BSE (Bombay Stock Exchange) – Online Trading System

Gone are the days when you needed a broker to help you buy and sell stocks, shares and make stock market investments. Through online investment you can buy and sell shares with just a few clicks of the mouse. The economic and capital market in India cannot exist without a stock exchange; there are two main stock exchanges where transactions take place; the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). While all the major transactions take place here, there are over 20 different stock exchanges located across the country.

Online trading in India has changed the meaning of trading in the country. With no requirement for a broker, trading has become easier, faster and far more convenient than earlier days. Some of the major financial products and services offered through online trading are mutual funds, equities, general insurance, life insurance, share trading, portfolio management, commodities trading and financial planning. In online trading, the investor has to pay less brokerage as compare to offline trading. There is no need for any paperwork through online investing and the need for a middle man is eliminated. All the stock accounts are stored in a Demat account where they can be viewed.

BSE online trading was established in 1995 and is the first exchange to be set up in Asia. It has the largest number of listed companies in the world and currently has 4937 companies listed on the Exchange with over 7,700 traded instruments.

The only thing that an investor requires for online trading through BSE is an online trading account. The trading can then be done within the trading hours from any location in the world. In fact, BSE has replaced the open cry system with automated trading. Open cry system is a common method of communication between the investors at a stock exchange where they shout and use hand gestures to communicate and transfer information about buy and sell orders. It usually takes place on the ‘pit’ area of the trading floor and involves a lot of face to face interaction. However, with the use of electronic trading systems trading is easier, faster and cheaper; and is less prone to manipulation by market makers and brokers/dealers.

The BSE provides an efficient and transparent market for trading in debt instruments, equity and derivatives. This is performed through a system known as BOLT – BSE’s Online Trading System.

In the stock exchange, a key index is used to keep track of the important or the most traded stocks in the exchange. The indice used at the BSE while trading is the SENSEX and is displayed in all major portals, newspapers and magazines. It is India’s first stock market index that enjoys an iconic stature and is tracked worldwide. It is conducted on a free-float methodology and is sensitive to market sentiments and realities.

There are also indices such as BSE small cap, BSE mid cap and BSE500 to take care of medium and small companies. Furthermore, India index services and Products Limited has indices such as CNX Nifty Junior, S&P CNX Nifty, CNX 100, S&P CNX 500 and CNX Mid cap. The BSE offers 22 indices to suit a multiplicity of needs, inclusive of 12 sectorial indices. For example, the BSE PSU Index tracks the performance of the listed PSY companies and also helps the Central Government to monitor its wealth on the bourses.

The BSE has become a completely ‘corporatised and demutualized stock exchange’ through the use of online exchanges. With partners such as Deutsche Borse (DB) and Singapore Stock Exchange (SGX) it has a global competitive force. BSE has strategic relationships in almost every part of the world- Europe (DB)), Hong Kong (ETF) and Asia (SGX), prominent public sector undertakings such as State Bank of India, Bank of India, Life Insurance Corporation of India and Central Bank of India.

Benefits of BSE trading system in India for share brokers or newbies

There are a number of attractive services to empower investors and facilitate smooth transactions. Some of these include:

1) Investor Services: A range of services are offered to investors. Being the first exchange in the country to provide an amount of INR 1 million towards the investor protection fund, the BSE had launched a nationwide investor awareness program; ‘Safe Investing in the Stock Market’ under which there were 264 programmes which were conducted in over 359 cities in India.

2) BSE has an Online trading BOLT system: the online-Trading system (BOLT) facilitates on-line screen based trading in securities. Currently it operates 25,000 Trader Workstations which are located across 359 cities in the country.

3) The BSE has the world’s first centralized exchange-based Internet trading system – This system helps the investors anywhere in the world to trade on the BSE platform.

4) The BSE has an online Surveillance system (BOSS) which monitors on a REAL-TIME basis the price movements, the volume positions and members’ positions as well as real time measurement of default risk, generation of cross market alerts and market reconstruction.

5) The BSE has a training institute – known as the Bombay Stock Exchange Training Institute (popularly known as the acronym BTI).The BTI imparts capital market training and certification; in collaboration with a number of reputed management institutes and universities. There are over 40 courses to choose from on different aspects of the capital market and the financial Bombay Stock Exchange market.


Sensex zooms 1,075 points to reclaim 39,000-mark

The S&P BSE Sensex and NSE Nifty 50 indices skyrocketed for second straight session after the investor sentiment got a boost from corporate tax rate cuts announced by Finance Minister Nirmala Sitharaman on Friday. The Sensex surged as much as 1,426 points to close above 39,000 mark for the first time since July 17 and the Nifty advanced close 11,700 mark. Rally in banking and fast moving consumer goods shares supported the upmove in today’s session. HDFC twins, ICICI Bank, Larsen & Toubro, ITC and Kotak Mahindra Bank were among the top Sensex movers and contributed over 800 points towards upmove in the Sensex.

The Sensex surged 1,075 points or 2.83 per cent to close at 39,090 and Nifty 50 index rose 329 points or 2.92 per cent to end at 11,603. Today’s upmove comes a day after the Sensex and Nifty surged the most in over 10 years on Friday following announcement of corporate tax rate cut.

“A mega bull market is starting now on the back of the reforms of the century for India‚Ķ I don’t think we will be looking back anytime soon,” AK Prabhakar, head of research at IDBI Capital, told NDTV.

Nine of 11 sector gauges compiled by National Stock Exchange ended higher led by the Nifty Private Bank index’s 5.6 per cent gain. Nifty FMCG, Nifty Financial Services, Nifty Bank, Nifty Auto, NIfty PSU Bank and Nifty Realty indexes also rose between 2 and 5.4 per cent each.

On the other hand, Nifty IT index dropped nearly 3 per cent after Infosys and Tata Consultancy Services came under selling pressure.

Mid- and small-cap shares also witnessed buying interest in today’s session as the Nifty Midcap 100 rose 2.45 per cent and the Nifty Smallcap 100 index climbed 3.14 per cent.

Bharat Petroleum was top gainer in the Nifty 50 basket of shares, the stock rose 14 per cent to close at Rs. 459. Larsen & Toubro, Bajaj Finance, Eicher Motors, Indian Oil, Asian Paints, Adani Ports, Bajaj Finserv, Axis Bank, Kotak Mahindra Bank and ITC were also among the gainers up between 7 and 9 per cent each.

On the flipside, Zee Entertainment, Infosys, Power Grid, Tata Motors, Dr Reddy’s Labs, Cipla and NTPC were among the laggards.

The overall market breadth was positive as 1,197 shares closed higher while 622 closed lower on the NSE.