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ASBA

ASBA (Application Supported by Blocked Amounts) is a process developed by the Securities and Exchange Board Of India (SEBI) for applying to IPO.In ASBA, an IPO applicant's account doesn't get debited until shares are alloted to him. ASBA means Application Supported by Blocked Amount. ASBA is an application containing an authorization to block the application money in the bank account, for subscribing to an issue. If an investor is applying through ASBA, his application money shall be debited from the bank account only if his/her application is selected for allotment after the basis of allotment is finalized, or the issue is withdrawn / failed.

Dutch auction
A Dutch auction is a type of auction where the auctioneer begins with a high asking price which is lowered until some participant is willing to accept the auctioneer's price, or a predetermined reserve price (the seller's minimum acceptable price) is reached. The winning participant pays the last announced price. This is also known as a "clock auction" or an open-outcry descending-price auction. This type of auction is convenient when it is important to auction goods quickly, since a sale never requires more than one bid. Theoretically, the bidding strategy and results of this auction are equivalent to those in a sealed first-price auction. The Dutch auction is named after its use in the Dutch Tulip craze[citation needed].

Institutional investor
Institutional investors are organizations which pool large sums of money and invest those sums in securities, real property and other investment assets. They can also include operating companies which decide to invest their profits to some degree in these types of assets. Types of typical investors include banks, insurance companies, retirement or pension funds, hedge funds, investment advisors and mutual funds. Their role in the economy is to act as highly specialized investors on behalf of others. For instance, an ordinary person will have a pension from his employer. The employer gives that person's pension contributions to a fund. The fund will buy shares in a company, or some other financial product. Funds are useful because they will hold a broad portfolio of investments in many companies. This spreads risk, so if one company fails, it will be only a small part of the whole fund's investment. Institutional investors will have a lot of influence in the management of corporations because they will be entitled to exercise the voting rights in a company. They can actively engage in corporate governance. Furthermore, because institutional investors have the freedom to buy and sell shares, they can play a large part in which companies stay solvent, and which go under. Influencing the conduct of listed companies, and providing them with capital are all part of the job of investment management.

What is IPO Grading?


It is a rating assigned by the Securities and Exchange Board of India-registered credit rating agencies to initial public offerings (IPOs) of various firms. The grade indicates an assessment of business fundamentals and market conditions in comparison to other listed equities at the time of the issuance. These ratings are generally assigned on a five-point scale, with a higher score indicating stronger companies. IPO grading can be done either before filing the draft offer documents or thereafter. However, the red herring prospectus must have the grades given by all the rating agencies. A company which has filed the draft offer document for an IPO on or after May 1, 2007, must be rated by at least one agency. Companies cannot reject the grade. If dissatisfied, they can opt for another agency. But, all grades obtained for the IPO must be disclosed to the regulator and the investors.

SEBIs new grievance redressal system


The stock market regulator SEBI is putting in place a web based centralized system to handle investor complaints. Code named SCORES (SEBI Complaints Redress System), this will be a computerized grievance redressal system with the intent of turning around the time taken to address a complaint. SEBI receives a record number of investor complaints averaging around 30,000 in a year and the current physical system causes huge delays for investors. SEBI has decided to actually outsource this responsibility to a third party who will take care of registering investor complaints and monitoring them for progress and closure.

Features of Stock Exchange


Market for securities : Stock exchange is a market, where securities of corporate bodies, government and semi-government bodies are bought and sold. Deals in second hand securities : It deals with shares, debentures bonds and such securities already issued by the companies. In short it deals with existing or second hand securities and hence it is called secondary market. Regulates trade in securities : Stock exchange does not buy or sell any securities on its own account. It merely provides the necessary infrastructure and facilities for trade in securities to its members and brokers who trade in securities. It regulates the trade activities so as to ensure free and fair trade Allows dealings only in listed securities : In fact, stock exchanges maintain an official list of securities that could be purchased and sold on its floor. Securities which do not figure in the official list of stock exchange are called unlisted securities. Such unlisted securities cannot be traded in the stock exchange. Transactions effected only through members : All the transactions in securities at the stock exchange are effected only through its authorised brokers and members. Outsiders or direct investors are not allowed to enter in the trading circles of the stock exchange. Investors have to buy or sell the securities at the stock exchange through the authorised brokers only. Association of persons : A stock exchange is an association of persons or body of individuals which may be registered or unregistered. Recognition from Central Government : Stock exchange is an organised market. It requires recognition from the Central Government. Working as per rules : Buying and selling transactions in securities at the stock exchange are governed by the rules and regulations of stock

exchange as well as SEBI Guidelines. No deviation from the rules and guidelines is allowed in any case. Specific location : Stock exchange is a particular market place where authorised brokers come together daily (i.e. on working days) on the floor of market called trading circles and conduct trading activities. The prices of different securities traded are shown on electronic boards. After the working hours market is closed. All the working of stock exchanges is conducted and controlled through computers and electronic system. Financial Barometers : Stock exchanges are the financial barometers and development indicators of national economy of the country. Industrial growth and stability is reflected in the index of stock exchange.

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