A STUDY ON

PORTFOLIO PERFORMANCE ANALYSIS IN SHAREKHAN LIMITED

A Project Report in partial fulfillment of the requirement for the award of

MASTER OF BUSINESS ADMINISTRATION

SUBMITTED BY

S.ASHOK

Ht.No:-(00142-08-115)

UNDER THE GUIDANCE OF

Mr.K.Rajashekar Reddy

Department of MANAGEMENT STUDIES(FINANCE)

PRAGNA POST GRADUATE COLLEGE

(Approved by AICTE and Affiliated to Osmania University)
SEETHARAMPET, IBRAHIMPATNAM,
2008-2010

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 DECLARATION

I hereby declare that project report titled "A STDUY ON PORTFOLIO PERFORMANCE
ANALYSIS AT SHAREKHAN LIMITED” has been undertaken and submitted by me to the
department of management studies,PRAGNA PG COLLEGE, and i also declare that the project
report is a result of my own effort and that has not been copied from any one and has not been
submitted by anybody in any other University/ Institution for the award of any other
degree/diploma/ certificate or published any time before.

Name and Address of the Student Signature of the Student

S.ASHOK S.ASHOK
H.No:-3-24, (Ht.No-142-08-115)
MANDAL:-MANCHERIAL,
VILLAGE:-SEETHARAMPALLY,
DIST:-ADILABAD-504302.

ACKNOWLEDGEMENT
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 I would like to thanks to our college principal Dr.K.MADHAVA RAO and other
professors for having given me the opportunity to work on this project. It is indeed a great pleasure
and a matter of immense satisfaction for me to express my deep sense of gratitude and indebtness to
(Head of Department of Business Administration) and my college lecturers for the continuous
support they have given me.

I would also like to take this opportunity to express my deep and sincere gratitude to the
management of SHAREKHAN LIMITED for allowing me to undertake this project and its various
employees who lent their hand towards the completion of this study

I am thankful to Mr.CH.SRINIVAS REDDY(Regional sales manager) for allowing me to

carry out my project work in the organization for apprising me of the situation with necessary back
up

I would like acknowledge, my sincere thanks to all the executive at SHARE KHAN, HYD
who have extended helping hand in giving the information and being a part of the study

S.ASHOK

Ht.No:-(00142-08-115)

LIST OF FIGURES
S.NO NAME OF THE FIGURES PAGE NO

1. RISK -RETURN 13

2. DAILY PRICE MOVEMENT OF RELIANCE INDUSTRIES

FOR THE MONTH OF FEB2010 25

3. DAILY PRICE MOVEMENT OF RELIANCE INDUSTRIES

FOR THE MONTH OF MAR2010 27

4. DAILY PRICE MOVEMENT OF ITC LTD

FOR THE MONTH OF FEB2010 29

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5. DAILY PRICE MOVEMENT OF ITC LTD
FOR THE MONTH OF MAR2010 31

6. DAILY PRICE MOVEMENT OF BHARTHI AIRTEL

FOR THE MONTH OF FEB2010 33

7. DAILY PRICE MOVEMENT OF BHARTHI AIRTEL

FOR THE MONTH OF MAR2010 35

8. DAILY PRICE MOVEMENT OF TCS

FOR THE MONTH OF FEB2010 37

9. DAILY PRICE MOVEMENT OF TCS

FOR THE MONTH OF MAR2010 39

10. DAILY PRICE MOVEMENT OF HUL

FOR THE MONTH OF FEB2010 41

11. DAILY PRICE MOVEMENT OF HUL

FOR THE MONTH OF MAR2010 43

12. DAILY PRICE MOVEMENT OF ICICI

FOR THE MONTH OF FEB2010 45

13. DAILY PRICE MOVEMENT OF ICICI

FOR THE MONTH OF MAR2010 47

14. DAILY PRICE MOVEMENT OF L&T

FOR THE MONTH OF FEB2010 49

15. DAILY PRICE MOVEMENT OF L&T

FOR THE MONTH OF MAR2010 51

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 LIST OF TABLES
S.NO NAME OF THE TABLE PAGE NO

1.Return, Variance, Standard Deviation of

Reliance Industries for the month of February-2010 24

2.Return, Variance, Standard Deviation of Reliance

Industries for the month of March-2010 26

3. Return, Variance, Standard Deviation of

ITC ltd. for the month of February-2010 28

4. Return, Variance, Standard Deviation of

ITC ltd. for the month of March-2010 30

5. Return, Variance, Standard Deviation of BHARTI

for the month of February-2010 32

6. Return, Variance, Standard Deviation of BHARTI

for the month of March-2010 34

7. Return, Variance, Standard Deviation of TCS

for the month of February- 2010 36

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8. Return, variance, standard deviation of TCS
for the month of March-2010 38

9. Return, Variance, Standard Deviation of HUL

for the month of February-2010 40

10. Return, Variance, Standard Deviation of HUL

for the month of March-2010 42

11. Return, Variance, Standard Deviation of I

CICI for the month of February-2010 44

12. Return, Variance, Standard Deviation of ICICI

for the month of March-2010 46

13. Return, Variance, Standard Deviation of L&T

for the month of February-2010 48

14. Return, Variance, Standard Deviation Of

L&T for The Month Of March-2010 50

15. Return variance and standard deviation Reliance, ITC,

BHARTI, TCS, HUL and
ICICI for the period of February-2010 52

16. Return variance and standard deviation Reliance, ITC,

BHARTI, TCS, HUL and
ICICI for the period of March -2010 53

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 TABLE OF CONTENTS

S. NO. TITLE PAGE NO.

CHAPTER I

1 INTRODUCTION 1-3

CHAPTER II

2 REVIEW OF THE LITERATURE 4-20

CHAPTER III

3 COMPANY PROFILE 21-23

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CHAPTER IV

4 DATA ANALYSIS AND INTERPRETATION 24-51

CHAPTER V

5 CONCLUSIONS AND SUGGESSTIONS 52-54

BIBLIOGRAPHY 55

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1.1 INTRODUCTION

A portfolio is a collection of investments held by an institution or a private individual.

In building up an investment portfolio a financial institution will typically conduct its own
investment analysis, whilst a private individual may make use of the services of a financial
advisor or a financial institution which offers portfolio management services. Holding a
portfolio is part of an investment and risk-limiting strategy called diversification. By owning
several assets, certain types of risk (in particular specific risk) can be reduced. The assets in
the portfolio could include stocks, bonds, options, warrants, gold certificates, real estate,
futures contracts, production facilities, or any other item that is expected to retain its
value.

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 Portfolio management involves deciding what assets to include in the portfolio,
given the goals of the portfolio owner and changing economic conditions. Selection
involves deciding what assets to purchase, how many to purchase, when to purchase
them, and what assets to divest. These decisions always involve some sort of performance
measurement, most typically expected return on the portfolio, and the risk associated with
this return (i.e. the standard deviation of the return). Typically the expected returns from
portfolios, comprised of different asset bundles are compared.The unique goals and
circumstances of the investor must also be considered. Some investors are more risk averse
than others. Mutual funds have developed particular techniques to optimize their portfolio
holdings.

