ONLINE TRADING Services of HDFC Securities Limited By Chitta Rama Krishna Objective
The main objective of the project is to understand online trading of Shares and the services provided by the custodian HDFC Securities Limited. Guides of this project
Mentor : Director and Principal Madam Preethi Chrysolite
Support : Head of the department for Management Madam Suhasini We are very much thankful to them for their guidance and support for this project. Abstract
In this project we discussed about the share market, Online trading and the services provided by the custodian HDFC Securities Limited.
We discussed in brief about the required terminology in the share market.
We discussed about the influences on share prices movement.
We briefed about the technical analysis of share market.
We discussed about the Advantages and disadvantages of the online trading.
We focused on the major custodians in India, International Stock exchange indices, sectoral indices, sources of information.
We discussed about the Do¶s and don¶ts given by Securities Exchange Board of India (SEBI)
Site map of HDFC Securities Limited
Briefed the procedure of trading of shares online through HDFC Securities Limited.
Displayed the portfolio of the presenter. As this is not a research project, hence, project design not mentioned., and there is no sampling technique used. It is an knowledge gaining project on online trading. Abstract
This project describes,
Share market, Online trading, services by HDFC Securities Limited Basic terminology Do¶s & Do not¶s given by SEBI Stock Exchanges, Different indexes, different sectors, etc. Factors influencing share price movement ONLINE TRADING
Online trading means trading of shares on Internet.
The Internet is a global system of interconnected computer networks that use the standard Internet Protocol Suit (TCP/IP) to serve billions of users worldwide. It is a network of networks that consists of millions of private, public, academic, business, and government networks, of local to global scope, that are linked by a broad array of electronic, Advantages of Online Trading
Speedy execution: It allows very fast execution, measured in terms of milli seconds. Cost reduction: Transaction costs are lower for trade executed with a direct access brokerage. Paperless Transaction: your share certificates get deposited in electronic form (DMAT) in your web trade account. Orders can be also placed offline during non-market hours. There is no limit to information available online in sites For NRIs this is the easiest option to invest in Indian markets. Record of all transactions are available at your fingertips. The overwhelming advantage of online share trading is convenience. While normally, you deal with a broker and own paper shares, with online trading everything is very simple, fast, and efficient and effective. Real time stock trading without calling or visiting broker's office. Display real time market watch, historical data, graphs etc Investment in IPO's, Mutual Funds and Bonds. Check the trading history; demat account balance and bank account balance at any time. Provide online tools like market watch, graphs and recommendations to do analysis of stocks. Place offline orders for buying or selling stocks. Set alert to inform you certain activity on the stock through email or sms. Customer service through Email or Chat. Secure transactions. Disadvantages of Online Trading
Website performance - sometime the website is too slow or not enough user friendly. Little long learning curve especially for people who doesn't know much about computer and internet. The fees involved in trading vary considerably with broker, market, ECN and type of trading account and software. Some online brokers may also charge inactivity fees on traders.
