio. The portfolio
manager provides day-to-day oversight. The portfolio manager
periodically reviews the performance of, and conformance to
expectations for, initiatives within the portfolio.

The portfolio manager ensures that data is collected and analyzed

about each of the initiatives in the portfolio. The portfolio manager
enables periodic decision making about the future direction of
individual initiatives.
4. Portfolio Reviews and Decision Making
As initiatives are executed, the organization should conduct periodic
reviews of actual (versus planned) performance and conformance to
original expectations. Typically, organization managers specify the
frequency and contents for these periodic reviews, and individual
portfolio managers oversee their planning and execution. The reviews
should be multi-dimensional, including both tactical elements (e.g.,
adherence to plan, budget, and resource allocation) and strategic
elements (e.g., support for business strategy goals and delivery of
expected organizational benefits).
A significant aspect of oversight is setting multiple decision points for
each initiative, so that managers can periodically evaluate data and
decide whether to continue the work. These
45

"continue/change/discontinue" decisions should be driven by an

understanding (developed via the periodic reviews) of a given
initiative's continuing value, expected benefits, and strategic
contribution, Making these decisions at multiple points in the
initiative's lifecycle helps to ensure that managers will continually
examine and assess changing internal and external circumstances,
needs, and performance.
5. Governance
Implementing portfolio management practices in an organization is a
transformation effort that typically involves developing new
capabilities to address new work efforts, defining (and filling) new
roles to identify portfolios (collections of work to be done), and
delineating boundaries among work efforts and collections.
Implementing portfolio management also requires creating a structure
to provide planning, continuing direction, and oversight and control
for all portfolios and the initiatives they encompass. That is where the
notion of governance comes into play. The IBM view of governance
is:
An abstract, collective term that defines and contains a framework for
organization, exercise of control and oversight, and decision-making
authority, and within which actions and activities are legitimately and
properly executed; together with the definition of the functions, the
roles, and the responsibilities of those who exercise this oversight and
decision-making.
Portfolio management governance involves multiple dimensions,
including:
Defining and maintaining an enterprise business strategy. Defining
and maintaining a portfolio structure containing all of the
46

organization's initiatives (programs, projects, etc.).

The basic objective of Portfolio Management is to maximize yield and

minimize risk. The other objectives are as follows:
a) Stability of Income: An investor considers stability of income from
his investment. He also considers the stability of purchasing power of
income.
hi Capital Growth: Capital appreciation has become an important
investment principle. Investors seek growth stocks which provide a
very large capital appreciation by way of rights, bonus and
appreciation in the market price of a share.
Liquidity: An investment is a liquid asset. It can be converted
into cash with the help of a stock exchange. Investment should
be liquid as well as marketable. The portfolio should contain a
planned proportion of high-grade and readily salable
investment.

Safety: safety means protection for investment against loss

under reasonably variations. In order to provide safety, a
careful review of economic and industry trends is necessary. In
other words, errors in portfolio are unavoidable and it requires
extensive diversification.

Tax Incentives: Investors try to minimize their tax liabilities

from the investments. The portfolio manager has to keep a list
of such investment avenues along with the retum risk, profile,
tax implications, yields and other returns.

47

CHAPTER-V

RE S E ARC H
METHODOLOGY

Research Methodology:
Research Methodology is a way to systematically solve the research
problem. It may be understood as a science of studying how research is
48

done significantly. In it we study the various steps that are generally

adopted by a researcher in studying his research problem along with the
logic behind it. Research design plays an important role in collecting
useful information in cost effective manner. The flow of the research
process is decided first hand, so that the conduct of the research does not
take an incorrect diversion from its objective. Research comprises
defining and redefining problems, formulating hypothesis, collecting,
organizing, evaluating data; making deduction and reaching conclusion
and at last carefully testing the conclusion to determine whether they fit
the formulated hypothesis:

Research Design:
Research design is nothing but the master plan for the actual research. It
is a frame work for carrying out research activities it comprises of series
of prior decisions. Master plan for this research for as follows:-

