Something About Stock Exchange: BY Aman Sharma

SOMETHING
ABOUT
STOCK EXCHANGE
BY
AMAN SHARMA
WHAT IS STOCK EXCHANGE
Stock exchange is that place where trading of
shares is done in terms of sale and purchase.
INTRODUCTION :
• There are 24 stock exchanges in the
India. Mumbai's (earlier known as
Bombay), Bombay Stock Exchange is
the largest, with over 6,000 stocks listed.
The BSE accounts for over two thirds of
the total trading volume in the country.
Established in 1875, the exchange is also
the oldest in Asia. Among the twenty-two
Stock Exchanges recognised by the
Government of India under the Securities
Contracts (Regulation) Act, 1956, it was
the first one to be recognized.
Name of Indian stock exchange:
• 1.Bombay stock exchange
• 2.national stock exchange(Mumbai)
• 3.Banglore stock exchange
• 4.Utter pradesh stock exchange(kanpur)
• 5.Magadh stock exchange(Patna)
• 6.Ahmedabad stock exchange
• 7.vadodara stock exchange(Baroda)
• 8.Bhubaneswar stock exchange
• 9.Calcutta stock exchange(kolkata)
• 10.madras stock exchange
Cont…….
• 11.Cochin stock exchange
• 12.coimbatore stock exchange
• 13.Gauhati stock exchange
• 14.Hydrabad stock exchange
• 15.Madhya pradesh stock exchange(indore)
• 16.Jaipur stock exchange
• 17.Ludhina stock exchange
• 18.Mangalore stock exchange
• 19.Pune stock exchange
• 20.saurashtrakutch stock exchange
Cont…….
• Bombay stock exchange : it has 30 companies sripted.
• 1.ACC
• 2.BAJAJ
• 3.AIRTEL
• 4.BHEI
• 5.CIPLA
• 6.DLF
• 7.GRASIM
• 8.GUJRAT AMBUJA
• 9.HDFC
• 10.HDFC BANK
CONT……
• 11.HERO HONDA
• 12.HINDALCO
• 13.HUL
• 14.ICICI BANK
• 15.INFICYS
• 16.ITC
• 17.L&T
• 18.MARUTI
• 19.NTPC
• 20.ONGC
CONT……
• 21.RANBAXY
• 22.RELIANCE COMMUNICATION
• 23.RELIANCE ENERGY
• 24.RIL
• 25.SATYAM
• 26.SBI
• 27.TCS
• 28.TATA MOTERS
• 29.TATA STEEL
• 30.WIPRO
NSE
• The National Stock Exchange (NSE),
located in Bombay, is India's first debt
market. It was set up in 1993 to encourage
stock exchange reform through system
modernization and competition. It opened
for trading in mid-1994. It was recently
accorded recognition as a stock exchange
by the Department of Company Affairs.
The instruments traded are, treasury bills,
government security and bonds issued by
public sector companies
CONT……….
• The Organisation: The National Stock
Exchange of India Limited has genesis
in the report of the High Powered Study
Group on Establishment of New Stock
Exchanges, which recommended
promotion of a National Stock
Exchange by financial institutions (FIs)
to provide access to investors from all
across the country on an equal footing.
SPECULATION :
• Definition : it involves the buying,holding,selling,short-
term selling of
stocks,bonds.commodities,currencies,collectibles or any
valuable financial instrument to profit from fluctuations
in its price as opposed to buying it for use or for income
via method like dividends or interest.
Kinds of speculation
• Bull Market : purchase of the shares at current prices to
sell at a higher price in the near future and makes a profit
if his expectations come true. The buyer is also called a
long buyer.
• Bear Market : if one sells security in the hope that he will
be able to buy them back at lesser price. It is also called
“short selling”.
Cont………………
• Stag : He is that type of speculator who applies
for a large number of a shares in a new issue with
the intention of selling them at a premium. He is
bullish and very cautious.
BENEFITS OF STOCK EXCHANGE
• FROM THE POINT OF VIEW OF COMMUNITY:

