A Literature Review On Adventure Tourism Tourism Essay

A Literature Review On Adventure Tourism Tourism Essay Adventure tourism has become more popular as an outdoor recreation activity in the tourism industry (Travel Industry Association of America, cited 2005). The term adventure can actually mean differently to different tourists because things that fill up the fear of one tourist may not fill up for another tourist (Buckly, 2006). Therefore, there is no any specific way to define adventure tourism. The word adventure is described as the risky activities in nature that are taken on by the tourist or the risky destination visited by the tourist and the tourist get an exciting and unusual experience from what the tourist had did (Farlex, The Free Dictionary). Adventure also is where the participants voluntarily putting themselves in a position that the participants believe that they are taking a step into the unknown where challenges will be faced and something valuable from the experience will be discovered or gained (Swarbrooke, Beard, Leckie, and Promfret, 2003). Consequently, adventure tourism is something related to nature and it is consisting of risk taking. Muller and Cleaver (2000) (cited in Swarbrooke et al. 2003, p. 29) defined adventure tourism as the capability to provide tourists with relatively high degrees of sensory stimulation. It is usually contained some physical challenging elements with the (typically short) tourists experience. While Buckley (2006) mentioned that the term adventure tourism is used to mean as guided commercial tours where these major attraction is an outdoor activity that has natural environment features and normally needs specialized sporting or equipment. It must be exiting for the tourists also. This definition does not mean that the tourists or clients have to prepare the equipments themselves, they may purely be travellers and rely on the agents to prepare the equipments for them. For example, tandem parachute harness or white water raft, etc. Therefore, adventure tourism can refer to activities done by the tourists, which have high level of perceived or real risk like diving, hiking, mountaineering, mountain biking, caving, sky-diving, skiing, snowboarding, white water rafting, kayaking, sailing, and sea kayaking. It also refer to a specific location of place with high degree of risk such as visiting desserts, jungles or mountaintops, polar regions and safaris. All these places have strong elements of adventure. Adventure tourism can be divided into soft adventure and hard adventure. These terms are developed by researchers who devised a scale to explain the diversity of behaviour, beginning with mild adventure also known as soft adventure at one end of the scale and progress to hard adventure at the other extreme. This continuum, illustrate in Figure 1.1, involves different degrees of challenge, uncertainty, setting familiarity, personal abilities, intensity, duration and perceptions of control (Lipscombe, 1995: 42). A simpler way to describe soft and hard adventure is that soft adventure does not necessarily require past experience whereas hard adventure requires some experiences and proficiency in the activity prior to the tourism experience (Millington and Locke, 2001). Hard Adventure Refers to activities with high levels of risk, requiring intense commitment and advanced skills. Soft Adventure Refers to activities with a perceived risk but low levels of real risk, requiring minimal commitment and beginning skills; most of these activities are led by experienced guides. Figure 1: The continuum of soft and hard adventure (source: Hill, 1995, cited in Beard et al. 2003, p. 33). Tourist behaviour is an in-depth topic as the behaviour of tourist change from time to time and sometimes it can be difficult to judge because not everyone shares the same behaviour. In order to understand tourist behaviour, psychologists have found that certain concepts are useful to understand the behaviour (Bhatia, 2006). According to Bhatia (2006), tourist behaviour can be understand by determining the motive, drives, or concerns being satisfied by the action and the attitudes and information that the person use to decide what kind of response should be made in a given situation. Motivation is one ways to describe tourist behaviour. Motivation is a verb derive from motivate Motivation is factor that influence or motivate trekkers to travel to Everest Base Camp. Motivation is defined as a reason or reasons for acting or behaving in a particular way or the desire or willingness to do something (Oxford online Dictionary). Hence, motivation of travel is why tourists travel to a place . It is important to know tourist travel motivations because motivations will affect travel decision process (Crompton and McKay, cited in Pan 2009, p. 216) and motivations are drivers that influence and affect the specific behaviour of a person or traveller. Furthermore, it also helps to develop strategies to attract tourists to a particular destination by understanding tourist behaviour. For example, travel agent or local authorities can find a way to increase the volume of tourists visiting a destination by understanding the tourist behaviour when the destination is kind of new in the tourism market or the number of tourists in the destination had decreased. Travel motivation is a wide theory where it can not be understood by looking at one part of the theory only. Figure 2: The Motivation Process (source: Holloway, Humphreys Davidson 2009, p.62). The process of translating a need into motivation to visit a specific destination or undertake a specific activity is quite complex and can be best demonstrated by means of a diagram (refer to Figure 2) (Holloway, Humphreys Davidson 2009, p.62). Potential consumers must be able to recognize their needs and wants and know what kinds of product actually satisfy their needs. Figure 2 shows that consumer perception of what will satisfy their need has to match with consumer perception of the attractions. Only when the consumer agrees on these 2 points, consumer will be motivated to visit a particular destination. For example, customer A and customer B have the same kind of need, where both of them like to do adventure activities and their think that trekking up to a mountain satisfies their need. Both customer A and B have the same interest but their perception on a particular destination may be different. Customer A may think that trekking to Mount Everest actually fulfils what he wants and his perception towards the destination is positive. While customer B may think that trekking to Mount Everest fulfil what he wants but he has a bad perception towards the destination as he think that the destination is very risky to him. Therefore, customer A will be willing to buy the package and climb up to Mount Everest because both the perception of the need and the attraction match. Customer B will not be motivated to go to Mount Everest as the perception of need and attraction do not match. According to Beerli and Martin (cited in Correia, Valle and Moco 2007, p. 46), motivation is the needs that drives and individual to act in a certain way to achieve the desire satisfaction. Therefore, people travel base on many different reasons. Motivation has also been referred as psychological / biological needs and wants including integral forces that arouse, direct, and integrate a persons behaviour and activity (Dann; Pearce; Uysal Hagan, cited in Shin 2009, p. 32). Travel motivators are the factors that create a persons desire to travel and are usually the internal psychological influences affecting individual choices (Bhatia, 2006). Travel motivations usually include a wide range of personal experiences and behaviours. Various studies have been done to find out why people wish to travel after the advent of mass tourism, especially after the Second World War. Macintosh (cited in Bhatia 2006) has group the basic travel motivators into four categories. Physical motivators, which are related to physical relaxation, refreshment of body and mind, sports, pleasure, and special medical treatment. All these are connected with individuals bodily well beings and connected to activities which help to reduce tension. Cultural motivators, which are related to individuals desire to travel in order to know more about other countries, natives of the countries and cultural heritage of the countries which expressed in art, music, dance, folklore, etc. Interpersonal motivators, which are related to individuals desire to meet new people, visit friends and relatives, and to seek new and different experiences. Travel is simply to escape from the daily routine or get away from the usual life or environment. Status and prestige motivators, which are related to the needs of personal esteem and personal development in an individual. Such motivators are more likely to be concerned with the desire for recognition and attention from others, in order to boost personal ego. Under this kind of motivations, people usually travel for business, for the purpose of education and the pursuit of hobbies. Crandall (cited in Hall Page 1999) who did a study on the motivations of the leisure travellers, outlined 17 motivational factors which derived from a synthesis of previous studies in this field. Below are the 17 motivational factors listed by Crandall. 1 ENJOYING NATURE, ESAPING FROM CIVILISATION To get away from civilisation for a while To be close to nature 10 RECOGNITION, STATUS To show other I could do it So other would think highly of me for doing it 2 ESCAPE FROM ROUTINE AND RESPONSBILITY Change from my daily routine To get away from the responsibilities of my daily life 11 SOCIAL POWER To have control over others To be in a position of authority 3 PHYSICAL EXRCISE For the exercise To keep in shape 12 ALTURISM To help others 4 CREATIVITY To be creative 13 STIMULUS SEEKING For the excitement Because of the risks involved 5 RELAXATION To relax physically So the mind can slow down for a while 14 SELF-ACTUALISATION (FEEDBACK, SELF-IMPROVEMENT, ABILITY UTILISATION) Seeing the results of your efforts Using a variety of skills and talent 6 SOCIAL CONTACT So I could do things with my companions To get away from other people 15 ACHIEVEMENT, CHALLENGE, COMPETITION To develop my skill and ability Because of the competition To learn what I am capable of 7 MEETING NEW PEOPLE To talk to new and varied people To build friendships with new people 16 KILLING TIME, AVOID BOREDOM To keep busy To avoid boredom 8 HETEROSEXUAL CONTACT To be with people of the opposite sex To meet people of the opposite sex 17 INTELLECTUAL AESTHETICISM To use my mind To think bout my personal values 9 FAMILY CONTACT To be away from the family for a while To help bring the family together more Table 1: Crandalls list of motivations. Source: Crandall 1980 (cited in Hall Page 1999). Pearce (cited in Pan 2009, p. 218) who had based and expanded on the theory of Maslows hierarchy of human needs, first developed the travel career ladder approach to travel motivation in 1988 and later made conceptual adjustment to the travel career ladder in 2005. The fundamental nature of this model connects the level of travel experiences with the hierarchy of travel needs. According to Pearce (cited in Pan 2009, p. 218), travellers who had more experiences in travel usually seek experiences that meet their higher order of travel needs such as self-esteem and self-actualization. On the other hand, inexperienced travellers will tend to seek experiences that meet their basic travel needs such as security and psychological ones. Tourism industry is a services industry and the products which offer in tourism industry are intangible. It is widely known that to travel is to experience. Consequently, tourist experience is fundamentally a service experience. The five level of travel career ladder, starting from the bottom are (1) concern with biological needs (including relaxation), (2) safety and security needs or level of stimulation, (3) relationship development and extension needs, (4) special interest and self-development needs, and (5) fulfilment of deep involvement needs which formally defined as self-actualization (Pearce cited in Marafa, Ho Chau 2007, p.8). This travel career ladder is later presented graphically by Ryan (cited in Marafa, Ho Chau 2007, p.8), refer to figure 3. It is not necessary that everyone has to start from the bottom because people change from time to time and some may try to seek for activities which satisfy high level of needs in pursuit of leisure and recreation (Marafa, Ho Chau, 2007). Figure 3: Travel Career Ladder by Ryan (cited in Marafa, Ho Chau 2007, p. 9). Another theory which often use by researchers when describing travel motivations is the push and pull theory. This theory shows that people travel because they are pushed and pulled to travel by some factors. Dann (cited in Pan 2009, p. 219) whom had combined and analyzed the relevant travel motivation literature, concluded that travel occurs due to the internal factors of indentified and unfulfilled desires (motivational push) and reinforce by external factors which is destination pull. Push factors are either internally generated or externally induced (Dann, cited in Pan 2009, p. 218). The desire to conquer a mountain by reaching the summit of the mountain is one of the examples of push factors. While pull factors are related to the attributes of the destination that serve to satisfy the needs and wants of travellers. Several authors assume that internal and external factors are factors that motivate human behaviour. For example, Kotler (cited in Correia, Valle and Moco 2007, p. 46) states that motivations can be the result of internal and external stimuli. Internal factors are factors derive from personal needs and wants such as psychological, social egocentric, self-actualization and safety. While external factors are usually result from promotion and publicity. Travel motivation can be either personal (personal training, compensation rest and knowledge) or interpersonal (resulting from social relation) (Crompton, 1979; Dann, 1977; Yoon and Uysal, 2005, cited in Corriea et al. 2007, p.47). Iso-Ahola; Ryan Glendon (cited in Pan 2009, p. 219) argued that travel motivation is closely related to leisure motivation and the former should not be studied independent of the latter. Iso-Ahola (cited in Alexandris, Kouthouris, Funk Giobani 2009, p. 482) defined tourism motivation as a meaningful set of mind which adequately disposes an actor or a group of actor to travel. Approach (seeking) and avoidance (escaping) are the two components in leisure motivation, identified by Iso-Ahola. Therefore, people travel in order to seek friendship, novelty, challenge, achievement, experience, and etc. while at the same time escape from the daily routine or personal problems. While Ryan Glendon (cited in Pan 2009, p. 219) applied an abbreviated version (14 items) of the Leisure Motivation Scale of 1,127 United Kingdom holidaymakers and identified four motivation factors from the scale which were intellectual, social, competence mastery and stimulus avoidance. The first three factors could be categorized as seek components and the last factor as escape component. Crompton (cited in Kao, Patterson, Scott, and Chung 2008, p. 18) studied travel motivation by using push and pull model and developed seven socio-psychological or push motives (escape from a perceived mundane environment, self-exploratory, relaxation, prestige and regression, enhancement of kinship relations, facilitation of social interaction) and two cultural motives or pull motives (novelty and education). This study refers to motives which are more specific and direct that can affect tourists decision on the travel decision or the type of holidays (Crompton, cited in Corriea et al. 2007, p.47). The author identify that psychological or social motives (push motives) sustain the desire to travel. While on the other hand, travel decision if affected by pull motives and pull motives are also associated to the destinations characteristic (Lundberg, cited in Corriea et al. 2007, p.47). A study was done to explore the motivations and satisfactions of Taiwanese Tourists who visit Australia (Kao, Patterson, Scott, and Chung, 2008). Push and pull approach was used to find 17 push motivations and 18 pull motivations for travel in this study. The most important push factor found in this study is Travelling around the world, while the most important pull factor is sunshine and scenery and most of the Taiwanese tourists are satisfied after visiting Australia. Study done by Chang (2007) on travel motivation of package tour travellers suggested that socio-psychological needs were an important motivation for travel, and socio-economic considerations were regarded as a crucial motivation for travel decision making. Furthermore, social relationships friends or relatives recommendations had a strong impact in the decision makings of the Taiwanese travellers (Chang, 2007). This study was done to examine travel motivations and travel decision-making of Taiwanese tourists with a g roup package tour abroad. Therefore, it can be said that tourists travel to a destination is strongly influenced by their socio-psychological needs. Tourist builds his/her perceptions based on intrinsic and extrinsic motivations (Gartner, 1993; Dann, 1996; Baloglu, 1997; cited in Corriea et al. 2007, p.47). Everyone receives and processes information differently. Therefore, individuals perception is also formed differently base on how the information is received and transformed. According to Oxford online dictionary, perception means the ability to see hear, or become aware of something through senses or the way in which something is regarded, understood, or interpreted. Perceptions are also defined as the perceived value of product by many previous researchers (Correia and Crouch, 2004; Correia et al., 2007C; Holbrook, 1996; oh, 2000; Sheth et al., 1991; Zeithaml, 1998; cited in Correia and Pimpao 2008). This concept develops based on cognitive and behavioural perspectives which result from the learning and motivational processes rendered by the tourist. Therefore, perception is the point of views about what the tourist think ab out the destination. Perception of a destination is linked to the destination image. Based on the image of the destination, perception of the destination will be generated and each tourist will have their own perception about the destination. Destination image is described as overall perceptions of individuals regarding a place or total set of impressions about a destination (Bigne et al., 2001; Fakeye and Crompton, 1991; cited in Alvarez and Korzay 2008). Destination image is usually formed through media, either positive or negative images. This is based on how the country promotes the destination in its country and through world news, people can easily know the problems or issues in the country. Hence, the destination image will be easily affected and it changes over time because people build up the destination images and representations based on the information that they receive (Avraham, 2000; So ¨nmez and Sirakaya, 2002; cited in Alvarez and Korzay 2008). In 21st century, internet is the most powe rful media that affect customers perception and destination image. In the world of internet, people can easily source for information regarding the destination and leave comments on the blogs or travel discussion forums after visiting the destination. Therefore, people nowadays not only listen to their friends past travel experiences but also read the worldwide tourists experiences from travel blogs or travel discussion forums. It is important to know what Malaysian trekkers think about Everest Base Camp which can be risky. Corriea et al. (2007) did a research on why people travel to exotic places by combining motivations and perceptions. This is the first time and they are the first few researchers that combine motivations and perceptions in order to understand how people can be pushed to travel to exotic places and how they form their perceptions. In this research, Corriea et al. (2007) try to find the relationship between push and pull motivation, push motivation and perception, and pull motivation and perception, based on a group of Portuguese tourists who go to exotic places such as Brazil, Morocco, Egypt, Sao Tome, and Principe. This study proves that perception of tourist destinations are formed based on push and pull factors but the relationship between push factors and perceptions in not significant and this proves that tourist decides to go for travel because he/she need to solve a conflict arousal (rest, social, and intellectual rewards) (Corriea et al. 2007). After that, the tourist will dec ide where to go based on the destination attributes. Destination attributes (pull motives) are seen as the way to solve intrinsic motives (push motives) in this study, but these constructs are not directly related to the overall perceptionof the destination because they are apparently solved when the tourist turns the attention to specific attributes (Corriea et al. 2007). Gnoth (1997) reports that the perception of a destination may be analysed from a cognitive or behavioural perspective. There are several types of perceptions which are cognitive component (which results from the evaluation of the destination attributes) and personal component (which results from the evaluation of the destination attributes) that a person can have, argued by Gnoth (1997). Travel motivation is an extensive researched area in tourism (Pan, 2009). Consequently, there are many theories that describe about tourist motivation to travel suggest by several authors or researchers as different tourist have different mindset and behaviour. Furthermore, there are many forms of tourism and tourists can be clustered into various types of groups. Perceptions of travellers on a particular destination can be unlikely because everyone thinks differently. Due to different in culture and the way they receive and transform the information will affect the perception of the tourists. Conceptual Framework Figure 4: Conceptual Framework Hypothesis Trekking in Everest region is the dream of most of the Malaysians trekkers. Its part of self-fulfillment of the trekkers and they want to challenge themselves as Malaysia does not have mountains which are more than 5000m and Everest is the highest mountain in the world. Malaysians trekkers travel to Everest Base Camp but not to the summit of Mount Everest because budget and time limit them to trek to the summit of Mount Everest. Additional information Objective To know the factors that motivate them to take Everest base camp trek To understand travelers perception on Everest base camp, Nepal as a tourism destination

Innovative Financial Instruments

Innovative Financial Instruments Methodology Collection of secondary data: Historical data from sites of NSE, BSE, SEBI etc Getting Data from newspapers Getting data from the Various Research papers published. Collecting data from various Books available on the topic. Review of Previous Management Research Reports Getting Access to Instruments available in India from SEBI websites. Findings and Conclusions In India financial market majorly denotes equity markets. Indian debt market is not well developed and still 80% of market is under Government securities. Securitization has to be done on assets held by Banks. Bond market needs a great consideration in terms of junk bonds An effort can be made to develop Carbon Emission and National growth index. Commodities Options should be developed in India. Credit derivatives should be developed with consideration of all the possible types of Credit derivatives. In a country with major income from Agriculture, Weather derivatives should be introduced to protect the interest of various involved parties. To mitigate the Catastrophe hazards new technique for risk management should be introduced. Financial development Index to measure the developments in various parameters to conclude growth in real terms. Conclusion Despite the accelerated industrial growth experienced this decade from recent economic reforms, most major investors around the globe do not yet see India as an ideal country for foreign investment. The competition for global capital will only get tougher in the years to come, and unless the political, judicial and economic environments are right, India will lag behind many other emerging nations. More importantly, the rising expectations of the middle-class, widening income and wealth inequalities between the haves and have-nots, require efficient initiatives from Government and corporate to attract and accommodate the funds available. Variety of financial products like mutual funds, insurance, shares, debentures, derivative instruments, etc. are available in India. However, the reach of these products is very limited and the features of many of these products are very basic in nature. Further development and innovation in these products would be faster if they are accessed by all classes of investors in urban as well as rural areas. The thrust lies mainly on the development of new financial products to deepen the improvements in the product distribution itself. The responsibility of ensuring these improvements vests with all the stakeholders in the financial services industry. ABSTRACT The Indian financial market has been primarily divided into three categories namely: Equity; Debt; Derivatives. Every category has its own importance in the development of financial markets. In most of the developed nations after the development of Equity now the major focus is on Debt and Derivatives market. The reason for this focus can be many supportive benefits which accrue to a market by development of double D market. Surprisingly in financial market is used as a synonym for equity market which has completely under deployed Debt and derivative markets. The importance and potentials of debt market are still under a doubtful impression in India and no major revolution has been brought to this effect in the recent periods. Focus of more and more to just equity markets has created saturation in Indian stock market. So willingly or unwillingly now the focus has to be shifted towards other possible avenues. Some of the possible avenues have been categorized during this research conducted on various instruments which are