TYPE OF RESEARCH DESIGN:

There are three types of research designs used for the project
(a) Descriptive &
(b) Analytical
The source/ methods of data collection:
The data was collected extensively through the following methods:
Primary Methods:
These are methods which are used to collect the data from the
actual field. In these methods questionnaires are prepared which have to
be appropriate and limited containing such which gives the full
information. These questions are asked to the selected group of people
and information is collected.
49

Interview Method:
In this method the group of people is selected and the prepared
questionnaires are asked to them. Questions can be the open ended or
close ended or both.
Open-ended: Questions are the questions, which are
having explanatory answers, suggestion.

Close-ended: Questions are the questions which are

having fixed answers. e.g.: Yes/No type of questions.

Oral interview: In this method interviewer ask

questions to interviewee orally and data is collected
in the record book.
For the project, closed ended questions were asked and also oral
interviews of few customers were taken.
2. SECONDARY METHODS:
These are the methods, which are carried out to collect the data from
indirect sources. In these method one need not to go in the direct market
to collect the Data. These methods are:
Data from the Axis bank:
In this methods the past data of the company is
collected such market area, distribution channels,
product costing etc. Also we get the information
about the growth the company.
50

 Data from the Internet:

This is of the latest methods of data collected. We can collect the
information like Company history, the product range of the
company, company objectives and welfare activities of company
etc.
Sampling Techniques:
The sampling technique used was Convenient sampling. Convenience
sampling is a non-probability sampling technique where subjects are
selected because of their convenient accessibility and proximity to the
researcher.
The subjects are selected just because they are easiest to recruit for the
study and the researcher did not consider selecting subjects that are
representative of the entire population. In all forms of research, it would
be ideal to test the entire population, but in most cases, the population is
just too large that it is impossible to include every individual. This is the
reason why most researchers rely on sampling techniques like
convenience sampling, the most common of all sampling techniques.
Many researchers prefer this sampling technique because it is fast,
inexpensive, easy and the subjects are readily available.
In pilot studies, convenience sample is usually used because it allows the
researcher to obtain basic data and trends regarding his study without the
complications of using a sample. This sampling technique is also useful
in documenting that a particular quality of a substance or phenomenon
occurs within a given sample. Such studies are also very useful for
detecting relationships among different phenomena
The survey process involved two phases: First phase included
identification and selection of the target audience to be studied and to
51

determine the parameters on which respondents will justify their

preferences. The audience were targeted and analyzed basically on the
basis of two important parameters: Age, and Income. Demographical
information was also taken in order to know the investment patterns
according to the location, age etc. A questionnaire was designed to collect
the needed information from the respondents. In the second phase data
was collected through questionnaire from around 30 respondents within
the branch. Results were viewed cautiously as sample was from a specific
population. The responses that were generated during this exercise were
converted in the form of percentages to have a comparative outlook, as
the numbers itself cannot explain the true picture. These percentages were
then represented through the simple tools like bar graphs; pie charts using
MS excel software.

52

CHAPTER VI

DATA ANALYSIS:

1) Age Distribution:

53

Age Distribution

13%

18-25 years
27%

26-35 years
36-50 years
Above 50 years

40%

20%

Graph1: Age Distribution

Interpretation:
1. Out of the total population under consideration, it was observed
that 27% is lying in the age group of 18-25 years, 20% of the
population is lying between the age group of 26-35 years of age,
40% is lying in the age group of 36-50 years and 13% is lying in
the age group of above 50 years of age.

54

2) Income Distribution:

Income Distribution(monthly)
Less than 15000

15000-30000

30000-50000

Greater than 50000

10%

27%

40%
23%

Graph2: Income Distribution

Interpretation:
1. From the above pie chart, out of the total population, 10% of the
people have their income groups in the range Less than 15000
rupees per month. 40% of the people have their income group in
the range of Rupees 15000-30000 per month, 23% of the people lie
in the 30000-50000 rupees per month and the remaining 27% of
the people belong to the group having monthly income Greater
than 50000.
2. The maximum number of people who have their accounts with axis
bank have their monthly income on an average of 15000-30000
rupees.

