The stock exchange provides a platform for stock brokers and traders to trade various securities like stocks, bonds, and derivatives. Companies must list their securities on a stock exchange in order to trade them. Major roles of stock exchanges include raising capital for businesses, mobilizing savings for investment, facilitating company growth, and profit sharing. Listing requirements vary by exchange but generally require a minimum market capitalization, public float, and years of audited financial statements. Ownership of exchanges has trended toward demutualization and public listings.

1. STOCK EXCHANGE
A stock exchange is an entity that 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 are electronic 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 is driven by various factors that, as in all free markets, affect
the price of stocks (see stock 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 and bonds are traded.
Increasingly, stock exchanges are part of a global market for securities.
The role of stock exchanges
Stock exchanges have multiple roles in the economy. This may include the following:
[3]
Raising capital for businesses
The Stock Exchange provide companies with the facility to raise capital for expansion
through selling shares to the investing public.[4]
Mobilizing savings for investment
When people draw their savings and invest in shares (through a IPO or the issuance of
new company shares of an already listed company), it usually leads to rational
allocation of resources because funds, which could have been consumed, or kept in
idle deposits with banks, are mobilized and redirected to help companies'
management boards finance their organizations. This may promote business activity
with benefits for several economic sectors such as agriculture, commerce and
industry, resulting in stronger economic growth and higher productivity levels of
firms. Sometimes it is very difficult for the stock investor to determine whether or not
the allocation of those funds is in good faith and will be able to generate long-term
company growth, without examination of a company's internal auditing.

2. Facilitating company growth
Companies view acquisitions as an opportunity to expand product lines, increase
distribution channels, hedge against volatility, increase its market share, or acquire
other necessary business assets. A takeover bid or a merger agreement through the
stock market is one of the simplest and most common ways for a company to grow by
acquisition or fusion.
Profit sharing
Both casual and professional stock investors, as large as institutional investors or as
small as an ordinary middle class family, through dividends and stock price increases
that may result in capital gains, share in the wealth of profitable businesses.
Unprofitable and troubled businesses may result in capital losses for shareholders.
Corporate governance
By having a wide and varied scope of owners, companies generally tend to improve
management standards and efficiency to satisfy the demands of these shareholders,
and the more stringent rules for public corporations imposed by public stock
exchanges and the government. Consequently, it is alleged that public companies
(companies that are owned by shareholders who are members of the general public
and trade shares on public exchanges) tend to have better management records than
privately held companies (those companies where shares are not publicly traded, often
owned by the company founders and/or their families and heirs, or otherwise by a
small group of investors).
Despite this claim, some well-documented cases are known where it is alleged that
there has been considerable slippage in corporate governance on the part of some
public companies. The dot-com bubble in the late 1990s, and the subprime mortgage
crisis in 2007-08, are classical examples of corporate mismanagement. Companies
like Pets.com (2000), Enron Corporation (2001), One.Tel (2001), Sunbeam (2001),
Webvan (2001), Adelphia (2002), MCI WorldCom (2002), Parmalat (2003),
American International Group (2008), Bear Stearns (2008), Lehman Brothers (2008),
General Motors (2009) and Satyam Computer Services (2009) were among the most
widely scrutinized by the media.
However, when poor financial, ethical or managerial records are known by the stock
investors, the stock and the company tend to lose value. In the stock exchanges,
shareholders of underperforming firms are often penalized by significant share price
decline, and they tend as well to dismiss incompetent management teams.
Creating investment opportunities for small investors
As opposed to other businesses that require huge capital outlay, investing in shares is
open to both the large and small stock investors because a person buys the number of
shares they can afford. Therefore the Stock Exchange provides the opportunity for
small investors to own shares of the same companies as large investors.

