Some Information On National Stock Exchange
Fairy Tales have always engaged human interest. The stuff dreams are made of, rags-to-riches stories. In the real world too we have these stories all around us. Among the many mediums which create "magic"in the real world, rated amongst the top ones are the stock exchanges. Trading is an activity which can be traced back to olden times. It has two primary motives- necessity and generating profits. The basics remain unchanged even today. An advanced form of trading is now carried out through stock exchanges.That is the trading of securities and other complex financial products.
The two major stock exchanges in India are the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). NSE which is situated in Mumbai is the largest stock exchange of the country. Set up in 1991 it is also the oldest and most advanced exchange in India. The exchange is owned mutually by a set of leading financial institutions, banks and other financial companies.NSE is a company incorporated under The Companies Act, 1956. It handles large volumes of trade on an everyday basis between the trading hours which is 9:15AM to 3:30PM
NSE started the trading platform for the securities market also called as the equity market followed by the debt market. NIFTY is the index used by NSE which reflects the market movement. Since these products have been in the market from a long time the volumes are huge due to a large number of participants. The various market participants are the retail customers, corporates and the high net worth individuals (HNI) Companies which fit into the specified criteria can have themselves listed on the exchange. The first time the stocks of any company are offered to the participants it is called as Initial Public Offering (IPO) Post which the stocks of that company can be traded in the secondary market.
Exchange traded funds and mutual funds are some of the other offerings under the equity product segment.Under the debt segment there are the retail and wholesale debt markets. The equity and debt markets balance each other. Corporate bonds are also seeing a boom these days. Apart from these traditional product offerings NSE also offers the complex, customised product called as derivatives. Derivatives have an underlying product and based on the value of the underlying, the movement of the derivative is determined. The derivative market is in the developing stage as people are yet to understand its merits and demerits completely.
NSE provides a trading platform thus generating huge volumes and creating a market in the process. NSE guidelines provide a comfort to the market participants. Genuine companies are listed on the exchange and trading is carried out in a fair manner. These practices boost investor confidence. Investors focus their attention on products as they understand that their money is being routed through a regulated and trusted entity. This helps in developing the market. Due to the electronic trading platform provided by NSE geographical barriers do not prove as a hindrance for potential investors. Investors need not worry about defaults as the settlement is done by the exchange. Counter party risk is completely eliminated due to the exchange platform.
Apart from being a trading platform, NSE also promotes investor awareness and education. Certificate courses and study modules have been designed with the same intent. NSE has always been developing and upgrading itself on the technology front. Latest, faster, efficient trading systems, shorter settlement cycle and an investor friendly approach is what makes it the most traded-on exchange in India.NSE with its technology and a disciplined approach is competing with the standards maintained by international exchanges.
India is a fast developing economy. The country is bursting with ideas and industries are booming. A positive market supports growth. Worthy companies are able to raise funds, create employment opportunities, export goods and create a healthy and competitive trading environment. NSE plays a vital role in making the wheel turn and leading the country on a path to progress.
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