3) Investment horizon:
55

a) Investment horizons per age:

50

46

45

45
40

37

34

35

30

30

25

25
18

20
15

17

16

12
8

10
3

5
0

20 21
10

18-25 years

20

26-35 years

36-50 years

upto 1 year

upto 3 years

upto 10 years

Greater than 10 years

Greater than 50 years

upto 5 years

Graph 3: Investment horizons per age

Interpretation:
1. In the age group of 18-25 years maximum of the investors that is
46% of them have their horizon as 5 years, around 37% of them
have their investment horizon as upto 3 years. In the age group is
26-35 years 45% of the investors have upto 3 years. In the age
group of 36-50 years around 34% of the people have 5 years as
their investment horizon. And in the age group of greater than 50
years of age maximum people invest for up to 1 year.
2. It has been revealed from the survey that in any age group, the
most preferred investment horizon for investors in either upto 3
years or upto 5 years. This is due to the change in the interest rates
and different investment options available with the investors. Also
in todays economy customers do not go in for very large duration
of investment schemes.
b)Investment horizon as per Income:

56

45

42

40

37
33

35
30
20
11

10
0

22

17

15
5

28 27

25

25

33 34

33

12 13

11

8
3

2
Less than 15000

15000-30000

30000-50000

Upto 1 year

Upto 3 years

Upto 10 years

Greater than 10 years

1
Greater than 50000

Upto 5 years

Graph 4: Investment horizons per income

Interpretation
1. From the above graph it can be seen that 42% of total population
under study in the income group of less than 15000 average
monthly income invest their money for 5 years, in the income
group of 15000-30000, 33% have upto 3 years of horizon, in the
income group of 30000-50000,33% have income horizon as upto 5
years and in the income group of greater than 50000, 34% invest
for a horizon of 5 years.
2. On study, data was revealed that in any income group usually the
investment horizon of upto 3 years to 5 years. According to the
income class, it is clear that due to the changing rates of interest
and different investment options available with the people they
invest for a shorter duration of time.

4) Investment made in Products

57

The investment products considered includes :

FD
FD+Insurance
Traditional Insurance
ULIP
Mutual Funds
ULIP+Mutual Funds
Equity
a) Investment made in Products as per Age Group:
Interpretation:

40

37

35
30

25

25

20

20

20

15 13
10
5
0

20

12 13

25

22
15
10

13

25
16

10 10

18-25 years

25

26-35 years

8 8

36-50 years

10

10

10

13

5
Abvove 50 years

FD

ULIP

MF

ULIP+MF

FD+Insurance

Traditional Insurance

Equity

Graph 5: Investment made in Products as per Age Group

Sample taken for study shows different investments in different

age groups
1. In the age group of 18-25 years and 26-35 years, there is a
large number of people who have preferred to invest in ULIP
and Mutual Funds as 25% and 20% each. whereas in the age
58

12

group of 36-50 and above 50 years of age, maximum

population have preferred to invest in the FDs which is 37%
and 25% respectively . There are also considerable
investments in ULIP+MF is these age groups i.e. 16% of the
total population in the age group of 36-50 years and 25% of
the total population in the age group greater than 50 years.
2. There has been a considerable rise in the percentage of the
people who invest in FDs as we go ahead considering the
age and we can interpret that the young population believes
in taking risk and so they invest in the various other products
also. People with older age try to seek for security of their
funds and thus opt for this option.
b) Investment made in Products as per Income Group:
45
40
35 32
30
29
30
25
20
15
10
4
2
2
5
1
0
Less than 15000