Traders need to have internet and computer in their home, because threat of information theft exists if he access at internet cafes Volume Requirement: Some firms charge inactivity fees if a minimum monthly trading volume has not been met. Knowledge: New and inexperienced traders may find it difficult to become familiar with direct access trading. Knowledge is required when dealing with something like making trade decisions & order routing Share Market
Stock Exchange
SEBI Custodians control
Broker Bank Account
Trader Stock Exchange
Stocks (Shares, equity) are traded in stock exchange. India has two big stock exchanges (Bombay Stock Exchange - BSE and National Stock Exchange - NSE) and few small exchanges like Jaipur Stock Exchange etc. visit www.chittorgarh.com to see the list of Stock Exchanges in India Investor can trade stocks in any of the stock exchange in India BSE Vs NSE BSE NSE Index Sensex NIFTY Started at 1986 1992 Base year 1978 ± 79 1995 No. of Companies 5034 1552 No. Index movers 30 50 Location Mumbai New Delhi Calculation Free float market capital Free Float Market capital method
Base value 100 100 Indices in BSE , NSE
BSE NSE
SENSEX S&P CNX NIFTY BSE 100 BSE 200 BSE 500 CNX NIFTY JUNIOR BSE Mid Cap Index BSE Small Cap Index CNX 100 Sectoral Indices S&P CNX 500 BSE Auto BSE Bankex CNX MIDCAP BSE Capital Goods Consumer Durables FMCG Health Care NIFTY MID CAP 50 IT Metal S&P CNX DEFTY Oil & Gas Power PSU Realty CNX IT TEC k BANK NIFTY Dollar Linked Indices Dollex 30 CNX INFRA Dollex 100 CNX REALTY Dollex 200 International Market Indices
USA - NASDAQ, S & P 500, Dowjones Ind.Avg Singapore - Straight Times Hong Kong - Hangseng Japan - Nikkei 225 Germany - DAX United Kingdom- FTSE 100 China - SSE 180 Composite Index (Shanghai) Stock Trading
Stock Trading Traditionally stock trading is done through stock brokers, personally or through telephones. As number of people trading in stock market increase enormously in last few years, some issues like location constrains, busy phone lines, miss communication etc start growing in stock broker offices. Information technology (Stock Market Software) helps stock brokers in solving these problems with Online Stock Trading. Online Stock Market Trading is an internet based stock trading facility. Investor can trade shares through a website without any manual intervention from Stock Broker. In this case these Online Stock Trading companies are stock broker for the investor . They are registered with one or more Stock Exchanges. Mostly Online Trading Websites in India trades in BSE and NSE. Types of Stock trading online 1. Installable software based Stock Trading Terminals 2. Web (Internet) based trading application Custodian
What Does Custodian Mean? A financial institution that has the legal responsibility for a customer's securities. This implies management as well as safekeeping.
There are 345 custodians existing in India. Some major Custodians in India
HDFC Securities Ltd. Share Khan Limited SBI Cap Securities Limited ICICI Securities Limited Karvy Stock Broking Ltd. TATA Securities Ltd. Broker
What Does Broker Mean? 1. An individual or firm that charges a fee or commission for executing buy and sell orders submitted by an investor. 2. The role of a firm when it acts as an agent for a customer and charges the customer a commission for its services. 3. A licensed real estate professional who typically represents the seller of a property. A broker's duties may include: determining market values, advertising properties for sale, showing properties to prospective buyers, and advising clients with regard to offers and related matters. Bear and Bulls
A bear market is a general decline in the stock market over a period of time. It is a transition from high investor optimism to widespread investor fear and pessimism.
A bull market is associated with increasing investor confidence, and increased investing in anticipation of future price increases (capital gains). A bullish trend in the stock market often begins before the general economy shows clear signs of recovery Influences on share prices
Company profile and Performance History Trend in the share price for certain period Natural calamities, national and international Political issues Government policies, subsidies, sops, ex-im policies EPS, PE Ratio, Profit%, Quarterly, half yearly, yearly results Budget allocations to the particular sector Effect of international policies Foreign Investments Bulk Deals Supply & Demand ± More sales low price, More purchases high price Seasonal agriculture yield Seasonal demand of goods Market sentiments Speculation by Bulls and Bears. Sectoral Indices
Automobile IT Bankex Consumer durables FMCG Oil & Gas PSU Reality Health Care Metal Telecommunication Power Consumer Goods Sources of Information
News Papers - Economic Times Finance columns of Eenadu and other news papers. Internet websites - Rediff money, Google finance, Economic Times, Bazaar Trend, and websites of custodians. Television - ET Now, ND TV Profit, HM TV, etc. Technical Analysis