globally available but cannot find place in Indian markets. Now these instruments are also categorized in the various forms and accrue to a specific market. Firstly the focus is laid on so called Backbone of Indian Financial system Vis the Indian equity market, which has incorporated every possible instrument which can be accommodated in Indian family of Equity instruments. Few instruments has been recognized which can be absorbed in Indian market, which can be Indian Depository Receipt (IDR), Non-Voting Shares, Cumulative convertible preference shares (CCPS), Debt-equity swap. Secondly it comes the most awaited Debt market which needs great development especially in case of corporate bonds. In India 80% of bonds are Govt. issued and 80% of remaining by institutional investors. So there has to happen lot of work by GOI (Government of India). In this few instruments which can be of utmost importance for Indian environment can be Inflation linked bonds (ILB), junk bonds, Specialized debt fund for infrastructure funding, securitization of debt. Thirdly it comes to the funds of masses i.e. pension funds and retirement schemes which are always backed by government and also has gained support from the government. In this case one of the major innovative works can be on New Pension Scheme. Fourthly, it comes to mutual funds which has the role of UTI, SEBI, RBI, AMFI and other such authorities which are regulating the workings of mutual funds in India. One of New Direction in mutual funds can be Investment funds in international Markets. Fifthly it comes to the derivatives market, which can be divided in two major forms futures and options. In future major development can be in the newly arrived concepts which can become, Instruments of masses. These include Futures on the Index of Industrial and Economy growth and Index and futures for Carbon Emission in the country. Further option market again has a lot of scope for improvements in the fields of Weather derivatives, Commodity Options, Credit derivatives. Last but not the least there is an open category which also has few innovative instruments to be captured. These can be Index for Natural Disaster and risk Management and Financial development Index. Important consideration to be noticed here is that India is a great Economy with tremendous growth opportunities has to cater with ongoing global competition in terms of capital and Money markets developments. Another important issue here is that India has to balance its Financial market with the equitable share of debt and equity. It should be open for latest and innovative types of instruments suitable for the growth and development of financial system. New concepts like Carbon Emission index should be a given a proper research and find out the ways to develop and implement it. INTRODUCTION INTEGRATION OF GLOBAL CAPITAL MARKETS In this age of globalization and liberalization domestic markets alone cannot cater to the growing needs of corporate and individuals. As a result of which there is a need of finance from various new sources which has led to the integration of world markets. As a result we have seen development of various financial products in past few years. Financial globalization has brought considerable benefits to economies and to investors and has also changed the structure of markets, creating new risks and challenges for market participants and policymakers. Globalization has also increased the scope of many new financial products. Two decades ago, someone building a new factory would probably have been restricted to borrow from a domestic bank. Today it has many more options to choose from. It can also shop around the world for loan with lower interest rate and can borrow in foreign currency if foreign-currency loans offer more attractive terms than domestic-currency loans; it can issue stocks or bonds in either domestic or international capital markets. The evolution of new financial products has increased the size of global capital markets considerably over the years. Market capitalization and year to date turnover of twenty major stock exchanges is given below : THE INDIAN CAPITAL MARKET A capital market is a place where both government and companies raise long term funds to trade securities on the bond and the stock market. It consists of both the primary market where new securities are issued among investors, and the secondary markets where already existent securities are traded. In the capital market, commodities, bonds, equities and other such investment funds are traded. There are 22 stock exchanges in India, first being the Bombay Stock Exchange (BSE), which began formal trading in 1875. Over the past few years, there has been a swift change in the Indian capital markets, especially in the secondary market. In terms of the number of companies and total market capitalization in share market, the Indian equity market is considered large relative to the countrys stage of economic development. CONVENTIONAL PRODUCTS IN INDIAN CAPITAL MARKETS EQUITY Equity shares are issued by the companies in primary market to raise capital from public and corporate houses. It provides a share in the earnings of the company and the equity shareholder can participate in decision making of the company also. There are three basic types of equity: Common stock or ordinary shares [1] Common stock, as it is known in the United States, or ordinary shares, according to British terminology, is the most important form of equity investment. An owner of common stock is part owner of the enterprise and is entitled to vote on certain important matters, including the selection of directors. Common stock holders benefit most from improvement in the firms business prospects. But they have a claim on the firms income and assets only after all creditors and all preferred stock holders receive payment. Some firms have more than one class of common stock, in which case the stock of one class may be entitled to greater voting rights, or to larger dividends, than stock of another class. This is often the case with family owned firms which sell stock to the public in a way that enables the family to maintain control through its ownership of stock with superior voting rights. Preferred stock [2] Also called preference shares, preferred stock is more akin to bonds than to common stock. Like bonds, preferred stock offers specified payments on specified dates. Preferred stock appeals to issuers because the dividend remains constant for as long as the stock is outstanding, which may be in perpetuity. Some investors favor preferred stock over bonds because the periodic payments are formally considered dividends rather than interest payments, and may therefore offer tax advantages. The issuer is obliged to pay dividends to preferred stock holders before paying dividends to common shareholders. If the preferred stock is cumulative, unpaid dividends may accrue until preferred stock holders have received full payment. In the case of non cumulative preferred stock, preferred stock holders may be able to impose significant restrictions on the firm in the event of a missed dividend. Warrants [3] Warrants offer the holder the opportunity to purchase a firms common stock during a specified time period in future, at a predetermined price, known as the exercise price or strike price. The tangible value of a warrant is the market price of the stock less the strike price. If the tangible value when the warrants are exercisable is zero or less the warrants have no value, as the stock can be acquired more cheaply in the open market. A firm may sell warrants directly, but more often they are incorporated into other securities, such as preferred stock or bonds. Warrants are created and sold by the firm that issues the underlying stock. In a rights offering, warrants are allotted to existing stock holders in proportion to their current holdings. If all shareholders subscribe to the offering the firms total capital will increase, but each stock holders proportionate ownership will not change. The stock holder is free not to subscribe to the offering or to pass the rights to others. In t he UK a stock holder chooses not to subscribe by filing a letter of renunciation with the issuer. RECENT DEVELOPMENT IN EQUITY MARKET Free pricing- The abolition of office of the controller of capital issue resulted in the emergence of new era in primary markets. All controls on designing, pricing and tenure were abolished. The investors were given the freedom to price an instrument. Entry Norms- Hitherto no restrictions for a company to tap the capital markets. This resulted in massive surge of small cap issues. The need for transparent free entry was felt by SEBI. Disclosures- the quality of disclosure in the offer document was really poor. A lot of vital adverse information was not disclosed. SEBI stringent discloser norms were introduced. Book Building- It is the process of price discovery. One of the drawbacks of free pricing was price mechanism. The issue price has to be decided around 60-70 days before the opening at issue. Introduction to price building has overcome the limitation of price mechanism. Streamlining the procedures- all the procedures was streamlined. Many aspects of the operations have been made transparent. SCOPE OF FURTHER EQUITY INSTRUMENTS INDIAN DEPOSITORY RECEIPTS (IDR) After the success of American Depository Receipts and Global Depository Receipts the Indian regulatory body, SEBI also allowed foreign companies to raise capital in India through INDIAN DEPOSITORY RECEIPTS (IDRs). IDRs can be understood as a mirror image of well-known ADRs/GDRs. In an IDR, foreign companies issue the shares to an Indian Depository, which would, issue Depository Receipts to investors in India. The Depository Receipts would be listed in Indian stock exchanges and would be freely transferable. The actual shares of the IDRs would be held by an Overseas Custodian, who shall authorize the Indian Depository to issue the IDRs. The Overseas Custodian must be a foreign bank having business in India and needs approval from the Finance Ministry for acting as a custodian while the Indian Depository needs to be registered with the SEBI. Following rules were established by SEBI for listing through IDR: ISSUERS ELIGIBILITY CRITERIA: [4] Must have an average; turnover of US$ 500 million during the previous 3 financial years. Must have capital and free reserves which must aggregate to at least US$100 million. Must be making a profit for the previous 5 years and must have declared a dividend of 10% in each such year. The pre issue debt-equity ratio must be not more than 2:1. Must be listed in its home country. Must not be prohibited by any regulatory body to issue securities Must have a good track record with compliance with securities market regulations. Must comply with any additional criteria set by SEBI REASONS FOR DORMANCY IN ISSUE OF IDR: Stringent rules set by SEBI made foreign companies stay away from Indian market. The rules were made more stringent after the Global economic crisis. Availability of easy funds in foreign markets. Rate of interest in foreign banks is also less which made them prime source of funds for companies. Uncertainty of subscription in Indian markets. Indian companies have been highly active in foreign markets by raising funds through ADR and GDR but till date no foreign company has raised money through IDRs. Standard Chartered is the first company to allow its plan to issue IDR and has received the clearance from RBI also. The bank has yet to announce the size of the IDR issue, though the figures are expected to vary from Rs 2,500 to Rs 5,000 crore. Non -Voting Shares A non- voting share is more or less similar to the ordinary equity shares except the voting rights. It is different from a preference share in the sense that in case of a possible winding up of the company, the preference shareholders get their shares of dividends repaid before the owners of the non-voting shareholders. The companies with the constant track record and a strong dividend history can issue these kinds of instruments. They are basically focused to small investors who are normally not interested in the management of the firm. Hence non promoting share are a good tool for the promoters of the company to increase the share capital without diluting the control. However if the company does not fulfill the commitment of higher dividend then these shares are automatically converted to shares with voting rights. Hence it is very important for the companies to assess the characteristics of future cash flow and determine whether paying a higher rate of dividend is practicable for them or not. Debt for equity and equity for debt swaps Adebt for equity swapis not an instrument but a situation where a company offers its shareholders and creditors debt in exchange for equity or stock. The value of the stock is determined on current market rates. The company may, however, offer a higher value to attract more shareholders and debt holders to participate in the swap. Equity for debt swapis the opposite of the above process. In this swap, the creditors to the company agree to exchange the debt for equity in the business. How do creditors benefit Creditors such as banks