3. Government capital-raising for development projects
Governments at various levels may decide to borrow money to finance infrastructure
projects such as sewage and water treatment works or housing estates by selling
another category of securities known as bonds. These bonds can be raised through the
Stock Exchange whereby members of the public buy them, thus loaning money to the
government. The issuance of such bonds can obviate the need, in the short term, to
directly tax citizens to finance development—though by securing such bonds with the
full faith and credit of the government instead of with collateral, the government must
eventually tax citizens or otherwise raise additional funds to make any regular coupon
payments and refund the principal when the bonds mature.
Barometer of the economy
At the stock exchange, share prices rise and fall depending, largely, on market forces.
Share prices tend to rise or remain stable when companies and the economy in general
show signs of stability and growth. An economic recession, depression, or financial
crisis could eventually lead to a stock market crash. Therefore the movement of share
prices and in general of the stock indexes can be an indicator of the general trend in
the economy.
Speculation
Main article: Speculation
The stock exchanges are also fashionable places for speculation. In a financial
context, the terms "speculation" and "investment" are actually quite specific. For
instance, although the word "investment" is typically used, in a general sense, to mean
any act of placing money in a financial vehicle with the intent of producing returns
over a period of time, most ventured money—including funds placed in the world's
stock markets—is actually not investment but speculation.
Major stock exchanges
New York Stock Exchange, New York City

4. London Stock Exchange, the City of London
Tokyo Stock Exchange, Tokyo
Hong Kong Stock Exchange, Hong Kong
Bolsa de Madrid, Madrid

5. Bombay Stock Exchange, Mumbai
Toronto Stock Exchange, Toronto
Sao Paulo Stock Exchange, Sao Paulo

6. Australian Securities Exchange's Sydney exchange centre, Sydney
Frankfurt Stock Exchange, Frankfurt
Paris Stock Exchange, Paris
SWX Swiss Exchange, Zurich

7. Mexican Stock Exchange, Mexico City
Major Stock Exchanges : Year ended 31 December 2010
Market Trade Value
Rank Economy Stock Exchange Capitalization (USD
(USD Billions) Billions)
United States
1 NYSE Euronext 15,970 19,813
Europe
United States
2 NASDAQ OMX 4,931 13,439
Europe
Tokyo Stock
3 Japan 3,827 3,787
Exchange
United London Stock
4 3,613 2,741
Kingdom Exchange
Shanghai Stock
5 China 2,717 4,496
Exchange
Hong Kong Stock
6 Hong Kong 2,711 1,496
Exchange
Toronto Stock
7 Canada 2,170 1,368
Exchange
Bombay Stock
8 India 1,631 258
Exchange
National Stock
9 India 1,596 801
Exchange of India
10 Brazil BM&F Bovespa 1,545 868
Australian Securities
11 Australia 1,454 1,062
Exchange
12 Germany Deutsche Börse 1,429 1,628
Shenzhen Stock
13 China 1,311 3,572
Exchange
14 Switzerland SIX Swiss Exchange 1,229 788
BME Spanish
15 Spain 1,171 1,360
Exchanges
16 South Korea Korea Exchange 1,091 1,607
17 Russia MICEX 949 408

8. 18 South Africa JSE Limited 925 340
The main stock exchanges:
• American Stock Exchange
• Australian Securities Exchange
• Athens Stock Exchange
• Belgrade Stock Exchange
• Berliner Börse
• Bermuda Stock Exchange
• Bolsa Mexicana de Valores
• Bolsa de Valores de Colombia
• Bolsa de Valores de Lima
• Bombay Stock Exchange
• Bucharest Stock Exchange
• Budapest Stock Exchange
• Bulgarian Stock Exchange - Sofia
• Canadian National Stock Exchange - CNSX
• Cairo & Alexandria Stock Exchange
• Casablanca Stock Exchange
• Channel Islands Stock Exchange
• Chicago Stock Exchange
• Euronext Amsterdam
• Euronext Brussels
• Euronext Lisbon
• Euronext Paris
• Frankfurt Stock Exchange
• Ghana Stock Exchange
• Helsinki Stock Exchange
• Hong Kong Stock Exchange
• Indonesia Stock Exchange
• Irish Stock Exchange
• Istanbul Stock Exchange
• Karachi Stock Exchange
• Korea Stock Exchange
• Kuwait Stock Exchange
• London Stock Exchange
• Luxembourg Stock Exchange
• Madrid Stock Exchange
• Malaysia Stock Exchange
• Milan Stock Exchange
• Montreal Stock Exchange
• Moscow Interbank Currency Exchange
• Nagoya Stock Exchange
• National Stock Exchange of India
• New York Stock Exchange
• New Zealand Exchange
• Nigerian Stock Exchange
• Osaka Securities Exchange