42
30

29
25

25

24
20

15

14 14 14

11 10

15000-30000

30000-50000

1
Greate than 50000

FD

ULIP

MF

ULIP+MF

FD+Insurance

Traditional Insurance

Equity

Graph 6: Investment made in Products as per Income Group

Interpretation:
1) Studying the survey data reveals that according to the income group
the investment strategies opted by people differ according to the
income level.
59

2) Income group with less than 15000 monthly incomes have their
investments majorly in the products like Fds, Mutual funds and
Traditional Insurance.
3) Whereas the people in the age group of 15000-30000 have their
investments in ULIP, FDs and Mutual funds.
4) The population under 30000-50000 monthly income group hav their
investments majorly in ULIP+Mutual funds, FDs, ULIP, Mutual
Funds, Equity and Fd+Insurance. A variety of investment patterns can
be observed here in this group.
5) Influence on Investment Decision:

Influence on Investment decision

Self Analysis

Agents and Brokers

Influence of Peers

Influence of media

13%
17%
53%
17%

Graph 7: Influence on Investment Decision:

Interpretation:
1) Out of the total population under study, 53% of the people make their
investments by self-analysis. They themselves find the need to invest
their money and they chose the investment products themselves by
self-introspection. 17% of the people gain knowledge through
60

investment brokers and these are the people who influence people to
make their investments. Another 17% of the people get influenced by
peers

6) Use of Maturity amount:

Use of Maturity Amount

Investment in same
products
33%
50%

Investment in different
products
Use for other purpose

17%

Graph 8: Use of maturity amount

Interpretation:
1. Out of the total population, about 50% of the people prefer
investing their money in the same investment option. This happens
because, they either find that the return on investment better, the
product is suitable for their present need, and if the services
provided by the company are comparatively better than those
offered by others.
2. 17% of the people invest in different investment options. Reason
for which is that they dont want to be stereotypical, if better

61

products are available which satisfy their needs, if better

investment returns are guaranteed by the other product.
3. 33% of the people withdraw from their investments and use the
money for other purposes. Maybe the purpose was the ultimate
goal of investment or could be a possibility of other need of funds
for which the person doesnt reinvest.
7) Re investment decision:
Re investment decision as per age:

120

100

100
80
60
40

68

25

25

20
0

58.33

50

18-25 years

16

25

16

26-35 years

17

36-50 years

Greater
0 than
0 50 years

Reinvest in same option

Re invest in other option
No Reinvestment, use for other purpose

Graph 9: Re investment decision as per age

62

a) Re investment decision as per Income:

80
70

67

65

58

60
50

42

40

33

33

20
10
0

30

28

25

30

14
3

2
Less than 15000

15000-30000

30000-50000

Greater than 50000

Reinvest in same option

Re invest in other option
No Reinvestment, use for other purpose

Graph 10: Re investment decision as per Income

Interpretation:
After going through the age and income reinvestment graphs, we can see
that in every age group and in every income group, people reinvest in the
same companys product because the product can exactly suit their
present needs of investment , has higher returns on investment and that
the services provided by the company are good.. If they invest in some
other products, it is because of the variety of new products coming up in
the market with additional benefits to the investors.

63

8) Type of Investors:
a)

80
70

70
60

50

50
40

40

40
35

20

20

35

30

30

10

48

20

10
2
18-25 years

26-35 years
Conservative

Type of Investors as per Age:

Graph 11: Type of investors as per age

Interpretation:

64

36-50 years
Balanced

Aggressive

Above 50 years

The age brackets taken for the analysis are as follows:

18-25 years
26-35 years
36-50 years
Greater than 50 years.
1. After analysing it was found that the major portion of the total
population under consideration lying in every group of age are safe
investors. They do not prefer taking risk while investing and like to
maintain the risk free portfolio.
2. Survey shows that in age group 18-25 years and 26-35 years, there
exists the population which is willing to take considerable amount
of risk which was analysed and found that around 70% of the
population lying in the age group of 18-25 years are aggressive
when it comes to investments and 40% of the population lying in
the age group of 26-50 years are aggressive investors. As these
belong to the youth of India and a part of its growing economy,
their savings have increased and this is the outcome of their
savings.
3. The traits of an aggressive investors can be derived out of their risk
taking capacity, their willingness to invest in the new products, the
comfortness to bear the up and down s in the investment values,
their prefeences for the portfolio diversification so as to how much
of their funds to be invested in the high risk and high returns
products and how much do they allocate their fund for the low risk
and low returns products.