and other financial institutions provide capital to large businesses. If the business gets into financial trouble, it may sometimes not be a good idea to allow the company to close down and go bankrupt. In these situations, these creditors find it easier to allow the business to take the form of going concern and become the shareholders in this business. The debt or the assets of the company may be so big that there would be no any profit or advantage to the banks in seeking its closure. At times, the company may also be seeking a restructuring of its capital for certain reasons. These include meeting contractual obligations, taking advantage of current stock valuation in the market or to avoid making coupon and face value payments. How debt for equity swap takes place Let us assume that a shareholder or investor of some company has $1000 worth of stock. The company offers the option to swap equity withdebtat a rate of 1:1. This means that for $1000 worth of stock, the investor would get $1000 worth of debt or bonds in the company. At times, the company may offer a ratio of 1:2 to attract more stock for its debt. This could mean an additional gain in the form of $1000 worth of stock for the investor. But it is also important to note that the investor would lose their rights as a shareholder, the moment he swaps his stock orequity for debt. Original shareholders often find themselves deprived of their voting rights when such swaps take place. DEBT MARKET Traditionally, the Indian capital markets are more synonymous with the equity markets both on account of the common investors preferences and the huge capital gains it offered no matter what the risks involved are. On the other hand, the investors preference for debt market has been relatively a recent phenomenon an outcome of the shift in the economic policy, whereby the market forces have been accorded a greater leeway in influencing the resource allocation. If we talk about the Indian debt market bond market has formed its own place in the financial systems. All the recent developments are accrued to bonds market in India. Size of debt market If we look at worldwide scenario, debt markets are three to four times larger than equity markets. However, the debt market in India is very small in comparison to the equity market. This is because the domestic debt market has been deregulated and liberalized only recently and is at a relatively nascent stage of development. Interest rate deregulation The last two decades witnessed a gradual maturing of Indias financial markets. Since 1991, key steps were taken to reform the Indian financial markets. With the introduction of auction systems for rising Government debt in the 1990s, along with the decision to put an end to the monetization of Government deficits, started the gradual process of deregulation of interest rates. While the immediate effect of deregulation of interest rates was associated with rising interest rates, deft debt management policy by the RBI and the improvements in the market micro structure saw a gradual decline in the interest rates. Abolition of tax deduction at source Tax deduction at source (TDS) used to be major barrier to the development of the government securities market in India. Recognizing this, the RBI convinced the Government to abolish it. The removal of TDS on Government securities was apparently a small but a major reform in removing pricing distortions for Government securities. Introduction of auctions For Auctions a major policy shift from administered interest rate regime to a market based regime, the choice of auction system needed to be carefully drawn, in order to give a comfort level to the government as a borrower as also to moderate the risks that might be faced by the uninitiated market participants. Accordingly, it was decided to begin with the sealed bid auction system with a post bid reserve price (since the RBI as an agent to government participates in the auctions as a non-competitive bidder.) Banks investments in Government securities valuation/accounting norms Concomitantly, regulatory initiatives in introducing international best practices in valuation/accounting norms for the banks investment portfolios (comprising mainly government securities) also necessitated the banks to mark to market their investment portfolios and forced them to actively trade. This gave an added impetus to the incipient trading activity. Consolidation of stocks Primary issuance strategy was further fine tuned towards issuance of benchmark securities to improve liquidity. Alignment of coupon payment dates for the new issuances has been consciously attempted to promote stripping of government securities (STRIPS), which if once materializes, can facilitate the establishment of zero coupon yield curve and also can take care of the segmental needs in terms of asset liability matching. Zero coupon curve for pricing[5] To bring further improvements in the pricing mechanism in debt market, a need was felt to promote a zero coupon yield curve (ZCYC). As indicated earlier, STRIPS (Separate Trading of Registered Interest and Principal of Securities) can facilitate a ZCYC. This curve is being used for pricing NSEs interest rate futures transactions. FIMMDA/PDAI, publishes a monthly ZCYC for the market participants to value their government securities portfolios. However, the ZCYC based pricing has not been popular with the Indian market participants. SCOPE OF INNOVATIONS IN BOND MARKET Inflation linked bonds (ILB)[6] The recent Monetary Policy released by RBI laid its thrust on controlling the spiraling inflation, especially the food price inflation. One of the reasons behind the CRR hike was to curtail the rising inflationary expectations (higher expected price trends) In the past RBI has been concerned about the fact that a common man does not have any protection against rising prices, Vis No Inflation Hedge. The common man has to rely on traditional but inefficient methods to hedge the real inflation risks, such as Gold and real assets such as commodities or real estate or even excessive stocking of goods In developed markets like US, the government has issues Treasury Inflation Protected Securities known as TIPS. Globally more than USD 1 trillion worth inflation linked bonds must be outstanding. Inflation linked bonds (ILB) securities give an opportunity to market participants and investors to hedge against inflation. The coupon (interest rate) of ILB is fixed but the underlying principal would move in tandem with the inflation levels in the country. At redemption of the securities the higher of the value (adding inflation) thus arrived or face value is paid off. Banks and Financial Institutions usually buy wholesale and create retail market for such securities. With right access retail investor can easily buy such securities to protect himself from inflation and this could have following advantage to investors and the government. The inflation linked bonds can make the governments accountable for higher inflation since the cost of borrowings will be linked to inflation (if coupon paid is inflation hedged). Rising inflation will also raise the repayment of inflation linked bonds. It will help government to broaden the investor base by offering inflation linked bonds at the retail level, where the participation now is minimal. Government can diversify the debt service costs in a deflationary (falling prices) scenario. It is very likely that the existence of inflation linked bonds might reduce the inflation risk premium embedded in government bonds. For the inflation linked bonds to be an effective hedge GOI should ensure that the underlying inflation index is representative of real or actual inflation on the streets. RBI can precisely quantify control the inflationary expectations embedded in the economy as well as in the markets. RBI can use inferences from trading in such bonds in formulating its monetary policy stance The onus on monetary policy tools such as interest rates, to contain inflation will reduce if RBI can guide or influence the inflationary expectations through the demand/supply of inflation linked bonds and with an excellent communication policy. For Investors in general, inflation linked bonds would provide distinct advantages: It allows investors to hedge the purchasing power (inflation) risk. The capital is inflation risk protected and the income (coupon) can be structured that way too. Inflation linked bonds universally are regarded as a separate asset class would provide diversification benefits to a portfolio due to its negative co relation with returns from traditional asset classes. Such bonds provide positive risk reward relationship too. Inflation linked bonds are effective vehicle for hedging risks for institutional investors, where the long term liabilities are inflation linked or linked to future wage levels or banks who face the inflation risk on their assets side due to their GOI Bond holdings. Access of FIIs to the inflation linked bonds can allow them to hedge their inflation risks in India which are currently expressed in the currency markets. The USD/INR (currency) volatility can hence come down hence. Junk bonds Sharp movements in the Indian equity market may be par for the course. But when it comes to the market for corporate bonds, its constantly stagnant. The reason is, we dont have a corporate bond market. But this is overwhelmingly dominated by government securities (about 80% of the total). Of the remaining, close to 80% again comprises privately placed debt of public financial institutions. An efficient bond market helps corporate reduce their financing costs. It enables companies to borrow directly from investors, bypassing the major intermediary role of a commercial bank. One of the important instruments in corporate market is Junk Bonds which could be great source of financing for countries like India where markets are not much regulated. A speculative bond rated BB or below. Junk bonds are generally issued by corporations of questionable financial strength or without proven track records. They tend to be more volatile and higher yielding than bonds with superior quality ratings.Junk bond funds emphasize diversified investments in these low-rated, high-yielding debt issues. Thus, these are high-yielding, high-risk securities issued by companies with less robust finances.[7] Need for Junk Bonds in India The major issue amongst Indian bond markets has been how companies with poorer ratings can raise funds. At times the banks and FIs are reluctant to invest in even the AAA-rated companies. In fact for progress of a developing nation like India, this would give a wonderful opportunity for the smaller companies to get funds and implement their ideas. However, a proper regulatory mechanism also needs to be set-up to avoid high risk of default in the case of junk bonds. Currently, there are only two instruments that FIIs can invest in India, i.e., equity and debt. The cap on FII debt investment varies from time to time between $1.5 billion and $2 billion. The Asset Reconstruction Company of India Ltd. (ARCIL), Indias first asset reconstruction company, has vied for permitting FIIs to invest in a new instrument in India distressed assets. ARCIL has recommended SEBI, RBI and the Finance Ministry to allow FII investment in a new category, which is neither equity nor debt but a separate lucrative instrument security receipts with underlying distressed assets. Proposed Junk Bond Market in India Scenario (Optimistic Realistic) Anoptimistic scenariowould be having junk bonds in the market ideally for funding by FIIs and Institutions for financing the small Indian companies. However, considering the risk associated with these bonds it might not be possible in near future because economy is still in its nascent phase and on a fast development track.So any move which is risky and can affect future inflows of foreign funds and investor confidence would not be ideal. The only way an investor should invest in junk bonds is by diversifying. A selection of at least half a dozen issues will afford the investor some protection. High risk is inherent in high yield bonds. Nevertheless, your portfolio may well have a place for some of these securities if you are not risk-averse. By having junk bond markets, it would in fact signify deepening and maturing of Indian debt markets. In India, companies are hamstrung by the fact that investment relaxations may come in only when the debt markets get deeper, so that insurance companies can increase their portfolio yield without exposing themselves to risk for long tenures by investing in junk bonds. Impact of Junk Bonds on Indian Economy[8] A well-functioning corporate bond market allows firms to tailor their assets and liability profiles. If companies fear they will not be able to raise long-term resources, they are likely to stay away from long-term investments or entrepreneurial ventures that have a long-term payoff. In the long run, this can affect economic growth. The corporate bond and the junk bond market could fill this vacuum. In the absence of a corporate bond market, a large part of debt funding comes from banks. In the process, banks assume a significant amount of risk due to maturity