INTRODUCTIONThe trading on stock exchange in INDIA used to takeplace through open outcry method without use ofinformation technology for immediate matching orrecording of trades.This was time consuming and inefficient. This imposedlimits on trading volumes and efficiency. In order toprovide efficiency, liquidity, and transparency NSE andBSE introduced nation wide online fully automated“SCREEN BASED TRADING SYSTEM”
SCREEN BASED TRADINGNSE’s screen based trading is known as NEAT- National exchange for automated trading. BSE’S screen based trading is known as BOLT- Bombay online trading.
MECHANISM OF ONLINE TRADINGBSE has main computer which is connectedthrough “VERY SMALL APERTURETERMINAL”(VSAT) installed at its office. THE main computer runs on a fault tolerant“STRATUS” mainframe computer at theexchange. Brokers have terminals installed attheir premises which are connected throughVSATS.
HOW TO PLACE ORDERAn investor informs broker to place an order onhis behalf. The broker enters the order throughhis PC, which runs under windows NT andsends signal to the satellite via VSAT. The signalis directed to mainframe computer at BSE viaVSAT at BSE’s office. A message relating to theorder activity is broad casted to respectivemember.
To enter a buy order
BASIS OF OPERATIONThe online trading operates on the strict basis of PRICE PRIORITY and TIME PRIORITY
HOW TO ENTER SELL ORDERSame as the process involved in the placing of the buy order.
To enter a Sell order
LOGGING ON On starting BOLT application, the logon screen appears with the following details. USER ID TRADING MEMBER ID PASSWORD NEW PASSWORD
TERMINOLOGIES OF ONLINE TRADING Snap quote:- feature available to get instantaneous market information on a desired security. Active and Passive orders:- when any order enters the trading system, it is an active order. It tries to find a match on the other side of books. If it finds a match trade is generated, if does not finds match it turns to passive order which is stored in order book.
MOVEMENT TIME FREEZED Circuit breakers:- Started implementing 10% PRIOR 1pm 1 HOUR compulsorily from July AFTER 1pm ½ HOUR 02, 2001. The circuit 15% PRIOR 1pm 2 hours breakers will be operated AFTER 1pm- 1 hour 2pm at the three stages of AFTER 2pm Freezed for the INDEX movement, day either way viz at 10%, 15%, 20%. 20% ANY TIME FREEZED FOR THE DAY