A

SYNOPSIS

On

PORTFOLIO MANAGEMENT
AT

ICICI BANK LTD

A Project report submitted to Osmania University in Partial

fulfillment of the requirement for the Award of Degree of

MASTER OF BUSINESS ADMINISTRATION

Submitted by
SHAHEEN BEGUM
1170-20-672-074
RG KEDIA COLLEGE
DEPARTMENT OF BUSINESS MANAGEMENT
(Affiliated to Osmania University, Hyderabad)
CHADARGHAT Hyderabad
Telangana
2020-2022
 INTRODUCTION
PORTFOLIO MANAGEMENT
MEANING:-
A portfolio is a collection of assets. The assets may be physical or financial like

Shares, Bonds, Debentures, Preference Shares, etc. The individual investor or a fund manager

would not like to put all his money in the shares of one company that would amount to great

risk. He would therefore, follow the age old maxim that one should not put all the eggs into

one basket. By doing so, he can achieve objective to maximize portfolio return and at the

same time minimizing the portfolio risk by diversification.

 Portfolio management is the management of various financial assets which comprise

the portfolio.

 Portfolio management is a decision – support system that is designed with a view to

meet the multi-faced needs of investors.

 According to Securities and Exchange Board of India Portfolio Manager is defined as:

“Portfolio means the total holdings of securities belonging to any person”.

 PORTFOLIO MANAGER: means any person who pursuant to a contract or

arrangement with a client, advises or directs or undertakes on behalf of the client

(whether as a discretionary portfolio manager or otherwise) the management or

administration of a portfolio of securities or the funds of the client.

 DISCRETIONARY PORTFOLIO MANAGER: means a portfolio

manager who exercises or may, under a contract relating to portfolio management

exercises any degree of discretion as to the investments or management of the

portfolio of securities or the funds of the client.

 To frame the investment strategy and select an investment mix to achieve the desired

investment objectives

 To provide a balanced portfolio which not only can hedge against the inflation but

can also optimize returns with the associated degree of risk

 To make timely buying and selling of securities. To maximize the after-tax return by

investing in various taxes saving investment instruments.

STRUCTURE / PROCESS OF TYPICAL PORTFOLIO

In the small firm, the portfolio manager performs the job of security analyst.

In the case of medium and large sized organizations, job function of portfolio manager and

Security analyst is separate.

PORTFOLIO
RESEARCH MANAGERS OPERATIONS
(e.g. Security (e.g. buying and
Analysis) selling of Securities)

CLIENTS
CHARACTERISTICS OF PORTFOLIO MANAGEMENT:

Individuals will benefit immensely by taking portfolio management services for the

following reasons:

 Whatever may be the status of the capital market, over the long period capital markets

have given an excellent return when compared to other forms of investment. The

return from bank deposits, units, etc., is much less than from the stock market.

 The Indian Stock Markets are very complicated. Though there are thousands of

companies that are listed only a few hundred which have the necessary liquidity.

Even among these, only some have the growth prospects which are conducive for

investment. It is impossible for any individual wishing to invest and sit down and

analyze all these intricacies of the market unless he does nothing else.

 Even if an investor is able to understand the intricacies of the market and separate

chaff from the grain the trading practices in India are so complicated that it is really a

difficult task for an investor to trade in all the major exchanges of India, look after his

deliveries and payments

Portfolio management has emerged as a separate academic discipline in India. Portfolio

theory that deals with the rational investment decision-making process has now become an

integral part of financial literature.

Investing in securities such as shares, debentures & bonds is profitable well as

exciting. It is indeed rewarding but involves a great deal of risk & need artistic skill.

Investing in financial securities is now considered to be one of the most risky avenues of

investment. It is rare to find investors investing their entire savings in a single security.

Instead, they tend to invest in a group of securities. Such group of securities is called as

Portfolio. Creation of portfolio helps to reduce risk without sacrificing returns. Portfolio

management deals with the analysis of individual securities as well as with the theory &

practice of optimally combining securities into portfolios.

The modern theory is of 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 perspective of combinations of securities under constraints of

risk and return.

 To study the investment pattern and its related risks & returns In the selected stocks

 To examine the factors influencing individual investor’s decision to make portfolio

choice

 To compare of selected stocks with BSE Sensex index

 To construct portfolios of positively correlated and negatively or less correlated

stocks.

 To calculate risk and return of different stocks.

 To evaluate the risk and return of those newly constructed portfolio

This study covers the Markowitz model. The study covers the calculation of correlations

between the different securities in order to find

out at what percentage funds should be invested among the companies in the portfolio. Also

the study includes the calculation of individual Standard Deviation of securities and ends at

the calculation of weights of individual securities involved in the portfolio. These

percentages help in allocating the funds available for investment based on risky portfolios.