Dependent on Intuition Analysis of Data and Interpretation Analysts interpret price charts depending on Analysts rely on complex calculations of the pattern of movement - head-and- numbers, to crunch raw price and volume shoulders patterns, double-bottoms, flags and data. After this analysis process, the pennants etc. These patterns are used by secondary indicators, i.e., oscillators, moving averages, bands, etc, are calculated and used analysts to predict share price movements. to spot buying or selling opportunities. Analysts use software, scientific methods, complex equations and complex mathematical formulas to derive indicators. Bollinger Bands Exponential Moving Averages Envelopes (5%) Parabolic SAR Simple Moving Averages Do¶s & Dont¶s by SEBI SEBI has laid down certain Guidelines for Dealing with Brokers & Sub-brokers Do¶s Don¶ts
Here are the DOs Watch out for the DON¶Ts Deal only with SEBI-registered brokers/sub-brokers. Don¶t deal with unregistered broker/sub-broker Ensure that the broker/sub-broker has a valid SEBI registration Don¶t pay more than the approved brokerage to the intermediary. certificate. Don¶t undertake deals on behalf of others. Ensure that the broker/sub-broker is permitted to transact in the market. Don¶t neglect to set out in writing orders for higher value given earlier State clearly to the broker/sub-broker who will be placing orders on over the phone. your behalf Don¶t sign blank delivery instruction slip(s) while meeting security pay- Insist on client registration form to be signed by the broker/sub-broker in obligation before commencing operations. Don¶t accept unsigned/duplicate contract note/confirmation memo Enter into an agreement with your broker/sub-broker setting out the Don¶t accept contract note/confirmation memo signed by any terms and conditions clearly. unauthorised person. Insist on contract note/ confirmation memo for trades done each day Don¶t delay payment/deliveries of securities to the broker/ sub-broker. Insist on bill for every settlement. Don¶t get carried away by luring advertisements Ensure that broker¶s name, trade time and number, transaction price and Don¶t be led by market rumours or get into shady transactions brokerage are shown distinctly on the contract note. All the best in your Stock market Trading endevour Insist on periodical statement of accounts. Issue cheques/drafts in trade name of the broker only. Ensure receipt of payment/ deliveries within 48 hours of payout In case of disputes, file written complaint to the broker/sub-broker, to the stock exchange of which he is a member and to SEBI within a reasonable time. In case of sub-broker disputes, inform the main broker about the dispute within a maximum of 6 months. Familiarise yourself with the rules, regulations and circulars issued by the stock exchanges/SEBI before carrying out any transactions. HDFC Securities Limited
HDFC securities Ltd, a trusted financial services intermediary is a subsidiary of India's respected private sector Bank - HDFC Bank. A leading stock broking company having completed 10 years in operation, serves a diverse customer base of retail and institutional investors. Discerning investors experience a robust platform to trade in Equities, derivatives, currency futures and mutual funds through both NSE & BSE and other investment options like IPO's, bonds, corporate fixed deposits,insurance etc. Investors are also provided with niche - Equity Investment advise and execution platform with superior technology aid and unbiased research across sectors, economy and scrips. Our webportal is designed to meet the requirements of everyone from a beginner to a savvy and well- informed trader with highest service standards,convenience and hassle-free trading tools. The Webportal aims to provide a one stop window for all financial needs with seamlessness and customer centric services HDFC Securities Limited
WEBPORTAL Based on Web 2.0 technology. SPEED State-of-the art technology enabling seamless trading experience on both the exchanges BSE and NSE.
Clients could adopt to trade with us either online, or on the phone, or relationship managers from the convenience of their home or office. The 4-in-1 Advantage account enables clients to seamlessly move funds and securities across your bank, demat and trading account. Clients get to enjoy limits across exchanges to trade No need to issue cheques or delivery instructions. Place IPO / NCD applications via few clicks using the trading account or by the phone. No standing in queues or filling application forms. ASBA application facility. Customer care centre to address all queries and grievances. HDFC Securities Limited
REACH HDFC securities has a strong unified call centre catering to clients across India and overseas aiding clients who wish to have their orders placed by a tele-agent. 7 Regional language call centre facility is available for clients. Over 128 exclusive branches across India also service clients locally by dedicated relationship managers.