Thus, portfolio management is all about strengths, weaknesses, opportunities and threats in
the choice of debt vs. equity, domestic vs. international, growth vs. safety and numerous other
trade-offs encountered in the attempt to maximize return at a given appetite for risk.

1.2 OBJECTIVES OF THE STUDY

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 o To Study portfolio performance analysis.
o To Study the return and average return of portfolio Structure.
o To study the performance by meaning its risk through Standard deviation.
o To study the range of difference for the returns.

1.3 SCOPE OF THE STUDY

Study is limited to the calculation of risk and return of 7 companies’ equities. The
companies are:

1. Reliance Industries

2. Bharti Airtel

3. TCS

4. ITC

5. L & T

6. ICICI

7. HUL

1.4 RESEARCH METHODOLOGY [ DATA COLLECTION]

SOURCES OF DATA :

The research can call for gathering secondary data, primary data or both. Secondary

data consists of information that already exists somewhere, having being collected for

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another purposes and primary data consists to original information gathered for the

specific purpose.

Data collection is very essential to study the information fact and figure that are
directly related to the problem that have being formulated. The kinds of data that has

1. PRIMARY DATA COLLECTION:

Data collected from the members of Sharekhan Limited.

This data is collected from the office getting interaction with the clients at the office.

2. SECONDARY DATA COLLECTION:

Data provided by Sharekhan Limited Project Guide member as part of the class
undertaken.

Data collected from newspaper & magazines.

Data obtained from the company journals, websites, and various books.

Formulae used for Data Analysis:

1. Return = Ve - Vb

______

Vbe

Ve = Value at the end

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 Vb = Value at the beginning

Range =Maximum value-Minimum value

2. Variance (σ2) = Σ (x-µ) 2

1.5 LIMITATIONS OF THE STUDY

1. The Study is limited to a period of 45 days.

2. The closing price of the scripts is taken from NSE only.
3. The Study is confined to 7 companies only.
4. The Study is based on the measurement of average return and risk only.

2.1 REVIEW OF THE LITERATURE

An Innovative Approach to Portfolio Management. Blending the Most Profitable Aspects of

Analytical and Quantitative.

Professional acclaim for Active Portfolio Management, 2nd edition. "Active Portfolio
Management is a unique reference for understanding the source of value-added by a money
manager. I am an enthusiastic supporter of the methodology used in the book, and I highly
recommend it to both the professional and academic communities."

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 -Professor William N. Goetzmann, Director, International Center for Finance, Yale
University School of Management.

"This edition of Active Portfolio Management continues the standard of excellence

established in the first edition, with new and clear insights to help investment professionals."
-William E. Jacques, Partner and Chief Investment Officer, Martingale Asset Management.

"Active Portfolio Management offers investors an opportunity to better understand the

balance between manager skill and portfolio risk. Both fundamental and quantitative investment
managers will benefit from studying this updated edition by Grinold and Kahn."

-Scott Stewart, Portfolio Manager, Fidelity Select Equity ® Discipline, Co-Manager,

Fidelity Freedom ® Funds.

"This second edition will not remain on the shelf, but will be continually referenced by Both
novice and expert. There is a substantial expansion in both depth and breadth on the original. It
clearly and concisely explains all aspects of the foundations and the latest thinking in active
portfolio management."

-Eric N. Remole, Managing Director, Head of Global Structured Equity, Credit Suisse
Asset Management.

"Active Portfolio Management, Second Edition, remains a readable yet theoretically and
mathematically rigorous book that one would expect from two such distinguished authors. I heartily
recommend this book to any practitioner who wants to refine his or her knowledge of state-of-the-
art quantitative money management or who would like a straightforward reference to quickly
answer those thorny theoretical questions that hit us now and again."

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 -Michael Even, Managing Director and Chief of Global Quantitative Analysis, Citibank
Global Asset Management.

"A more comprehensive examination of quantitative techniques for portfolio management

would be hard to find. Active Portfolio Management is an outstanding treatise on the methods and
techniques of measuring performance and risk control that is both rigorous and understandable."

-Jon A. Christopherson, Research Fellow, Frank Russell Company

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2.2 ABOUT THE PORTFOLIO MANAGEMENT

PORTFOLIO:

A Portfolio is a collection of securities. Since it is rarely desirable to invest the entire

funds of and individual or an institution in a single security, it is essential that every security

be viewed in a portfolio context. Thus it seems logical that the expected return on a

portfolio should depend on the expected return of each of the security contained in the

portfolio.

Portfolio analysis considers the determination of future risk and return in holding

various blends of individual securities. Portfolio expected return is a weighted average of

the expected return of individual securities but portfolio variance, in short contrast. Can be

something less than a weighted average of security variances? As a result an investor can

sometimes reduce portfolio risk by adding security with greater individual risk than other

security in the portfolio. This is so because risk depends greatly on the co-variance among

returns of individual securities. Portfolios, which are combinations of securities, may or may

not take on the aggregate characteristics of their individual parts.

Since portfolio's expected return is a weighted average of the expected returns of

its securities, the contribution of each security to the portfolio's expected returns depends

on its expected returns and its proportionate share of the initial portfolio's market value. It

follows that an investor who simply wants the greatest possible expected return should

hold one security; the one, which is considered to have a greatest, expected return. Very

few investors do this, and very few investments advisers would counsel such an extreme

policy. Instead, investors should diversify, meaning that their portfolio should include more

than one security.

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SCHEMATIC DIAGRAM OF STAGES IN PORTFOLIO MANAGEMENT

Specification
and
quantification
of investor Monitoring
objectives, investor related
constraints,

Portfolio policies
and strategies Portfolio
Attainment
construction and
of investor
revision asset
objectives
allocation, portfolio
Capital market optimization,
expectations security selection,
implementation Performance

Relevant
Monitoring
economic,
economic and
social, political
market input
sector and
security
considerations

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PROCESS OF PORTFOLIO MANAGEMENT:

The Portfolio Program and Asset Management Program both follow a disciplined
process to establish and monitor an optimal investment mix. This six-stage process helps
ensure that the investments match investor’s unique needs, both now and in the future.

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1. IDENTIFY GOALS AND OBJECTIVES:
When will you need the money from your investments? What are you saving your
money for? With the assistance of financial advisor, the Investment Profile
Questionnaire will guide through a series of questions to help identify the goals and
objectives for the investments.

2. DETERMINE OPTIMAL INVESTMENT MIX:

Once the Investment Profile Questionnaire is completed, investor’s optimal

investment mix or asset allocation will be determined. An asset allocation represents
the mix of investments (cash, fixed income and equities) that match individual risk and
return needs.