The data collected for equity picks were from CNX Nifty index only and thus the study deals

with stocks from CNX Nifty index only. The data used for the equity portfolio study is the

historical data of immediate pervious 1 year (1st June 2020 to 31st May 2021)
RESEARCH METHODOLOGY
DATA COLLECTION METHODS:
The data collection method secondary collection method.

Secondary collection methods:

The secondary collection methods includes the lectures of the superintend of the department

of market operations and so on., also the data collected from the news, magazines and

different books issues of this study Superintend

STANDARD DEVIATION:

The concept of standard deviation was first suggested by Karl Pearson in 1983.it may

be defined as the positive square root of the arithmetic mean of the squares of deviations of

the given observations from their arithmetic mean In short S.D may be defined as “Root

Mean Square Deviation from Mean”.

It is by far the most important and widely used measure of studying dispersions.

For a set of N observations X1, X2……..Xn with mean X,

Deviations from Mean: (X1-X), (X2-X),…. (Xn-X)

Mean-square deviations from Mean=

1/N (X1-X)2+(X2-X)2+………. +(Xn-X)2

=1/N sigma(X-X)2

Root-mean-square deviation from mean , i.e.

Deviations from Mean: (X1-X), (X2-X),…. (Xn-X)

Mean-square deviations from Mean=

1/N (X1-X)2+(X2-X)2+………. +(Xn-X)2

=1/N sigma(X-X)2

Root-mean-square deviation from mean , i.e.

standard deviation:

Variance = (S.D) 2

Where, (S.D) is standard deviation

CORRELATION ANALYSIS:
The correlation coefficient is a measure that determines the degree to which two

Variables' movements are associated. The range of values for the correlation coefficient is -

1.0 to

1.0. If a calculated correlation is greater than 1.0 or less than -1.0, a mistake has been made.

A Correlation of -1.0 indicates a perfect negative correlation, while a correlation of 1.0

indicates a Perfect positive correlation.

LIMITATIONS OF THE STUDY

1. Construction of portfolio is restricted to two companies based on Markowitz model.

2. Very few and randomly selected scripts/companies are analyzed from BSE listings.

3. Data collection was strictly confined to secondary source. No primary data is associated

with the project.

4. Detailed study of the topic was not possible due to limited size of the project.

5. There was a constraint with regard to time allocation for the research study i.e for a period

of two months
 CHAPTERISATION:

CHAPTER-1

INTRODUCTION

SCOPE OF THE STUDY

OBJECTIVES OF THE STUDY

METHODOLOGY OF THE STUDY

LIMITATIONS OF THE STUDY

CHAPTER-2

REVIEW OF LITERATURE

CHAPTER-3

INDUSTRY PROFILE

COMPANY PROFILE

CHAPTER-4

DATA ANALYSIS AND INTERPRETATION

CHAPTER-5

SUGGESTION

FINDINGS & CONCLUSION

BIBLIOGRAPHY
 BIBLIOGRAPHY

BOOK

1. Glenn Hubbard, Michael f. Koehn,” the mutual fund industry: competition and

investor welfare” 1st edition Published by Columbia University Press, 2010.

2. Donald Fischer & Ronald Jordan --“Security Analysis and portfolio

th
Management”,6 edition published by prentice Hall 2095.

3. Prasanna Chandra - “Financial Management Theory and Principle”- 2008.

JOURNAL

1. Glushkov, D. and Statman, M., 2015. Classifying and Measuring the Performance of

Socially Responsible Mutual Funds.

2. Bogle, J.C., 2015. Bogle on mutual funds: New perspectives for the intelligent

investor. John Wiley & Sons.

3. Frankel, T. and Laby, A.B., 2015. The regulation of money managers: mutual

fundsand advisers (Vol. 3). Wolters Kluwer Law & Business

4. Kacperczyk,LauraVeldkampStijn,&Van Nieuwerburgh (2016), ‘A Rationl Theory of

Mutual Funds Attention Allocation’, Journal of the Econometic Theory.

5. Arno Rifdl& Paul Smeet (2018),’ Why Do Investors Hold Socially Responsible

Mutual Funds?’, Journal of Finance.

6. InderjitKaur (2018), ‘Determinants of Investment Behavior of Investors Towards

Mutual Funds’, Journal of Indian Business Research.

7. Lawrence Schmidt,AllanTimmermann& Russ werners (2016),’Runs On Money

Market Mutual Funds, American Economic Review.

Funds’, The Review of Financial Studies.

WEB SITE

1. https://mf.indiainfoline.com/MFOnline/Home

2. https://economictimes.indiatimes.com/mutual-funds

3. https://www.nseindia.com/products/content/equities/mutual_funds/mfss.htm

4. https://www.moneycontrol.com/mutualfundindia

NEWSPAPER

1 .Dharmendra Kumar 2021“Should a new investor invest in direct plans of mutual funds?”

on ECONOMIC TIMES, July 17

2.Jash Kriplani 2021“Mutual funds disclousers from rating agencies to improve

predictability” BUSINESS STANDARD ,November 15