A STUDY ON INVESTOR BEHAVIOUR TOWARDS INVESTMENT DECISION

WITH SPECIAL REFERENCE TO MYFINO PAYMENT WORLD(P)LTD

 CHAPTER-I
INTRODUCTION
1.1 ABOUT THE STUDY:
Savings is the foundation stone on which the whole structure of capital formation and
investment rests. Basically the saving potential of the community depends upon the income
and consumption pattern, save and the facilities available in the country to induce the public
to save. Bank rate, interest rate of government securities etc., attract the community to save
the part of income so as to earn money out of money. In many cases, the fear over a future
makes the people to go for saving investment and capital formation are not only in the hands
of the public, but even rate of growth of investment depends in general public, business
community and government.
Investment is the process of development of funds by considering its profitability,
liquidity, safety and the like. The profitability of any investment is base on the regulation of
reserve bank of India. Reserve bank of India frames the rules regarding the deposit
mobilization and decides the interest rate is increased; the deposit mobilization will be very
easy. In other words, the profitability of investment leads to high saving. So the investment is
a development factor of savings. Investment takes place with the purchase of any asset that
offers the expectation of future income or profit or both.
Economic development of a country depends upon its investments in productivity
sector. Inadequate investments lead to a setback in economic development. Adequate
investment is based on savings. The investment depends upon the savings. People prefer for
profitable parking space of their funds by considering safety. It the return on investment is
attractive public will freely invest.
If the amount so saved is being invested in various investment channels, with a view
to earn a good return, then the saving become investment and the saver becomes investor. An
investor should well aware of the various investment opportunities before he takes an
investment decision. Any investment decision is a tradeoff between risk and return
Investments are both important and useful in the context of present day condition.
Some factors that have made investment decision increasingly important are,
 Longer life expectancy
 Increasing rates of tax
 High interest rates
 Larger income
 Availability of complex number of investment outlets
 The investor in his/ her choice of investment tries to achieve a proper mix between
rate of return and stability of return to reap the maximum benefits. The investor should be
concerned with concepts and applications that will satisfy his/ her investment objectives and
constantly evaluate the performance of their investment, if needs, the investor may consider
switching over to alternative proposals.
SIGNIFICANCE OF THE STUDY:
The significance or importance of the study is to analyze the various advantages about
the investment pattern and behavior of the salaried class employees. The study provides the
information about investment and its sources. It shows that the extent of awareness among
the investors about the various types of investment. The investor to choose the investment
opportunity they should exercise their skills, knowledge, efficiency and experience while
they investing for their future needs. The suggestion for improving the investment ability of
the investors taken into account for the study.
STATEMENT OF THE PROBLEM:
Every human being has a tendency to have a social status in the society. To obtain or
to maintain status they need money. This can be achieved through standard income. People
try to multiply their existing wealth as well as money.
They are different types of investment portfolio available to the investor who like
high-risk investment tax-rebate investment, low risk investment and fast track investment. In
case of high-risk investment, even through the risk involved is high, the return will also be
high.
Tax rebate investments are suitable for that investor who belong to high-income group
and pay high tax. In low risk investment, the risk well as return will be at a low level. The
fast track investments are those investments in which the principal amount invested itself is at
a dangerous position. Hence it involves a high amount of risk. The investors by considering
all the different types of investment portfolio available can think of channeling the excess
income for their exercise own benefits as well for the growth of the economy of the country.
Thus the present study aims to analyze the investment pattern of salaried men employees.