This step represents one of the most important decisions in your portfolio
construction, as asset allocation has been found to be the major determinant of long-
term portfolio performance.

3 CREATE A CUSTOMIZED INVESTMENT POLICY STATEMENT

When the optimal investment mix is determined, the next step is to formalize our
goals and objectives in order to utilize them as a benchmark to monitor progress and
future updates.

4. SELECT INVESTMENTS

The customized portfolio is created using an allocation of select QFM Funds. Each
QFM Fund is designed to satisfy the requirements of a specific asset class, and is
selected in the necessary proportion to match the optimal investment mix.

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 5 MONITOR PROGRESS

Building an optimal investment mix is only part of the process. It is equally important
to maintain the optimal mix when varying market conditions cause investment mix to
drift away from its target. To ensure that mix of asset classes stays in line with investor’s
unique needs, the portfolio will be monitored and rebalanced back to the optimal
investment mix

6. REASSESS NEEDS AND GOALS

Just as markets shift, so do the goals and objectives of investors. With the flexibility of
the Portfolio Program and Asset Management Program, when the investor’s needs or
other life circumstances change, the portfolio has the flexibility to accommodate such
changes.

OBJECTIVES OF PORTFOLIO MANAGEMENT

The basic objective of Portfolio Management is to maximize yield and minimize risk. The
other ancillary objectives are as per needs of investors, namely:

Regular income or stable return

Appreciation of capital

Marketability and liquidity

Safety of investment

Minimizing of tax liability.

NEED FOR PORTFOLIO MANAGEMENT:

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 The Portfolio Management deals with the process of selection securities from the
number of opportunities available with different expected returns and carrying different
levels of risk and the selection of securities is made with a view to provide the investors the
maximum yield for a given level of risk or ensure minimum risk for a level of return.

Portfolio Management is a process encompassing many activities of investment in

assets and securities. It is a dynamics and flexible concept and involves regular and
systematic analysis, judgment and actions. The objectives of this service are to help the
unknown investors with the expertise of professionals in investment Portfolio Management.
It involves construction of a portfolio based upon the investor’s objectives, constrains,
preferences for risk and return and liability. The portfolio is reviewed and adjusted from
time to time with the market conditions. The evaluation of portfolio is to be done in terms
of targets set for risk and return. The changes in portfolio are to be effected to meet the
changing conditions.

Portfolio Construction refers to the allocation of surplus funds in hand among a

variety of financial assets open for investment. Portfolio theory concerns itself with the
principles governing such allocation. The modern view of investment is oriented towards
the assembly of proper combinations held together will give beneficial result if they are
grouped in a manner to secure higher return after taking into consideration the risk
element.

The modern theory is the view that by diversification, risk can be reduced. The
investor can make diversification either by having a large number of shares of companies
in different regions, in different industries or those producing different types of product
lines. Modern theory believes in the perspectives of combination of securities under
constraints of risk and return.

ELEMENTS:

Portfolio Management is an on-going process involving the following basic tasks.

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  Identification of the investors objective, constrains and preferences which help
formulated the invest policy.
 Strategies are to be developed and implemented in tune with invest policy
formulated. This will help the selection of asset classes and securities in each class
depending upon their risk-return attributes.
 Review and monitoring of the performance of the portfolio by continuous overview
of the market conditions, company’s performance and investor’s circumstances.
 Finally, the evaluation of portfolio for the results to compare with the targets and
needed adjustments have to be made in the portfolio to the emerging conditions
and to make up for any shortfalls in achievements (targets).

RISK:

Risk is uncertainty of the income / capital appreciation or loss of both. All

investments are risky. The higher the risk taken the higher is the return. But proper

management of risk involves the right choice of investments whose risks are

compensating. The total risks of two companies if their risks are offset by each other.

The two major types of risks are Systematic or Market related risk and unsystematic

or company related risks. The Systematic risks are the market problems, raw material

availability, tax policy or any Govt. policy inflation risk, Interest, and financial risk.

The unsystematic risks are mismanagement, increasing inventory, wrong

financial policy, defective marketing etc.

The company specific risks (unsystematic risks) can be reduced by diversifying into

few companies belonging to various industry groups, asset groups or different types of

instruments like equity shares, bonds, debentures etc. thus asset classes are bank deposits,

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company deposits, gold, silver, land, real estate, equity shares etc. industry groups are tea

sugar, paper, cement, steel, electricity electronics computer software etc. Each of them

have different risk return characteristics and investments are made - based on individual's

preferences. The second category of risk (systematic risk) is managed by the use of Beta of

different company share

RETURN OF PORTFOLIO:

Each security in a portfolio contributes returns in the proportion of its investment in

security. Thus the portfolio expected return is the weighted average of the expected

returns, form each of the securities, with weights representing the proportionate share of

the security in the total investment. Why does an investor have many securities in his

portfolio? If the security ABC gives the maximum return why not he/she invests in that

security all his/her funds and thus maximize return. The answer to this question lies in the

investor's perception of risk attached to investments, his objectives of income safety,

appreciation, liquidity and hedge against the loss of value of money etc. This pattern of

investment in different asset categories, security categories 'types of instruments, etc.

would all be described under the caption of diversification, which aims at he reduction or

even elimination of non-systematic or company related risks and achieve the specific

objectives of investors.

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PORTFOLIO RISK:

Risk on a portfolio is different from the risk on individual securities. This Risk is reflected

in the variability of the returns from zero to infinity. The expected return depends on the

probability of the returns and their weighted contribution to the risk of the portfolio. There

are two measures of risk in this context; one is the absolute and the other standard

deviation.

Most investors invest in a portfolio of assets, as they do not want to put all their eggs

in one basket. Hence, what really matter to them is not the risk and return of stocks in

isolation, but the risk and return of the portfolio as a whole

RISK-RETURN ANALYSIS:

All investments have some risks. Investment in shares of companies has its own risks or

uncertainty. These risks arise out of variability of returns or yields and uncertainty of

appreciation or depreciation of share prices, loss of liquidity etc. The risk over time can be

represented by the variance of the returns, while the return over time is capital

appreciation plus payout, divided by the purchase price of the share.

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Graph

SML (SECURITY MARKET LINE)

EXPECTED RETURN

VARIABLE RETURN

RISK FREE RETURN

O X

RISK

Normally, the higher the risk that the investor takes the higher is the return. There is

however, a risk less return on capital of about 12% which is the bank rate charged by the

R.B.I. or long term yielded on government securities at around 13%to 14%. This risk less

return refers to lack of variability of return and no uncertainty in the repayment of capital.

But other risks such as loss of liquidity due to parting with money etc. may however, remain

but are awarded by the total return on the capital.

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Risk-return is subject to variation and the objective of the portfolio manager is to reduce

that variability and thus reduce the risky by choosing an appropriate portfolio.

