Share Market

India has the largest volume in stock trading. It is very difficult to make money in India by investing in stock markets. With a total of more than 5000 companies listed in NSE and BSE, the most important choice of choosing the company whose shares are to be bought becomes increasingly difficult. Once decided on the stock, one need to time the market as or long term investment are done to get a good profit on the investment. A trader should always have the eye for the investment. He has to follow the valuations at which to buy or sell. When we talk about the Indian share market, we talk about two exchange points:

1) Bombay Stock Exchange (BSE): The BSE was set up in the year 1875 and is the oldest stock exchange in Asia. It is located on Dalal Street, Mumbai. It has around 3500 companies and has the most number of trading volume.

There are over 5,085 listed Indian companies on the stock exchange as per the June data and the Bombay Stock Exchange has the most significant trading volume. The BSE SENSEX, also called “BSE 30”, is a widely used market index in India and Asia.

2) National stock exchange (NSE): It is India’s leading stock exchange covering various cities and towns. It was set up on 1956. It is operating on the wholesale debt market, the capital market segment and the derivative market. Following are the capital market segments NSE has undertaken:

· Equity

· Futures and Options

· Retail Debt Market

· Wholesale Debt Market

· Currency futures

· Mutual Fund

· Stocks lending and borrowing

The NSE’s key index is the S&P CNX Nifty, known as the NSE NIFTY (National Stock Exchange Fifty), an index of fifty major stocks weighted by market capitalization.

NSE is mutually-owned by a set of leading financial institutions, banks, insurance companies and other financial intermediaries in India but its ownership and management operate as separate entities

Recent developments in Indian Stock Market:

1) New measures of risk management system:

a) Reduction of price volatility: To reduce this, the derivatives products, index options, futures were introduced.

b) Placement of circuit breakers

c) Intraday trading limit

d) Mark to market margin

2) Investigations in case a company violate any law.

3) Investor awareness campaign

4) Ban on insider trading

Trading in Indian stock exchanges is limited to listed securities of public limited companies. They are forward list and cash list.

A member broker in an Indian stock exchange can act as an agent, buy and sell securities for his clients on a commission basis and also can act as a trader or dealer as a principal, buy and sell securities on his own account and risk.

The nature of trading on Indian Stock Exchanges are that of age old conventional style of face-to-face trading with bids and offers being made by open outcry. However, there is a great amount of effort to modernize the Indian stock exchanges in the very recent times.