THEORITICAL BACKGROUND AND CONCEPTS OF INVESTMENTS

Investment is the sacrifice of certain present value for the uncertain future reward. It
entails arriving at numerous decisions such as type, mix, amount, timing, grade etc. of
investment and disinvestments. Further, such decision-making has not only to be continuous
but rational too. Broadly speaking, an investment decision is a trade off between risk and
return. All investment choices are made at points of time in accordance with the personal
investment ends and in contemplation of an uncertain future. Since investments in securities
are revocable, investment ends are transient and investment environment is fluid, the reliable
bases for reasoned expectations become more and more vague as one conceives of the distant
future. Investors in securities will therefore, from time to time, reappraise and reevaluate their
various investment commitments light of new information, changed expectations and ends.
CONCEPTS OF INVESTMENTS:
“Investment” or “Investing”, like “value” is a word of many interpretations. There are
basically three concepts of investment: (1) Economic investment-that is, an economist’s
definition of investment; (2) Investment in a more general or extended sense, which is used
by “the man on the Street”; (3) The sense in which we are going to be very much interested
namely, financial investment.
The term economic investment has a rather precise meaning in the literature of
economic theory. Typically it includes net additions to the capital stock of society. By
‘capital stock of society’ is meant those goods, which are used in the production of other
goods. This is a gross, societal or aggregate point of view. In society there are a number of
goods which are used to produce other goods, and that these means of production are
considered part of the capital stock of society. For a number of reasons, economists also
include inventories as part of the capital stock. Thus, a net addition to the capital stock an
investment means an increase in buildings, equipments or inventories over the amount of
equivalent goods that existed, say, one year ago at the same time.
The everyday usage of the term investment can mean a variety of things, but to the
man on the street it usually refers to a money commitment of some sort. For example, a
commitment of money to buy a new car is certainly an “investment” from an individual’s
point of view. But these are so in very extended sense of the word since no rate of return is
involved, nor is a financial return or capital growth expected.
Financial investment is a form of this general or extended sense of them. It means an
exchange of financial claims-stocks and bonds, real estate, mortgages, etc. investors to
differentiate between the pseudo- investment concept of the real investment of the
businessman often use the term financial investment. Semantics aside, there is still a
difference between investments in a ticket on a horse the construction of a new plant;
between the pawning of a watch and the planning of a field of corn. Some investments are
simply transactions among people, others involve nature. The latter are “real” investments;
the former are “financial” investments.
FEATURES OF INVESTMENT AVENUES:
The investor has various alternative avenues of investment for his savings to flow in
accordance with his preferences. Savings flow into investment for a return, but savings kept
as cash are barren and do not earn anything. Savings are invested in assets depending on their
risk and return characteristics. But a minimum amount of cash is always kept in hand for
transactions and contingencies. Any rational investor knows that money is losing its value by
the extent of the rise in prices. If money lent cannot earn, as much as rise in prices or
inflation, the real rate of return is negative. Thus, if inflation is at an average annual rate
of10%, them the return should be 10% or above to induce savings to flow into investment.
Thus, if an investment is made in short-term deposits with bank or in securities of
Government then the rate of interest is around 11-12%. As the risk of loss of money is almost
negligible in such case, this rate can be called a risk-free return. All investments involve in
some risk or uncertainty. The objective of the investor is to minimize the risk involved in
investments and maximize the return.
1.2 INDUSTRY PROFILE

Money and the idea of its exchange through payments have evolved a lot from the
time of its inception. From goods to grain, from metal coins to paper, from bank accounts to
e-wallets, money has taken various shapes, sizes, and forms. Payments evolved from a barter
system (exchange of goods for grains) to the token system (exchange of coins and cash on
paper) to cash pooling (bank accounts and deposits) to cashless payments (credit cards,
checks, e-wallets). Over the last decade or so, payment technologies have grown at a dizzying
pace.
Payments are now evolving at a rapid pace with new providers, new platforms, and
new payment tools launching on a near-daily basis. As consumer behavior evolves, an
expectation of omnicommerce emerges – that is the ability to pay with the same method
whether buying in-store, online, or via a mobile device. This shift precipitates a need for
retailers to adapt toward fast, simple, and secure mobile payments.
The payments industry would be in a transformational state in 2017. The ongoing war
with alternative payment channels will intensify and challenges in emerging markets would
force the incumbents to take drastic measures. Some key drivers would be:
1. Real-Time Payments: RTP represents a new phase of evolution within the payments
industry, with several key features that differentiate them from current payment methods,
specifically speed, value-added messaging capabilities, and immediate availability of
transaction status. RTP will provide FIs with the functionality/features to innovate and meet
customer demand.
2. Distributed Ledger Technology (DLT)/Blockchain: Blockchain has the potential to
completely change the financial transaction processing cost model amongst its various
applications. It also enables all processing to be done over a distributed system network or in
the cloud, avoiding the usage of costly data centers or mainframes.