RISK IN A TRADITIONAL SENSE:

Risk in holding securities is generally associated with the

possibility that realized returns will be less than the returns that were
expected. The source of such disappointment is the failure of dividends
(interest) and / or the security’s price to materialize as expected
.
Forces that contribute to variations in return-price or dividend
(interest) – constitute elements of risk. in investments, those forces
that are uncontrollable, external and broad in their effect are called
sources of systematic risk. Conversely, controllable internal factors
somewhat peculiar to industries and / or firms are referred to as
sources of unsystematic risk.

SOURCES OF RISK:

Risk emanates from several sources. Following are the broadly classified sources of
risk:

1. Systematic Risk
2. Unsystematic Risk

Systematic Risk: It refers to the portion of total variability in return caused by factors
affecting the prices of all securities. Economic, political, and sociological changes are
sources of Systematic Risk. Their effect is to cause prices of nearly all individual common
stocks and/ or all individual bonds to move together in the same manner. Systematic Risk is
further classified into the following:

1. Market Risk
2. Interest-Rate Risk
3. Purchasing Power Risk

MARKET RISK:

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 Finding stock prices fall from time to time while a company’s
earnings are rising, and vice versa are not common. The price of a
stock may fluctuate widely within a short span of time even though
earnings remain unchanged. The cause of this phenomenon is varied,
but it is mainly due to a change in investor’s attitudes towards equities
in general, or towards certain types or groups of securities in
particular. Variability in return on most common stocks that is due to
basic sweeping changes in investor expectation is referred to as
market risk. It is caused by investor reaction to tangible as well as
intangible events.

INTEREST-RATE RISK:

Interest-Rate Risk refers to the uncertainty of future market

values and of the size of future income, caused by fluctuations in the
general level of interest rates. The root cause of interest-rate risk lies
in the fact that, as the rate of interest rate paid on U.S Government
securities (USG’s) rises or falls, the rates of returns demanded on
alternative investment vehicles, such as stocks and bonds issued in the
private sector, rise or fall. In other words, as the cost of money
changes for nearly risk-free securities (USG’s), the cost of money to
more risk prone issuers (private sector) will also change. Interest-
Rate on USG’s shifts with changes in the supply and demand for
government securities.

PURCHASING-POWER RISK:

Market Risk and Interest-Rate Risk can be defined in terms of

uncertainties as to the amount of current dollars to be received by an
investor. Purchasing-Power Risk is the uncertainty of the purchasing
power of the amounts to be received. In more everyday terms,
purchasing power risk refers to the impact of inflation or deflation on
an investor.

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BUSINESS RISK:

Business Risk is a function of the operating conditions faced by a firm and the variability
these conditions inject into the operating income and expected dividends. The degree of
variation from the expected trend would measure business risk. Business risk can b divided
into two broad categories:

1. External Business Risk

2. Internal Business Risk

FINANCIAL RISK:

Financial risk is associated with the way in which a company finances its activities. It is
usually gauge by looking at the capital structure of a firm. Financial risk is avoidable to the
extent that managements have the freedom to decide to borrow or not to borrow funds.
A firm with no debt financing has no financial risk.

By engaging in debt financing, the firm changes the characteristics of the earnings stream
available to the common-stock holders. Debt financing

1. increases the variability of their returns,

2. affects their expectations concerning their returns, and
3. increases their risk of being ruined.

TYPES OR RISK:

Modern portfolio theory looks at risk from a different perspective.

It divides total risk as follows:

TOTAL RISK = UNIQUE RISK + MARKET RISK

Unique Risk is also referred to as Diversifiable Risk or Un-Systematic Risk

Market Risk is also referred to as Non-Diversifiable Risk or Systematic Risk

The unsystematic risk can be reduced by diversifying the portfolio of scripts up to an

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optimum level of about 15 shares. These scripts should be so chosen that the risks on each

of them are diverse and their variability of return is also different. By investing in such a

diverse set of scripts, the total risk can be reduced as some of them may have positive

and other negative co-variance and they may vary in the degree of risk as well.

Diversifying into a basket of scripts can lower the unsystematic risk. Thus, a degree

of diversification of investment is a necessary pre-requisite of portfolio management and

for reducing the risk.

In the management of a portfolio, the problem of risk management is vital. Given

the individual preference of portfolio holders, the portfolio is to be constructed in such a

manner that its exposure to the market related risks cannot be reduced the company

related risks can be eliminated through a proper diversification into around 15 scripts of

different groups of industries and

companies would be able to reduce the company related risks involved almost to

negligible proportion. An optimum degree of diversification can be secured which would

minimize risk and optimize return, if the covariance of scripts included in the portfolio is less

than 1 or negative.

The coefficient of correlation is also designed to measure the relationship between

two securities. It gives an indication of the variables being positively or negatively related

to each other. If the coefficient of correlation is zero, then it means that the returns on

securities are independent of one another. When correlation coefficient is 1. The portfolio

risk will be the minimum.

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TRADITIONAL PORTFOLIO SELECTION:

Traditionally, portfolio selection has been viewed as an art form, perhaps even a craft.
Portfolio people are builders.

Security-portfolio selection must be preceded by attention to

financial planning needs must be analyzed in provision made for such
things as emergency savings, adequate insurance & home ownership.

A step-by step traditional approach to portfolio building recognizes several basic tenets.

1). Investors prefer large to smaller relation from securities.

2). The way to achieve this goal is to take more risk

3). The ability to achieve higher returns is dependent upon

a). The investor’s judgment of risk &

b). his ability to assure specific risks.

Spreading money among many securities can reduce risk portfolio are
presumable constructed by employing securities associated with
varying degree of risk & non-risk factors.

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TRADITION PORTFOLIO ANALYSIS:

Traditional security analysis recognizes the key importance of risk & return to the investor.

Most traditional methods recognize return as some divided

receipt & Price appreciation over a forward period . but the edition for
individual securities is not always over the same common holding
period , nor are the rates of return necessarily time –adjusted. An
analyst may well estimate the dividend. But he may not discount the
values to determine the acceptability of the return in relation to the
investor’s requirements.

In case, given an estimate of return, the analyst is likely to think of

and express risk as the probable downside price expectation. Each
security ends up with same rough measure of likely return & potential
downside risk for the future.

The key to why the investor needs to look at only a subset of the available portfolios lies in
the efficient set theorem, which states that:

An investor will choose his/her optimal portfolio from the set of portfolios that :-

1) offer maximum expected return for varying tends of risk &

2) offer minimum risk for varying lends of expected returns.

The set of port folios meeting these 2 conditions is known as the efficient set/ efficient 7
counters.

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THE FEASIBLE SET

The graph above provides an illution of the location of the feasible set
/ opportunity set from which the efficient set can be identified. The
feasible set simply represents all portfolios that could be formed from
a group of N securities.

PORTFOLIO & DIVERSIFICATION

A combination of securities that have risk and return features make up a portfolio.

