NSE, or National Stock Exchange, is one of the premier stock exchanges of India located in Mumbai. It is the largest stock exchange in India and the second largest globally by the number of trades in equity shares. NSE was established in 1992 as the first demutualized electronic exchange.
Leading institutions set up NSE to provide a modern, fully automated screen-based trading system with a national reach. It started operations in the Wholesale Debt Market segment in 1994. Nifty & Bank nifty are benchmark indices of NSE.
NSE's flagship index, the NIFTY 50, the 50 stock index, is used extensively by investors in India and worldwide as a barometer of the Indian capital markets. The National Stock Exchange has a total market capitalization of more than INR49480.97 crore, making it the world's 09th-largest stock exchange as of Dec 2021.
Most active Stocks on NSE by Trading Volumes
Here are the most active stocks by trading volumes on NSE (as of ):
Top Companies on NSE by Market Capitalisation
Here are the Top-10 companies in NSE by market capitalisation:
What are the services offered by NSE?
NSE works similarly to other stock exchanges around the world. Some brokers deal with orders from their clients (buy/sell-side). Brokers send these orders to the exchange for matching. Orders are matched based on price-time priority (better-priced orders get priority). Once an order is filled, the counterparty information is sent to both parties for settlement. The trade is settled through a clearing corporation, ensuring there is no default from either party.
The exchange offers trading, clearing and settlement services in equity, equity derivatives, debt and currency derivatives segments. It is the first exchange in India to introduce an electronic trading facility, thus connecting the investor base of the entire country.
NSE has a fully-integrated business model comprising exchange listings, trading services, clearing and settlement services, indices, market data feeds, technology solutions and financial education offerings. NSE also oversees compliance by trading and clearing members with SEBI regulations through various departments, including surveillance, arbitration and risk management.
NSE offers trading and clearing services through an electronic, fully automated screen-based trading system that adopts an order-driven market principle. It also provides a settlement guarantee through its clearing corporation. NSE has launched several new products like currency derivatives, interest rate futures (IRFs) and debt products like corporate bonds and Government Securities (G-Secs).
Why do companies list on NSE?
The most significant benefit of listing on the NSE is giving a company access to capital. It allows companies to raise money by offering investors equity ownership in exchange for cash.
Listing on NSE also provides liquidity to shareholders. Investors can buy or sell shares of a company listed on the exchange at any time during trading hours. The price at which an investor can buy or sell shares is determined by supply and demand, but there is an orderly market for most traded securities.
Benefits of listing on NSE:
1) Raising funds through the issue of shares, debentures and bonds
2) Providing liquidity and marketability to the existing shareholders by enabling them to trade their shares
3) Attracting investors and potential investors who buy shares in companies listed on NSE
4) Attracting good talent as they prefer working with listed companies.
5) The efficient market structure that facilitates the trading process in a fast and hassle-free manner
6) Assured transparency as the trading process is entirely computerized
What are the top indices on NSE?
The National Stock Exchange is a large and well-diversified bourse that offers various products in all market segments such as equity, equity derivatives, currency derivatives, debt, mutual funds, IPO etc. Nifty is the most crucial benchmark index for the Indian stock market. In addition to the benchmark index, NSE also has other popular indices like Nifty Midcap 50, Nifty Junior etc.
Below is the List of Top NSE Indices -
Nifty Next 50
Nifty Midcap 50
The Nifty 50 is a well-diversified 50 stock index accounting for 23 sectors. It is used for various purposes such as benchmarking fund portfolios, index-based derivatives and index funds.
The Indian benchmark indices, BSE Sensex and NSE's CNX Nifty, are calculated on a free-float market capitalization methodology. The free float methodology includes only those publicly issued shares that are readily available for trading in the marketplace.
In the case of equity shares, this would comprise only those in public hands, excluding promoters holding, holding of any person who is not resident Indian and strategic holding by Government. Free float excludes locked-in shares held by promoters, employees, and other long-term shareholders. Shares locked-in as margin against buyback of securities or pledges with lenders have also been excluded from a free float.
What are the trading categories on NSE?
Leading financial institutions set up the NSE at the government's behest to bring transparency to the Indian capital market. It attempted to bring down information asymmetry between investors and issuers so that pricing could reflect actual market dynamics.
Equity markets in India are regulated by the Securities and Exchange Board of India (SEBI). India has a dual listing system for companies, allowing them to list their shares in both the primary and secondary markets simultaneously from the same company address. Investors can trade on NSE through Internet, Brokers or directly from the primary market (New Delhi Stock Exchange) or Secondary market (National Stock Exchange), which could have different prices and ask/bid price differences.
There are three types of trading on NSE – Equity, F&O and Debt instruments (gold bonds, T-bills, SDLs etc.).
Equity Trading – The leading equity trading is through NSE's share market. In NSE, the transactions are carried out between buyers and sellers. The primary motive of investors is to sell or purchase shares that they want to buy or sell, depending upon their investment requirements.
F&O Trading – F&O stands for Future & Options, which refers to assets that are traded electronically. These are financial derivatives that can be used to speculate on the price of stocks or other financial instruments. These derivatives are standardized contracts traded like stocks on an exchange, but they can be purchased at a discount (called 'F&O') and later sold at a premium (called 'O').
ETFs - exchange-traded funds (ETFs), equity ETFs and debt ETFs open for trading on NSE, i.e., you can buy and sell them anytime during market hours through your broker or any other mode of buying stocks, i.e., Demat account/trading account etc.
Debt Instruments such as T-Bills, State Development Loans (SDL), Gold Bonds etc., will be traded on this platform.
The online trading platform of 5paisa.com allows its customers to trade shares of their choice and make profits. The money earned can be used for other purposes, including paying off the home loan or savings in mutual funds.
5paisa discount brokerage offers online trading services like stock trading, equity delivery and options in which you get all trading services at the lowest brokerage costs.
5paisa offers other features like real-time market data, easy to understand charting, price alerts and free SMS alerts. It also gives users access to sell/buy orders from other traders and order execution from multiple stock exchanges