mismatch between short-term deposits that can be readily withdrawn and relatively long-term illiquid loan assets resulting in high NPAs. An active and efficient bond market gives companies an alternative means of raising debt capital in the event of a credit crunch. It also leads to better pricing of credit risk (since expectations of all market participants are incorporated into bond prices). FIIs are major players in the equities market. However, thanks to the ceiling on their investment in the debt market (currently, there is a cumulative sub-ceiling of $0.5 bn on investment in corporate debt), they are present only in a limited way in the bond market. Pension funds and the insurance sector could be another constituency, but the absence of pension funds and low insurance penetration has meant limited demand for lon Innovative Financial Instruments Innovative Financial Instruments Methodology Collection of secondary data: Historical data from sites of NSE, BSE, SEBI etc Getting Data from newspapers Getting data from the Various Research papers published. Collecting data from various Books available on the topic. Review of Previous Management Research Reports Getting Access to Instruments available in India from SEBI websites. Findings and Conclusions In India financial market majorly denotes equity markets. Indian debt market is not well developed and still 80% of market is under Government securities. Securitization has to be done on assets held by Banks. Bond market needs a great consideration in terms of junk bonds An effort can be made to develop Carbon Emission and National growth index. Commodities Options should be developed in India. Credit derivatives should be developed with consideration of all the possible types of Credit derivatives. In a country with major income from Agriculture, Weather derivatives should be introduced to protect the interest of various involved parties. To mitigate the Catastrophe hazards new technique for risk management should be introduced. Financial development Index to measure the developments in various parameters to conclude growth in real terms. Conclusion Despite the accelerated industrial growth experienced this decade from recent economic reforms, most major investors around the globe do not yet see India as an ideal country for foreign investment. The competition for global capital will only get tougher in the years to come, and unless the political, judicial and economic environments are right, India will lag behind many other emerging nations. More importantly, the rising expectations of the middle-class, widening income and wealth inequalities between the haves and have-nots, require efficient initiatives from Government and corporate to attract and accommodate the funds available. Variety of financial products like mutual funds, insurance, shares, debentures, derivative instruments, etc. are available in India. However, the reach of these products is very limited and the features of many of these products are very basic in nature. Further development and innovation in these products would be faster if they are accessed by all classes of investors in urban as well as rural areas. The thrust lies mainly on the development of new financial products to deepen the improvements in the product distribution itself. The responsibility of ensuring these improvements vests with all the stakeholders in the financial services industry. ABSTRACT The Indian financial market has been primarily divided into three categories namely: Equity; Debt; Derivatives. Every category has its own importance in the development of financial markets. In most of the developed nations after the development of Equity now the major focus is on Debt and Derivatives market. The reason for this focus can be many supportive benefits which accrue to a market by development of double D market. Surprisingly in financial market is used as a synonym for equity market which has completely under deployed Debt and derivative markets. The importance and potentials of debt market are still under a doubtful impression in India and no major revolution has been brought to this effect in the recent periods. Focus of more and more to just equity markets has created saturation in Indian stock market. So willingly or unwillingly now the focus has to be shifted towards other possible avenues. Some of the possible avenues have been categorized during this research conducted on various instruments which are globally available but cannot find place in Indian markets. Now these instruments are also categorized in the various forms and accrue to a specific market. Firstly the focus is laid on so called Backbone of Indian Financial system Vis the Indian equity market, which has incorporated every possible instrument which can be accommodated in Indian family of Equity instruments. Few instruments has been recognized which can be absorbed in Indian market, which can be Indian Depository Receipt (IDR), Non-Voting Shares, Cumulative convertible preference shares (CCPS), Debt-equity swap. Secondly it comes the most awaited Debt market which needs great development especially in case of corporate bonds. In India 80% of bonds are Govt. issued and 80% of remaining by institutional investors. So there has to happen lot of work by GOI (Government of India). In this few instruments which can be of utmost importance for Indian environment can be Inflation linked bonds (ILB), junk bonds, Specialized debt fund for infrastructure funding, securitization of debt. Thirdly it comes to the funds of masses i.e. pension funds and retirement schemes which are always backed by government and also has gained support from the government. In this case one of the major innovative works can be on New Pension Scheme. Fourthly, it comes to mutual funds which has the role of UTI, SEBI, RBI, AMFI and other such authorities which are regulating the workings of mutual funds in India. One of New Direction in mutual funds can be Investment funds in international Markets. Fifthly it comes to the derivatives market, which can be divided in two major forms futures and options. In future major development can be in the newly arrived concepts which can become, Instruments of masses. These include Futures on the Index of Industrial and Economy growth and Index and futures for Carbon Emission in the country. Further option market again has a lot of scope for improvements in the fields of Weather derivatives, Commodity Options, Credit derivatives. Last but not the least there is an open category which also has few innovative instruments to be captured. These can be Index for Natural Disaster and risk Management and Financial development Index. Important consideration to be noticed here is that India is a great Economy with tremendous growth opportunities has to cater with ongoing global competition in terms of capital and Money markets developments. Another important issue here is that India has to balance its Financial market with the equitable share of debt and equity. It should be open for latest and innovative types of instruments suitable for the growth and development of financial system. New concepts like Carbon Emission index should be a given a proper research and find out the ways to develop and implement it. INTRODUCTION INTEGRATION OF GLOBAL CAPITAL MARKETS In this age of globalization and liberalization domestic markets alone cannot cater to the growing needs of corporate and individuals. As a result of which there is a need of finance from various new sources which has led to the integration of world markets. As a result we have seen development of various financial products in past few years. Financial globalization has brought considerable benefits to economies and to investors and has also changed the structure of markets, creating new risks and challenges for market participants and policymakers. Globalization has also increased the scope of many new financial products. Two decades ago, someone building a new factory would probably have been restricted to borrow from a domestic bank. Today it has many more options to choose from. It can also shop around the world for loan with lower interest rate and can borrow in foreign currency if foreign-currency loans offer more attractive terms than domestic-currency loans; it can issue stocks or bonds in either domestic or international capital markets. The evolution of new financial products has increased the size of global capital markets considerably over the years. Market capitalization and year to date turnover of twenty major stock exchanges is given below : THE INDIAN CAPITAL MARKET A capital market is a place where both government and companies raise long term funds to trade securities on the bond and the stock market. It consists of both the primary market where new securities are issued among investors, and the secondary markets where already existent securities are traded. In the capital market, commodities, bonds, equities and other such investment funds are traded. There are 22 stock exchanges in India, first being the Bombay Stock Exchange (BSE), which began formal trading in 1875. Over the past few years, there has been a swift change in the Indian capital markets, especially in the secondary market. In terms of the number of companies and total market capitalization in share market, the Indian equity market is considered large relative to the countrys stage of economic development. CONVENTIONAL PRODUCTS IN INDIAN CAPITAL MARKETS EQUITY Equity shares are issued by the companies in primary market to raise capital from public and corporate houses. It provides a share in the earnings of the company and the equity shareholder can participate in decision making of the company also. There are three basic types of equity: Common stock or ordinary shares [1] Common stock, as it is known in the United States, or ordinary shares, according to British terminology, is the most important form of equity investment. An owner of common stock is part owner of the enterprise and is entitled to vote on certain important matters, including the selection of directors. Common stock holders benefit most from improvement in the firms business prospects. But they have a claim on the firms income and assets only after all creditors and all preferred stock holders receive payment. Some firms have more than one class of common stock, in which case the stock of one class may be entitled to greater voting rights, or to larger dividends, than stock of another class. This is often the case with family owned firms which sell stock to the public in a way that enables the family to maintain control through its ownership of stock with superior voting rights. Preferred stock [2] Also called preference shares, preferred stock is more akin to bonds than to common stock. Like bonds, preferred stock offers specified payments on specified dates. Preferred stock appeals to issuers because the dividend remains constant for as long as the stock is outstanding, which may be in perpetuity. Some investors favor preferred stock over bonds because the periodic payments are formally considered dividends rather than interest payments, and may therefore offer tax advantages. The issuer is obliged to pay dividends to preferred stock holders before paying dividends to common shareholders. If the preferred stock is cumulative, unpaid dividends may accrue until preferred stock holders have received full payment. In the case of non cumulative preferred stock, preferred stock holders may be able to impose significant restrictions on the firm in the event of a missed dividend. Warrants [3] Warrants offer the holder the opportunity to purchase a firms common stock during a specified time period in future, at a predetermined price, known as the exercise price or strike price. The tangible value of a warrant is the market price of the stock less the strike price. If the tangible value when the warrants are exercisable is zero or less the warrants have no value, as the stock can be acquired more cheaply in the open market. A firm may sell warrants directly, but more often they are incorporated into other securities, such as preferred stock or bonds. Warrants are created and sold by the firm that issues the underlying stock. In a rights offering, warrants are allotted to existing stock holders in proportion to their current holdings. If all shareholders subscribe to the offering the firms total capital will increase, but each stock holders proportionate ownership will not change. The stock holder is free not to subscribe to the offering or to pass the rights to others. In t he UK a stock holder chooses not to subscribe by filing a letter of renunciation with the issuer. RECENT DEVELOPMENT IN EQUITY MARKET Free pricing- The abolition of office of the controller of capital issue resulted in the emergence of new era in primary markets. All controls on designing, pricing and tenure were abolished. The investors were given the freedom to price an instrument. Entry Norms- Hitherto no restrictions for a company to tap the capital markets. This resulted in massive surge of small cap issues. The need for transparent free entry was felt by SEBI. Disclosures- the quality of disclosure in the offer document was really poor. A lot of