• 1.It assist the economis development by providing a body of
interested investors.
• 2.it uploads the position of superior enterprises and assist
them in raising further funds.
• 3.It encourages capital formation
• 4.Government can undertake projects of national importance
and social value raising funds through the sale of its securities
on the stock exchange.
• 5.It is the stock exchanges that central bank of a country can
control credit by undertaking open market operations
(purchase and sale of securities)
FROM THE COMPANY POINT OF VIEW
• 1.A company whose shares quoted on stock

exchange they enjoy better reputation and credit.
• 2.The market for the shares of such a company is
naturally widened.
• 3.The market price of securities is likely to be
higher in relation to its earnings,dividends and
property values.This raises the bargaining power
of the company in the event of a takeover,merger
or amalgamation.
FROM THE INVESTORS POINT OF VIEW
• 1.Liquidity of the investment is increased

• 2.The securities dealt on a stock exchange are good
collateral security for loans.
• 3.The stock exchange safeguards interests of investors
through strict enforcement of rules and regulations.
• 4.The present net worth of investments can be easily
known by the daily quotations.
• 5.His risk is considerably less when he holds or purchases
listed securities.
SOME OTHER TERMS
EQUITY SHARES
• These shares do not have a fixed rate of
dividend ,they are always irredeemable and their
holders have normal voting rights.
• They are also the owners of the company.
• They take dividend
DEBENTURES
• A document under the company seal which
provides for the payment of a principal sum and
interest there on at regular intervals which is
usually secured by a fixed or floating charge on
the company’s property or undertaking which
acknowledges a loan to the company.
BUY BACK SHARES
• In simple term when company re-purchase of its
own shares that is called buy back shares.
INTERNAL PLAYERS
• The members of the stock exchange can be
divided into two parts:
• Broker: He is a commission agent who transacts
business in securities on behalf of non-members.
They may have number of sub-brokers to canvass
and secure business for them.
• Jobber: He is an independent dealer securities.
He purchase and sells securities in his own name.
He is not allowed to deal with non-members
directly. He works for profit.
CAUSES OF PRICE FLUCTUATION
• 1.DAMAND AND SUPPLY

• 2.BANK RATE
• 3.SPECULATIVE PRESSURE
• 4.ACTIONS OF UNDERWRITERS AND
OTHER FINANCIAL INSTITUTIONS
• 5.CHANGE IN COMPANY’S BOARD OF
DIRECTORS
• 6.FINANCIAL POSITION OF THE COMPANY
CONT……..
• 7.TRADE CYCLE
• 8.POLITICAL FACTORS
• 9.SYMPATHETIC FLUCTUATIONS
• 10.OTHER FACTORS:
• A.EXPECTED MONSOON
• B.PERSONAL HEALTH OF HEAD OF
GOVERNMENT OR CHAIRMAN OF THE COMPANY
• C.OIL PRICES IN THE INTERNATIONAL MARKET.
HOW RATING IS GIVEN TO THE COMPANY?
• Basically rating is given after see the company

'image,management quality,assets quality,auditors
quality,accounting accuracy.Rating is not fixed, it may be
change. The rating grades are:
• AAA: HIGHEST SAFTY
• AA: HIGH SAFTY
• A: ADEQUATE SAFTY
• BBB: MODERATE SAFTY
• BB: IN ADEQUATE SAFTY
• BC&D: HIGH RISK AND DEFAULT
THE TOP TEN SINGLE DAY FALLS
OF THE SENSEX HAS :
1. Jan 21, 2008 --- 1,408.35 points
2. Jan 22, 2008 --- 857 points
3. Feb 11, 2008 --- 833.98 points
4. May 18, 2006 --- 826 points
5. Dec 17, 2007 --- 769.48 points
6. Oct 17, 2007 --- 717.43 points
7. Jan 18, 2007 --- 687.82 points
8. Nov 21, 2007 --- 678.18 points
9. Aug 16, 2007 --- 642.70 points
10. Apr 2, 2007 --- 616.73 points
conclusion
• THE STOCK EXCHANGE IS
CONSIDERED TO BE THE
BAROMETER OF ECONOMIC
ACTIVITY.

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SOMETHING

• FROM THE POINT OF VIEW OF COMMUNITY:

• 1.A company whose shares quoted on stock

• 1.Liquidity of the investment is increased

• 1.DAMAND AND SUPPLY

• Basically rating is given after see the company

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