3. Expansion of Payments to Non-Physical Interfaces: Traditional interfaces are

challenged by external stakeholders (Amazon, Google, Facebook, and Apple) in two ways –
voice assistants and VR. Connected assistants become smarter and add functionality with the
enhancement of NLP and image recognition. Betting on physical interfaces, and mobile, in
particular, can no longer ensure long-term relevance as voice-first solutions evolve. With
Facebook obsessed with killing the smartphone to own virtual spaces, classic interfaces and
solutions developed for them will gradually fall out of grace.
4. Unified Platforms: The first Visa/Mastercard/SWIFT-free payments system – the Unified
Payments Interface (UPI) by NPCI was launched in 2016. UPI is an open-source platform
designed for the mobile age that helps with the easy integration of various payment
platforms. UPI is powered by a single payment API and a set of supporting APIs. UPI offers
a whole new model of the financial services industry ecosystem. UPI became a starting point
of what SWIFT called a journey to a single payments platform. UPI is a benchmark to what
the payments landscape should be moving towards given that oversaturated payments
ecosystem, where too many ‘pay’s’ won’t let anyone win. Disjoint experiences across
businesses create customer confusion, and, in the end, with a limited customer base, limit
opportunities for every payment service provider – existing and new. Professionals from
SWIFT emphasize that the payments industry must migrate from a plethora of aging and
expensive systems and schemes to a single platform to process all payments. However, a
single payment experience for customers (based on seamless system interoperability,
comparable to mobile telephony) is a more probable future than a single payments platform.
Participants
Pay1.png
Source: Overview of the Payments Ecosystem – Electronic Transactions Association
Channels
Here are three main payment channels based on market participants and underlying
funding mechanisms:
B2C
C2C
B2B
Regulation, demographics, and technology are affecting B2C and B2B in various
ways. Technology is most actively shaping C2C payments while B2C and C2B have not been
left behind with technology partnerships mushrooming across banks, enterprises, and
startups. C2C payments have the highest potential to evolve as a result of several factors:
Convenience and ease of use
Lack of entrenched counterparties such as businesses, which are typically much slower to
adopt new business processes
Lack of stickiness for incumbent service providers such as offers and rewards
Processors for the payment systems can use different channels to make a payment and each
has different operating characteristics, rules, and settlement mechanisms. All payment
systems can be broadly placed into one of the following four payment channels:
Paper-Based systems such as checks or drafts. Payments are initiated when one party
writes an instruction on paper to pay another. These systems are one of the oldest forms of
non-cash payment systems. Checks are a common paper-based channel and are still widely
used in the United States and a few other countries.
RTGS (Real Time Gross Settlement) or High-Value Payments, commonly called wire
transfers. Wires came into being in the late 1800s with the invention of the telegraph but did
not become widely used until the early 1900s.
RTNS, or Real Time Net Settlement systems or Automated Clearing House (ACH) batch
payments were introduced in the early 1970s and were designed to replace checks with
electronic payments. Unlike wires, which are processed individually, ACH payments are
processed in batches and were originally intended for small payments under $100,000 such as
payroll and consumer transactions.
Cards are a payment channel that includes credit, debit, and stored-value cards. They are a
fast-growing segment of the methods for making and receiving payments.
Mobile payment is defined as the use of the mobile phone to pay for the purchase of goods
and services at a retail POS terminal or on the Internet. Payment may be initiated via SMS
text message, mobile browser, downloadable app, contactless near-field communication
(NFC), or quick response (QR) code. As more and more smartphone owners use their devices
to pay for products online, mobile payment services are predicted to grow rapidly. At the
same time, the emergence of one-touch checkout buttons, P2P payments, and the rise of
sharing economies have created new opportunities for remote mobile payments.
Real-Time Low-value payments provide consumers and businesses with the ability to
conveniently send and receive immediate fund transfers directly from their accounts at FIs,
anytime 24/7/365. Financial institutions can leverage a variety of features – enhanced speed,
security, and messaging capabilities – to create unique offerings for their retail and corporate
customers. RTP also provides a backbone on which new business models can be redefined.
Payments Schemes
Pay-2.png
Source: What does the payment ecosystem look like?, Ecommerce Foundation
OBeP Scheme
The Online Banking ePayments (OBeP) scheme is a type of payments network, developed by
the local or international banking industry – in conjunction with technology providers –
designed to facilitate online bank transfers or direct debits.
In an OBeP scheme, the consumer is authenticated in real-time by the consumer’s financial
institution’s online banking infrastructure. The availability of funds is validated in real-time
and the consumer’s financial institution provides a guarantee of the payment to the merchant
in case the payment is made as a credit transfer (push payment): the consumer/buyer initiates
the payment. In case the merchant initiates the payment – a debit transfer (pull payment) –
the consumer is protected from wrong debits and has the right to reverse the payment
depending on scheme regulation and market legislation.
OBeP schemes often allow for direct merchant integration and do guarantee payment to
merchants. Other benefits are the relatively low transaction cost compared to card, wallet, or
other alternative payments.
OBeP Types
Across markets, there are several OBeP scheme types to distinguish:

Mono-Bank OBeP Scheme: Entails that a seller or Payment Service Provider has a separate
connection to each participating financial institution.
Multi-Bank OBeP Scheme: Entails that a seller or Payment Service Provider has one single
connection to the OBeP network in order to accept payment from any participating financial
institution (Ex.: the iDEAL scheme in the Netherlands and BankAxess in Norway)
Overlay OBeP Scheme: Similar to the Multi-Bank or Mono-Bank scheme, however, there is
a third party (the overlay provider) who sits between the payment network and the consumer.
The overlay provider requires the consumer to share their online banking credentials with
them in order to have access to the consumer’s bank account and to initiate the credit transfer
to the merchant. (e.g. SOFORT banking, or SOFORT Überweisung)
Three-Party Model
A three-party scheme consists of three main parties whereby the issuer – who has the
relationship with the cardholder – and the acquirer – who has the relationship with the
merchant – is the same entity. The three parties consist of the consumer, the merchant and the
scheme.
Often the three-party model is a franchise set-up, whereby there is only one franchisee in the
market. There is no competition within the brand; however, there is competition with other
card brands and other alternative payment methods. Some examples of three-party card
schemes: Diners Club International, Discover, and American Express.
In the last few years, these schemes have also partnered with other issuers and acquirers to
ensure the issuance and acceptance of their card brand. These schemes could be seen as
‘premium’ card schemes as they tend to have a strong cardholder focus and to provide
additional privileges for cardholders. Merchants are often charged a relatively high merchant
commission rate.
Four-Party Model
In a four-party scheme, the issuer – who has the relationship with the cardholder – and the
acquirer, who has the relationship with the merchant, are different entities. The four parties
consist of the consumer, the merchant, the issuer, and the acquirer. These four-party schemes
are referred to as ‘open schemes’ as they allow banks and financial institutions to join, to start
issuing their cards, and/or to acquire merchants for card acceptance. In principle, there is no
limitation to who may join the scheme, as long as the scheme requirements are met. Some
examples of a three-party card scheme: Mastercard, Visa, Maestro, UnionPay, JCB, and
RuPay (India).

