Review of Literature

Bhatt & Bhatt (2012) in their paper entitled “Financial Performance Evaluation of depositories in
India (A comparative study of NSDL & CDSL)” explores the fact that the trend of automation
especially, Dematerialization, has enabled the Indian capital market to take the world center
stage & scale to unprecedented heights. Securities market in India has grown exponentially. The
analysis of the progress of NSDL & CDSL in economic terms clearly reveals that both the
depositories have shown a remarkable progress in terms of DEMAT accounts; DEMAT value
&quantity, Settlement value and quantity and the number of depository participants. Their study
reveals that both the depositories have been working financially smoothly over a period of last
six financial years.

Chaudhary & Malik (2011) in their paper “Depository system in India: An appraisal” states that
majority of the participants are resided with NSDL with stake of 55 percent. Thus, it acts as the
primary organization with the majority of participants in the system. Further the paper analysis
concludes that the respondents have no clear & crisp idea regarding the services offered by the
DPs to their clients. In order to overcome geographical & time barriers formal & informal
communication need to be developed. The majority of respondents were comfortable with the
prevailing fee structure of depository which shows the existing fee structure followed by NSDL is
benevolent.

George (1996) in his article “Towards a paperless settlement system” explains about the role of
the NSDL in revolutionizing the paperless stock settlement system in the country. He has
examined steps taken by the depository to ensure that the scripless trading system is a success.
He has also stressed the importance of the role of regulatory body in making the depository
system successful.

Jeyanthi (2007) in his research work “A study on National Stock Exchange of India Limited” has
highlighted that the NSE has created a niche for itself not only in the national arena but also in
the international market with the adaptation of required structural changes. Therefore there is
no doubt that NSE will be an attractive destination for the national & international investors to
park their funds in the years to come.

Javaid (2003) in his thesis “A study of operations of stock exchanges with the special reference to
Delhi Stock Exchange” discussed that Indian stock market has emerged as a major source of
finance for the corporate sector. It is an institution evolved in the industrial developed
capitalistic economies with free market mechanism. Stock exchange was termed as institutional
allocator of resources par excellence.

Kaur (2013) in her paper “Investors preference between DEMAT & REMAT and awareness
regarding depository & its various laws” explains the depository system in India, focusing on the
reasons for investors preference between REMAT & DEMAT. To sum up she concludes that the
growth rates of DEMAT account holder is increasing over years. The Indian system of capital
market is two tier system-Indian government allows holding securities in any form i.e. either in
physical securities or in electronic (DEMAT) form. The respondents feel that the
dematerialization provides enough services & it is convenient to use. Majority of people are
shifting towards dematerialization as compared to the past history & study.

Olekar & Talwar (2013) in their paper “Online trading & DEMAT account in India – Some issues”
observed that the banks normally levy a lower service charges compared to other depository
participants. He also found that when the numbers of users are more online, the speed of
transactions is affected.

Rao (1995) in his paper “Depository System: A boon for India capital markets” holds the view
that the introduction of depositories would improve the market efficiency. It is also expected to
arrest the prolonged depression in the stock market. The paper analysis shows the manner in
which the depository would help to revive the stock market. To sum up, he states that the
eligibility criteria will require companies to improve their internal systems. He is hopeful that
depository system will bring a sea change in corporate democracy, particularly in corporate
management, price discovery in market place & proxy exercise etc.

Sahoo (1995) in his article “The depositories ordinance, 1995 explained” has explained the
provisions of Depositories Ordinance 1995, which provides a legal basis for the establishment of
depositories in securities with a view to ensure free & expeditious transfer of securities.

Singh & Goyal ( 2011) in their paper entitled “ Analysis of factors affecting the Decision Making
of the Investors in Depository System” holds the view that most of the investors think that the
shorter settlement period , safety of securities with the depositories , attitude of the staff
available with the DPs, timely services provided by the DPs to the investors, reduction in
transaction costs , rapatriation of sales proceeds of shares / debentures are some of the factors
 which affects the decision making of the investors in depository system. Opening DEMAT
account with DP is easy but they charge for providing this service. The education of the investors
plays an important role in decision making where the difference in the opinions of the investors
is found significant in most of the cases followed by other factors such as occupation, age etc.

Research methodology

REASEARCH AND MEHTODOLOGY

Objectives of research
 To Study present online share trading
 To find the awareness of Demat account among the common people.
 To know about problems faced in trading by traders.
 To know the challenges faced in trading by traders
 To determine the satisfaction levels of consumers, doing online trading.

Scope of research
 It provides a complete knowledge of various fundamental concepts of share market and
online trading.
 It will help in analyzing the behavior of consumers.
 It will help in Knowing the parameters of investment on which they would like to invest.
 From the study I have learned very much, about online trading and demat account.

Significance of research
 By having a demat account, you can avoid the jeopardy of bad-delivery.
 By having a demat account, you can avoid the delay in transferring the securities
physically or holding duplicate documents.
 Demat account enables the investor to store entire portfolio of investment, shares and
other securities in electronic form in one account.
 You are assured of the safety of your continuing investments by electronically holding
your investments.
 You can keep persistent track of your investments and securities without worrying about
the handling of physical papers.
  Investors having demat account are capable of enjoying quicker benefits like bonuses
and stock splits.

Limitation of research
 I was not able do survey in every area.
 Many traders and consumer were not revealing their investment as they were not
trusting.
 Sample size is limited to only 50 people.
 I was unable to survey to actual traders who trade and use demat account.
 I was only able to survey in limited locality which is near my house.

Sampling Procedure
 By adopting convenience sampling, approximately 50 respondents were selected.
The essential data were collected with people of questionnaire.
 It was collected through filling up the questionnaire prepared. The data has been
analyzed by using Statistical tool.

Sample size:
The sample size of project is limited to 50 people only.

Sample design:
Data had been presented with the help of tables and pie chart.

Area of study:
We have collected primary data (Questionnaires) from Local Public of worli.

Finding:
The below are the questions posed to the respondents for the purpose of primary data
collection with mode of structured questionnaire.
Objectives

Objectives of Present Trading System:

 Reduce and eliminate operational inefficiencies inherent in manual system.
 Increased trading capacity in Stock Market Improve market transparency.
 Eliminate unmatched trades and delayed reporting Provide for on-line and off-line
monitoring control and surveillance of the market.
 Promote fairness and speedy matching Smooth market operations using technology
while retaining the flexibility of conventional treading practices.
 Set up various limits, rules and controls centrally.
 Consolidate the trades data on electronic media to interface will the broker‘s back office
system.
 Provide public information on scrip prices, indices for all users of the system.
 Provide analytical data for use of Stock Market.