65

4. As we progress along the age groups, it is seen that a person tries to

safeguard his hand earned money and this behaviour can be clearly
seen in the age group of above 50 years where the percentage of
aggressive investors is approximately 0.
5. Whereas the percentage for the balanced in vestors is moderate
throughout all the age groups.

b) Type of Investors as per Income:

70

63
57

60
50
40

42
33

33

42

34

20

16

14

10
0

32

29

30

5
Less than 15000

15000-30000
Conservative

30000-50000

Balanced

Graph 12: Type of investors as per Income

Interpretation:
66

Aggressive

Greater than 50000

1. As per the survey conducted, it was observed that in the income

group of less than 15000 average monthly income have fairly
conservative investors but as we go ahead with the income groups,
the number of balanced investors and aggressive investors increase.

9) Reason for Investment:

Reason for investment

Increase in wealth and
opportunity for growth
13%
20%

Monthly Income
generation
47%

Safety of Principal
Liquidity in terms of cash
convertibility

20%

Graph 13: Reason for investment

Interpretation:
1. Out of the total sample that was considered for analysis,
around 47% of the people invest their money in order to
increase their wealth and also when they feel that a particular
product is fit as an opportunity for growth of their wealth.
67

Steady growth of funds is expected by these kinds of people

and thus they invest in the products which satisfy their needs
of stable growth.
2. 20% of the total population under study invests their funds
with a view of monthly income generation. The fixed
income generation after retirement is their investment goal
and thus they opt for such products accordingly.
3. Another 20% of the population looks after the safety of their
principal amount. These are the risk averse people who have
very less willingness to take up risks.
4. The remaining percent of the population which is 13% invest
with a goal of liquidity in terms of cash convertibily
10) Portfolio Preference:
a) Portfolio Preference as per Age:
70
60
50
40
30

Portfolio 1

20

Portfolio 2
Posrtfolio 3

10

Portfolio 4

Portfolio 5

Graph 14: Portfolio preference as per age

68

Here, Portfolio 1: 100% of the total funds to be invested in high risk high
return funds and 0% to be invested in low risk low return funds
Portfolio 2: 75% of the total funds to be invested in high risk high return
funds and 25% to be invested in low risk low return funds
Portfolio 3: 50% of the total funds to be invested in high risk high return
funds and 50% to be invested in low risk low return funds
Portfolio 4: 25% of the total funds to be invested in high risk high return
funds and 75% to be invested in low risk low return funds
Portfolio 5: 0% of the total funds to be invested in high risk high return
funds and 100% to be invested in low risk low return fund
Inference:
1) According to the survey, the age group 18-25 years, prefer
portfolio 2 the most. Around 50% of the people in that age group
prefer portfolio 2
2) As we progress along the age groups, people prefer investments
with low risk returns.
b) Portfolio preference as per Income:

69

60
50
40
30

Portfolio 1
Portfolio 2

20

Portfolio 3
10

Portfolio 4
Portfolio 5

Graph 15: Portfolio preference as per Income

Inference:
1. As we progress along the income groups, it is observed through the
survey that higher the income group, higher is the investment in the
portfolios with high risk and high returns funds.