Capital Market is one of the significant aspects of every financial market. Hence it is
necessary to study its correct meaning. Broadly speaking the capital market is a market for
financial assets which have a long or indefinite maturity. Unlike money market instruments
the capital market instruments become mature for the period above one year. It is an
institutional arrangement to borrow and lend money for a longer period of time. It consists of
financial institutions like IDBI, ICICI, UTI, LIC, etc. These institutions play the role of
lenders in the capital market. Business units and corporate are the borrowers in the capital
market. Capital market involves various instruments which can be used for financial
transactions. Capital market provides long term debt and equity finance for the government
and the corporate sector. Capital market can be classified into primary and secondary
markets. The primary market is a market for new shares, where as in the secondary market
the existing securities are traded. Capital market institutions provide rupee loans, foreign
exchange loans, consultancy services and underwriting.

Let us get acquainted with the important functions and role of the capital market.
1. Mobilization of Savings: Capital market is an important source for mobilizing idle
savings from the economy. It mobilizes funds from people for further investments in
the productive channels of an economy. In that sense it activate the ideal monetary
resources and puts them in proper investments.
2. Capital Formation: Capital market helps in capital formation. Capital formation is
net addition to the existing stock of capital in the economy. Through mobilization of
ideal resources it generates savings; the mobilized savings are made available to
various segments such as agriculture, industry, etc. This helps in increasing capital
formation.
3. Provision of Investment Avenue: Capital market raises resources for longer periods
of time. Thus it provides an investment avenue for people who wish to invest
resources for a long period of time. It provides suitable interest rate returns also to
investors. Instruments such as bonds, equities, units of mutual funds, insurance
policies, etc. definitely provides diverse investment avenue for the public.

4. Speed up Economic Growth and Development: Capital market enhances

production and productivity in the national economy. As it makes funds available for
long period of time, the financial requirements of business houses are met by the
capital market. It helps in research and development. This helps in, increasing
production and productivity in economy by generation of employment and
development of infrastructure.
5. Proper Regulation of Funds: Capital markets not only helps in fund mobilization,
but it also helps in proper allocation of these resources. It can have regulation over the
resources so that it can direct funds in a qualitative manner.
6. Service Provision: As an important financial set up capital market provides various
types of services. It includes long term and medium term loans to industry,
underwriting services, consultancy services, export finance, etc. These services help
the manufacturing sector in a large spectrum.
7. Continuous Availability of Funds: Capital market is place where the investment
avenue is continuously available for long term investment. This is a liquid market as it
makes fund available on continues basis. Both buyers and seller can easily buy and
sell securities as they are continuously available. Basically capital market transactions
 are related to the stock exchanges. Thus marketability in the capital market becomes
easy.

Investment services in Myfino Payment world Pvt Ltd

Investment has different meanings in finance and economics. Finance investment is

putting money into something with the expectation of gain that upon thorough analysis has a
high degree of security for the principal amount, as well as security of return, within an
expected period of time. In contrast putting money into something with an expectation of
gain without thorough analysis, without security of principal, and without security of return is
speculation or gambling. As such, those shareholders who fail to thoroughly analyze their
stock purchases, such as owners of mutual funds, could well be called speculators. Indeed,
given the efficient market hypothesis, which implies that a thorough analysis of stock data is
irrational, all rational shareholders are, by definition, not investors, but speculators.

Investment is related to saving or deferring consumption. Investment is involved in many

areas of the economy, such as business management and finance whether for households,
firms, or governments. To avoid speculation an investment must be either directly backed by
the pledge of sufficient collateral or insured by sufficient assets pledged by a third party. A
thoroughly analyzed loan of money backed by collateral with greater immediate value than
the loan amount may be considered an investment.

Automatic investment plan (AIP)

It is the investment for every month or quarter. Then on the day of your choice, that
amount is automatically transferred from your checking or savings account. Investments must
be in amounts of $100 or more. There is no additional fee for this service and you can
terminate it at any time.

Systematic withdrawal plan (SWP)

The systematic withdrawals of $50 or more on a monthly or quarterly basis. The

proceeds of the withdrawal plan can be sent to your address of record, sent by electronic
transfer to your bank or invested in another Wright fund. This is a useful way to deal with
mandatory withdrawals from an IRA.

Commodities in Myfino Payment world pvt Ltd

Commodity markets are markets where raw or primary products are exchanged. These
raw commodities are traded on regulated commodities exchanges, in which they are bought
and sold in standardized contracts.