9. • Philippine Stock Exchange
• Prague Stock Exchange
• Russian Trading System
• Santiago Stock Exchange
• São Paulo Stock Exchange (BOVESPA)
• Shanghai Stock Exchange
• Shenzhen Stock Exchange
• Singapore Exchange
• Stockholm Stock Exchange
• Stock Exchange of Thailand
• Taiwan Stock Exchange
• Tehran Stock Exchange
• Tel Aviv Stock Exchange
• Tokyo Stock Exchange
• Toronto Stock Exchange
• Trinidad and Tobago Stock Exchange
• Warsaw Stock Exchange
• Zurich Stock Exchange
See also: :Category:Stock exchanges
Listing requirements
Listing requirements are the set of conditions imposed by a given stock exchange
upon companies that want to be listed on that exchange. Such conditions sometimes
include minimum number of shares outstanding, minimum market capitalization, and
minimum annual income.
Requirements by stock exchange
Companies must meet an exchange's requirements to have their stocks and shares
listed and traded there, but requirements vary by stock exchange:
• Bombay Stock Exchange: Bombay Stock Exchange (BSE) has requirements
for a minimum market capitalization of 25 crore and minimum public float
equivalent to 10 crore.[5]
• London Stock Exchange: The main market of the London Stock Exchange
has requirements for a minimum market capitalization (£700,000), three years of
audited financial statements, minimum public float (25 per cent) and sufficient
working capital for at least 12 months from the date of listing.
• NASDAQ Stock Exchange: To be listed on the NASDAQ a company must
have issued at least 1.25 million shares of stock worth at least $70 million and
must have earned more than $11 million over the last three years.[6]
• New York Stock Exchange: To be listed on the New York Stock Exchange
(NYSE) a company must have issued at least a million shares of stock worth $100
million and must have earned more than $10 million over the last three years.[7]
Ownership

10. Stock exchanges originated as mutual organizations, owned by its member stock
brokers. There has been a recent trend for stock exchanges to demutualize, where the
members sell their shares in an initial public offering. In this way the mutual
organization becomes a corporation, with shares that are listed on a stock exchange.
Examples are Australian Securities Exchange (1998), Euronext (merged with New
York Stock Exchange), NASDAQ (2002), the New York Stock Exchange (2005),
Bolsas y Mercados Españoles, and the São Paulo Stock Exchange (2007). The
Shenzhen and Shanghai stock exchanges can been characterized as quasi-state
institutions insofar as they were created by government bodies in China and their
leading personnel are directly appointed by the China Securities Regulatory
Commission.
Other types of exchanges
In the 19th century, exchanges were opened to trade forward contracts on
commodities. Exchange traded forward contracts are called futures contracts. These
commodity exchanges later started offering future contracts on other products, such as
interest rates and shares, as well as options contracts. They are now generally known
as futures exchanges.
National Stock Exchange of India
The National Stock Exchange (NSE) (Hindi: राषीय शेअर बाजार Rashtriya Śhare
Bāzaār) is a stock exchange located at Mumbai, Maharashtra, India. It is the 9th
largest stock exchange in the world by market capitalization and largest in India by
daily turnover and number of trades, for both equities and derivative trading.[2] NSE
has a market capitalization of around US$1.59 trillion and over 1,552 listings as of
December 2010.[3] Though a number of other exchanges exist, NSE and the Bombay
Stock Exchange are the two most significant stock exchanges in India, and between
them are responsible for the vast majority of share transactions. The NSE's key index
is the S&P CNX Nifty, known as the NSE NIFTY (National Stock Exchange Fifty),
an index of fifty major stocks weighted by market capitalisation.
NSE is mutually-owned by a set of leading financial institutions, banks, insurance
companies and other financial intermediaries in India but its ownership and
management operate as separate entities.[4] There are at least 2 foreign investors
NYSE Euronext and Goldman Sachs who have taken a stake in the NSE.[5] As of
2006, the NSE VSAT terminals, 2799 in total, cover more than 1500 cities across
India.[6] NSE is the third largest Stock Exchange in the world in terms of the number
of trades in equities.[7] It is the second fastest growing stock exchange in the world
with a recorded growth of 16.6%
Origins
The National Stock Exchange of India was promoted by leading Financial institutions
at the behest of the Government of India, and was incorporated in November 1992 as
a tax-paying company. In April 1993, it was recognized as a stock exchange under the
Securities Contracts (Regulation) Act, 1956. NSE commenced operations in the
Wholesale Debt Market (WDM) segment in June 1994. The Capital market (Equities)

