Bombay Stock Exchange

BOMBAY STOCK EXCHANGE :BOMBAY STOCK EXCHANGE

Introduction to BSE :Introduction to BSE Bombay Stock Exchange Limited Bombay Stock Exchange Profile

Bombay Stock Exchange Limited :Bombay Stock Exchange Limited Bombay Stock Exchange Limited, established in 1875 as the "Native Share and Stock Brokers' Association" is one of the oldest stock exchanges in Asia. BSE provides an efficient market, upholding the interests of the investors. The market capitalization as on December 31, 2007 stood at USD 1.79 trillion. An investor can choose from more than 4,700 listed companies, which for easy reference, are classified into A, B, S, T and Z groups.

Slide 5:The Bombay Stock Exchange is the largest of 22 exchanges in India, with over 6,000 listed companies. It is also the fifth largest exchange in the world, with market capitalization of $466 billion.

Bombay Stock Exchange Profile :Bombay Stock Exchange Profile

Stock Exchange Members :Stock Exchange Members Members information Types of Brokers Functions of Stock Exchange Members

Members information :Members information Transactions in any stock Exchange are executed by member brokers who deal with investor. A member of a stock exchange is an individual or a corporate body who holds the right to trade in the stocks listed on the exchange. An investor can buy or sell securities only through one of the members of the exchange. The Bombay stock exchange has, at present (2004), 678 members, of whom 192 are individual members and 486 are corporate members.

Types of Brokers :Types of Brokers There are five types brokers of BSE. Foreign brokers: Industrial groups: Local bodies: Subsidiaries of Indian financial institutions and banks: Subsidiaries of Stock exchanges:

Functions of Stock Exchange Members :Functions of Stock Exchange Members Broker/Dealer All stock exchange members are brokers/dealers though not all firms in practice at in this down capacity. Opening a securities account with a broker involves establishing the clients identify and depositing the requisite amount to cover the initial security purchase.

Market Makers :Market Makers Market makers fulfill traditional role of wholesaler. A jobber is a wholesaler and also acts as market maker offering dual quotes for scrip's. They may also specialize in select scrip's.

.Agency Brokers :.Agency Brokers Agency brokers act as an intermediary between the investor and the market maker. They provide advice and charge a fee for this service. Some stockbrokers, however, do not provide any advice and render their service as "execution-only" brokers that is, purely taking orders and carrying out deals but not providing advice.

Bombay Stock of Exchange Market :Bombay Stock of Exchange Market There are four types of BSE Market Over the counter Exchange of India The Inter-Connected Stock Exchange of India Secondary Market Groups of Shares Secondary Market Trading

Over the counter Exchange of India :Over the counter Exchange of India The over the counter exchange of India was incorporated in 1990 and is recognized as a stock exchange under the securities Contracts (regulation) Act, 1956. The exchange easy set up to aid enterprising promoters in raising finance for new projects in a cost effective manner and to provide inventors with a transparent and efficient mode of trading.

Slide 15:Over the counter exchange of India has been co-promoted by the leading financial institutions of the country, namely, unit Trust of India, Industrial Development Bank of India, SBI Capital Market Limited, Industrial Finance Corporation of India, its subsidiaries.

The Inter-Connected Stock Exchange of India :The Inter-Connected Stock Exchange of India

Slide 17:The Inter-connected stock exchange of India Limited has been up at Mumbai in 1997. Inter-connected stock exchange is an association of the 14 regional stock exchanges Bangalore, Bhubaneswar, Cochin, Coimbatore, Guwahati, Hyderabad, Jaipur, Madhya Pradesh, Madras, Mangalore, Saurashta Kutch, Utaar Pradash, and Vadodara acting as a single exchange.

Secondary Market :Secondary Market The existence of secondary markets for shares is of advantage to both the company and the investors. As for the companies, a good performance of the company's shares in the capital market creates a good image or goodwill for the company so that it can use this market information successfully for its future finance requirements.

