Today, many people are talking about stock market due to fantastic returns in recent years. Most of people have started their journey through IPO, Mutual Funds, or trading in stock market. More and more common people are participating in capital market. Besides, there are many interesting facts about the Indian stock market which we should know.
Bombay Stock Exchange or BSE is considered as the biggest stock exchange in the world by the number of listed companies. There are more than 5,500 companies listed on BSE. Sensex is an index for BSE and its full form is Stock Exchange Sensitive Index. It comprises the top 30 largest & actively traded companies in the Indian stock market.
National Stock Exchange or NSE is the 11th largest stock exchange in the world with a market capitalization of over $2.27 trillion. It is the 4th largest stock exchange in the world based on trading volume. Nifty is an index for NSE and its full form is National Stock Exchange. It comprises the top 50 largest & actively traded companies in the Indian stock market.
Apart from BSE and NSE, there are 7 trading exchanges in India:
1) Calcutta Stock Exchange
2) India International Exchange
3) Indian Commodity Exchange
4) Metropolitan Stock Exchange
5) Multi Commodity Exchange of India
6) National Commodity and Derivatives Exchange
7) NSE IFSC Ltd
BSE is the oldest stock exchange in Asia which was established in 1875. It was started by a businessman named Premchand Roychand.
The Indian stock market jumped to 5th position by market capitalization ($3.21 trillion) last week. It is only behind the US ($47.32 trillion), China ($11.52 trillion), Japan ($6.00 trillion), and Hong Kong ($5.55 trillion).
No. of Investors
Currently, there are more than 7.38 crore Demat account holders in India. The number of mutual fund investors is 2.75 crore.
The no. of Registered Investment Advisors (RIA) is more than 1324 with SEBI in India. The ratio of Demat account holders and mutual fund investors to Registered Investment Advisors (RIA) is around 76500:1. That means 1 RIA is available for every 76,500 investors.
The number of Demat accounts was 3.5 crore till 2018-19. In only the next three years it was doubled to 7.38 crore accounts. Scam 1992 web series is one of the reasons for it. Mumbai has the highest number of Demat account holders while Gujarat stands second.
Master Blaster Effect
According to studies, whenever India wins a match the Nifty or BSE index is usually flat. But whenever Sachin Tendulkar loses the game, the stock market also starts to face loss. His dismissal affected the Indian stock market.
MRF is the costliest share in the Indian stock market. Currently, its price is around Rs.69,000. Its share touched a lifetime high of Rs.98,000 on 11th Feb 2021.
Bull vs Bear
Have you ever thought about why it is called the Bull & Bear market? It is derived from the way in which these animals attack its opponent. The Bull has its horns toward the sky, which indicates upward movement. Whereas, the bear has palms toward the ground indicating downward movement.
TCS, Reliance, HDFC’s market capitalization is higher than the combined market capitalization of the Karachi Stock Exchange (Pakistan).
Rakesh Jhunjhunwala, Radhakishan Damani, Ramdev Agarwal, Ramesh Damani, and Porinju Veliyath are the major traders/investors in India.
Foreign Portfolio Investors (FPIs) and Foreign Institutional Investors (FIIs) hold the largest percentage of shares in the Indian stock market. LIC is the largest Domestic Institutional Investor (DII) in India. In 2020-21, FII and FPI’s investment was Rs.2.7 lakh crore in India.
Algo trading is a process of automated trading for executing orders using variables such as time, price, and volume. In algo trading, trades happened in milliseconds or microseconds. A millisecond is a thousandth of a second. Whereas, a microsecond is the thousandth of a millisecond. In India, almost 50% of trades happen through Algo trading.
In 1992, Harshad Mehta who was a registered stock broker committed a scam of around Rs.4,000 crore in BSE. Ketan Parekh who is CA and former stockbroker was a trainee under Harshad Mehta. He was working in the Harshad Mehta’s firm GrowMore Investments. In 2009, Ketan was responsible for the second biggest scam in India amounting to Rs.40,000 crore.