Stock Exchanges In India

Traditionally, An Indian stock exchanges was an association of individual members called ,member brokers formed for the express purpose of self regulating and facilitating the buying and selling of securities by the public and institution at large.These member broker were essentially middlemen,who carried out the desired transaction in securities either on be half of public or on their own behalf.Some brokers used to be the important person of the association who used to cause issue of good governance.

There are currently 23 recognized stock exchanges.The 4 are national and 19  are regional exchanges.The four national level exchanges are Bombay Stock Exchange (BSE) , National Stock Exchange (NSE),OTC Exchange of India (OTCEI) with OTC standing for ‘Over The Counter ‘and Inter-connected Stock Exchange of India (ISE) .The Overall development and regulation of securities market was entrusted to the SEBI by act of Parliament ,1992.

BSE dominated the Indian stock market for well over a century until the NSE took the lead in early 90s .

The Inter-connected Stock Exchange of India Limited (ISE) was promoted by 14 regional stock exchanges, with a view to provide trading connectivity to all the member of of participating exchange , in a cost effective manner . Like other exchanges it also provide trading , clearing, settlement , risk management and surveillance etc in order to address the needs of smaller companies in and retail investors in smaller town.

OCTEI was promoted in 1990 as a profit making company , along the lines of NASDAQ in USA. Its main objective was to help enterprising promoter in raising finance for new projects and to provide investors with a transparent and efficient mode of trading. OCTEI introduced many novel concepts to Indian capital market.It was the first to offer screen-based nationwide trading , sponsorship of companies,market making and scripless trading .It primarily targeted technology related growth companies for listing.

The segregation of three arm that is ownership,membership and management of stock exchange , by giving them a corporate model is referred to as demutualization  .This ensures that the brokers were separated from the management and cant take advantage of being benefited themselves on the cost of other. This removed the bad governance in earlier association or exchange. NSE , from starting , was founded de-mutualated which is a advantage over the BSE.

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