vital adverse information was not disclosed. SEBI stringent discloser norms were introduced. Book Building- It is the process of price discovery. One of the drawbacks of free pricing was price mechanism. The issue price has to be decided around 60-70 days before the opening at issue. Introduction to price building has overcome the limitation of price mechanism. Streamlining the procedures- all the procedures was streamlined. Many aspects of the operations have been made transparent. SCOPE OF FURTHER EQUITY INSTRUMENTS INDIAN DEPOSITORY RECEIPTS (IDR) After the success of American Depository Receipts and Global Depository Receipts the Indian regulatory body, SEBI also allowed foreign companies to raise capital in India through INDIAN DEPOSITORY RECEIPTS (IDRs). IDRs can be understood as a mirror image of well-known ADRs/GDRs. In an IDR, foreign companies issue the shares to an Indian Depository, which would, issue Depository Receipts to investors in India. The Depository Receipts would be listed in Indian stock exchanges and would be freely transferable. The actual shares of the IDRs would be held by an Overseas Custodian, who shall authorize the Indian Depository to issue the IDRs. The Overseas Custodian must be a foreign bank having business in India and needs approval from the Finance Ministry for acting as a custodian while the Indian Depository needs to be registered with the SEBI. Following rules were established by SEBI for listing through IDR: ISSUERS ELIGIBILITY CRITERIA: [4] Must have an average; turnover of US$ 500 million during the previous 3 financial years. Must have capital and free reserves which must aggregate to at least US$100 million. Must be making a profit for the previous 5 years and must have declared a dividend of 10% in each such year. The pre issue debt-equity ratio must be not more than 2:1. Must be listed in its home country. Must not be prohibited by any regulatory body to issue securities Must have a good track record with compliance with securities market regulations. Must comply with any additional criteria set by SEBI REASONS FOR DORMANCY IN ISSUE OF IDR: Stringent rules set by SEBI made foreign companies stay away from Indian market. The rules were made more stringent after the Global economic crisis. Availability of easy funds in foreign markets. Rate of interest in foreign banks is also less which made them prime source of funds for companies. Uncertainty of subscription in Indian markets. Indian companies have been highly active in foreign markets by raising funds through ADR and GDR but till date no foreign company has raised money through IDRs. Standard Chartered is the first company to allow its plan to issue IDR and has received the clearance from RBI also. The bank has yet to announce the size of the IDR issue, though the figures are expected to vary from Rs 2,500 to Rs 5,000 crore. Non -Voting Shares A non- voting share is more or less similar to the ordinary equity shares except the voting rights. It is different from a preference share in the sense that in case of a possible winding up of the company, the preference shareholders get their shares of dividends repaid before the owners of the non-voting shareholders. The companies with the constant track record and a strong dividend history can issue these kinds of instruments. They are basically focused to small investors who are normally not interested in the management of the firm. Hence non promoting share are a good tool for the promoters of the company to increase the share capital without diluting the control. However if the company does not fulfill the commitment of higher dividend then these shares are automatically converted to shares with voting rights. Hence it is very important for the companies to assess the characteristics of future cash flow and determine whether paying a higher rate of dividend is practicable for them or not. Debt for equity and equity for debt swaps Adebt for equity swapis not an instrument but a situation where a company offers its shareholders and creditors debt in exchange for equity or stock. The value of the stock is determined on current market rates. The company may, however, offer a higher value to attract more shareholders and debt holders to participate in the swap. Equity for debt swapis the opposite of the above process. In this swap, the creditors to the company agree to exchange the debt for equity in the business. How do creditors benefit Creditors such as banks and other financial institutions provide capital to large businesses. If the business gets into financial trouble, it may sometimes not be a good idea to allow the company to close down and go bankrupt. In these situations, these creditors find it easier to allow the business to take the form of going concern and become the shareholders in this business. The debt or the assets of the company may be so big that there would be no any profit or advantage to the banks in seeking its closure. At times, the company may also be seeking a restructuring of its capital for certain reasons. These include meeting contractual obligations, taking advantage of current stock valuation in the market or to avoid making coupon and face value payments. How debt for equity swap takes place Let us assume that a shareholder or investor of some company has $1000 worth of stock. The company offers the option to swap equity withdebtat a rate of 1:1. This means that for $1000 worth of stock, the investor would get $1000 worth of debt or bonds in the company. At times, the company may offer a ratio of 1:2 to attract more stock for its debt. This could mean an additional gain in the form of $1000 worth of stock for the investor. But it is also important to note that the investor would lose their rights as a shareholder, the moment he swaps his stock orequity for debt. Original shareholders often find themselves deprived of their voting rights when such swaps take place. DEBT MARKET Traditionally, the Indian capital markets are more synonymous with the equity markets both on account of the common investors preferences and the huge capital gains it offered no matter what the risks involved are. On the other hand, the investors preference for debt market has been relatively a recent phenomenon an outcome of the shift in the economic policy, whereby the market forces have been accorded a greater leeway in influencing the resource allocation. If we talk about the Indian debt market bond market has formed its own place in the financial systems. All the recent developments are accrued to bonds market in India. Size of debt market If we look at worldwide scenario, debt markets are three to four times larger than equity markets. However, the debt market in India is very small in comparison to the equity market. This is because the domestic debt market has been deregulated and liberalized only recently and is at a relatively nascent stage of development. Interest rate deregulation The last two decades witnessed a gradual maturing of Indias financial markets. Since 1991, key steps were taken to reform the Indian financial markets. With the introduction of auction systems for rising Government debt in the 1990s, along with the decision to put an end to the monetization of Government deficits, started the gradual process of deregulation of interest rates. While the immediate effect of deregulation of interest rates was associated with rising interest rates, deft debt management policy by the RBI and the improvements in the market micro structure saw a gradual decline in the interest rates. Abolition of tax deduction at source Tax deduction at source (TDS) used to be major barrier to the development of the government securities market in India. Recognizing this, the RBI convinced the Government to abolish it. The removal of TDS on Government securities was apparently a small but a major reform in removing pricing distortions for Government securities. Introduction of auctions For Auctions a major policy shift from administered interest rate regime to a market based regime, the choice of auction system needed to be carefully drawn, in order to give a comfort level to the government as a borrower as also to moderate the risks that might be faced by the uninitiated market participants. Accordingly, it was decided to begin with the sealed bid auction system with a post bid reserve price (since the RBI as an agent to government participates in the auctions as a non-competitive bidder.) Banks investments in Government securities valuation/accounting norms Concomitantly, regulatory initiatives in introducing international best practices in valuation/accounting norms for the banks investment portfolios (comprising mainly government securities) also necessitated the banks to mark to market their investment portfolios and forced them to actively trade. This gave an added impetus to the incipient trading activity. Consolidation of stocks Primary issuance strategy was further fine tuned towards issuance of benchmark securities to improve liquidity. Alignment of coupon payment dates for the new issuances has been consciously attempted to promote stripping of government securities (STRIPS), which if once materializes, can facilitate the establishment of zero coupon yield curve and also can take care of the segmental needs in terms of asset liability matching. Zero coupon curve for pricing[5] To bring further improvements in the pricing mechanism in debt market, a need was felt to promote a zero coupon yield curve (ZCYC). As indicated earlier, STRIPS (Separate Trading of Registered Interest and Principal of Securities) can facilitate a ZCYC. This curve is being used for pricing NSEs interest rate futures transactions. FIMMDA/PDAI, publishes a monthly ZCYC for the market participants to value their government securities portfolios. However, the ZCYC based pricing has not been popular with the Indian market participants. SCOPE OF INNOVATIONS IN BOND MARKET Inflation linked bonds (ILB)[6] The recent Monetary Policy released by RBI laid its thrust on controlling the spiraling inflation, especially the food price inflation. One of the reasons behind the CRR hike was to curtail the rising inflationary expectations (higher expected price trends) In the past RBI has been concerned about the fact that a common man does not have any protection against rising prices, Vis No Inflation Hedge. The common man has to rely on traditional but inefficient methods to hedge the real inflation risks, such as Gold and real assets such as commodities or real estate or even excessive stocking of goods In developed markets like US, the government has issues Treasury Inflation Protected Securities known as TIPS. Globally more than USD 1 trillion worth inflation linked bonds must be outstanding. Inflation linked bonds (ILB) securities give an opportunity to market participants and investors to hedge against inflation. The coupon (interest rate) of ILB is fixed but the underlying principal would move in tandem with the inflation levels in the country. At redemption of the securities the higher of the value (adding inflation) thus arrived or face value is paid off. Banks and Financial Institutions usually buy wholesale and create retail market for such securities. With right access retail investor can easily buy such securities to protect himself from inflation and this could have following advantage to investors and the government. The inflation linked bonds can make the governments accountable for higher inflation since the cost of borrowings will be linked to inflation (if coupon paid is inflation hedged). Rising inflation will also raise the repayment of inflation linked bonds. It will help government to broaden the investor base by offering inflation linked bonds at the retail level, where the participation now is minimal. Government can diversify the debt service costs in a deflationary (falling prices) scenario. It is very likely that the existence of inflation linked bonds might reduce the inflation risk premium embedded in government bonds. For the inflation linked bonds to be an effective hedge GOI should ensure that the underlying inflation index is representative of real or actual inflation on the streets. RBI can precisely quantify control the inflationary expectations embedded in the economy as well as in the markets. RBI can use inferences from trading in such bonds in formulating its monetary policy stance The onus on monetary policy tools such as interest rates, to contain inflation will reduce if RBI can guide or influence the inflationary expectations through the demand/supply of inflation linked bonds and with an excellent communication policy. For Investors in general, inflation linked bonds would provide distinct advantages: It allows investors to hedge the purchasing power (inflation) risk. The capital is inflation risk protected and the income (coupon) can be structured that way too. Inflation linked bonds universally are regarded as a separate asset class would provide diversification benefits to a portfolio due to its negative co relation with returns from traditional asset classes. Such bonds provide positive risk reward relationship too. Inflation linked bonds are effective vehicle for hedging risks for institutional investors, where the long term liabilities are inflation linked or linked to future wage levels or banks who face the inflation risk on their assets side due to their GOI Bond holdings. Access of FIIs to the inflation linked bonds can allow them to hedge their inflation risks in India which are currently expressed in the currency markets. The USD/INR (currency) volatility can hence come down hence. Junk bonds Sharp movements in the Indian equity market may be par for the course. But when it comes to the market for corporate bonds, its constantly stagnant. The reason is, we dont have a corporate bond market. But this is overwhelmingly dominated by government securities (about 80% of the total). Of the remaining, close to 80% again comprises privately placed debt of public financial institutions. An efficient bond market helps corporate reduce their financing costs. It enables companies to borrow directly from investors, bypassing the major intermediary role of a commercial bank. One of the important instruments in corporate market is Junk Bonds which could be great source of financing for countries like India where markets are not much regulated. A speculative bond rated BB or below. Junk bonds are generally issued by corporations of questionable financial strength or without proven track records. They tend to be more volatile and higher yielding than bonds with superior quality ratings.Junk bond funds emphasize diversified investments in these low-rated, high-yielding debt issues. Thus, these are high-yielding, high-risk securities issued by companies with less robust finances.