SECONDARY MARKET

Outstanding securities are traded in the secondary market Stock markets primarily deal with equity shares Promotes capital formation Growth of primary market depends on the stock market Economy is also dependent on stock market

FUNCTIONS
Maintain active trading Fixation of prices Ensures safe and fair dealing Financing for industry Dissemination of information Performance inducer Guidance on cost of capital

 Brokers -Limit orders : Orders limited by fixed price -Best rate order: Freedom given to the broker -Discretionary order: Range of price given -Stop loss order: If price falls below limit, sell to limit losses Jobbers -Buys/sells on his own behalf -Profit from price diffrences

 Bulls -Expects the price to rise -Buys securities to sell in future Bears -Expects price to fall -Sells securities for future delivery

SETTLEMENT CYCLE
Fixed and Rolling Fixed starts on a particular day and ends after 5 days. This pay-in-day and pay-out day follows the settlement cycle Rolling settlement from 2000 T+5 period trades are settled five days from the date of transaction Net position

PRICE FILTERS
Price volatility can create artificial demand and supply conditions Intra day price bands Proper reaction in prices for given information is not got Intra day volatility cannot be checked Graded price filters

Margins
Gross exposure margin: Upper limit to the transaction Net exposure margin: If purchase is greater than sale a margin needs to be submitted. Mark to market margin: A fixed percentage deposit has to be made based on the difference between the opening and closing price. This is refunded back to the broker Concentration ratio margin

SEBI
In 1988 the Securities and Exchange Board of India (SEBI) was established by the Government of India through an executive resolution, and was subsequently upgraded as a fully autonomous body (a statutory Board) in the year 1992 with the passing of the Securities and Exchange Board of India Act (SEBI Act) on 30th January 1992

Objectives It tries to develop the securities market. Promotes Investors Interest. Makes rules and regulations for the securities market Functions Regulates Capital Market Checks Trading of securities. Checks the malpractices in securities market. It enhances investor's knowledge on market by providing education. It regulates the stockbrokers and sub-brokers. To promote Research and Investigation

Primary market
Entry norms -Track record of dividend payment -Post issue net worth more than 5 times Promoters contribution -Not less than 20 percent Disclosure Book building

 Allocation of shares -Minimum application -Reservation for small investors Intermediaries -Licensing -Net worth

SECONDARY MARKET
Governing body Infrastructure Settlement -Auction within 80 days -Clearing house Debt market Price stabilization Delisting

NSE
InApril 1993,,it was recognized as a stock exchange under the Securities Contracts (Regulation)Act,956.NSE commenced operations in the Wholesale Debt Market segment in June1994. The Capital Market (Equities) segment of the NSE commenced operations in November 1994, while operations in the Derivatives segments commenced in June 2000.

PURPOSE
Establishing a nationwide trading facility for all types of securitiesall types of securities Ensuring equal access to investors all over the country through an appropriatethe country through an appropriate communication network Providing for a fair, efficient and securities market using electronic trading system Enabling shorter settlement cycles Meeting up with international benchmarks standards

Equity Futures and Options Retail Debt Market Wholesale Debt Market Currency future

 The S&P CNX Nifty is a composite of the top 50 stocks listed on the NSE representing different sectors of the economy. The CNX Nifty Junior is an index for companies on the National Stock Exchange of India . It represents the next rung of liquid securities after S&P CNX Nifty . It consists of 50 companies representing approximately 10% of the traded value of all stocks on the NSE. The S&P CNX 500 is Indias first broadbasedstock market index of the Indian stock market.The S&P CNX 500 represents about 96% of total market capitalization and about 93% of the total market the total turnover on the NSE.

LISTING
Every NSE listed company is required to satisfy stringent financial, public distribution and management requirements. High listing standards foster investor confidence and also bring credibility into the markets. NSE plays an important role in helping companies access equity capital by providing a liquid and well regulated market. It includes companies from different industries

ADVANTAGES OF TRADING AT NSE

An integrated network for trading in stockmarket of India Fully automated screen based system that provides higher degree of transparency Investors can transact from any part of thecountry at uniform prices Greater functional efficiency supported by by totally computerized network

BSE
The origin of the Bombay Stock Exchange dates back to1875. It was organized under the name of The Na tiveStock and share brokersAssociation as a non-profit makingAssociation. It was recognised on a permanent basisin 1957.

 In March 1995, The Bombay StockExchange has introduced screen based trading called BOLT (Bombay On-Linetrading) The securities traded in the BSE are classified into three groups namely, A Group and nonspecified securities. The latter is sub-divided into B1 and B groups. A group contains with large outstanding shares, good track record and large volume of business. Relatively liquid securities come under the B1 group and the remaining shares are placed under the B group.