Functional Report on Stock ExchangeIntroduction

A stock exchange is a form of exchange which provides services for stock brokers and traders to trade stocks, bonds,

and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial

instruments, and capital events including the payment of income and dividends. Securities traded on a stock exchange

include shares issued by companies, unit trusts, derivatives, pooled investment products and bonds.

To be able to trade a security on a certain stock exchange, it must be listed there. Usually, there is a central location at

least for record keeping, but trade is increasingly less linked to such a physical place, as modern markets areelectronic

networks, which gives them advantages of increased speed and reduced cost of transactions. Trade on an exchange is

by members only.

The initial offering of stocks and bonds to investors is by definition done in the primary market and subsequent trading is

done in the secondary market. A stock exchange is often the most important component of a stock market. Supply and

demand in stock markets are driven by various factors that, as in all free markets, affect the price of stocks (seestock

valuation).

There is usually no compulsion to issue stock via the stock exchange itself, nor must stock be subsequently traded on the

exchange. Such trading is said to be off exchange or over-the-counter. This is the usual way

that derivatives andbonds are traded. Increasingly, stock exchanges are part of a global market for securities.

Bombay Stock Exchange (BSE), now known as 'BSE Limited', is the oldest stock exchange in the entire Asia. It is located in the PhirozeJeejeebhoy Towers, Dalal Street in Fort and has the largest number of companies of the world listed on it. . It is the 10th largest stock exchange in the world by market capitalization. Established in 1875, BSE Ltd. (formerly known as Bombay Stock Exchange Ltd.), is Asia’s first Stock Exchange and one of India’s leading exchange groups. Over the past 137 years, BSE has facilitated the growth of the Indian corporate sector by providing it an efficient capital-raising platform. Popularly known as BSE, the bourse was established as "The Native Share & Stock Brokers' Association" in 1875. As per March 2012, there are more than 5,133 Indian companies listed in the stock exchange market. The BSE Sensex, which is otherwise known as 'BSE 30', is the most commonly used term while referring to the trading volume in India and Asia. When compared with NSE (National Stock Exchange), BSI has quite similar statistics interms of total market capitalization but in terms of share volume, NSE is almost twice of BSE.

Hours of operation

Session Timing

Pre-open Trading Session 09:00 - 09:15

Trading Session 09:15 - 15:30

Position Transfer Session 15:30 - 15:55

Closing Session 15:50 - 16:05

Option Exercise Session 16:05

The hours of operation for the BSE quoted above are stated in terms the local time (GMT + 5:30). BSE's normal trading sessions are on all days of the week except Saturday, Sundays and holidays declared by the Exchange in advance

History

The Bombay Stock Exchange is the oldest exchange in India. It traces its history to the 1855, when four Gujarati and one Parsi stockbroker would gather under banyan trees in front of Mumbai's Town Hall. The location of these meetings changed many times, as the number of brokers constantly increased. The group eventually moved to Dalal Street in 1874 and in 1875 became an official organization known as 'The Native Share & Stock Brokers Association'. In 1956, the BSE became the first stock exchange to be recognized by the Indian Government tunder the Securities Contracts Regulation Act. The Bombay Stock Exchange developed the BSE SENSEX in 1986, giving the BSE a means to measure overall performance of the exchange. In 2000 the BSE used this index to open its derivatives market, trading SENSEX futures contracts. The development of SENSEX options along with equity derivatives followed in 2001 and 2002, expanding the BSE's trading platform. Historically an open outcry floor trading exchange, the Bombay Stock Exchange switched to an electronic trading system in 1995. It took the exchange only fifty days to make this transition. This automated, screen-based trading platform called BSE On-line trading (BOLT) currently has a capacity of 8 million orders per day. The BSE has also introduced the world's first centralized exchange-based internet trading system, BSEWEBx.co.in to enable investors anywhere in the world to trade on the BSE platform

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Board of Directors

Mr. S. RamadoraiPublic Interest Director

Vice Chairman Tata Consultancy Services Ltd

Managing Director & CEOMr. AshishkumarChauhan

 

     

Public Interest DirectorMr.SudhakarRao

Dr. SanjivMisraPublic Interest Director of BSE

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Mr. S.H. KapadiaPublic Interest Director of BSE

Mr. Keki M. MistryShareholder Director

Mr. Andreas PreussShareholder Director

Mr. Thomas BendixenAlternate Director to Mr. Andreas Preuss

 

SEBI Act :

The government of India has enacted an act (SEBI Act 1952), which provides for the establishment of a board to protect the interest of investor in securities. The SEBI has emerged as a monitoring institution of the country fir the development and regulation of stock market, SEBI has issued from time to time guideline to insider trading listing of securities, registration of intermediaries mutual funds etc.

CareersAt BSE, we continuously upgrade ourselves and strive to provide world-class service, thus adding value to India's capital market. BSE is committed to operating a fair and orderly market that is both technology-driven as well as is fast paced, with an edge of efficiency.BSE believes that employees are the driving force for its ambitious growth plans, and hence the focus is on attracting motivated, adaptable employees with a customer service focus, strong team spirit and sharp business acumen to fulfill our dreams.BSE is committed to creating and maintaining a culture that fosters an inclusive, diverse workforce; and an environment in which every employee has the opportunity to demonstrate his or her potential by performing to meet the challenges ahead .Inshortmeritocracy is the order that we respect.BSE offers every employee a very congenial and vibrant working environment, conducive to bringing out the best in every employee. If you are looking for a challenging career, in the fast-growing financial market and thrive in a fast-paced environment, explore your options at BSE. We certainly believe that it would be a mutually rewarding relationship. 

Websites

http://www.mumbai.org.uk

www.bseindia.com

en.wikipedia.org/wiki/Bombay_Stock_Exchange

http://www.livemint.com

http://www.ciol.com/ciol/news/71922/bse-sebi-approval-sme-exchange

Vision and Mission of BSE

• VisionOur vision is to be the most sought after learning provider in the world in areas of financial and leadership learning, by pioneering the generation and dissemination of knowledge for the enhancement of skills and capabilities of professionals and aspiring professionals.

• MissionAs a centre of learning, our mission is to promote an open learning environment that brings together people, cultures and ideas from around the world, changing lives and helping transform organizations through innovative learning programs.

Through our learning programs, we develop responsible, thoughtful leaders and entrepreneurs who create value for their organizations and their communities.

Indices: SENSEX & NIFTY

Stock Market performance is quantified by calculating an index using the benchmark scrip’s and as known to all SENSEX (Sensitive Index) is associated with Bombay Stock Exchange and S&P CNX NIFTY is associated with National Stock Exchange

How are the SENSEX 30 Stocks are selected?

• Listing History

• Trading Frequency

• Rank based on the Market Cap (Should be Among top 100)

• Market Capitalization weight

• Industry / sector they belong

• Historical Record

SENSEX Calculation

SENSEX is calculated using the "Free-float Market Capitalization" methodology, wherein, the level of index at any point of time reflects the free-float market

It reflects value of 30 component stocks relative to a base period.

The market capitalization of a company is determined by multiplying the price of its stock by the number of shares issued by the company.

Benefits to Investor

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.

Benefits to the company

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

Adjustment for Bonus, Rights and Newly Issued Capital

• SENSEX calculation needs to be adjusted for issue of Bonus or Rights shares, If no adjustments are made, a discontinuity would arise between the current value of the index and its previous value despite the non-occurrence of any economic activity of substance

• At the BSE Index Cell , the base value is adjusted, which is used to alter market capitalization of the component stocks to arrive at the SENSEX value.