2. Nepal Stock Exchange (NEPSE)
• Founded – 1993
• NEPSE opened its trading floor on 13 January 1994.
• Number of listed companies – 370.
• Includes Commercial Banks, Hydro Power
Companies, Insurance Companies and Finance
Companies among others.
• Has 50 registered brokers as of April 2013.
• The NEPSE Index is primary all equity market index of
NEPSE.
• It is regulated by the Securities Board of Nepal.
3. Market Depth
What it is?
• The market for a stock is "deep“ means, there will be a
sufficient volume of pending orders on both the bid and
ask side, preventing a large order from significantly
moving the price.
How it Works?
• Market Depth measures the number of units that must be
traded before a stock or bond's price moves.
Market depth (M) = ƒunction of buy order to sell order
and liquidity of issuing company.
Why it matters?
• Stocks that display consistently high levels of market
depth do not require market makers to facilitate or
supplement the volume of buy and sell orders.
4. Factors Influencing Market Depth
• Tick Size: Tick size is the minimum price increment at
which trades may be made on the market.
• Price movement restrictions: Most major financial
markets do not allow completely free exchange of the
products they trade, but instead restrict price movement in
well-intentioned ways. (NEPSE Circuit Breaker).
• Allowable leverage: Major markets and governing bodies
typically set minimum margin requirements for trading
various products.
• Market transparency. Latest bid or ask price is usually
available for most participants, additional information about
the size of these offers and pending bids or offers that are
not the best are sometimes hidden for reasons of technical
complexity or simplicity.
7. Sharp Practices
• Use of “Rat Trap” such as: Charge you nothing upfront,
but trap you into large fees - tens of thousands of
pounds - to be paid even if your business doesn't sell.
• They'll give you whatever valuation they feel will
persuade you to sign up with them.
• They'll give you the impression that no upfront fees
means you risk nothing (but there's a real and very
considerable danger to your business that they won't
disclose).
• They will claim to have a large database of eager buyers
or one buyer looking urgently for a business just like
yours (both of which claims they know you can't verify).
8. SEBON – The Market Regulator
Functions, Powers and Duties
• To assist in the execution of the Policy and Program of
Government of Nepal in respect of Securities and Capital
Market.
• To formulate and implement professional code of
conduct to be observed by Securities Market and
Securities Entrepreneurs in order to maintain investor's
interest and market fairness.
9. • To formulate and implement good governance code to
be observed by the body corporate which registers and
lists the Securities for the good governance of organized
sector.
• To develop regional and international relations by
obtaining the membership of regional and international
organizations or authorities relating to Capital Market.
• To effect other works as may be required for the
regulation and development of Capital Market.
10. Nepal Stock Exchange (NEPSE)
• No. of listings 370 (Scrips)
• Market Cap: US$ 11.93 Billion (2/24/2016)
• Indices NEPSE index
• Dominant Companies
• Chilime Hydro Power Company Limited
• National Hydro Power Company Limited
• Citizens Bank Limited
• Sanima Bank Limited
• Butwal Power Company Limited