11) Risk taking capacity:

a) Risk taking capacity as per age:

70

60
50
40
30

0%

20

10%
20%

10

30%

35% and more

Graph 16: Risk taking capacity as per age

Interpretation:
The risk taking capacity of an individual changes according to his age.
This happens because the entire purpose and reason for investment is
dependent on this factor.
1. It is observed that In the age group of 18-25 years theres not much
responsibility on an individual so he can take risks. This capacity
goes on decreasing as we go ahead with the age because the
responsibilities increase along with the expenses of a person in
terms of liabilities.

b) Risk Taking capacity as per Income:

71

70

64

60
50

50
40

33

32
30

16 17

20

14

25
14 14

11

10
2
0

29 29

25

Less than 15000

13

1
15000-30000

30000-50000

0%

10%

30%

Greater than 35%

Greater than 50000

20%

Graph 17: Risk taking capacity as per income

Interpretation:
1) Out of the total population under consideration, it has been clearly
observed that the risk taking capacity for a person is dependent on
the average monthly income of a person. There is a gradual
increase in the risk taking capacity as we move forward as per the
income groups.
2) Out of The income group of less than 15000, 67% of the people
have 0% as their risk taking capacity. Rest of the 33% of the people
have 10% risk taking capacity
3) In the income group of 15000-30000 average monthly income,
33% of the people have 0% risk taking capacity, 27% of the people
have 20% risk taking capacity whereas, 18% have 30% risk taking
capacity and another 18% of the people have greater than 35% risk
taking capacity
72

4) In the income group of 30000-50000 average monthly income,

28% of the people have 10% and another 28% of the people have
20% risk taking capacity. Whereas, equal number of percentage of
the remaining people i.e. 14% has 0%, 30% and greater than 35%
risk taking capacity.
5) In the income group of greater than 35% of average monthly
balance, 50% of the people have 20% risk taking capacity and 23%
of the people have 30% risk taking capacity.

73

Case studies:

Portfolio Analysis:
The portfolios of certain customers were analyzed and these portfolios
were carefully scrutinized through various aspects. Considering some of
them as follows:
Case study 1:
1) Total amount of investment: Rs.4,00,000
2) Type of investor- Conservative
3) Current investment:
Fixed Deposit of Rs.4,00,000
4) Suggested investment:
Fixed deposit of Rs.2,80,000
Principal protected structured product(Axis hybrid
mutual funds) of Rs.80,000
Equity linked FMPs(Axis Equity) of Rs.40,000

Description:
Salaried person with a moderate risk taking ability, lying in
the age group of 35-50 years. Thus instead of gaining 8%
interest on an average over a Fixed deposit, a diversification
was suggested. As per the equation as Debt-70% Equity20%, Alternate investment-10% .thus the option
of hybrid mutual funds was suggested because
it gives the tax benefit to the investor.

74

 Case study 2:
1) Total amount of investment: Rs.7,00,000
2) Type of Investor- balanced
3) Current investment:
ULIP of Rs.4,00,000
Equity of Rs.3,00,000
4) Suggested investment:
ULIP of Rs.3,50,000
Indian sectorial mutual funds of Rs.2,45,000
Axis equity of Rs.10,500

Description: Salaried person at a good position, with a

balanced risk taking capacity, lying in the age group of 35-50
years. Thus instead of investment in only two options, an
recommendation was given to diversify it further and invest
according to the equation Debt-50%, Equity-35%,
Alternate Investment-15%.

75

 Case study 3:
1) Total amount of investment: Rs. 10,00,000
2) Type of investor- aggressive
3) Current investment:
Life insurance of Rs.3,00,000
Fixed deposit of Rs.4,00,000
Equity of Rs.3,00,000
4) Suggested investment:
Long term investment plan: Shiksha plus of Rs. 4,00,000
Recurring Deposit of Rs.2,00,000
Private equity funds- Rs. 4,00,000

Description: Businessman with a large income per month in the age

group of 35-40 years of age having a child, and is willing to take
up high risks is given the diversification as per the equation
Debt-10%, Equity-65% Alternate investment- 25%.
The childs future plan was given because it is also a
tax saver plan and the need of child future plan was
recognized.