Portfolio may or may not on aggregate characteristics of individual facts.

 Portfolio analysis takes the various risk factors for each industry and considers the

mixed effect of combined securities.

 Portfolio selection involves choosing the best portfolio to suit the risk return

preferences of the portfolio investors.

 Management of portfolio is a dynamic activity of evaluating and the revising the

portfolio in terms of its objectives.

It is widely accepted that individual scripts carry a certain degree of risk.

Portfolio helps in spreading the risk in many securities. Thus, the risk is reduced. The

basic principle is that if a portfolio holds several assets or securities that may include cash

also, even if one goes bad the other will provide protection with the loss.

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 The diversification can be either vertical or horizontal. In vertical diversification a

portfolio can have scripts of different companies within the same industry. In horizontal

diversification one can have different scripts chosen from different industries.

EXAMPLES OF VERTICAL DIVERSIFICATION

(A)Cement Industry (B) Textile Industry

JK Cement Garden Silk Mill

Unitech Reliance industries

Birla Cement Bombay Dyeing

ACC Cement Raymonds

HORIZONTAL DIVERSIFICATION

Acc Ltd (Cement)

Garden Silk Mill (Textiles)

Infosys Ltd (Software)

Diversification should neither be too large or too less. It should be an adequate

diversification according to the size of the portfolio.

Traditional approach advocates that one security holds the better it is, according to

the modern approach diversification should be related to the quality of scripts which

leads to quality of portfolios.

Experience has shown that beyond the certain securities by adding more securities

expensive.

38
Simple Diversification Reduces Risk:

An asset's' total risk can be divided into systematic plus unsystematic risk, as shown

below.

Systematic risk (undiversifiable risk) + Unsystematic risk (diversifiable risk) = Total risk =

Var (r).

Unsystematic risk is that portion of the risk that is unique to the firm (for example, risk

due to strikes and management errors). Unsystematic risk can be reduced to zero by

simple diversification.

Simple diversification is the random selection of securities that are to be added to a

portfolio. As the number of randomly selected securities added to a portfolio is increased,

the level of unsystematic risk approaches zero. However, market-related systematic risk

cannot be reduced by simple diversification. This risk is common to all securities.

39
3.1 COMPANY PROFILE

Sharekhan Ltd is India’s leading online retail broking house with its presence through
1288‘Share Shops’ in 325 cities and serving more than 8,00,000 customers across the
nation. Launched on Feb 8th 2000 as an online trading portal, Sharekhan offers its clients
trade execution facilities for cash as well as derivatives, on BSE and NSE, depository
services, mutual funds, initial public offerings (IPOs), and commodities trading facilities
on MCX and NCDEX. Besides high quality investment advice from an experienced
research team Sharekhan provides market related news, stock quotes fundamental
and statistical information across equity, mutual funds, IPOs and much more.

Sharekhan has set category leadership through pioneering initiatives like ‘Speed Trade’,
a net based executable application that emulates a broker terminal besides providing
information relevant to Day traders. Their second initiative, ‘First Step’ is targeted at
empowering first time investors. Sharekhan has also set their global footprints through
the ‘India First’ initiative, a series of seminars conducted by Sharekhan to help NRIs
participate and benefit from the huge investment opportunities in India.

Investment Advice on

They under stand that every investor’s needs and goals are different which is
why they provide our clients with a comprehensive set of research reports, so you can
take the right investment decisions regardless of your investment preferences. They also
offer investment Advice on
 • Equities.
• Online trading.
• Dial ‘N’ Trade.

Core Services of Sharekhan

 Equity and Derivatives trading on BSE and NSE

 Depository Services.
 IPO Service.
 Online Trading (Integration of online trading +Bank Account+Demat
Account).
 Commodities Trading on MCX and NCDEX.
 Portfolio management Services.
 Fundamental Research.
 Technical Analysis.

Our research products

Tailor-made products for customers

Intra day trading


Short term trading

Long term trading

High yield products

Hedging products

Share khan is the retail broking arm of SSKI, an organization with more than eight decades of
trust & credibility in the stock market

• Leading domestic player in Indian institutional business

• Over US$ 5 billion of private equity deals
• Awarded “Top Domestic Brokerage House four times by Euro money & Asia money
• Amongst pioneers of investment research in the Indian market
• In 1984, ventured into Institutional Broking & Corporate Finance.

SERVICES :

• Broking in Equities & Derivatives on NSE & BSE.

• Depository Services.
• Commodities Trading on MCX & NCDEX.
• IPO Services.
• Portfolio Management Services.
• Distribution Services.

AWARDS:

Rated among the top 20 wired companies along with Reliance, HLL, Infosys etc by

Business Today Jan 2004 edition.


PIONEERS of online trading in India.

Amongst the top 3 online trading websites from India.

Most preferred financial destination amongst online banking customers.

Winner of ‘Best Financial Website Award

Awarded to Share khan at the Awaaz ‘Consumer Awards 2005’ in the "Stock Broking"

category. Research conducted by AC Nielsen-ORG MARG for Awaaz.

4.1 DATA ANALYSIS AND INTERPRETATION

1.Reliance Industries:-

Return, Variance, Standard Deviation of Reliance

Industries for the month of February-2010
 Date Close Price

1-Feb-10 1906.7

2-Feb-10 1761.45

3-Feb-10 1641.6

4- Feb-10 1674.65

5- Feb-10 1648.55

8- Feb-10 1527.6

9- Feb-10 1571.4

10- Feb-10 1621.05

11- Feb-10 1520.2

12- Feb-10 1391.95

15- Feb-10 1306.05

16- Feb-10 1320.9

17- Feb-
10 1394.95

18- Feb-10 1316.8

19- Feb-10 1217.65

22- Feb-10 1019.5

23- Feb-10 1077

24- Feb-10 1153

25- Feb-10 1201.75

26- Feb-10 1375.45

Descriptive statistics
Descriptive statistics Price

Minimum 1019.5

Maximum 1906.7

Average 1432.41

Range 887.2

Variance 56647.66

Standard deviation 238.0077

Graphical Representation
 Daily Price movement of Reliance industriesfor the
month of Feb-2010
Price
3000

2000
Series1
1000

0
1 3 5 7 9 11 13 15 17 19 21 23

Days

Interpretation:

The above graph and table represents the risk and returns of Reliance
Industries for the month of Feb-2010. In the month of February,
there are high fluctuations in the price movement of Reliance
Industries. There is high risk i.e. (238.0077) with price variation
of (566647.66)
Return, Variance, Standard Deviation of Reliance Industries for the month of March-2010