This article focuses on the history and current debates regarding global commodity markets.
It covers physical product (food, metals, and electricity) markets but not the ways that
services, including those of governments, nor investment, nor debt, can be seen as a
commodity.
1.3 COMPANY PROFILE

Myfino Payment world pvt Ltd, incorporated in 18th October of the year 2005 as
Probity Research & Services Private Limited at Salem. The Myfino Payment world is a one-
stop shop for information, advice as well as transaction execution of financial services. MPL
along-with its subsidiaries caters to entire gamut of financial services including equities and
commodities broking, portfolio management, distribution of mutual funds, life insurance
products, home loans, personal loans, etc. Broking services are offered under the 5paisa
brand (offers broking services in the Cash and Derivatives segments of the NSE as well as the
Cash segment of the BSE). The company has proven research capabilities and was rated by
the Forbes as the best of web' and must read for investors'. A network of 758 business
locations spread over 346 cities across India, facilitates the smooth acquisition and servicing
of a large customer base.
Myfino Payment world 's research is available not just over the Internet but also on
international wire services like Bloomberg (Code: MPL), Thomson First Call and Internet
Securities where it is amongst the most read Indian brokers. The Company identified the
potential of the Internet to cater to a mass retail segment and transformed its business model
from providing information services to institutional customers to retail customers. Hence
MPL launched its Internet portal, www.myfinopaymentworld.com in May of the year 2009
and started providing news and market information, independent research, interviews with
business leaders and other specialized features.
In the year 2010, MPL leveraged its position as a provider of financial information
and analysis by diversifying into transactional services, primarily for online trading in shares
and securities and online as well as offline distribution of personal financial products, like
mutual funds and RBI Bonds.

These activities are carried on through the wholly owned subsidiaries. The broking
service was launched under the brand name of 5paisa through our subsidiary, Myfino
Payment world Securities Private Limited and www.5paisa.com, the e-broking portal, was
launched for online trading in June of the year 2000. It combined competitive brokerage rates
and research, supported by Internet technology. Besides investment advice from an
experienced team of research analysts, also offer real time stock quotes, market news and
price charts with multiple tools for technical analysis.
 In December of the year 2010, Myfino Payment world Insurance Services Limited
(subsidiary) became a corporate agent for ICICI Prudential Life Insurance Company Limited.
In the year 2014, the company launched commodities broking through its subsidiary Myfino
Payment world Commodities Private Limited. Also received a license for Portfolio
Management Services from SEBI for broking subsidiary. During the year 2016, the company
received the requisite prior approval from
The Securities and Exchange Board of India for its proposed merger of Myfino
Payment world Securities Private Limited (IISPL), a wholly owned subsidiary with itself. It
had earlier received in-principle approval from National Stock Exchange and The Stock
Exchange, Mumbai. In January of the year 2017, the company entered into an alliance with
Bank of Baroda for providing Brokerage Platform, besides research and analysis services to
the bank's customers. Myfino Payment world awarded the Best Broker in India' by Finance
Asia. This was a result of Finance Asia's annual look at the best financial services firms in
each country around Asia for the period from June 2017 to May 2018. During March of the
year 2018, Myfino Payment world 's institutional broking arm MPFL, partnered with
Auerbach Grayson & Company, Inc., a New York-based brokerage firm to offer US investors
premium access to investing in India's capital markets. Auerbach Grayson specializes in
providing global trade execution and exclusive research to U.S. institutional investors. As of
July 2018, the company received the in-principle approval for the insurance broking license
from IRDA.
In today’s competitive world there are many goods chasing few customers some are trying it
expands their size and share of existing market. As a result there are loser and winners.
Winner’s are those who carefully analyze needs identify opportunities and create aloe rich
offers for target customer. The objective of the market research to determine the demand and
supply and use of the product and competitors s t u d y s o a s t o g e t t h e t o t a l m a r k e t
s c e n a r i o o f t h e p r o d u c t f o r a n a l y z i n g market problem research is needed. A firm
can obtained market research in a n u m b e r o f w a y s . I t c a n h i r e m a r k e t r e s e a r c h
f i r m o r i t c a n a s k s t u d e n t t o design and carry out market research project. These
marketing problems and opportunities if entrust to the student of marketing. Especially when
they seek the same during the project g i v e s o p p o r t u n i t i e s t o a p p l y t h e i r
t h e o r e t i c a l k n o w l e d g e a n d m a n a g e r i a l knowledge.
CHAIRMAN AND MEMBER OF SHARE : MR.NIRLMAL B.JAIN

MANAGING DIRECTOR : MR.R.VENKATARAMAN

CHIEF FINANCIAL OFFICER : MR.L.P AGGARWAL

CHIEF OPERATING OFFICER : MR.NARENDRA JAIN

Business Operation : Finance - Stock Broking

1.4 OBJECTIVES OF THE STUDY
 To study the investor behavior towards investment decision with special
reference to myfino.
 To know the awareness of various investment avenues.
 To study the reasons for selecting the investment avenues.
 To analysis the factors of investment decision.
1.5 SCOPE OF THE STUDY

 The study has been undertaken to analyse the saving pattern and investment
preferences of individual.

 The main reason behind the study is to study the demographic factors like age,
gender, income, education qualification and Employment.