76

CHAPTER VII

FINDINGS

77

FINDINGS
1. The maximum number of people who have their
accounts with axis bank have their monthly income
on an average of 15000-30000 rupees.
2. It has been revealed from the survey that in any age group or
income group, the most preferred investment horizon for investors
in either upto 3 years or upto 5 years. This is due to the change in
the interest rates and different investment options available with
the investors. also in todays economy customers do not go in for
very large duration of investment schemes.
3. There has been a considerable rise in the percentage of the people
who invest in FDs as we go ahead considering the age and we can
interpret that the young population believes in taking risk and so
they invest in the various other products also. People with older
age try to seek for security of their funds and thus opt for this
option
4. They themselves find the need to invest their money and they
chose the investment products themselves by self-introspection.
Self-analysis helps to find the needs of oneself and thus
accordingly one can make investments.
5. Majority of the people prefer investing their money in the same
investment option. This happens because, they either find that the
return on investment better, the product is suitable for their present
need, and if the services provided by the company are
comparatively better than those offered by others
78

6. In age group 18-25 years and 26-35 years, there exists the
population which is willing to take considerable amount of risk.
inthe age group of 18-25 years are aggressive when it comes to
investments and most of the population lying in the age group of
26-50 years are aggressive investors. As these belong to the youth
of India and a part of its growing economy, their savings have
increased and this is the outcome of their savings. As we progress
along the age groups, it is seen that a person tries to safeguard his
hand earned money and this behavior can be clearly seen in the
age group of above 50 years where the percentage of aggressive
investors is approximately 0. Similarly, as we go ahead with the
income groups, the number of balanced investors and aggressive
investors increase.
7. Most of the people invest their moneyin order to increase their
wealth and also when they feel that a particular product is fit as an
opportunity for growth of their wealth. Steady growth of funds is
expected by these kinds of people and thus they invest in the
products which satisfy their needs of stable growth.
8. It has been clearly observed that the risk taking capacity for a
person is dependent on the average monthly income of a person.
There is a gradual increase in the risk taking capacity as we move
forward as per the income groups.
9. As we progress along the income groups, it is observed through the
survey that higher the income group, higher is the investment in the
portfolios with high risk and high returns funds

10.People reinvest in the same companys product because the product

can exactly suit their present needs of investment, has higher
79

returns on investment and that the services provided by the

company are good.. If they invest in some other products, it is
because of the variety of new products coming up in the market
with additional benefits to the investors.
11.It has been found that the overall investment decision of a person
completely relies on his age, income, risk taking capacity,
influence from people etc.

80

CHAPTER VIII

CONCLUSION

CONCLUSION

81

Theres a variety of investment products available with the bank. It is

very essential to find out the need of the customer, study his objective of
investment, other traits like his nature of investment i.e. to find out
whether he is risk averse or an aggressive investor, his capacity to face
the ups and downs of the market and most importantly his horizon for
investment, and accordingly a suitable mix of products can be suggested
to the customer.
Various other factors also affect the investment decision of customer. The
careful scrutinization of the products and also the various advantages
derived out of it must be considered like example the tax benefits offered
by certain products. Let us consider some of them
Risk
Profile
Risk averse

Suggested
Allocation
Debt-100%

Products Recommended

Conservativ Debt-70%
e
Equity-20%
Alternate
investment-10%

Balanced

Debt-50%
Equity-35%
Alternate
Investment-15%

82

Bank deposit
Capital gain bond
Money market & short
term debt funds
India AAA bonds
In addition to above:
Medium to long term debt
mutual funds
Balanced mutual funds
Equity linked FMPs
INDIAN AND Global
Diversified Equity funds
Fund of Funds/ Multi
manager funds
Gold ETF
Principal protected
structured products
In addition to above:
Non principal protected
structured
products(interest rate/
equity/ commodity linked)
Managed accounts/
portfolio
Management
service( discretionary or

non-discretionary)
Indian & global sectorial
equity MF

Growth

Aggressive

Debt-30%
Equity-50%
Alternate
investment-20%
Debt-10%
Equity-65%
Alternate
investment- 25%

Commercial real estate

Real estate MF/ REIT
In addition to above
private equity/ venture
capital funds
real estate venture funds
In addition to above
Derivatives

Table 3: Risk profiles and product offering

The above stated table gives an account of the equations to be considered

while investing in the various investment options that is while designing a
portfolio.
From the analysis which was conducted, it has been clear that
Hypothesis Ho: Age and Income has no impact on the portfolio
preference of the investors is rejected.
Thus alternative hypothesis Ha: Age and Income has impact on the
portfolio preference of the investors is accepted.