[7] Need for Junk Bonds in India The major issue amongst Indian bond markets has been how companies with poorer ratings can raise funds. At times the banks and FIs are reluctant to invest in even the AAA-rated companies. In fact for progress of a developing nation like India, this would give a wonderful opportunity for the smaller companies to get funds and implement their ideas. However, a proper regulatory mechanism also needs to be set-up to avoid high risk of default in the case of junk bonds. Currently, there are only two instruments that FIIs can invest in India, i.e., equity and debt. The cap on FII debt investment varies from time to time between $1.5 billion and $2 billion. The Asset Reconstruction Company of India Ltd. (ARCIL), Indias first asset reconstruction company, has vied for permitting FIIs to invest in a new instrument in India distressed assets. ARCIL has recommended SEBI, RBI and the Finance Ministry to allow FII investment in a new category, which is neither equity nor debt but a separate lucrative instrument security receipts with underlying distressed assets. Proposed Junk Bond Market in India Scenario (Optimistic Realistic) Anoptimistic scenariowould be having junk bonds in the market ideally for funding by FIIs and Institutions for financing the small Indian companies. However, considering the risk associated with these bonds it might not be possible in near future because economy is still in its nascent phase and on a fast development track.So any move which is risky and can affect future inflows of foreign funds and investor confidence would not be ideal. The only way an investor should invest in junk bonds is by diversifying. A selection of at least half a dozen issues will afford the investor some protection. High risk is inherent in high yield bonds. Nevertheless, your portfolio may well have a place for some of these securities if you are not risk-averse. By having junk bond markets, it would in fact signify deepening and maturing of Indian debt markets. In India, companies are hamstrung by the fact that investment relaxations may come in only when the debt markets get deeper, so that insurance companies can increase their portfolio yield without exposing themselves to risk for long tenures by investing in junk bonds. Impact of Junk Bonds on Indian Economy[8] A well-functioning corporate bond market allows firms to tailor their assets and liability profiles. If companies fear they will not be able to raise long-term resources, they are likely to stay away from long-term investments or entrepreneurial ventures that have a long-term payoff. In the long run, this can affect economic growth. The corporate bond and the junk bond market could fill this vacuum. In the absence of a corporate bond market, a large part of debt funding comes from banks. In the process, banks assume a significant amount of risk due to maturity mismatch between short-term deposits that can be readily withdrawn and relatively long-term illiquid loan assets resulting in high NPAs. An active and efficient bond market gives companies an alternative means of raising debt capital in the event of a credit crunch. It also leads to better pricing of credit risk (since expectations of all market participants are incorporated into bond prices). FIIs are major players in the equities market. However, thanks to the ceiling on their investment in the debt market (currently, there is a cumulative sub-ceiling of $0.5 bn on investment in corporate debt), they are present only in a limited way in the bond market. Pension funds and the insurance sector could be another constituency, but the absence of pension funds and low insurance penetration has meant limited demand for lon

How Christian Faith-Based Organizations Can Help Homeless Shelters :: Soup Kitchens Spirituality Food Pantries Essays

How Christian Faith-Based Organizations Can Help Homeless Shelters Abstract Spirituality affirms the essential self-worth, dignity and core health of a person’s well being; therefore, homeless shelters should incorporate spirituality, in order to benefit a person in the long term compared to the satisfaction of an immediate need. â€Å"Our national epidemic of intolerance for poor and homeless people is the consequence of America’s lack of spirituality, coupled with America’s love of materialism and society’s expense (3, martin).† The number one book sold for over a decade, seizing to be a fad or a trend has been the Bible. In a study of New York prisoners, studies found that those who participated in a Prison Fellowship Bible Study were rearrested drastically less compared to the amount of prisoners those whom did not. Of those who took part in the Bible study, 14 percent were rearrested within one year, compared to those who choose to not participate was 41 percent. In a similar case, at a Texas prison, out of 80 prisoners who took part in the Prison Fellowship, a whopping five percent are back in prison. In a Public Health Service, which is strongly Christian oriented, done of Teen Challenge’s Drug treatment program, by a Northwestern University doctoral student, it was found that it was more effective with the participants than that of its counterparts. With these examples, it becomes credible that with faith-based programs long term results are received, which further exemplifies my position u pon the integration of Christian faith into the homeless shelter environment. While researching this issue, I came across President Bush’s Faith-Based Initiative. Bush wants federal funding to flow to religious organizations without pointless restrictions. In doing this, there will be departments created to tend to housing, urban development, labor, health and human services. In establishment of these positions, bush will oversea them as they work closely to fund the faith-based services. On a CNN interview with Eileen O’Connor (whom represented Bush) she stated, â€Å"They (faith-based services) have an effectiveness rate. In some cases, it is proven by studies that they can be more effective as with recidivism in drug treatment programs. President Bush says that if they are effective, why not turn them.† Many critics have argued Bush’s stance in saying that it crosses the line drawn between church and state. O’Connell argued, â€Å"He (Bush) has appointed men of different faiths to head these programs up.

The Mind of a Killer Essay example -- Psychology, State of Mind

The mind of a killer is one that is not easily comprehended. The events of their lives deeply root and morph themselves into disturbed thoughts and mind sets that fuel a killer to commit murder. In Truman Capote’s In Cold Blood, the case of the quadruple homicide of the Clutter family in Holcomb, Kansas involved murderers who were two very different individuals that had teamed up to commit an important â€Å"score†. The plan was devised by Dick Hickock to rob and murder the Clutter family and he brought about his cellmate from prison, Perry Smith to assist him with the job. Each man’s past contains different events that contribute to their not-so-sound states of mind and each view the crime differently. The psychological differences between the men give a better insight into the execution of the Clutter murders and the reasoning behind them. Perry Smith’s past proves to be highly influential his psychological state of mind. He grew up in an unstable home as his mother was an alcoholic and his father remained absent for long periods during his life. His home life was very insolvent as a child until his parents divorced when he was six years old. After that, he was sent to a Catholic orphanage where he was punished by the nuns. Whenever Smith would wet the bed, the nuns would beat him. Perry states, â€Å"I had weak kidneys and wet the bed every night. I was severely beaten by the cottage mistress, who had called me names and made fun of me in front of all the boys† (275). First signs of his disturbed psychological state were brought up around this time. â€Å"She was later discharged from her job. But this never changed my mind about her and what I wish I could have done to her and all the people who made fun of me† (275). His father then came, ... ...m all while Dick collected the shells from the gun. Dick’s suffering from a character disorder is different from Perry suffering from schizophrenia because while Dick’s disorder still affects his actions and thought process, Perry’s keeps him blind to his actions and how they are wrong. While Perry and Dick were on two different sides of the psychological realm, it did not stop them from working together to execute the murders of the Clutter family. Capote’s portrayal of Perry and Dick provides an insight into the minds of the killers themselves and brings the reader a better understanding of the crime. The explanation of their past and what led them to their psychological disturbed states helps one to understand why the two men, although virtually complete different with their problems, were able to execute one of the most heinous murders in American history.

Ancient Greek Theater Architecture Essay -- Architecture History

Ancient Greek Theater Architecture Many aspects of ancient Greek theaters have long been studied and debated. Much of the information about these theaters is based on speculation due to the fact that so little of them still exist today. This lack of remnants especially applies to the architecture of the early Greek Theaters. However, through archeological finds and years of studying the people, the plays, and the architecture of the time, we are able to make many conclusions about these early structures. Greek Theaters are classified into three categories: The early Athenian Theaters, Hellenistic Theaters, and Graeco-Roman Theaters. Like most new inventions or creations, the initial theaters built by the Athenians were very simple. In the fifth century B.C., it became popular to build theaters on the slope of a large hill, or an acropolis, the most famous, being in Athens. These early theaters could be divided into three parts. The theater consisted of the theatron (or auditorium), the orchestra, and the skene (or scene building) (Betancourt). The Greeks would eventually perfect a technique that would fit as many spectators into the theatron as possible. At first the spectators sat on the ground until wooden bleachers were installed. After it was discovered that the wooden bleachers were prone to collapsing, permanent stone seating was built. The architects created concentric tiers of seats that followed the circular shape of the orchestra and hugged the rising ground of a hillside, following the natural contours of the land. Usually, theatrons were symmetrical; however, there do remain examples of irregularly shaped theatrons. A horizontal passage called the diazoma separated the theatron into halves, thu... ...heater of the fifth century B.C. has been lost forever due to changes made by the Romans. This leaves scholars of today with scant evidence of ancient Greek Theater architecture. Works Cited Allen, James T. The Greek Theater of the Fifth Century Before Christ. Berkeley, California: University of Californioa Press, 1924. Betancourt, Philip P. The Ancient Greek Theater. CD-ROM. New York: Pseudo News Films & CD-ROMS, 1996. Brockett, Oscar G. History of the Theatre. 8th ed. London: Secker & Warburg British Broadcasting Corporation, 1984. Harwood, Ronald. All the World’s A Stage. London: Secker & Warburg British Broadcasting Corporation, 1984. Nicoll, Allardyce. The Development of the Theater. 6th ed. London: George G. Harrap & Company Ltd, 1966 Corrigan, Robert W. Classical Tragedy Greek and Roman. New York: Applause, 1990.