Close
Date Price

1-Mar -10 2044.15

2-Mar -10 2144

3-Mar -10 2070.1

4-Mar -10 2097.9

5- Mar -10 2028.2

8- Mar -10 1979.45

9- Mar -10 2079.15

10-Mar -10 2046.65

11-Mar -10 2016.1

12-Mar -10 2043.45

15- Mar -10 1977.4

16- Mar -10 1943.5

17- Mar -10 2018.55

18- Mar -10 2113.2

19- Mar -10 2152.85

22- Mar -10 2152.15

23- Mar -10 2267.3

24- Mar -10 2308.05

25- Mar -10 2147.1

26- Mar -10 2179.9

29- Mar -10 2083.1

 30- Mar -10 2165.5

31- Mar -10 2207.5

Descriptive statistics

Descriptive statistics Price

Minimum 1943.5

Maximum 2308.05

Average 2098.489

Range 364.55

Variance 8498.157

Standard deviation 92.18545

Graphical Representation
 Daily price movements of Reliance Industries
for the Mar-2010
Price
2400
2200
2000
1800
1600
1 3 5 7 9 11 13 15 17 19 21 23
Days

Interpretation:

The above graph and table represents the risk and returns of

Reliance Industries for the month of Mar-2010.In the month of March, there

is high fluctuations in the price movement of Reliance Industries. There is

high risk i.e. ( 92.18) with price variation of (8498.15).

2.ITC:-

Return, Variance, Standard Deviation of ITC ltd. for the month of February-2010

Date Close Price

1-Feb-10 192.4

2-Feb-10 190.45

3-Feb-10 180

4- Feb-10 174.5

5- Feb-10 165.8

8- Feb-10 163.35

9- Feb-10 170.05

10- Feb-10 168.95

11- Feb-10 160.65

12- Feb-10 161.7

15- Feb-10 158.9

16- Feb-10 165.2

 17- Feb-
10 169.1

18- Feb-10 170.85

19- Feb-10 168.65

22- Feb-10 158.9

23- Feb-10 149

24- Feb-10 155.3

25- Feb-10 153.1

26- Feb-10 155.15

Descriptive statistics

Descriptive statistics Price

Minimum 149

Maximum 192.4

Average 166.6

Range 43.4

Variance 129.7016

Standard deviation 11.38866

Graphical Representation

Daily price movements of ITC ltd for the

month of Feb-2010
Price

250
200
150
Series
100 1
50
0
1 3 5 7 9 11 13 15 17 19 21
Days

Interpretation:

The above graph and table represents the risk and returns of ITC for
the month of Feb-2010. In the month of February there is low fluctuations in
the price movement of ITC. There is low risk i.e. (11.38866). With price
variation of (129.7016)
Return, Variance, Standard Deviation of ITC ltd. for the month of March-2010

Close
Date Price

1-Mar -10 183

2-Mar -10 179.9

3-Mar -10 169.3

4-Mar -10 171.2

5- Mar -10 177.85

8- Mar -10 171.8

9- Mar -10 183.85

10-Mar -
10 179.15

11-Mar -10 174.55

 12-Mar -10 168.6

15- Mar -10 160.45

16- Mar -10 162.35

17- Mar -10 167.25

18- Mar -10 176.25

19- Mar -10 179.2

22- Mar -10 189.85

23- Mar -10 191.6

24- Mar -10 190.5

25- Mar -10 189.15

26- Mar -10 190.65

29- Mar -10 189.6

30- Mar -10 188.3

31- Mar -10 186.8

Descriptive statistics

Descriptive statistics Price

Minimum 160.45

Maximum 191.6

Average 178.3833

Range 31.15

Variance 94.76258
Standard deviation 9.734608

Graphical Representation

Interpretation:
 Daily price movements of ITC ltd for the Month of Mar -2010

Price

200
190
180
170 Se ries1
160
150
140
1 3 5 7 9 11 13 15 17 19 21
Days

The above graph and table represents the risk and returns of ITC

for the month of Mar-2010.In the month of March there is low fluctuations

in the price movement of ITC. There is low risk i.e. (9.734608.) With price

variation of (94.76258)
3.BHARTI Airtel:-

Return, Variance, Standard Deviation of BHARTI for the month of

February-2010

Date Close Price

1-Feb-10 790.7

2-Feb-10 756.3

3-Feb-10 727.75

4- Feb-10 748.25

5- Feb-10 733.35

8- Feb-10 692.3

9- Feb-10 739.85

10- Feb-10 766.6

11- Feb-10 714.85

12- Feb-10 730.65

15- Feb-10 677.15

16- Feb-10 708.1

17- Feb-
10 724.35
 18- Feb-10 666.25

19- Feb-10 615.05

22- Feb-10 537.1

23- Feb-10 564.6

24- Feb-10 610.7

25- Feb-10 616.45

26- Feb-10 653.75

Descriptive statistics

Descriptive statistics Price

Minimum 537.1

Maximum 790.7

Average 688.705

Range 253.6

Variance 4831.46

Standard deviation 69.50871

Graphical Representation

Daily price movements of Bharti for the month

Price Of Feb- 2010

1000
800
600
400
200
0
1 3 5 7 9 11 13 15 17 19

Days

Interpretation:

The above graph and table represents the risk and returns of BHARTI
for the month of Feb-2010. In the month of February there is low
fluctuations in the price movement of BHARTI. There is high risk (69.50871).
With price variation of (4831.46)
Return, Variance, Standard Deviation of BHARTI for the month of March-2010

Date Close Price

1-Mar -10 706.9

2-Mar -10 742.3

3-Mar -10 707.75

4-Mar -10 717.15

5- Mar -10 727.65

8- Mar -10 711.05

9- Mar -10 746.4

10-Mar -10 741.75

11-Mar -10 744.9

 12-Mar -10 735.85

15- Mar -10 710.05

16- Mar -10 730.95

17- Mar -10 749.45

18- Mar -10 803.1

19- Mar -10 798.55

22- Mar -10 778.2

23- Mar -10 816.2

24- Mar -10 799.65

25- Mar -10 796.85

26- Mar -10 795.15

29- Mar -10 777.9

30- Mar -10 809.9

31- Mar -10 798.7

Descriptive statistics

Descriptive statistics Price

Minimum 706.9

Maximum 816.2

Average 754.1786

Range 109.3

Variance 1326.444

Standard deviation 36.42037

 Graphical Representation

Daily price movements of BHARTI for the Month of Mar-2010

Price
850
800
750
700
650
1 3 5 7 9 11 13 15 17 19 21 23

Days

Interpretation:

The above graph and table represents the risk and returns of BHARTI
for the month of Mar-2010. In the month of March there is low fluctuations
in the price movement of BHARTI. There is low risk (36.42037). With price
variation of (1326.444)
4.TCS :-