Groups of Shares :Groups of Shares At the Bombay stock exchange, trading takes place in groups,. Group ASpecified shares Group B- Non-specified shares further classified into B1and B2 groups) Group C- Odd lots and permitted shares Group F- Debt market (fixed income securities) Group G- Government Securities Group Z- List of companies which have failed to comply with listing requirements and failed to resolve investor complaints.

Secondary Market Trading :Secondary Market Trading Trading in any of these shares is done during trading hours fixed by the specific stock exchange. If trading is done before or after these fixed hours, it is called as kerb trading. During trading hours, members approach other brokers or jobbers who have an offer or sale quotations.

Operation Hours :Operation Hours Beginning of the Day Session....8:00 - 9:00 Login Session....9:00 - 9:30 Trading Session....9:30 - 15:30 Position Transfer Session....15:30 - 15:50 Closing Session....15:50 - 16:05 Option Exercise Session....16:05 - 16:35 Margin Session....16:35 - 16:50 Query Session....16:50 - 17:35

TERMS USED IN BSE TRADING :TERMS USED IN BSE TRADING Arbitrage: Arbitration: At best: Bear: Bear Market: Blue Chips: Clearing House: Cum: Volume of Trading: Delivery: Fill or Kill order: Jobbers: Kerb Dealings: Limit Orders: Listed Company: Market Order: Market on Close (MOC) order: Market on Opening (MOO):

Chapter 4Department of Investor Services :Chapter 4Department of Investor Services Introduction of the Deptt. Safeguards' for Investors‘ Selecting a Broker/ Sub – Broker Entering in to Agreement Settlement Transacting Rights of Investors Investor Awareness & Education BSE Training Institute

Introduction of the Deptt. :Introduction of the Deptt. Protecting the interest of the investors dealing in securities is one of the main objectives of BSE. In pursuit of this objective, Department of Investor ' Services was set up in 1986. Trading Members, BSE has laid down a set of procedures for arbitration thereof. These procedures are duly embodied in the Rules, Bye-laws and Regulations of BSE, which have been duly approved by the Government of

India / Securities and Exchange Board of India (SEBI).

Safeguards' for Investors' :Safeguards' for Investors' These are some of the safeguards the investors should keep in mind before trading in the securities market. Selecting a Broker/ Sub – Broker Deal only with a SEBI registered Broker / Sub - broker after due diligence. Entering in to Agreement Fill in a Client registration form with the Broker / Sub - broker

Slide 26:Transacting Specify to the Broker / Sub - broker, the exchange through which your trade is to be executed and maintain separate account for each exchange. Obtain a valid Contract Note from the Broker / Sub-broker within 24 hours of the execution of the trade.

Slide 27:Settlement Member should pay the money or securities to the investor within 24 hours of the payout. Opt for buying and selling shares in demat form. For delivery of shares from demat account, give the Depository Participant (DP) 'Delivery out' instructions to transfer the same from the beneficiary account to the pool account of broker through whom shares and securities have been sold.

Rights of Investors :Rights of Investors To receive all benefits/ material information declared for the investors by the Company. As an equity holder have a right to subscribe to further issue of capital by the Company. Brokerage not to exceed 2.5% of the contract price. Expect delivery of shares purchased/value of shares sold within 24 hours from pay-out.

Investor Awareness & Education :Investor Awareness & Education The Investor Awareness Programmes cover topics like Doe's and Don'ts for investors, Instruments of Investment, Portfolio approach, Mutual funds, Trading, Clearing and Settlement, Rolling Settlement, Investors' Protection Fund, Trade Guarantee Fund, Dematerialization of Shares, Debt Market, Investors' Grievance Redressal system available with SEBI, BSE & Company Law Board, information on Sensex and other Indices, Derivatives etc.BSE also takes initiatives through:

BSE Training Institute :BSE Training Institute (BTI) which organizes investor education programs periodically on various subjects like Capital Markets, Fundamental Analysis, Technical Analysis, Derivatives, Index Futures and Options, Debt Market etc. For the Derivatives market, BTI conducts BCDE i.e. BSE's certification on Derivative Exchange, a certification test recognized by the SEBI.