 The percentage of Indian investors investing in Indian equity market is very less as
compared to the bank deposits.

 This project contains the investor’s preferences as well as the different factors that
affect investor’s decision on different investment avenues; all investors are the
individuals of Hyderabad city.

 This study includes response of investors in choosing securities in each classification

and analysis has been for the respective performance based on their returns.

 The finding relates to the out-performing products and investor’s risk taking ability
while investing in different avenues.
1.6 LIMITATIONS OF THE STUDY
The present study is concerned with the following major constraints.
 Since the present city covers only salem city, the result may not be
applicable to whole universe.
 The collected data for the present study was confined with the responses of
50 respondents. Hence result may not be an accurate one.
 The investment pattern of the investors change from time to time and this
study may not be applied for all circumstances.
 The attitude of the respondents is always not a constant one. Hence the
various opinions given by the sample respondents towards investments
may not be true

In spite of all these limitation, the present study is very much helpful for offering
suggestions and recommendations on privatization of public sector banks.
 CHAPTER-II

REVIEW OF LITERATURE

Paul A. Griffin, Ning Zhu Journal of Contemporary Accounting &

Economics, Volume 2, Issue 2, December 2006, Pages 123-150 .This paper investigates the
existence of a pre-holiday effect in the most important individual stocks of the Spanish Stock
Exchange that are also traded in both the New York Stock Exchange and the Frankfurt Stock
Exchange. Our results show high abnormal returns on the trading day prior to holidays that
are not related to any calendar anomaly. A thorough study of diverse liquidity-related
measures suggests a new explanation for the pre-holiday effect based on the reluctance of
small investors to buy on pre-holidays. The results of this paper are important for the
practitioners since we show that institutional investors could have economically exploited
this anomaly.
Vicente Meneu, Angel Pardo Journal of Empirical Finance, Volume 11,
Issue 2, March 2004, Pages 231-246 .This paper investigates the existence of a pre-holiday
effect in the most important individual stocks of the Spanish Stock Exchange that are also
traded in both the New York Stock Exchange and the Frankfurt Stock Exchange. Our results
show high abnormal returns on the trading day prior to holidays that are not related to any
calendar anomaly. A thorough study of diverse liquidity-related measures suggests a new
explanation for the pre-holiday effect based on the reluctance of small investors to buy on
pre-holidays. The results of this paper are important for the practitioners since we show that
institutional investors could have economically exploited this anomaly.
Mark A. DeWeaver, Randall Shannon Journal of Socio-Economics, Volume
39, Issue 1, January 2010, Pages 18-23. We argue that existing explanations for the stock-
market investor's disposition to “ride losers too long” are unsatisfactory because they abstract
from any role for information processing. We propose instead that the disposition effect is a
special case of “waning vigilance:” investors pay less attention to new information and
analysis when making decisions about loss makers and are therefore slower to sell them when
arguments in favor of holding cease to be valid. Results from a Thai
individual investor survey are presented as empirical evidence in support of the hypothesis
that vigilance is reduced following losses.
Cho-Min Lin, Yen-Hsien Lee, and Chien-Liang Chiu Research in International
Business and Finance, Volume 23, Issue 1, January 2009, Pages 78-89. This study
investigates the impact of the expected and unexpected trading behavior of
foreign investors on return volatilities during structural change periods. And the jump
intensity model pinpoints crucial events that have influenced the stock market. The empirical
results find that there has been a stabilizing effect of foreign investment on Taiwan's stock
market as restrictions on foreign trading have been gradually relaxed, as opposed to there
being a complete relaxation of the restrictions imposed on Qualified Foreign
Institutional Investors (QFIIs).
Kent Daniel, David Hirshleifer, and Siew Hong Teoh Journal of Monetary
Economics, Volume 49, Issue 1, January 2002, Pages 139-209. We review extensive
evidence about how psychological biases affect investor behavior and prices. Systematic
mispricing probably causes substantial resource misallocation. We argue that limited
attention and overconfidence cause investor credulity about the strategic incentives of
informed market participants. However, individuals as political participants remain subject to
the biases and self-interest they exhibit in private settings. Indeed, correcting
contemporaneous market pricing errors is probably not government's relative advantage.
Government and private planners should establish rules ex ante to improve choices and
efficiency, including disclosure, reporting, advertising, and default-option-setting regulations.
Especially, government should avoid actions that exacerbate investor biases.
Natalie Y. Oh, Jerry T. Parwada, Terry S Pacific-Basin Finance
Journal, Volume 16, Issues 1–2, January 2008, Pages 26-43. Walter. This paper
investigates the trading behavior and performance of online equity investors in comparison to
non-online equity investors in Korea. While online trading has become more prevalent in
financial markets, the role of online investors and their impact on prices has attracted little
empirical scrutiny. We study the trading activity of foreign investors, local institutions and
individual traders between 2001 and 2005 and compare their performance based on whether
or not trading is performed online. Our main finding is that in aggregate,
online investors perform poorly in comparison to non-online investors. Between investor-
types, foreigners show the best returns, followed by local institutions.
Individual investors provide liquidity to other investor-types, particularly when trading
online. On balance, the main implication of our findings is that the disadvantage suffered by
individual investors is mainly explained by their online trades.
Lalith P. Samarakoon Journal of Multinational Financial
Management, Volume 20, Issues 2–3, July 2010, Pages 93-113. Using unique trading data
for investor classes from Sri Lanka, this study finds asymmetric investor behavior between
buy side and sell side in large trades. Investors are positive feedback traders on the buy side
and contrarians on the sell side. Domestic investors exhibit more feedback and
contrarian behavior than foreign investors, suggesting that foreign investors are more
informed on the buy side and less informed on the sell side. Individuals are more feedback
and contrarian traders than institutions. Foreign institutional investor sales do not precede,
coincide with, or lead to significant returns. Trades do not lead to price momentum or
reversals, but leave a permanent positive price effect.
Jack J.W. Yang International Review of Financial Analysis, Volume 11,
Issue 4, 2002, Pages 533-547. This paper examines the information spillover between stock
returns and the trading behavior of Taiwan's institutional investors. Institutional investors in
Taiwan are classified into three categories: foreign institutional investors (a combination of
QFII, qualified foreign institutional investors, and foreign mutual funds), domestic mutual
funds, and security dealers. Using a vector autoregressive model for July 4, 1996–May 4,
1999, the findings indicate that none of them influences the stock returns. However, foreign
institutional investors adopt a “contrarian” trading strategy, which serves as a market-
stabilizing mechanism. It seems that the open-door and institutionalization policies should be
maintained and even broadened by local authorities.
 CHAPTER-III
RESEARCH METHODOLOGY