11. segment of the NSE commenced operations in November 1994, while operations in
the Derivatives segment commenced in June 2000.
[edit] Innovations
NSE pioneering efforts include:
• Being the first national, anonymous, electronic limit order book (LOB)
exchange to trade securities in India. Since the success of the NSE, existent
market and new market structures have followed the "NSE" model.
• Setting up the first clearing corporation "National Securities Clearing
Corporation Ltd." in India. NSCCL was a landmark in providing innovation on all
spot equity market (and later, derivatives market) trades in India.
• Co-promoting and setting up of National Securities Depository Limited, first
depository in India [9]
• Setting up of S&P CNX Nifty.
• NSE pioneered commencement of Internet Trading in February 2000, which
led to the wide popularization of the NSE in the broker community.
• Being the first exchange that, in 1996, proposed exchange traded derivatives,
particularly on an equity index, in India. After four years of policy and regulatory
debate and formulation, the NSE was permitted to start trading equity derivatives
• Being the first and the only exchange to trade GOLD ETFs (exchange traded
funds) in India.
• NSE has also launched the NSE-CNBC-TV18 media centre in association
with CNBC-TV18.
• NSE.IT Limited, setup in 1999 , is a 100% subsidiary of the National Stock
Exchange of India. A Vertical Specialist Enterprise, NSE.IT offers end-to-end
Information Technology (IT) products, solutions and services.
• NSE (National Stock Exchange) was the first exchange in the world to use
satellite communication technology for trading, using a client server based system
called National Exchange for Automated Trading (NEAT). For all trades entered
into NEAT system, there is uniform response time of less than one second.
[edit] Markets
Currently, NSE has the following major segments of the capital market:
• Equity
• Futures and Options
• Retail Debt Market
• Wholesale Debt Market
• Currency futures
• Mutual Fund
• Stocks lending and borrowing
August 2008 Currency derivatives were introduced in India with the launch of
Currency Futures in USD INR by NSE. Currently it has also launched currency
futures in EURO, POUND & YEN. Interest Rate Futures was introduced for the first

12. time in India by NSE on 31 August 2009, exactly after one year of the launch of
Currency Futures.
NSE became the first stock exchange to get approval for Interest rate futures as
recommended by SEBI-RBI committee, on 31 August 2009, a futures contract based
on 7% 10 Year GOI bond (NOTIONAL) was launched with quarterly maturities. [10]
[edit] Hours
NSE's normal trading sessions are conducted from 9:15 am India Time to 3:30 pm
India Time on all days of the week except Saturdays, Sundays and Official Holidays
declared by the Exchange (or by the Government of India) in advance.[11] The
exchange, in association with BSE (Bombay Stock Exchange Ltd.), is thinking of
revising its timings from 9.00 am India Time to 5.00 pm India Time.
There were System Testing going on and opinions, suggestions or feedback on the
New Proposed Timings are being invited from the brokers across India. And finally
on 18 November 2009 regulator decided to drop their ambitious goal of longest Asia
Trading Hours due to strong opposition from its members.
On 16 December 2009, NSE announced that it would advance the market opening to
9:00 am from 18 December 2009. So NSE trading hours will be from 9.00 am till 3:30
pm India Time.
However, on 17 December 2009, after strong protests from brokers, the Exchange
decided to postpone the change in trading hours till 4 Jan 2010.
NSE new market timing from 4 Jan 2010 is 9:00 am till 3:30 pm India Time.
[edit] Milestones
• November 1992 Incorporation
• April 1993 Recognition as a stock exchange
• May 1993 Formulation of business plan
• June 1994 Wholesale Debt Market segment goes live
• November 1994 Capital Market (Equities) segment goes live
• March 1995 Establishment of Investor Grievance Cell
• April 1995 Establishment of NSCCL, the first Clearing Corporation
• June 1995 Introduction of centralised insurance cover for all trading members
• July 1995 Establishment of Investor Protection Fund
• October 1995 Became largest stock exchange in the country
• April 1996 Commencement of clearing and settlement by NSCCL
• April 1996 Launch of S&P CNX Nifty
• June 1996 Establishment of Settlement Guarantee Fund
• November 1996 Setting up of National Securities Depository Limited, first
depository in India, co-promoted by NSE
• November 1996 Best IT Usage award by Computer Society of India
• December 1996 Commencement of trading/settlement in dematerialised
securities