Chapter 5 Business Development & Marketing :Chapter 5 Business Development & Marketing Introduction Technology BSE On Line Trading (BOLT) BSE webx.co.in A Large Private Network BSE's Campus LAN BSE WAN VSATs: Regional Hubs:

Introduction :Introduction Bombay Stock Exchange Limited (BSE) which was founded in 1875 with 6 brokers in Mumbai has now grown into a giant institution with 874 registered brokers ( now referred to as Members) spread over 380 cities across the country. BSE's Wide Area Network (WAN) connecting over 8,000 BSE Online Trading (BOLT) System Trader Work Stations (TWS) is one of the largest of its kind in the country

Technology :Technology

BSE On Line Trading (BOLT) :BSE On Line Trading (BOLT) To facilitate smooth transactions, BSE had replaced its open outcry system with the BSE On-line Trading (BOLT) facility in 1995. This totally automated, screen-based trading in securities was put into practice nation-wide within a record time of just 50 days. BOLT has been certified by

DNV for conforming to BS7799 security standards, making BSE the second stock exchange in the world to have this certification. The capacity of the BOLT platform stands presently enhanced to 80 lakh orders per day.

BSE webx.co.in :BSE webx.co.in BSE has also introduced the world's first centralized exchange based Internet trading system, bsewebx.co.in. The initiative enables investors anywhere in the world to trade on the BSE basis which has enabled it to achieve the BS7799 certification and the subsequent ISO 27001 certification. In addition, BSE has also been successful in maintaining systems and processes uptime of 99.99%.

A Large Private Network :A Large Private Network BSE operates a large private network in India. In addition to BSE service segment, the network supports Depository operations (CDSIL) and Commodities Trading (NMICE). The network uses following segments to cater to market intermediaries. BSE's Campus LAN BSE’s Campus LAN covers around 350 member offices across 3 BSE buildings: P.J. Towers, Rotunda and Cama building

Slide 37:BSE WAN BSE WAN connects approximately 2500 member offices within Mumbai and 29 major metros to the BSE systems. Leased MLLN circuits from MTNL / BSNL are provided with ISDN / TTML leased circuit backup. Around 550 circuits are of 2Mbps capacity and the rest are of 64Kbps / 128Kbps capacity.

Slide 38:VSATs: BSE's uses VSAT technology to cater to around 2000 locations spread across 400 cities. Services are provided from BSE's satellite hub at Mumbai. Regional Hubs: The regional Hubs in 9 cities provide low cost local leased lines backed by high availability trunk backbone to BSE. Such regional technology hubs are commissioned in Ahmedabad, Bangalore, Chandigarh, Chennai, Delhi, Hyderabad, Indore, Jaipur, Kolkatta, Ludhiana, Pune and Rajkot.

Integrated Services :Integrated Services Member Services and Development Department is the single point interface for addressing the Members' requirements and questions. across products such as Cash, Derivatives and Internet Trading, and processes such as Trading, Technology, Clearing and Settlement, Surveillance and Inspection, Membership, Training and Corporate Information.

Slide 40:Relationship Managers Member Services and Development Department has an efficient mechanism of ‘Relationship Managers. Each Manager maintains a database of and is responsible for providing comprehensive services to an assigned group of Members.. The Relationship Managers as such become a single-point contact for the Members, saving them efforts and valuable time..

Slide 41:Technical Help Desk The Systems Help Desk provides assistance on system related issues concerning trading on BOLT, DTSS, BSE web systems, etc. that are available through different data networks like. Managed Leased Data Network (MLDN) and Wide Area Network (WAN) through VSAT connectivity.

Economics and Research :Economics and Research BSE has always been conscious of its responsibility towards promotion of investor education and financial literacy. In recent times, the Economics & Research Team has launched two publications, namely the "Indian Journal of Capital Market" ( IJCM) and the "SENSEX". These publications aim at making available to regulators, policy makers, academicians, capital market professionals and investors an in-depth analysis of various issues and ideas pertaining to the capital markets.