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CHAPTER IX

RECOMMENDATIONS

RECOMMENDATIONS:
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The profile of the investor should be carefully

scrutinized and a proper investment
suggestion should be given to the customer
Awareness regarding the new products of the
bank must be spread among the banking
customers
Investors should be motivated to invest in
various options which match their risk taking
capacity and thus diversify their portfolio.

ANNEXURE
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Survey Questionnaire
Dear respondent this survey is carried to find the investment behavior of
consumers and is for academic purpose only, all your disclosures will be
kept confidential.
Respondent details
Name: Address:

.. Ph no:..
Please tick mark the suitable option.
1. What is your present age?
a) 18 25 yrs

b) 26 35 yrs

c) 36 50 yrs

d).>50 yrs
2. What is your monthly income?
a) up 1> 15000

b) 15000 30000 c) 30000 50000

d)

> 50000
3. What is your investment horizon?
a) up to 1 year
up to 10 year

b) up to 3 years

c). up to 5 years

d)

e) greater than 10 years

12. How best would you describe your saving habits over the years?
a) After covering living expenses I am able to save substantial amounts
regularly
b) After covering living expenses I am able to save some amounts
regularly
c) Afer covering living expenses I am only able to save some amount on
an ad-hoc basis
d) After covering the living expenses I am hardly able to save
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e) I am not able to save at all

4. Which of the following Investment options would you prefer the most?
a) ULIP

b) Mutual fund

Traditional insurance

c) Fixed deposit

d)

e) UL1P+ MF f) FD+ insurance e) Equity

5. What factors would you consider most important before choosing an

investment option?
a) how quickly I will be able to increase my wealth
b) the opportunity for steady growth
c) the amount of monthly income the investment will generate
d) the safety of my investment principal amount
e)Liquidity in terms of cash convertibility
6. Your financial investment are influenced /based on which of the
following?
a) information received by broker agent
c) self analysis and interospection

b) influence of peers

d) Information delivered through

Media (advertisement/news)
7. What would you prefer doing on the realisation of the maturity amount
of your investment?
a) reinvest in same investment options
investment options

b) invest in other

c) use for other purpose

8. If u reinvest do u go with same product?

a) yes, if product is suitable for my present need

b) yes if return

on investment is better
c) yes, if service and returns provided are comparatively better.
9. As an investor, how do you describe your willingness to take financial
risk?
87

a) I am comfortable taking ona higher level of risk, knowing it may mean

higher returns
b) I am willing to take calciulated risks, knowing it may mean high
returns
c) I am happy with the moderate level of risk
d) I am fairly conservative,but can take on a small level of risk
e) I am a conservative investor and I am completely risk averse
10. Which of the following mix of investments do you find most
appealing for your portfolio?

Portfolio

High risk-High

Low risk-Low

return
100%

return
0%

1
b Portfolio

75%

25%

2
Portfolio

50%

50%

3
d Portfolio

25%

75%

0%

100%

4
Portfolio
5

11. Investments can go up and down in value. By how much could the
total value of your investments go down before you begin to feel
uncomfortable?
a) 35% and more b)30%

c)20% d)10%

would make me uncomfortable

88

e) Any fail

BIBLIOGRAPHY

www.investopedia.com
www.wikipedia.com
www.axisbank.com
www.birlasunlife.com
www.managementstudyguide.com
Banking Theory, Law &PracticeE.Gordon&K.Natraj

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