Return, Variance, Standard Deviation of TCS for the month of February- 2010

Date Close Price

 1-Feb-10 671.75

2-Feb-10 657.5

3-Feb-10 619

4- Feb-10 575.9

5- Feb-10 546.6

8- Feb-10 524.8

9- Feb-10 572.85

10- Feb-10 592.7

11- Feb-10 543.1

12- Feb-10 495

15- Feb-10 453.85

16- Feb-10 491.35

17- Feb-10 559.1

18- Feb-10 546.65

19- Feb-10 547.3

22- Feb-10 498.85

23- Feb-10 496.75

24- Feb-10 540.25

25- Feb-10 540.8

26- Feb-10 537.5

Descriptive statistics

Descriptive statistics Price

Minimum 453.85

Maximum 671.75

Average 550.58

Range 217.9

Variance 2970.675

Standard deviation 54.5039

Graphical Representation
 Daily price movements of Tcs for the month of
Price Feb-2010

800
600
400
200
0
1 3 5 7 9 11 13 15 17 19
Days

Interpretation:

The above graph and table represents the risk and returns of TCS for the
month of Feb-2010. In the month of February there is low fluctuations in the
price movement of TCS. There is high risk (54.5039). With price variation of
(2970.675)
Return, variance, standard deviation of TCS for the month of March-2010

Close
Date Price

1-Mar -10 847.7

2-Mar -10 876.5

3-Mar -10 856.65

4-Mar -10 844.5

5- Mar -10 852.25

8- Mar -10 830.2

9- Mar -10 876.75

10-Mar -10 868.4

11-Mar -10 798.6

12-Mar -10 767.85

15- Mar -10 750.65

 16- Mar -10 728.1

17- Mar -10 783.25

18- Mar -10 793.85

19- Mar -10 812.8

22- Mar -10 831.85

23- Mar -10 860.55

24- Mar -10 802.55

25- Mar -10 799.2

26- Mar -10 806.25

29- Mar -10 808.95

30- Mar -10 838.95

31- Mar -10 833.75

Descriptive statistics

Descriptive statistics Price

Minimum 728.1

Maximum 876.75

Average 820.4391

Range 148.65

Variance 1568.447

Standard deviation 39.60363

Graphical Representation

Daily price movements of Tcs for the month of Mar 2010

Price
1000
800
600
400
200
0
1 3 5 7 9 11 13 15 17 19 21 23

Days

Interpretation:

The above graph and table represents the risk and returns of TCS for

the month of Mar-2010.In the month of March there is low fluctuations in

the price movement of TCS. There is low risk (39.60363). With price

variation of (1568.447)
5.HUL :-

Return, Variance, Standard Deviation of HUL for the month of February-2010

Date Close Price

 1-Feb-10 254.35

2-Feb-10 256.7

3-Feb-10 249.55

4- Feb-10 249.3

5- Feb-10 238.15

8- Feb-10 221.85

9- Feb-10 231

10- Feb-10 238.8

11- Feb-10 231.35

12- Feb-10 247.55

15- Feb-10 241.55

16- Feb-10 239.3

17- Feb-10 250.3

18- Feb-10 252

19- Feb-10 241.75

22- Feb-10 226.45

23- Feb-10 211.65

24- Feb-10 218.2

25- Feb-10 207.4

26- Feb-10 221.75

Descriptive statistics

Descriptive statistics Price

Minimum 207.4

Maximum 256.7

Average 236.4475

Range 49.3

Variance 214.297

Standard deviation 14.63889

Graphical Representation
 Daily price movements of HUL for the month of Feb-2010

Price

300

200

100

0
1 3 5 7 9 11 13 15 17 19

Days

Interpretation:

The above graph and table represents the risk and returns of HUL
for the month of Feb-2010. In the month of February there is low
fluctuations in the price movement of HUL. There is low risk (14.63889).
With price variation of (214.297)
Return, Variance, Standard Deviation of HUL for the month of March-2010

Close
Date Price

1-Mar -10 197.65

2-Mar -10 200.2

3-Mar -10 196.35

4-Mar -10 201.5

5- Mar -10 209.75

8- Mar -10 209.85

9- Mar -10 216.45

10-Mar -
10 218.5

11-Mar -
10 214.1

12-Mar -
10 220.1

15- Mar -10 211.7

16- Mar -10 215.15

 17- Mar -10 219.75

18- Mar -10 219.8

19- Mar -10 228

22- Mar -10 232.7

23- Mar -10 230.85

24- Mar -10 227.7

25- Mar -10 233.2

26- Mar -10 230.85

29- Mar -10 237.8

30- Mar -10 238.65

31- Mar -10 239.65

Descriptive statistics

Descriptive statistics Price

Minimum 196.35

Maximum 239.65

Average 219.5761

Range 43.3

Variance 176.5602

Standard deviation 13.2876

Graphical Representation

D aily price mo ve men ts o f H U L f or t he m on th o f M ar- 201 0

Price
3 00

2 00

1 00

0
1 3 5 7 9 11 13 15 17 19 21 23
D ays

Interpretation:

The above graph and table represents the risk and returns of HUL for

the month of Mar-2010. In the month of March there is low fluctuations in

the price movement of HUL. There is low risk (13.2876). With price

variation of (176.5602)
6.ICICI:-

Return, Variance, Standard Deviation of ICICI for the month of February-2010

Date Close Price

1-Feb-10 550.9
 2-Feb-10 504.35

3-Feb-10 490.05

4- Feb-10 485.05

5- Feb-10 453.75

8- Feb-10 363.65

9- Feb-10 425.15

10- Feb-10 449.55

11- Feb-10 414.15

12- Feb-10 416.15

15- Feb-10 391.25

16- Feb-10 411.35

17- Feb-10 431.05

18- Feb-10 396.7

19- Feb-10 365.8

22- Feb-10 308.5

23- Feb-10 316.1

24- Feb-10 335.5

25- Feb-10 345.35

26- Feb-10 398.75

Descriptive statistics

Descriptive statistics Price

Minimum 308.5

Maximum 550.9
Average 412.655

Range 242.4

Variance 4129.912

Standard deviation 64.26439

Graphical Representation
 Daily price movements of ICICI for the month Of Feb 2010

Price

600

400

200

0
1 3 5 7 9 11 13 15 17 19
Days

Interpretation:

The above graph and table represents the risk and returns of ICICI
for the month of Feb 2010.In the month of February there is low
fluctuations in the price movement of ICICI. There is high risk (64.26439).
With price variation (4129.912)
Return, Variance, Standard Deviation of ICICI for the month of March-2010

Date Close Price

1-Mar -10 589.1

2-Mar -10 621.05

3-Mar -10 571.9

4-Mar -10 603.6

5- Mar -10 605.15

8- Mar -10 594.35

9- Mar -10 621.7

10-Mar -
10 616.9

11-Mar -10 591.6

12-Mar -10 578.9

15- Mar -10 529.15

 16- Mar -10 519.75

17- Mar -10 551.85

18- Mar -10 617.45

19- Mar -10 642.95

22- Mar -10 661.7

23- Mar -10 738.7

24- Mar -10 730.2

25- Mar -10 656.75

26- Mar -10 663.4

29- Mar -10 607.7

30- Mar -10 636.1

31- Mar -10 637.3

Descriptive statistics

Descriptive statistics Price

Minimum 519.75

Maximum 738.7

Average 616.837

Range 218.95

Variance 2822.411

Standard deviation 53.12636

Graphical Representation

D a il y p r i c e m o v e m e n t s o f IC IC I f o r t h e M a r 2 0 1 0
m o n th o f
P r ic e
8 00
6 00
4 00
2 00
0
1 3 5 7 9 11 1 3 1 5 17 19 21 23

