SHRI RAMSWAROOP MEMORIAL

GROUP OF PROFESSIONAL COLLEGES

LUCKNOW

RESEARCH REPORT

ON

““PORTFOLIO CONSTRUCTION USING

FUNDAMENTAL ANALYSIS””SUBMITED IN PARTIAL FULFILLMENT OF REQUIRMENT FOR THE

AWARD OF DEGREE OF

MASTER OF BUSINESS ADMINISTRATION

TO

GAUTAM BUDDHA TECHNICAL UNIVERSITY, LUCKNOW

FOR THE SESSION

2013-14

UNDER GUIDANCE OF: SUBMITTED BY:

Department of Management Roll no.:

SRMGPC, LUCKNOW M.B.A. 4th Semester

CERTIFICATE

ii

DECLARATION

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ACKNOWLEDGEMENT

We think if any of us honestly reflects on who we are, how we got here, what we think

we might do well, and so forth, we discover a debt to others that spans written history.

The work of some unknown person makes our lives easier everyday. We believe it's

appropriate to acknowledge all of these unknown persons; but it is also necessary to

acknowledge those people we know have directly shaped our lives and our work.

First of all we would like to thank my guide Mr. S. NIYAZI, Faculty of Management

Department, SRI RAMSWAROOP MEMORIAL GROUP OF PROFESSIONAL

COLLEGES, Lucknow for his guidance throughout the semester.

Finally, I would like to thank My God, My Parents and my friends for all the support and

blessings that was required for completion of this project.

_______________________

Roll No.: _________________

MBA (IV Sem.)

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PREFACE

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.

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.

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ABSTRACT

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TABLE OF CONTENTS

Certificate ii

Declaration iii

Acknowledgement iv

Preface v

Abstract vi

1. Introduction 1

Investment Pattern 5

Risk Tolerance 14

Factors Associated with Risk Tolerance 20

2. Literature Review 23

The Age Effect on Risk Tolerance 24

Social Effect on Risk Tolerance 27

Period Effect on Risk Tolerance 28

Attitudinal Self Assessment 29

Overconfidence and Estimation Bias 32

Gender Differences in Risk Preferences 35

Risk Preferences and Education 37

Risk Preferences and Income/wealth 38

Risk Assessment 39

3. Research Methodology 47

Research Design 48

Data Collection 49

Sampling 49

4. Objective of the Study 50

vii

5. Importance Of The Study 51

6. Data Analysis 52

7. Findings 63

8. Recommendations 67

9. Conclusion 69

10.Limitations 71

11.Bibliography 73

12.Annexure 75

Questionnaire 76

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