STOCK MARKET

CONTENTS

INTRODUCTION TO STOCK MARKET

FEATURES OF STOCK MARKET

IMPORTANCE OF STOCK MARKET

FUNCTION OF STOCK MARKET

CLASSIFICATION OF STOCK MARKET

STOCK INDICES

CONCLUSION

STOCK EXCHANGE

Stocks are issued by companies in order to raise capitals and are

bought by investors in order to acquire a portion of the company.

Stock exchange means anybody of individual

whether incorporated or not ,constituted for the

purpose of assisting ,regulating or controlling the

business of buying ,selling or dealing in securities “.

(Securities Contract (Regulation) Act ,1956)

Features of stock exchange

It is a place where securities issued by companies, govt. & other authorities are purchased & sold.

Its area of operation or geographical jurisdiction is well defined.

Its purpose is to assist & regulate buying & selling in securities.

It operates as per rules 7 guidelines issued by the Securities & Exchange Board Of India (SEBI).

Importance of stock exchange Stock exchange is a organized securities market which provides sufficient

marketability to shares & debentures.

Stock exchange provide a reasonable measure of safety & fair dealing in the

buying & selling of securities.

It constitutes the prime centre through which bulk of investment activities

are conducted by individual & institutional operators.

Stock exchange play an important part to speed up the process of economic

in the country.

Stock exchange has been described as the pulse of the economy of the

country.

Functions of Stock Exchange Provide central and convenient meeting places for sellers and buyer of

securities

Increase the marketability and liquidity of securities

Contribute to stability of prices of securities

Equalization of price of securities

Smoothen price movement

Help the investors to know the worth of their holdings

Promote the habit of saving and investment

Help companies and government to raise funds from the investors

Provide forecasting service

BOMBAY STOCK EXCHANGE

BSE Limited formerly known as Bombay Stock

Exchange (BSE) , is the oldest stock exchange in Asia.

It is a stock exchange located on Dalal Street, Mumbai.

The equity market capitalization of the companies listed.

on the BSE was US$1 trillion as of December 2012

It the 6th largest stock exchange in Asia and the 14th

largest in the world.

BSE was established in 1875 as “The Native Share & Stock Brokers”.

First Stock Exchange in the country to obtain permanent recognition in 1956 from GOI.

Around 4700 Indian companies listed with Stock Exchange.

As of 2012, it is among the five biggest Stock Exchanges in the world in terms of transactions volume. As of March 2012, there are over 5,133 listed Indian companies and over 8,196 scrip's on the stock exchange, the Bombay Stock Exchange has a significant trading volume.

The BSE SENSEX, also called "BSE 30", is a widely used market index in India and Asia.

NATIONAL STOCK EXCHANGE

The National Stock Exchange (NSE) is stock

exchange located at Mumbai, India.

It is the second fastest growing stock exchange in

the world with a recorded growth of 16.6%.

In the year 1991 Pherwani Committee

recommended to establish National Stock

Exchange (NSE) in India.

It is the 16th largest stock exchange in the world by market

capitalization and largest in India by daily turnover and number of

trades, for both equities and derivative trading.

NSE has a market capitalization of around US 985 billion and over

1,646 listings as of December 2012.

In National Stock Exchange there is trading of equity shares, bonds

and government securities.

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.

In 2012, NSE was the third largest stock exchange in the world in

terms of the number of contracts (1221 million) traded in equity

derivatives.

Presently there are 24 stock exchanges in India, out of which 20 have

exchanges National Stock Exchange (NSE)

MULTI COMMODITY EXCHANGE

OF INDIA LTD (MCX)

Multi Commodity Exchange of India Ltd (MCX) is an independent commodity exchange based in India

To facilitate online trading and clearing & settlement operations for commodity futures across the country.

MCX hold’s market share of over 80% of the Indian commodity future market

MCX is the world largest exchange in Silver, second largest in Gold, Copper and Natural Gas, and third largest in Crude Oil Futures

OVER THE COUNTER EXCHANGE OF

INDIA (OTCEI)

Incorporated in 1990, setup to aid enterprising promoters in raising

finance for new projects.

To provide investors with a transparent efficient mode of trading.

OTCEI introduced a screen based nation wide trading.

OTCEI introduced many novel concepts to the Indian capital markets

such as screen-based nationwide trading, sponsorship of companies,

market making and scrip less trading.

The first Indian stock exchange to introduce nationwide computerized

screen based trading.

STOCK INDICES

BULLS & BEARS

BULLS

A Bull Market indicates the constant

upward movement of the stock

market.

A particular stock that seems to be

increasing in value is described to be

bullish

BEARS

A bear market indicates the continuous

downward movement of the stock

market.

Stock that seems to be decreasing in

value is described to be bearish.

STOCK BROKER

A stockbroker is person who is licensed to trade in shares.

Brokers also have direct access to the share market and can act as an

agent in share transactions.

For this service they charge a fee i.e. brokerage.

They can also offer additional services like advice on shares,

debentures, government bonds and listed property trusts and non-

listed investment options

TRADING IN STOCK MARKET

The market regulator, the Securities and Exchange Board of India

(SEBI), has made it compulsory to open the demat account if you

want to buy and sell stocks.

A person want to buy/sell stocks in the stock market has to first

place his/her order with a broker or can do themselves using online

trading systems.

The stocks purchased will be sent to the your demat account. This

process is called Rolling Settlement Cycle.

CONCLUSION

The stock exchange is considered to be the barometer of economic

activity.

Stock exchange regulate and monitor trading activity

SEBI regulate the functions of stock exchange

Secondary market provides a platform for sale of already issued and

listed securities.