13. • December 1996 Dataquest award for Top IT User
• December 1996 Launch of CNX Nifty Junior
• February 1997 Regional clearing facility goes live
• November 1997 Best IT Usage award by Computer Society of India
• May 1998 Promotion of joint venture, India Index Services & Products
Limited (IISL)
• May 1998 Launch of NSE's Web-site: www.nse.co.in
• July 1998 Launch of NSE's Certification Programme in Financial Market
• August 1998 CYBER CORPORATE OF THE YEAR 1998 award
• February 1999 Launch of Automated Lending and Borrowing Mechanism
• April 1999 CHIP Web Award by CHIP magazine
• October 1999 Setting up of NSE.IT
• January 2000 Launch of NSE Research Initiative
• February 2000 Commencement of Internet Trading
• June 2000 Commencement of Derivatives Trading (Index Futures)
• September 2000 Launch of 'Zero Coupon Yield Curve'
• November 2000 Launch of Broker Plaza by Dotex International, a joint
venture between NSE.IT Ltd. and i-flex Solutions Ltd.
• December 2000 Commencement of WAP trading
• June 2001 Commencement of trading in Index Options
• July 2001 Commencement of trading in Options on Individual Securities
• November 2001 Commencement of trading in Futures on Individual Securities
• December 2001 Launch of NSE VaR for Government Securities
• January 2002 Launch of Exchange Traded Funds (ETFs)
• May 2002 NSE wins the Wharton-Infosys Business Transformation Award in
the Organization-wide Transformation category
• October 2002 Launch of NSE Government Securities Index
• January 2003 Commencement of trading in Retail Debt Market
• June 2003 Launch of Interest Rate Futures
• August 2003 Launch of Futures & options in CNXIT Index
• June 2004 Launch of STP Interoperability
• August 2004 Launch of NSE’s electronic interface for listed companies
• March 2005 ‘India Innovation Award’ by EMPI Business School, New Delhi
• June 2005 Launch of Futures & options in BANK Nifty Index
• December 2006 'Derivative Exchange of the Year', by Asia Risk magazine
• January 2007 Launch of NSE – CNBC TV 18 media centre
• March 2007 NSE, CRISIL announce launch of IndiaBondWatch.com
• June 2007 NSE launches derivatives on Nifty Junior & CNX 100
• October 2007 NSE launches derivatives on Nifty Midcap 50
• January 2008 Introduction of Mini Nifty derivative contracts on 1 January
2008
• March 2008 Introduction of long term option contracts on S&P CNX Nifty
Index
• April 2008 Launch of India VIX
• April 2008 Launch of Securities Lending & Borrowing Scheme
• August 2008 Launch of Currency Derivatives
• August 2009 Launch of Interest Rate Futures
• November 2009 Launch of Mutual Fund Service System
• December 2009 Commencement of settlement of corporate bonds

14. • February 2010 Launch of Currency Futures on additional currency pairs
• October 2010 Launch of 15-minute special pre-open trading session, a
mechanism under which investors can bid for stocks before the market opens. [12]
[edit] Indices
Graph of S&P CNX Nifty from January 1997 to March 2011
NSE also set up as index services firm known as India Index Services & Products
Limited (IISL) and has launched several stock indices, including:[13]
• S&P CNX Nifty(Standard & Poor's CRISIL NSE Index)
• CNX Nifty Junior
• CNX 100 (= S&P CNX Nifty + CNX Nifty Junior)
• S&P CNX 500 (= CNX 100 + 400 major players across 72 industries)
• CNX Midcap (introduced on 18 July 2005 replacing CNX Midcap 200)
[edit] Exchange Traded Funds on NSE
NSE has a number of exchange traded funds. These are typically index funds and
GOLD ETFs. Some of the popular ETF's available for trading on NSE are:
• NIFTYBEES - ETF based on NIFTY index Nifty BEES Live quote
• GoldBees - ETF based on Gold prices. Tracks the price of Gold. Each unit is
equivalent to 1 gm of gold and bears the price of 1gm of gold.
• BankBees - ETF that tracks the CNX Bank Index.
[edit] Certifications
NSE also conducts online examination and awards certification, under its programmes
of NSE's Certification in Financial Markets (NCFM)[1]. Currently, certifications are
available in 19 modules, covering different sectors of financial and capital markets.
Branches of the NSE are located throughout India. NSE, in collaboration with reputed
colleges and institutes in India, has been offering a short-term course called NSE
Certified Capital Market Professional (NCCMP) since August 2009, in the campuses
of the respective colleges/ institutes