What is stock exchange and share market?
Stock market is a market where shares, bonds and other securities of various companies are bought and sold by investor companies. The stock market can provide a number of facilities such as the issue and redemption of securities and other financial instruments and events of capital, income and payment of dividends. The Bombay Stock Exchange, established in 1875, is the first stock exchange in Asia. The stock market is managed and regulated by the Securities and Exchange Board of India (SEBI).
There are 23 stock exchanges in India recognized by SEBI. There are two national level stock exchanges of these, BSE and NSE. The remaining 21 are Regional Stock Exchanges (RSE). Due to the stringent norms introduced by SEBI, 20 RSEs in the country opted out of trading. SEBI derecognised Saurashtra Stock Exchange, Rajkot on 09 July 2007 due to slow functioning.
Securities and Exchange Board of India (SEBI):
The Securities and Exchange Board of India (SEBI) is the regulatory board of securities and finance in India. The current chairman of SEBI is Ajay Tyagi. SEBI was officially established by the Government of India on 12 April 1992. SEBI is headquartered in Mumbai and has Northern, Eastern, Southern and Western Regional Offices at New Delhi, Kolkata, Chennai and Ahmedabad respectively.
Main functions of the Securities and Exchange Board of India (SEBI):
The main objectives of SEBI are to provide the best protection of the interests of the Indian stock investors and to promote the development and regulation of the securities market. SEBI was established as a non-statutory organization which has been given statutory status under SEBI ACT 1992. Its assigned functions are as follows:
- To protect the interests of the investors in the securities market and to regulate and develop the securities market through appropriate measures.
- To regulate the business of stock exchanges and any other securities market.
- Regulating and registering the work of stock brokers, sub-brokers, share transfer agents, trustees, merchant bankers, under-writers, portfolio managers, etc.
- To register and regulate Collective Investment Schemes of Mutual Funds.
- To eliminate Unfair Trade Practices related to securities market.
- To train people associated with the securities market and to encourage investor education.
- Prohibition of insider trading in securities.
List of all approved stock exchanges in India:
|Names of the Stock Exchanges
|Location (city and state name
|Uttar Pradesh Stock Exchange
|Kanpur, Uttar Pradesh
|Vadodara Stock Exchange
|Coimbatore Stock Exchange
|Coimbatore, Tamil Nadu
|Meerut Stock Exchange
|Meerut, Uttar Pradesh
|Mumbai Stock Exchange
|Over the Counter Exchange
|National Stock Exchange
|Ahmedabad Stock Exchange
|Bangalore Stock Exchange
|Bhubaneswar Stock Exchange
|Kolkata Stock Exchange
|Kolkata, West Bengal
|Cochin Stock Exchange
|Delhi Stock Exchange
|Delhi, New Delhi
|Guwahati Stock Exchange
|Hyderabad Stock Exchange
|Hyderabad (joint capital of Telangana and Andhra Pradesh)
|Jaipur Stock Exchange
|Canara Stock Exchange
|Ludhiana Stock Exchange
|Chennai Stock Exchange
|Chennai, Tamil Nadu
|Madhya Pradesh Stock Exchange
|Indore, Madhya Pradesh
|Magadh Stock Exchange
|Pune Stock Exchange
|Capital Stock Exchange Kerala Limited
Bombay Stock Exchange (BSE)
- BSE is an Indian stock exchange based in Dalal Street, Mumbai, driven by a vision to "emerge as the premier Indian stock exchange with best-in-class global practice in technology, product innovation and customer service". .
- It is one of the two major stock exchanges in India and was founded by Mr. Premchand Roychand, popularly known as the Cotton King, Bullion King or Big Bull.
- He was one of the most influential Indian businessmen of the 19th century and made his fortune in the stock-broking business.
- Established in 1875, BSE is the oldest and first stock exchange in Asia and was earlier known as Native Share and Stock Brokers Association.