MEANING:

Research methodology is the way to solve the research problems. It may be

understood as a science of studying how research is done scientifically primary and
secondary data were made use of along with data collection are alone through questionnaire
and internet.

3.1 RESEARCH DESIGN

Research is the systematic and logical study of an issue or a problem to arrive at

accurate results. Research the job of collecting, recording and analyzing relevant data to
arrive at decisions. The present study is a systematic, objective and exclusive search for
studies of the facts relevant to a problem in the field of marketing. The search for the fact
may be through either(1)Unscientific method (2)scientific method

DESCRIPTIVE RESEARCH:

The study comes under the Descriptive research includes survey and fact finding
enquired of different kinds the major purpose of descriptive research is the descriptive of the
state of affairs as it exists at present.

3.2 SAMPLE DESIGN

Sample design depends on the researches objective and the nature of problem
samples are selected by using simple random sampling method.
3.3 DATA COLLECTION

Data constitute the foundation of the research. Hence the first step was to gather the
required data. The study was conduct at Myfino payment ,the data or information collected
from the various sources were divided in to two parts.

 Primary Sources
 Secondary Sources
PRIMARY DATA
The primary data means directly collected by the researcher himself or by investigator
appointed by him from the original sources.
QUESTIONNAIRE
A questionnaire is a printed list of question related to particular enquiry.
SECONDARY DATA
The secondary data is information which already exists. The secondary data was
collected from journals, magazines, books. The research specific information was less
available more emphasis was given on primary data.
SAMPLING UNIT
One of the unit in to which an aggregate is divided or regulated as divided for the
purpose of sampling.
SAMPLE SIZE
The Sample of 50 respondents was selected using simple random sampling method.

TOOLS USED FOR ANALYSIS

The following tools are used for interpretation.

 Percentage Analysis
 Chi – Square Test
 Correlation

SIMPLE PERCENTAGE METHOD

One of the tools used for analyzing the data is percentage method. Percentage
refers to a special kind of ratio, which is used to describe relationships. Percentage
reduces everything to a common base and there by allows a meaningful comparison to be
made.

CHI – SQUARE TEST

Chi – square test is applied in statistics to test the goodness of fit to verify the
distribution of observed data with assumed theoretical distribution. Therefore, it is a measure
to study the divergence of actual and expected frequencies. It has great use in statistics.
Especially in sampling studies, where we expect a doubted coincidence between actual and
expected frequencies and the extent to which the difference can be ignored because of
fluctuations in sampling.

If there is no difference between the actual and expected frequencies 2 is zero. Thus,
the chi-square test describes the discrepancy between theory and observation.
The 2 may be defined as

2 =  (O – E)2
E

O = Observed frequencies
E = Expected frequencies

Degrees of freedom = (R-1) (C-1)

Where
O = Observed frequency
E = Expected frequency
R = No. of rows
C = No. of columns
The expected frequency is calculated by using the following formula

E =
Row Total x Column Total
Grand Total

Grand Total
CORRELATION
Karl Pearson’s coefficient of correlation is the most widely used method of measuring
the degree of relationship between two variables. Karl Pearson’s coefficient of correlation
formula comes below
∑XY

∑(X) 2 ∑ (Y) 2

The correlation analysis studies the joint variation of two or more variables for
determining the amount of correlation between two or more variables. Karl Pearson’s
coefficient of correlation (or simple correlation) is the most widely used method of measuring
the degree of relationship between two variables. This coefficient assumes the following.
 That there is linear relationship between two variables.
 That the variables are casually related which means that one of hte variables is
independent and the other one is dependent; and
 A large number of independent causes are operating in both variables so as to
produce a normal distribution.

