2. Stock Exchange
• A stock market or equity market is a public
entity (a loose network of economic
transactions, not a physical facility or discrete
entity) for the trading of
company stock (shares) and derivatives at an
agreed price; these are securities listed on
a stock exchange as well as those only traded
privately.

3. History
• 1875 - BSE is Asia's first stock exchange.
• 12th century France the courretiers de change - Debt of
Agriculture – First Brokers.
• 13th Century - 1309 Family Van der Beurze had a building
in Antwerp - Where people trade.
• 13th Century - 1351 Venetian bankers began to trade in
government securities.
• 14 Century – Bankers in Pisa and Florence also began trading
in government securities.
• 16th – Century – 1602 Dutch East India Company (Joint Stock
Company) started to trade to raise fund - Amsterdam
Exchange
• Dutch people were pioneer in short selling but it was banned
in 1610

4. Function & Purpose
• To Raise Fund.
• Liquidity – Easy to Sell & Buy rather than
investing like Real Estate and so on..
– Companies are also trading its own share for
Operational (Liquidity) Expense Needs.
• Operating as Clearing House – Buy & Sell – Investor
Safety.
• Economy Growth – Promote Production of Products,
Services & Employment Opportunities.

5. Investment Strategies or Tools to
Analysis the Performance of Stock
• Fundamental Analysis
– Financial Statements like Balance Sheet, Trial
Balance and so on…
• Technical Analysis
– Using of Charts and Quantitative Techniques like
Trend Line….
• Index Method
– Buying weighted Stock of Entire Stock Market..
• Eg: BSE – Top 30 Blue Chip Companies…

6. Leveraged strategies
• Short Selling
– The trader borrows stock then sells it on the market,
hoping for the price to fall.
• Margin Buying
– The trader borrows money (at interest from Brokers) to
buy a stock based on collateral from other stocks the
trader owns outright.
– Eg: Regulation of US – for Investing $1000 – 50% can be
borrowed on the basis of Stock. If price falls lower than the
Margin Value the brokers will sold the share to the safety
of borrowed money.
• Derivatives
– It may be used to control large blocks of stocks for a much
smaller amount of money than would be required by
outright purchase or sales.

7. Stock Exchange Crashes
• Wall Street Crash of 1929
• the stock market crash of 1973–74
• The Black Monday of 1987
• The Dot-com bubble of 2000
• Stock Market Crash of 2008.

8. Circuit Breakers
• In 1990 - The New York Stock Exchange and
the Chicago Mercantile Exchange - Circuit
Breakers for Dow Index.
• Halts the Trade.
• If Dow index Points declines a prescribed
number of points for a prescribed amount of
time. –

9. New York Stock Exchange (NYSE)
circuit breakers
% Drop Time of drop Close trading for
10 before 2 pm one hour halt
10 2 pm – 2:30 pm half-hour halt
10 after 2:30 pm market stays open
20 before 1 pm halt for two hours
20 1 pm – 2 pm halt for one hour
20 after 2 pm close for the day
30 any time during day close for the day

10. Single - Stock Circuit Breakers
• In February 2012, the Investment Industry
Regulatory Organization of Canada (IIROC)
introduced single-stock circuit breakers.

11. World Stock Exchanges
Market
Capitaliza Trade Value
Rank Economy Stock Exchange Location tion (USD
(USD Bill Billions)
ions)
United States NYSE Euronext (US & New York
1 14,242 20,161
Europe Europe) City
United States NASDAQ OMX (US & New York
2 4,687 13,552
Europe North Europe) City
3 Japan Tokyo Stock Exchange Tokyo 3,325 3,972
London Stock
4 United Kingdom London 3,266 2,837
Exchange
Shanghai Stock
5 China Shanghai 2,357 3,658
Exchange
Hong Kong Stock
6 Hong Kong Hong Kong 2,258 1,447
Exchange
Toronto Stock
7 Canada Toronto 1,912 1,542
Exchange
8 Brazil BM&F Bovespa São Paulo 1,229 931

12. Cont…..
Australian Securities
9 Australia Sydney 1,198 1,197
Exchange
10 Germany Deutsche Börse Frankfurt 1,185 1,758
11 Switzerland SIX Swiss Exchange Zurich 1,090 887
Shenzhen Stock
12 China Shenzhen 1,055 2,838
Exchange
BME Spanish
13 Spain Madrid 1,031 1,226
Exchanges
Bombay Stock
14 India Mumbai 1,007 148
Exchange
15 South Korea Korea Exchange Seoul 996 2,029
National Stock
16 India Mumbai 985 589
Exchange of India
17 Russia MICEX-RTS Moscow 800 514
18 South Africa JSE Limited Johannesburg 789 372

13. Stock Exchanges in INDIA
• Bombay Stock Exchange (BSE) • Bhubaneshwar Stock
• National Stock Exchange of Exchange (BhSE)
India (NSE) • Cochin Stock Exchange (CSE)
• Indian Commodity Exchange (ICEX) • Hyderabad Stock Exchange (HSE)
• United Stock Exchange of • Calcutta Stock Exchange (CSE)
India (USE) • Delhi Stock Exchange (DSE)
• Multi Commodity Exchange (MCX) • Bangalore Stock Exchange
• MCX Stock Exchange (MCX-SX) • Madhya Pradesh Stock Exchange,
• Over the Counter Exchange of Indore
India (OTCEI) • Jaipur Stock Exchange (JSE)
• Inter-connected Stock Exchange of • Magadh Stock Exchange, Patna
India (ISE) • UP Stock Exchange (UPSE)
• Madras Stock Exchange (MSE) • Vadodara Stock Exchange,Vadodara
• Ahmedabad Stock Exchange (ASE) (VSE)

14. Commodity Exchanges
• Multi Commodity Exchange of India
Limited (MCX)
• National Commodity & Derivatives Exchange
Limited (NCDEX)
• Indian National Multi-Commodity Exchange
(NMCE)
• Commodity Exchange Limited ICEX.