Lady Macbeth is not the main driving force behind King Duncan’s murder Essay

In my opinion, Lady Macbeth is not the main driving force behind King Duncan’s murder. The onus for this heinous deed rests with Macbeth himself, as he would have committed this treacherous act even if Lady Macbeth had not goaded him on. When the witches make their predictions, they told Macbeth that he would be Thane of Cawdor and then later King. I firmly believe that these predictions caused Macbeth to start thinking, and thus started a chain of events that ended up with Duncan being murdered. Macbeth’s reaction to the witches’ prophecy was one of fear and agitation. â€Å"Good sir, why do you start, and seem to fear things that do sound so fair?† says Banquo. I feel that Macbeth fears the prophecy because he had been thinking about becoming King before. Deep inside him, Macbeth had the ambition to become King, and this is exactly what the witches prophesized and it was as if they had read his mind. This must be the reason the witches had chosen Macbeth, and not Banquo or any other Thane in Scotland. The witches’ prophecy ignited his deep dark ambition, and he starts to think about how he will become King. However, the witches cannot be held responsible for Duncan’s murder because Macbeth already did have the thought of being King before. The thought was already in Macbeth’s head, all the witches did was to act as a catalyst in making him pursue his ambition. Macbeth then becomes â€Å"rapt withal† because, I feel, he starts thinking about the different ways he can become King. One of them was to murder Duncan himself, and this must have been the â€Å"horrid image† Macbeth thinks about. Although this image scares him, it stills raises the question of whether Macbeth really is as noble and loyal a Thane as people say he is. If he were such a noble Thane, why would he think about killing his own King? One important point to mention here is that he is already thinking about killing King Duncan without any intervention of Lady Macbeth, who has not even been introduced into the play. However, Macbeth then decides that since he was made Thane of Cawdor without doing anything, he might become King without having to do much either (â€Å"without my stir†). Macbeth decides that if he becomes King it will be because of sheer good luck, not because he did something to try becoming King. I feel that this decision might have been made because he knows that he is one of the most powerful Thane in Scotland and so expects to be made Duncan’s heir to the throne. However, King Duncan names the heir of his throne to be Malcolm, his elder son, who shall be known as the Prince of Cumberland. It is then that Macbeth decides that he must take some action if he ever hopes to be King. â€Å"The Prince of Cumberland-that is a step, on which I must fall down, or else o’erleap For in my way it lies. Stars hide your fires, Let no light see my black and deep desires,† says Macbeth. This is very much a contrast to the decision he had made of doing nothing against Duncan in the previous scene. His loyalty to his King looses out to his ambition. Lady Macbeth is then introduced into the play when Macbeth sends a letter to her, telling her about the strange events that happened that day, perhaps because he knew that his wife would be there to give him the strength he needed to do anything against the King. Lady Macbeth’s first reaction after reading the letter is that Macbeth is too kind and noble to do anything bad to become King. She knows that Macbeth has the ambition, but she also knows that he would be hesitant to do the evil things to achieve his ambitions. â€Å"Art not without ambition, but without the illness that should attend it,† she says. From the first meeting between Lady Macbeth and Macbeth, I can conclude that Lady Macbeth wants to be Queen more than Macbeth wants to be King. Such was her desperation to be Queen that Lady Macbeth was even prepared to call on the evil spirits to make her strong, and she wants to assume masculine qualities â€Å"unsex me here† so that she will not have any womanly weaknesses. She had spoken of pouring her â€Å"valour† into â€Å"Macbeth’s ear, and valour (according to Shakespearean audiences’) is a masculine quality. This would have shocked the audience in the Elizabethan era, because at that time they believed that the universe, the natural world and human society were ordered in one great chain or hierarchy. According to the great chain, women should be weak, and their husbands should rule all wives. However, in this scene, Lady Macbeth is shown to have a lot of mettle, and has a power over her husband. She tells him that people can see right through him. â€Å"Your face, my Thane, is a book where men May read strange matters†. She then tells him to disguise his real thoughts and deceive people into believing something. â€Å"Look like th’ innocent flower, But be the serpent under’t.† Macbeth’s will to murder Duncan wavers because he starts to list the reasons for why he should not stray onto the path of evil. He fears judgment from God and his conscience will haunt him for his entire life. â€Å"Bloody instructions, which being taught return To plague th’ inventor†. He then says that he is Duncan’s â€Å"kinsman and his subject† and should protect Duncan since he is his host, and not â€Å"bear the knife myself.† He says that Duncan is a good, kind and virtuous King and the only thing driving him towards Duncan’s murder is his â€Å"vaulting ambition.† (Macbeth is shown here as being a tragic hero, an otherwise noble and virtuous character who falls due to one particular flaw, ambition. There are many other Shakespearean plays with tragic heroes, such as Othello, which tells a story of a man destroyed by jealousy.) When his wife arrives Macbeth tells her that he will not murder Duncan. (â€Å"We will proceed no further in this business†) This depicts Macbeth’s confused state of mind and his vacillation whether or not to assassinate Duncan. Here, Lady Macbeth shows her deep resolve and when she persuades and manipulates Macbeth into killing Duncan. She accuses him of cowardice and lack of love for her. â€Å"And live a coward in thine own esteem.† She claims that he was drunk when he promised her he would kill Duncan (although nowhere has the audience actually seen Macbeth promise this). She even says that she would dash the brains of her very own child if she had promised to, and so Macbeth should also be loyal to his promise. â€Å"Have plucked my nipple from his boneless gums, And dashed the brains out, had I sworn as you Have done this† These words from Lady Macbeth suggest that she is less moral than Macbeth and even evil. While she sees nothing wrong in Duncan’s murder, Macbeth, despite his deep ambition, fears the consequences of his immoral deeds. Another reason for not killing Duncan was because he was afraid of getting caught, and not because he wished to remain loyal. Getting caught would jeopardize his chances of becoming King forever. â€Å"If we should fail?† is what he asks Lady Macbeth. After Lady Macbeth formulates a plan, which impresses Macbeth and he says â€Å"Bring forth men-children only.† Macbeth is convinced that this plan was foolproof, and he succumbs to his ambition and proceeds to murder Duncan. This reveals that he wanted to kill Duncan all along, and was just waiting for the right opportunity to present itself. The moment Lady Macbeth came up with a plan, he readily agreed. Lady Macbeth believed that this was the time to murder Duncan without getting caught, and this is what she made Macbeth believe. If Lady Macbeth had not been there Macbeth would has probably stuck to his decision of not killing Duncan at that time but he would have killed Duncan later. He says this in the end of the scene- â€Å"I am settled and bend up each corporal agent to this terrible feat.† He even starts making plans of what to do with the daggers after he murders Duncan- â€Å"When we mark with blood those sleepy two.† Fate was also playing its hand at making Macbeth feel that it was his destiny to kill Duncan when Macbeth starts hallucinating and sees a dagger, leading him to Duncan’s room. (â€Å"Is this dagger which I see before me?†) It shows that fate also played its role in trying to push Macbeth into murdering his King. Later, Act Two Scene Two we see Lady Macbeth waiting for Macbeth, who has left to murder Duncan. It is then when she says that she would have killed Duncan herself if he hadn’t looked like her father sleeping. Lady Macbeth did not have the courage to kill someone who looked like her father. â€Å"Had he not resembled my father as he slept, I had done’t,† says Lady Macbeth. This tells us that she is not as brave and courageous as she made herself sound before, and still had some womanly weaknesses. This would have made Elizabethan audiences feel that although Lady Macbeth is evil and is stronger than her husband in some aspects, she is still the dutiful daughter she should be. This father-daughter relationship was considered very important at that time, and they were also very important in Shakespearean plays. There are many other examples of father daughter relationships in other plays written by Shakespeare, such as Othello and King Lear. When Macbeth arrives after killing Duncan he starts wavering again, he was worried about the consequences of him murdering murder. He was afraid of being judged by God for the evil he had done. Macbeth deeply regrets killing Duncan, and this was his immediate reaction, so he probably never wanted to. This is shown when Macbeth hears the Thanes knocking on Duncan’s bedroom door- â€Å"Wake Duncan with thy knocking. I would thou couldst.† There is also a marked contrast between the reaction of Lady Macbeth and Macbeth once they both have Duncan’s blood on their hands. Macbeth starts going mad with guilt from the sight of the blood, while Lady Macbeth just tells him to wash it off, as if nothing happened. She said that â€Å"My hands are of your colour; but I shame To wear a heart so white.† From the murder onwards all the devious plots and plans were made by Macbeth and not Lady Macbeth. He is the one who kills Banquo, because he knows that Banquo suspects him of foul play. (â€Å"To be thus is nothing, But to be safely thus.†). This shows that Macbeth is also quite evil and black hearted and will do anything to be King. From the murder onwards Macbeth is the real driving force and not Lady Macbeth. In conclusion the final responsibility for his actions rests with Macbeth himself. The witches’ predictions did stroke his ambition and Lady Macbeth egged him on to commit acts of perfidy. However Macbeth always had a choice. Witches had predicted that Banquo’s sons would be Kings. Banquo chose to do nothing- leaving matters to fate. Macbeth became Thane of Cawdor by being a loyal subject and he could have chosen to remain so until his destiny ordained him King. He could have easily said that since he was destined to be King it would somehow happen anyway. Instead he chose to murder his King and arranged to kill his best friend. His ambition drives him to rule as a tyrant, and he chose to abandon his former path of duty and honour – which ultimately leads to his downfall and tragic end.