Karl Pearson’s coefficient of correlation is also known as the product moment correlation.
The value of ‘r’ lies between +1. Positive values of r indicate positive correlation between the
two variables (i.e., changes in both variables take place in the statement direction), whereas
negative values of ‘r’ indicates negative correlation i.e., changes in the two variables taking
place in the opposite directions. A zero value of ‘r’ indicates that there is no association
between the two variables. When r = (+) 1, it indicates perfect positive correlation and when
it is (-)1, it indicates perfect negative correlation, meaning thereby that variations in
independent variable (X) explain 100% of the variations in the dependent (Y). We can also
say that for a unit change in independent variable, if there happens to be a constant change in
the dependent variable in the same direction, then correlation will be termed as perfect
positive. But if such change occurs in the opposite direction, the correlation will be termed as
perfect negative. The value of ‘r’ nearer to +1 to -1 indicates high degree go correlation
between the two variables.
 APPENDIX
A STUDY ON INVESTOR BEHAVIOUR TOWARDS INVESTMENT DECISION WITH
SPECIAL REFERENCE TO MYFINO PAYMENT.

Personal details
(Personal details are kept highly confidential; these details will not be revealed to any third
party)
Name: _________________________________________
Designation: ___________________________
Organization: ___________________________________
1. Age Group
o Below 20
o Between 20 – 30
o Between 30 – 40
o Above 40

2. Qualification:
o H.Sc
o Under Graduate
o Post graduate
o Other: ______________________

3. Occupation:
o Salaried
o Business
o House wife
o Student
o Professional
o Retired
o Other: _____________________________

4. Annual income:
o Below Rs.200000
o Rs. 200000 – Rs. 400000
o Rs.400000 – Rs. 600000
o Above Rs. 600000
5. Do you have a financial advisor?
o Yes
o No

6. What best describes your investment experience?

o Beginning
o Moderate
o Knowledgeable
o Experienced

7. Are you aware of the following investment avenues?

Safe/ low Risk Investment Avenues:
o Savings account
o Bank fixed deposits
o Pubic provident fund
o National savings certificccates
o Post office savings
o Government securities

Moderate Risk investment Avenues:

o Mutual funds
o Life insurance
o Debentures
o Bonds

High Risk Investment Avenues:

o Equity share market
o Commodity market
o FOREX market

Traditional Investment Avenues:

o Real estate
o Gold / silver
o Chit funds

Emerging Investment Avenues:

o Virtual real estate
o Hedge funds
o Private equity investment
o Art and passion
8. What do you think are the best option for investing your money?
o Safe/ low Risk Investment Avenues
o Moderate Risk investment Avenues
o High Risk Investment Avenues
o Traditional Investment Avenues
o Emerging Investment Avenues

9. Reasons for selecting these options:

o Moderate Risk
o High Risk
o Low Risk

10. In which sector do you prefer to invest your money?

o Private sector
o Government sector
o Public sector
o Foreign sector

11. What are your savings objectives?

o Children’s Education
o Retirement
o Home Purchase
o Children’s Marriage
o Healthcare
o Other________________________________________

12. What is your investment objective?

o Income and capital preservation
o Long- term Growth
o Growth and income
o Short- term Growth
o Others------------------------------------------------------------------------------------

13. What is the purpose behind investment?

o Wealth creation
o Tax saving
o Earn returns
o Future Expenses
o Others-------------------------------------------------------------------
14. Have you set aside funds specifically for the education and marriage of your children?
If yes please give amounts and how the founds are held
o Education : Amount Rs.----------------------- invested in
-----------------------
o Marriage : Amount Rs.----------------------- invested
in-----------------------

15. Do you have a formal budget for family expenditure?

o Yes
o No

16. Do you having a savings and investment target amount you aim for each year?
o Yes if yes : Amount------------------------------------------------------
o No

17. At which rate do you want your investment to grow?

o Steadily
o At an Average Rate
o Fast

18. Which factors do you consider before investing?

o Tata benefits
o Convenience
o Capital appreciation
o Dividend
o Liquidity
o Safety

19. Do you invest your money in share market?(through a DEMATA A/C)

o Yes
o No

If yes: imagine that stock market drops after invest in it then what will you do?
o Withdraw your money
o Wait to increase
o Invest more in it

20. How often do you monitor your investment?

o Daily
o Monthly
o Occasionally
21. What percentage of your income do you invest?
o 0-15%
o 15-30%
o 30-50%

22. What is the time period you prefer to invest?

o Short-term(0-1yrs)
o Medium- term(1-5yrs)
o Long-term(>5yrs)

23. Can you take the risk of losing your principal investment amount?
o Yes
o No if yes :what percentage--------------------------------

24. What is your source of investment advice?

o Newspapers
o News channels
o Family or friends
o Books
o Internet
o Magazines
o Advisors
o Certified market professional/ financial planners