Overview of Stock Exchanges
Transcript of Overview of Stock Exchanges
8/9/2019 Overview of Stock Exchanges
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STOCK EXCHANGES
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What is a Stock Exchange?
The word “Stock” eans a !raction o!the ca"ita# o! a co"an$ and the word
“Exchange” eans a "#ace !or %&$ingand se##ing soe thing'
Hence stock exchange is a "#ace orinstit&tion !aci#itating %&$ing and se##ingo! “!raction ownershi"” o! co"anies'
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(e)nition o! StockExchange The Sec&rities Contracts *+eg&#ation,
Act- ./01 de)nes stock exchange as2
“an association- organisation or %od$ o!indi3id&a#s- whether incor"orated or not-esta%#ished !or the "&r"ose o! assisting-reg&#ating and contro##ing the %&siness
o! %&$ing- se##ing and dea#ing insec&rities”
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4&nctions o! Stock Exchanges
Ens&re increased #i5&idit$ and read$ arket !or thesec&rities'
6o%i#i7ation o! s&r"#&s !&nds o! indi3id&a#s and%&siness )rs !or in3estent in sec&rities'
(eterining the !air "rice o! 3ario&s sec&rities'Ens&re !air dea#ings and sa!et$ o! !&nds %eca&se o!strict reg&#ations on the working o! SEs'
8isted co"anies ha3e to !o##ow the r&#es !raed %$the SEs'
Act as a %aroeter o! the %&siness conditions in theco&ntr$'
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Characteristics o! a good6arket
Availability of Information 9 regarding 3o#&e-"rices o! "re3io&s transactions- c&rrent %ids : o;ers
Liquidity 9 a%i#it$ to %&$<se## an asset at a known"rice that does not s&%stantia##$ di;er !ro "re3io&s
transactions Depth = N&ero&s "otentia# %&$ers : se##ers at
3ario&s "rices
Low Transaction costs = argins- %rokerage costs-
de"ositor$ charges Informational Eciency =>artici"ants want "rices
to ad&st to in!oration 5&ick#$
Well regulated
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E3o#&tion o! Stock 6arkets in @ndia
The Nati3e Share and Stock rokersBAssociation- .D0 *o%a$ Stock Exchange,
Aheda%ad Share and Stock rokersB
Association- ./ Ca#c&tta Stock Exchange in ./F
Sec&rities Contract *+eg&#ation, Act- ./01
SE@ Act- .//
NSE- .//
Inited Stock Exchange- F..
6CX Stock Exchange- F.
Sec&rities Contract *+eg&#ation, *StockExchanges and C#earing Cor"orations,
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Stock Exchanges in @ndia
Sr. No. Name of the Exchange
1 Ahmedabad Stock Exchange Ltd.
2 BSE Ltd.
3 Bangalore Stock Exchange Ltd.
4 Bhubaneswar Stock Exchange Ltd
5 Calcutta Stock Exchange Ltd.
Coch!n Stock Exchange Ltd
" #elh! Stock Exchange Ltd.$%he
& 'auhat! Stock Exchange Ltd.$%he
( )nter*Connected Stock Exchange o+ )nd!a
L!m!ted
1, -a!ur Stock Exchange Ltd
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ot recogni!ed any longer2 6agadh- 6anga#ore-H$dera%ad- Coi%atore- Sa&rashtra K&tch- 8&dhiana
So&rce2 SE@
11 /C0 S0 Exchange L!m!ted
12/adha radesh Stock Exchange Ltd
13 /adras Stock Exchange Ltd.
14at!onal Stock Exchange o+ )nd!a Ltd.
15 %C Exchange o+ )nd!a
1 une Stock Exchange Ltd.
1"%he adodara Stock Exchange Ltd.
1&6.. Stock Exchange L!m!ted
1( 6n!ted Stock Exchange o+ )nd!a L!m!ted
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Stock Exchanges aro&ndthe wor#d htt"2<<www'wor#d=
exchanges'org<statistics<onth#$=re"orts
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O&r share in wor#d 6=ca"
SEBs arket ca" stands at IS( .'/ tri##ion *6a$F.,
Wor#d arket ca" stands at IS( 0D'0 tri##ion*6a$ F.,
J share2 'J
(ata So&rce2 Wor#d 4ederation o! Exchanges
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(e3e#o"ent o! Sec&rities 6arkets in@ndia
4reedo in designing and "ricing instr&ents o!