TRANSPARENCY With our trusted pedigree, a client can be assured of best services in a transparent manner and is in total control of their funds and stocks.
EXPERTISE With a decade of experience and a rating of A1+1, HDFC securities has a admired lineage of providing financial services to customers in a transparent and trusted manner. We have a dedicated, motivated and experienced team of professionals to provide you top class service.
TIMELY AND RELEVANT INFORMATION We realize the importance of making information available to clients as it happens. Empowered with the latest news, developments and unbiased research, enables a client to take informed decisions.
YOUR INTEREST For HDFC securities, client's interest comes first. We endeavor to provide high quality investment services, in a simple, direct and cost-effective manner to help you achieve your financial goals. HDFC Securities Limited
OUR OFFERINGS' ONE STOP SHOP, FOR ALL YOUR INVESTMENT NEEDS
Equity and Derivatives IPO Mutual Fund Fixed Deposits Non Convertible Debentures General Insurance Life Insurance Bonds Currency Derivatives PMS REGISTERED OFFICE / CORPORATE OFFICE HDFC Securities Limited Office Floor 8, "I THINK" Bldg, Jolly Board Campus, Kanjurmarg (East), Mumbai - 400042. India. Tel : 022 - 30753400 Fax : 022 -30753435 HDFC Securities Limited
Resident Account Opening
To Open An Account :- Step 1: Fill the online application form, or you may call us on our toll-free number at 1800-209-9700 or on 91-22-61411700 Step 2: Keep the minimum essential documents ready and our representative will contact you and come over to collect these, and complete the application formalities.
Step 3: Within two weeks of submitting the form you shall receive your online trading login and password and can start trading online right away.
Trading online procedure
Login
Buy transactions Sell transactions
System checks buying limits System checks DP Account Quantity
Orders Accepted Orders accepted Rejected orders will be communicated along with reasons
Order is transmitted to exchange for execution
Amount will be deducted/deposited in Execution is displayed on the the screen immediately traders bank account
Confirmation could be sent to traders Contract note would sent to trader by e-mail and mobile mail or hand delivery. The information of services available to the online trader.
Buy & Sell Place your equities or derivative orders.
Order Book View the list and current statuses of the orders you have placed during the day but which have not been traded in the exchange as yet.
Trade Book View the list of orders that have been traded during the day.
Quotes Retrieve the latest quotes and other vital trading information for the stock of your choice.
Place and release fund holds from your Bank accounts to cover the cash or margin trades you make. Funds Hold/Release A funds hold is a block made in your HDFC Bank account exclusively for trading purposes. Once a funds hold is created, the hold amount cannot be used for purposes other than trading.
Place and release holds from your HDFC Bank demat accounts when you need to sell shares. Securities Hold/Release A securities hold is a block made in your HDFC demat account exclusively for trading purposes. Once a securities hold is created, the quantity on hold cannot be used for purposes other than trading.
Option Calculator Use this calculator to determine the theoretical premium for option contracts.
Cost of Carry For futures contracts, use this tool to calculate the storage cost and the interest paid to finance the underlying asset. Calculator
Password Update your login password from here. References
www.nseindia.com www.bseindia.com www.rediff.com/money www.hdfcsec.com www.investopedia.com A book on Fundamentals of Investments by Gordon. Alexander, William F.Sharpe & Jeffery V. Bailey Conclusion
Online trading is a great experience by the trader to buy and sell shares online. But, trader must be aware of internet usage, beware of phishing, hacking, maintain secrecy of passwords, have their own set up of computer with internet communications. Trader holding a PAN Card is mandatory for trading. HDFC Securities online trading is continuously improving their services and modifying their website to become more user friendly to the trader. This website gives us a clear picture of trend in share price movements of each and every scrip to enable us to make a correct decision. Online trading facilitates the trader to have a convenient trading, fast, reliable, and informative experience. Online trading is environmental friendly, because, there is no paper work involved in the 90% of online trading. Thank you