- But the story of BSE begins in the 1850s when 22 stockbrokers would gather under banyan trees in front of Mumbai's Town Hall. The location of these meetings changed several times to accommodate the growing number of brokers. The group finally moved to Dalal Street in the year 1874.
- In the year 1986, SENSEX was introduced as the first equity index to provide a basis for identifying the top 30 traded companies of the exchange in more than 10 sectors.
- Apart from Sensex, other important indices of BSE are BSE 100, BSE 200, BSE 500, BSE MIDCAP, BSE SMLCAP, BSE PSU, BSE Auto, BSE Pharma, BSE FMCG, BSE Metal etc.
- As of April 2018, BSE has a total market capitalization of over $4.9 trillion, making it the 10th largest stock exchange marketplace in the world.
- It also provides various services like market data services, risk management, CDSL (Central Depository Services Limited) depository services etc.
National Stock Exchange (NSE)
- NSE is the youngest stock exchange of India which came out in the year 1992 and works with a vision.
- In 1992, for the first time in India, NSE introduced the advanced electronic trading system, which replaced the paper-based settlement system and offered an easy trading facility.
- A year later, in the year 1993, NSE was established as a tax paying company, which later registered itself as a stock exchange under the Securities Contract Regulation Act.
- National Securities Depository Limited (NSDL) was formed in the year 1995 to provide depository services to the investors.
- NSDL allows investors and traders to securely store and transfer their stocks.
- Additionally, it allows investors to hold and trade in something in the form of a share or a bond.
- The Nifty 50, a popular benchmark index in the Indian stock market, was introduced by the NSE in the same year. Nifty lists the top 50 companies that are traded on the NSE stock market.
Kolkata Stock Exchange (CSE)
- CSE is a Regional Stock Exchange (RSE), located in Lyons Range, Kolkata and is the second oldest stock exchange in South East Asia.
- Incorporated in 1908, CSE is the second largest stock exchange in India.
- In the year 1980, it was granted permanent recognition by the Government of India under the relevant provisions of the Securities Contracts (Regulation) Act, 1956.
- While around 20 regional stock exchanges have voluntarily exited in protest against SEBI's stringent regulations against RSE, CSE is now the only stock exchange.
Metropolitan Stock Exchange (MSE)
- MSE was recognized by SEBI on 16th September 2008 and was valid till 15th September 2019.
- MSE provides a hi-tech platform to trade in capital markets, futures and options, currency derivatives and debt market segments of the Indian market
- It was recognized by SEBI on 16th September 2008 and is valid till 15th September 2019
- The shareholders of MSEs include Indian public sector banks, private sector banks, investors and domestic financial institutions which are subject to CAG audit.
- It has come out with a "Manifesto of Change", which is the goal of the stock exchange in terms of growth and inclusive growth of the stock market over the next 10 years.
India International Exchange (India INX)
- India INX opened in January 2017, it is India's first international stock exchange.
- It is a wholly owned subsidiary of the Bombay Stock Exchange (BSE) and is based at the International Financial Services Center (IFSC), GIFT City in Gujarat.
- It is claimed to be the world's most technologically advanced platform, with a turn time of 4 microseconds, operating 22 hours a day and six days a week.
- Due to these timings, international investors and non-resident Indians (NRIs) can trade from anywhere across the globe at their preferred timings.
- In addition, India INX launched Global Securities Markets, India's first international primary market platform, connecting global investors with Indian and foreign issuers.
NSE IFSC Ltd.
- NSE IFSC Limited (NSE International Exchange) incorporated on 29 November 2016, is a wholly owned subsidiary of National Stock Exchange (NSE) and is located at International Financial Services Center (IFSC) at GIFT City in Gujarat.
- NSE IFSC Limited has been launched with the hope of enhancing the financial market as well as bringing capital into India.
- It is permitted to trade in securities denominated in any currency other than the Indian Rupee. NSE IFSC Limited operates 16 hours of daily trading.
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