WHAT IS BSE? – BOMBAY STOCK EXCHANGE

You might have heard this term BSE in some or the other way, Firstly, the full form of BSE is Bombay Stock Exchange. As the name says it is the Bombay’s Stock Exchange, Hence, it is Located in Bombay (Mumbai)

It plays an important role in the field of the Stock Market and has begun a revolution in the operations of the Stock Market. It is equipped with the latest digital trading platform which enables users to trade easily from anywhere in the world.

Contents of this Blog

1. History of BSE  
2. Advantages of Listing on BSE?    
3. Index of BSE  
4. Market Segments in BSE?
5. Conclusion
6. FAQs

HISTORY OF BSE 

Let us know What is BSE? So, the Bombay Stock Exchange(BSE) is located in Mumbai; It was founded by an influential businessman of Mumbai, namely Premchand Roychand.

Secondly, It is the oldest Stock Exchanges in Asia. So, It plays a prominent role in the field of Stock Market, it is a place where sellers and buyers of the Stock Market meet, but nowadays everything is online, so this platform also offers online buying and selling of shares.   

Firstly, It was formed in the year 1875 as the Native Share and Stock Brokers’ Association. But, BSE has nearly 6,000 companies listed in it.

So, It is one of the largest exchanges in the world. Besides the New York Stock Exchange (NYSE), NASDAQ, Japan Exchange Group, London Stock Exchange Group, and Shanghai Stock Exchange.  

Secondly, It was recognized as a Stock Exchange by the Government of India on August 31, 1957. But, In 2000, the Bombay Stock Exchange opened its derivatives market, which helped them to expand their trading platform.  

Thirdly, BSE has played an essential role in India’s Capital markets. But it has also played a principal role in the retail debt market.

But, It also has a role in the growth of the Indian Corporate Sector. So, It has changed from an open-floor trading system to an electronic trading system in the year 1995.  

ADVANTAGES OF LISTING ON BSE 

A premier marketplace    

Moreover, the large volume of trading activity assures that the impact cost is lesser on the Exchange. It reduces the cost of trading of the investor. But, BSE’s electronic mechanized trading technology ensures stability. So, the transparency in the trade matching enhances investors’ belief and openness of our market.    

Visibility    

Meanwhile, The trading system enables a unique level of trade and post-trade statistics. The best bid and ask orders are exhibited on the trading system and the total number of securities available for buying and selling is also shown.  

In Short, This enables the investor to realize the depth of the market. Besides this the corporate announcements, results, corporate actions etc., are also accessible on the trading system.   

Also know : How the Stock Market works?

Hassle-free capital generation   

Moreover, Listed companies can easily win the trust of all kinds of investors in the market. Because It spreads knowledge about the company, its business in the market, which allows individuals to analyze the present, future condition of such companies quickly, and invest.

Largest exchange    

The largest Stock Exchange in Asia is BSE, with more than 6000 Companies listed on it.  

Unmatched reach    

BSE has a trading system that extends across the country. Investors from 191 Countries can avail of trading facilities on the BSE Trading System. The Exchange uses new communication technology to give quick access from every location.    

Good Transaction speed    

Speed of the transactions made on the Exchange is so better that it results in liquidity and good available prices.   

Broadcast advantage for Corporate announcements    

Firstly, The Platform of BSE is useful to publicize the information and company announcements across the country. So, Major details regarding the companies are set forth to the market through the Broadcast System of BSE.  

Corporate developments such as dividends, rights, takeover, financial results, book closure, announcements of bonuses, splits, mergers, subsidiaries, etc. are publicized across the country thus decreasing chances of price manipulation or misuse.    

Trade details for listed companies    

The Companies listed on the Stock Exchange are provided with Monthy Trade Statistics.

Nominal listing Charges   

The fees charged by the exchange for listing is very lower when compared with the other exchanges in the country.   

Legal Supervision   

Investors can be away from fraudulent companies if they choose to invest in companies listed on BSE. Strict rules and regulations are made by SEBI to monitor the actions of listed companies, hence decreasing the chances of loss for investors due to the frauds of the business.  

Also Read : Stock Market Crashes in India

Index of BSE  

Firstly, This is an index created by BSE to understand the whole movement of all the companies listed on the BSE. Because we cannot sit and see the change of every company, The name of the Index is Sensex  

Secondly, there is a simple parameter made for everyone to understand the whole movement of the market. But, Sensex is made up of the list of top 30 companies listed on the Bombay Stock Exchange.

So, Sensex is the indicator of the Bombay Stock Exchange (BSE). But, It is known as the S&P BSE Sensex index. So, It provides us the movement of the economy. But, Sensex is the oldest index of India. It was started in 1986, so it contains most of the falls and rises of the economy,  

Also Read : What is Nifty?

Sensex

The Name Sensex is derived from two words Sensitivity and Index. Firstly, it was derived by a person named Deepak Mohoni. It shows the sensitivity of the Stock Exchange, in simple words, it is the Sensitivity Index of Bombay Stock Exchange hence it is named Sensex. Market Analysts and Investors utilize it for the observation of the growth, development of the Indian economy.  

The List of Top 30 Companies is 

Name of the Company

Housing Development Finance Corporation (HDFC)

Cipla

State Bank of India (SBI)

Dr. Reddy’s Laboratories

HDFC Bank Ltd.

Hero Motocorp

Infosys

Kotak Mahindra Bank

Lupin

Oil & Natural Gas Corporation (ONGC)

Reliance Industries

Tata Steel

Larsen & Toubro

Mahindra & Mahindra

Tata Motors

Hindustan Unilever

Asian Paints

ITC

Wipro

Sun Pharmaceuaticals

ICICI Bank

Axis Bank

Bharathi Airtel

Maruti Suzuki India

Tata Consultancy Services

NTPC

Power Grid Corporation of India

Adani Ports

Bajaj Auto

Coal India

Tata Motors (DVR Ordinary)

MARKET SEGMENTS IN BSE   

Bombay Stock Exchange provides trading across the following sectors:    

• Equities    
• Exchange-Traded Funds    
• Initial Public Offerings    
• Security Lending and Borrowing Scheme    
• Derivatives    
• Equity Derivatives    
• Interest Rate Futures    
• Debt    
• Corporate Bonds    

Trading schedule    

Market timings of the equities segment are:    

(1) Pre-open session    

• Order entry & modification Open: 09:00 hrs    
• Order entry & modification Close: 09:08 hrs    

(2) Regular trading session    

• Normal/Retail Debt/Limited Physical Market Open: 09:15 hrs    
• Normal/Retail Debt/Limited Physical Market Close: 15:30 hrs.    

Equity trading is open on all days of the week, except for Saturdays, Sundays and other holidays declared by BSE in advance.    

Conclusion

Bombay Stock Exchange is a place where the sellers and buyers of the Stock market meet for transacting. It was founded by a businessman Premchand Roychand. In the olden days, people would go to the Stock Exchange to buy or sell Stocks but nowadays as everything is working on digital platforms, Sellers and Buyers are not required to go to the exchange. They can make purchases and Sell the Stocks digitally

FAQs

Also Read :- The best Stock Brokers in India