)nancing
+eg&#ation %$ SE@
Screen ased Trading in a## the Stock Exchanges
Change in anageent str&ct&re 9
cor"oratisation and de&t&a#isation*OWNE+SH@>- 6ANAGE6ENT and T+A(@NG +@GHTS are
segregated !ro one another,
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(e3e#o"ent o! Sec&rities6arkets in @ndia
@ntrod&ction o! ro##ing sett#eent *T now,
@ntrod&ction o! e5&it$ deri3ati3es trading
@ntrod&ction o! exchange traded c&rrenc$ !&t&res-interest rate !&t&res
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Trading S$ste
"pen outcry system in the Stock
Exchanges witho&t the &se o! techno#og$
ti## NSE started trading in .//
NSE introd&ced #creen $ased Trading
#ystem in.// *NEAT,' @n .//0- SE
introd&ced O8T'
On #ine !&##$ a&toated screen %ased
tradin s ste'
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C#earing
C#earing cor"oration 9 NSCC8 *NSE,
No3ation 9 act or re"#acing one"artici"ating e%er o! a contract with
another CC %&$s !ro se##erL %&$er %&$s !ro CC
Co&nter"art$ g&arantee
CC "rotects itse#! &sing argins
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Sett#eent
$uyer gets the securities%shares andthe seller gets the money&
S$ste !o##owed "re3io&s#$ 2 "h$sica#de#i3er$'
Now 2 e#ectronic trans!er o! shares withthe he#" o! de"ositories
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Sett#eent
The (e"ositories Act- .//1
Nationa# Sec&rities (e"ositor$ 8td *NS(8,
Centra# (e"ositories Ser3ices 8td' *C(S8,
Inder NS(8 and C(S8- there arede"ositor$ "artici"ants *(>s,
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+isk Containent 6eas&res *at NSE,
(ai#$ 6argins in Cash 6arket Segent Ma#&e at +isk *Ma+, argin
Extree 8oss 6argin
6ark To 6arket 6argin
(argin requirements 9 >a$a%#e on T.
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+e3en&e o! StockExchanges
Transaction charges 9 range o! +s to'0 "er #akh F'FFJ to F'FF0J
8isting !ees 9 @nitia# +s 0F-FFF !o##owed%$ ann&a# !ees *starts !ro .FFF,
Ann&a# s&%scri"tion 9 +s . #akh "er
e%er *cor"orates, Others #ike
@nterest incoe
@n3estent incoe
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+e3en&e and Net >ro)t o! NSE : SE
+E,E-E ../.0 .0/.1 .1/.2
NSE .F1/'/. .FFF' .'0F
SE 0D' 0F/'00 F'01
ET
)+"3IT
../.0 .0/.1 .1/.2
NSE DF'/ DD'1. 0D'F.
SE .D'. .F'0D .0'./
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+eg&#ation o! Stock 6arkets
The Ca"ita# @ss&es * Contro#, Act- ./D*re"ea#ed in .//,
Sec&rities Contract *+eg&#ation, Act-
./01 4oration o! SE@ in ./
A%o#ition o! CC@ in .// and
The SE@ Act- .// Sec&rities Contracts *+eg&#ation, *Stock
Exchanges and C#earing Cor"oration,
+eg&#ations- F.
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+eg&#ation o! Stock 6arkets
O%ecti3es o! SE@ To >+OTECT the interest o! the in3estors in
sec&rities
To >+O6OTE the de3e#o"ent o! sec&ritiesarket in @ndia
To +EGI8ATE the sec&rities arket
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+eg&#ation o! Stock 6arkets
4&nctions o! SE@ +eg&#ating the sec&rities arket
+ecognition and reg&#ation o! stock
exchanges +egistering and reg&#ating interediaries
+egistering and reg&#ating !&nctioning o!de"ositories- (>s and c&stodians
+egistering 4@@s
+egistering and reg&#ating !&nctioning o!MC4s- >6s- 64s- etc'
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+eg&#ation o! Stock 6arkets
4&nctions o! SE@ >rootion and reg&#ation o! S+Os
>rohi%iting !ra&d&#ent and &n!air trade "ractices
>rohi%iting insider trading +eg&#ating 6 : A acti3ities
>rooting in3estor ed&cation and training o!interediaries
Cond&cting research re#ated to sec&rities arket >er!or the !&nctions and exercise "owers o! Go@
&nder SC+A- ./01
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+eg&#ation o! Stock 6arkets
>owers o! SE@ (isco3er$ and "rod&ction o! %ooks o!
acco&nts and other re#ated doc&ents
S&oning- exaining and en!orcingattendance o! "ersons<re"resentati3es
@ns"ections o! %ooks- registers and otherdoc&ents o! interediaries and #isted
co"anies
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+eg&#ation o! Stock 6arkets
@nternationa# Organi7ation o! Sec&ritiesCoissions Head5&artered in S"ain
association o! organi7ations that reg&#atethe wor#dBs sec&rities arkets
e%ers !ro o3er .FF di;erent co&ntries
+o#e2 to assist its e%ers to "roote high standards
o! reg&#ation and
act as a !or& !or nationa# reg&#ators tocoo"erate with each other and other
internationa# organi7ations