What are Markets?
A stock market is a market for the trading of
company stock/ shares, and derivatives. This
includes securities listed on a stock exchange as
well as those only traded privately.
Market is a place where buyers and
sellers of securities can enter into
transactions to purchase and sell
shares, bonds, debentures etc
Features of Stock Market
• Stock Market is an organized market, where
securities of govt. and semi govt. bodies and
corporate enterprises are bought and sold.
• Stock Market deals in second hand or existing
• Individuals alone can buy and sell securities.
• The Stock Market does not provide this facility
to corporation and partnership firms.
• In the Stock Market only those securities
which are listed in the Stock Market or
transacted. Unlisted Securities or not
permitted to be dealt in the market.
• The Stock Exchange to regulate its day-to-day
Stock exchange is a place where buyers
and sellers are come together for
undertaking transactions involving sale of
Function of Stock Exchange
o It provide ready market for securities
o It helps in price discovery of securities.
o It insure low cost of raising finance issue
of new market instruments in the market
o Helps in capital generation process.
o Encourages capital formation
o Provides proper direction to invest
oPromotion of investment.
o Help capital formation.
o Give mobility to capital.
o Exercise control over the working of
oMarketing of new issues.
In India overview
India's oldest and first stock exchange:
Mumbai (Bombay) Stock Exchange.
Established in 1875. More than 6,000 stocks
Total number of stock exchanges in India: 22
They are in: Ahmadabad, Bangalore, Calcutta,
Chennai, Delhi etc.
There is also a National Stock Exchange (NSE)
which is located in Mumbai.
There is also an Over The Counter Exchange
of India (OTCEI) which allows listing of small
and medium sized companies.
The regulatory agency which oversees the
functioning of stock markets is the Securities
and Exchange Board of India (SEBI), which is
also located in Bombay
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)
A Brief History Prior to SEBI the security markets
and stock exchange were regulated by several Acts,
• The Bombay Securities Contracts Control Act,
• The Capital Issues (Control) Act, 1947
• The Securities Contracts (Regulation) Act, 1956
• Registrar of Companies (The Indian Companies
For a healthy growth of capital
markets and to prevent malpractices in
trading, the Government subsequently
decided to “set up a separate board
for the regulation and orderly
functioning of Stock Exchange and the
SEBI was established as a statutory
authority through an Ordinance
promulgated on 30.01.1992 by the
President of India
SEBI is the regulator for the
Securities Market in India
It is managed by a Board comprising
of nine members including the
Paradoxically this is a positive
outcome of the Harshad Mehta
Securities Scam of 1990-91
• To protect the interests of investors in
• To promote the development of Securities
• To regulate the securities market and
• For matters connected therewith or incidental
Powers of SEBI
Powers to regulate business of stock
• SEBI is empowered to regulate the business of
• Intermediaries associated with the securities
market as well as mutual funds, fraudulent and
unfair trade practices relating to securities and
regulation of acquisition of shares and takeovers of
Creation of Market Regulator SEBI Act
Protection of interest of Investors
Promote the developments
Regulating the Securities Market
SBT Provides Efficiency, Liquidity and