D ays

Interpretation:

The above graph and table represents the risk and returns of ICICI

for the month of Mar-2010. In the month of March there is low fluctuations

in the price movement of ICICI. There is high risk (53.12636). With price

variation of (2822.411)
7.L&T:-

Return, Variance, Standard Deviation of L&T for the month of February-2010

Date Close Price

 1-Feb-10 1216.1

2-Feb-10 1159

3-Feb-10 1083.95

4- Feb-10 1008.05

5- Feb-10 966.5

8- Feb-10 890.35

9- Feb-10 986.1

10- Feb-10 1005.1

11- Feb-10 895.6

12- Feb-10 823.5

15- Feb-10 799.7

16- Feb-10 811.7

17- Feb-10 859.6

18- Feb-10 815.65

19- Feb-10 832.5

22- Feb-10 768.45

23- Feb-10 723.5

24- Feb-10 768.9

25- Feb-10 759.8

26- Feb-10 807.05

Descriptive statistics
Descriptive statistics Price

Minimum 723.5

Maximum 1216.1

Average 899.055

Range 492.6

Variance 19286.41

Standard deviation 138.8755

Graphical representation
 Daily price movements of L&T for the month of Feb 2010

Price

1500

1000

500

0
1 3 5 7 9 11 13 15 17 19

Days

Interpretation:

The above graph and table represents the risk and returns of LT for
the month of Feb- 2010.In the month of February there is low fluctuations
in the price movement of LT. There is high risk (138.8755). With price
variation (19286.41)
Return, Variance, Standard Deviation Of L&T for The Month Of March-2010

Close
Date Price

1-Mar10 2142.35

2-Mar -10 2296.05

3-Mar -10 2231.9

4-Mar -10 2381.45

5- Mar -
10 2361.8

8- Mar -
10 2397.1

9- Mar -
10 2523.2
 10-Mar10 2532.4

11-Mar -10 2354.15

12-Mar -10 2386.8

15- Mar -10 2279.3

16- Mar -10 2263.9

17- Mar -10 2442.95

18- Mar -10 2547.55

19- Mar -10 2511.95

22- Mar -10 2571.9

23- Mar -10 2772.9

24- Mar -10 2714.7

25- Mar -10 2625.5

26- Mar -10 2720.15

29- Mar -10 2546.65

30- Mar -10 2590.1

31- Mar -10 2605.55

Descriptive statistics

Descriptive statistics Price

Minimum 2142.35

Maximum 2772.9

Average 2469.578

Range 630.55
Variance 28228.11

Standard deviation 168.0122

Graphical Representation
 D aily p rice m o v em en ts o f L &T fo r th e m o nth o f
M ar 20 10
Pr ic e
30 00

20 00

10 00

0
1 3 5 7 9 11 13 15 17 19 21 23

Day s

Interpretation:

The above graph and table represents the risk and returns of L&T

for the month of Mar-2010.In the month of March there is low fluctuations

in the price movement of L&T. There is high risk (168.0122). With price

variation (28228.11)
Descriptive Reliance ITC BHARTI TCS HUL ICICI LT

Average
daily 1432.41 166.6 688.70 550.58 236.4475 412.655 899.055
returns

Variance
56647.66 129.7016 4831.46 2970.675 214.297 4129.912 19286.41
5.
1
Standard
deviation 238.0077 11.38866 69.50871 54.5039 138.8755 C
14.63889 64.26439
O
N
CLUSION

Return variance and standard deviation Reliance, ITC, BHARTI, TCS, HUL and
ICICI for the period of February-2010

CONCLUSION

The above table shows the risk, variance and returns of Reliance,
ITC, Bharti, TCS, HUL, ICICI, L&T for the period Feb-2010 to Mar-2010.In the
above table observe that ITC has Low risk (11.38866) with average daily
price is (166.6 )with minimum price variation of (129.7016)

Return variance and standard deviation Reliance, ITC, BHARTI, TCS, HUL and
ICICI for the period of March -2010

Descriptiv Relianc ITC BHARTI TCS HUL ICICI L&T

e e

Average
daily 2098.489 178.383 754.1786 820.439 219.576 616.837 2469.578
returns 3 1 1

Variance 94.7625 1326.444 1568.44 176.560 2822.411 28228.11

8 7 2
8498.157
 Standard 9.73460 36.42037 13.2876 53.12636 168.0122
8 39.6036
deviation 3
92.18545

CONCLUSION

The above table shows the risk, variance and returns of Reliance,
ITC, Bharti, TCS, HUL, ICICI, LT for the period Feb-2010 to Mar-
2010.In the above table observe that L&T has high risk (168.0122)
with average daily price is (2469.57) with maximum price variation
of (28228.11).
SUGGESTIONS

1. The study reveals that ITC is giving minimum levels of risk in the Month
of Feb
and it is supported a high expectation of return this is the right time. For
the
investors to invest.

2. ITC is performing well with high average return and low level of risk .In
the Month
of March, which is a suitable period for investment.

3. BHARTI Airtel is giving good results in the month of March with low level
of
risk and high Level of returns, which can be considered as a better
period for
investment similarly TCS is also giving same results during same month.

4. HUL is giving low levels of risk and high levels of returns in the month of
March.
5. The report reveals that March and can be considered as a better and
best Period
for investment for any type of investors.

BIBLIOGRAPHY

BOOKS REFERRED

Security Analysis & Portfolio Management - Fishers & Jordon

Financial Management – M.Y. Khan

Financial Management – Prasanna Chandra

NEWS PAPERS

Business Line

Times of India

India Today

MAGAZINES

Business Daily

WEBSITES REFFERED

www.sharekhan.com

www.investsmartindia.com
www.nscindia.com

www.nseindia.com

www.bseindia.com

www.wekipedia.org

www.sebi.com
 BIBLIOGRAPHY

BOOKS / MAGAZINES REFERRED:

M.Y.KHAN, FINANCIAL MANAGEMENT ,

7th Edition, Publisher : Tata Mcgrew Hill.

JORDAN&FISCHER, SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT ,

6th Edition, Publisher : Prentice Hall Of India.

PRASANNA CHANDRA, FINANCIAL MANAGEMENT,

6th Edition, Publisher : Tata Mcgrew Hill.

WEBSITES REFERENCES

http://www.sharekhan.com

http://www.wekipedia.com
http://www.nseindia.com

http://www.bseindia.com

http://www.investsmartindia.com

http://www.nscindia.com

http://sebi.com