What Is a Stock Exchange?

Introduction to Stock Exchanges

It is a regulated platform on which shares of public listed companies gets traded . It is place where buyers buy stocks and sellers sell stocks . They provide transparent enviroment to buy , sell stocks . Not only stocks but also derivatives , bonds and futures gets traded on stock exchanges . It provides platform for companies to raise money by listing their shares on exchanges .

Indian stock exchange is authorized by Indian government and regulated by SEBI . It is the oldest stock exchange in the world . Bombay stock exchange and National stock exchange are biggest exchanges in India .

History of Stock Exchanges

First stock exchange in India was founded under banyan tree by 21 merchants in Mumbai . After some years they moved to dalal street . In 1875 Bombay stock exchange was formed. Later in 1908 another stock exchange was opened in Calcutta . National stock exchange was founded in 1992 after Harshad Mehta Scam . Calcutta stock exchange was shut down in 2013 due to various scams.


Bombay Stock Exchange

BSE is the oldest stock exchange in India and Asia . It is located on Dalal street in Mumbai . It is second biggest exchange in India and 10th biggest in the world . Also it is fastest exchange in Asia . Total market capitalization of all companies listed on BSE is Rs 2,58,98,439.31 crores . BSE has more than 5000 listed companies .Sensex is standard index of Bombay Stock Exchange.

National Stock Exchange

NSE is the newest stock exchange in India . It was formed after Harshad Mehta scam in 1992 also it is biggest stock exchange in India .It is biggest stock exchange in the world in terms of total contracts gets traded . It was first exchange in India to introduce electronic trading system in India . Headquarters of NSE are in Mumbai . NSE has total 1300 companies listed in it and total market capitalization of all stocks listed on NSE is 3.6 Trillions dollars . Nifty 50 is standard index of NSE .

Functions of Stock Exchanges

  • They provide regulated enviroment to buy and sell stocks.
  • They provides real time accurate prices to stocks .
  • Companies can list their shares on exchanges and raise money .
  • Provide transparent platform for transactions of stocks.

1 thought on “What Is a Stock Exchange?”

Leave a Comment