NATIONAL STOCK EXCHANGE

National Stock Exchange was established in Mumbai, India in 1992. When it emerged, it also became the first electronic stock exchange in India. It is the pet project of Pherwani Committee. It was recognised as a stock exchange in 1993, under Securities Contracts [Regulation] Act of 1956, the time when P.V. Narasimha Rao was our Prime Minister and our former Prime Minister Manmohan Singh was the finance minister. 

Why NSE? :-

At the time of its emergence and before that, the trading memberships were interned only for some groups of broker. The transparency in these trading memberships were absent at those times. With the upcoming of NSE, this was transparent like a shiny flat glass, the most transparent substance!  Anyone who was qualified and eligible could be able to invest in the stock exchange.

NSE v/s BSE:-

 Though it stands as the world’s 11^th largest stock exchange, next only to Bombay Stock Exchange (BSE), National Stock Exchange is most preferred as compared to BSE. This is due to the higher amount of volumes in NSE.

Operations of the stock exchange:-

NSE currently operates in the below four segments:

1. Capital Market Segment
2. Wholesale Debt Market Segment
3. Futures and Options Segment
4. Currency Derivatives Segment

The Transformation:-

NSE has moved the trading platform from halls and rooms to online platforms. This electrical transformation carried on by National Stock Exchange has made it one of Asia’s leading stock exchanges.

What NSE has? :-

In its website, nseindia.com, NSE has given its purpose, vision and values as follows:

• Purpose: – Determined to improve the financial well-being of people
• Vision: – To continue to be a leader, establish global presence and facilitate financial well-being of people.
• Value: – NSE is committed to values like integrity, customer, trust, excellence and teamwork.

NIFTY 50:-

 The name sounds different right! NIFTY 50!! It is the forerunning index of National Stock Exchange. It was launched on 22 April, 1996. It represents the weighted average of 50 of the largest Indian companies listed in National Stock Exchange. This NIFTY 50 covers 12 sectors of our country’s economy across 50 securities.

Features:-

NSE is known for its high level of promulgating information through its screen based automated trading system. It gives access to buyers disregarding their geographical location. 

NSE commenced its operations in Wholesale Debt Market [WDM] Segment in November 1994. Operations in Derivatives Segment were set in motion later only in June 2000.

Special NSE:-

NSE is the first stock exchange in the world to use satellite communication automation for trading using a client-giver based system called the National Exchange for Automated Trading (NEAT). For all trades, that enter this NEAT system, it responds within a fraction of a second!

Head:-

Vikram Limaye is the Managing Director and Chief Executive Officer of this India’s leading stock exchange. Before this, he was the Managing Director and Chief Executive Officer of IDFC (Infrastructure Development Finance Company Limited). 

Innovative National Stock Exchange:-

It is using various innovative reforms like Information Technology (IT), dematerialization, electronic transfer of stocks, and compression of settlement cycles. Mission of NSE is setting the docket for change in stock markets of India.

NSE EMERGE IS an enterprise by National Stock Exchange for Small and Medium Sized Enterprises (SME) and Startup companies in India. 

The great achievement:-

As of June 2020, National Stock Exchange has accumulated $2.27 Trillion in total market capitalization. The exchange supports more than 3000 Very Small Aperture Terminals (VSATs). This has made National Stock Exchange the largest private wide area network of our diversified nation. In 2020, National Stock Exchange became the number one derivatives exchange in the world.

It has also led the way in Indian financial markets, by being the first electronic limit order book to trade derivatives and ETFs (Exchange Traded Funds).

NSE has honoured awards:-

Usually, people receive awards and get honoured. For example, Dr. APJ Abdul Kalam received Bharat Ratna in 1997.

 Sometimes, organizations working for social causes receive prizes. For example, International Committee of Red Cross has won Nobel Prize thrice in 1917, 1944 and 1963! 

Following this way, our NSE also has been lionized by various awards. 

• In 2019-20, it won the prize of Best of the Best for being the index provider of the year award. 
• In the years of 2018-19, it won the award, Innovative Practices Award 2018 on sustainable development goals.

Industrial Development Bank of India is the leading promoter of the National Stock Exchange. ICICI, IFCI, LIC, SBI are some notable promoters of this stock market.

Advantages of NSE:-

NSE has various advantages. 

• As it is technologically operated, the process of exchanging is quick and efficient. 
• Everything is transparent. Investors from all over the country are able to access the information, if they are qualified and eligible. 
• Also, the supervision of these trading activities is better. 
• In this screen based automated trading system, the transactions are faster.

Regularly, the market opens at 9:15 hours and ends at 15:30 hours. Also, in this the buyers and sellers remain anonymous at times. This is because, when an order is placed, if it matches with the limit, then stocks are sold. This helps both the purchaser and the broker.

So, let us praise the National Stock Exchange of India which has given a special name to stock markets!!!

By Prasanna Venkatesh, Thiruchirapalli

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