CHAPTER-4 RESEARCH METHODOLOGY The research methodology of the selected topic falls in the following dimensions: 4.1. TITLE: The title of the thesis is A Study on Investors' General and Legal Awareness for online trading in Gujarat state. 4.2 OBJECTIVES: The main objectives of the study are as follows: To examine the perception of investors regarding online trading. To examine the preferences of investors towards existing online trading firm. To find out various purposes for online trading usage. To know the preference of investors towards conducting their online trading transactions. To examine which criteria are important for the investors while opening an account in a brokerage house in online trading. To find out knowledge level of investors regarding online trading To identify the problem faced by the investors during the usage of online trading. To examine general awareness regarding online trading To know about different act related to online trading. To find out awareness level of investor s right towards online trading. To find out awareness level of investor s responsibility towards online trading. 122
4.3 HYPOTHESIS: For the present study the researcher has formulated two hypothesis i.e. Null Hypothesis and Alternative Hypothesis. Both hypothesis are tested with the help of statistical tools. The statements of hypothesis are as under: NULL HYPOTHESIS: 1. There would be no significant relationship between online trader s knowledge level and their age groups. 2. There would be no significant relationship between general awareness and education level of respondent. 3. There would be no significant relationship between respondent knowledge level for the online trading laws and education groups. 4. There would be no significant relationship between respondent knowledge level for the online traders rights and education groups. 5. There would be no significant relationship between respondent knowledge level for the online traders responsibility and education groups. ALTERNATIVE HYPOTHESIS: 1. There would be significant relationship between online trader s knowledge level and their age groups. 2. There would be significant relationship between general awareness and education level of respondent. 3. There would be significant relationship between respondent knowledge level for the online trading laws and education groups. 4. There would be significant relationship between respondent knowledge level for the online traders rights and education groups. 5. There would be significant relationship between respondent knowledge level for the online traders responsibility and education groups. 123
4.4 SCOPE OF THE STUDY: The scope of the study is very wide. This study will be useful to academicians as well as the online traders. It is also useful to brokers, depository, stock exchange, corporate sector and investors. 4.5 NATURE OF THE STUDY: It is an empirical research. The numbers of online trading investors in Gujarat state are very large. So it is beyond the capacity of an individual researcher to pursue the study on hundred percent of enumerative basis of adequate size of sampled online traders of Gujarat city in sampling design. 4.6 SAMPLING DESIGN: The population of the study consists of all types of online trading investors in Gujarat state. It also consists of all the online trading investors in different occupation. But the numbers of online trading investors are quite large; it is not easy to contact all. So the convenience sampling is selected here. In sampling, four metro cities that is Ahmedabad, Rajkot, Surat and Vadodara are selected in present studied. The sampling of the research can be seen from the following table no.4.1 which is as follows: 124
CITY TABLE 4.1 PERCENTAGE OF RESPONSE ONLINE TRADERS (GIVEN) ONLINE TRADERS (RESPONSE) IN% AHMEDABAD 100 80 80 RAJKOT 100 98 98 SURAT 100 70 70 VADODARA 100 96 96 TOTAL 400 344 86 4.7 DATA COLLECTION: The study is primarily based on primary data collected through well-structured questionnaire containing various types of questions like multiple choice questions, rating questions, scaling type questions and dichotomous questions regarding important aspects of awareness of online trading. This questionnaire has been administered, the size of the population being very large, to a sample of about four hundred investors of Gujarat state. But the researcher could successfully get the responses only from three hundred and forty four investors. The study is also use secondary data like magazines, journals, newspapers, reference books and websites are taken for the purpose of study. 4.8 DATA ANALYSIS: The collected data is duly edited, classified and analyzed by using appropriate and relevant statistical techniques. On the basis of the information received through questionnaire, the uni-variate and bi-variate tables were prepared for further analysis. 125
In addition to the average information scales were analyzed and relationships between the score were calculated. For the purpose of testing the hypothesis the researcher has used non-parametric and parametric tests like F-test (one way analysis of variance) and rank test at 5% level of significance. 4.9 CHAPTER PLAN: The research report is being produced under the following eight chapters: I. Chapter 1: Overview of Stock Market This chapter gives an overview of the stock market, History of stock exchange in India, concept, types of market, features of market, role, functions of the stock exchange, regulatory framework of stock exchange and development of the stock market. II. Chapter 2: Investors general awareness about online Trading This chapter includes History of online trading, concept, features, facilities, products and services, role of deposits, internet system and sub system, internet and security of online trading, benefits and limitation of the online trading. III. Chapter 3: Investors legal awareness about online trading This chapter deals with legislative and regulatory provisions relevant from the viewpoint of online traders. The four main legislations governing the securities market are:(a) the Securities Contracts (Regulation) Act, 1956, which provides for regulation of transactions insecurities through control over stock exchanges; (b) the Companies Act, 1956, which sets out the code of conduct for the corporate sector in relation to issue, allotment and transfer of securities, and disclosures to be made in public issues; (c)the SEBI Act, 1992 which establishes SEBI to protect investors and develop and regulate securities market; and (d) the Depositories Act, 1996 which provides for electronic maintenance and transfer of ownership of dematerialized securities. IV. Chapter 4: Research Methodology This chapter deals with Research Methodology of the research work. It covers title of the study, objectives of the study, null hypothesis and alternative hypothesis, scope of the 126
study, nature of the study, sampling design, data collection, data analysis, chapter plan, significance of the research, and limitations of the research. V. Chapter 5: Literature Review and Sample Profile This chapter includes past review of literature and sample profile. Sample profile consists of age, sex and occupation of respondents. This chapter includes analysis of information like two most preferred online trading websites, two most preferred search engine, types of online trading, factor affecting on it, time factor involved in online trading, most preferable broker firm conducting their transactions, satisfaction level of services of online trading, problems faced by investors and agreement level for online trading. VI. Chapter 6: Analysis of investors general awareness about online trading This chapter will cover analysis of the primary data. The analysis will include identifying online traders general awareness about online trading in Gujarat State based on data collected and testing of hypothesis as per the objectives of the study. VII. Chapter 7: Analysis of investors legal awareness about online trading This chapter will cover analysis of the primary data. The analysis will include identifying online traders legal awareness about online trading in Gujarat State based on data collected and testing of hypothesis as per the objectives of the study. VIII. Chapter 8: Summery and Findings 4.10 SIGNIFICANCE OF THE RESEARCH: This study gives a clear picture of investors prospective for online trading. This study covers various important aspects like information searching behavior of online trading investors, various problems of online trading investments that investor keep in mind. It gives overall scenario of online trading investors. 127
4.11 LIMITATIONS OF THE RESEARCH: The researcher is very much aware of the following limitations of the study: 1. Sampling approach has been used in this study. As such, the study suffers from the limitations of sampling in general. 2. The study is related only to the online trading in stocks. The other aspects like online trading in commodities, online shopping etc. are not covered. 3. These data are purely based on the responses of the respondents. 4. The statistical techniques have their own limitations; they also apply to this study. 128