Stock Exchange

What is a Stock Exchange?

The stock exchange in India, under the overall supervision of SEBI ,provides a trading platform, where buyers and sellers can meet and transact in securities. 

The trading platform provided by NSE is an electronic one and there is no need for buyers and sellers to meet at a physical location to trade. They can trade through the computerized trading screens available with the NSE trading members or the internet-based trading facility provided by the trading members of NSE.

There are two types of exchanges. Demutualised exchange and a Mutualised Exchange

Demutualised Vs Mutualised Exchange

Demutualisation refers to the legal structure of an exchange whereby the ownership, the management and the trading rights at the exchanges are segregated from one another. National Stock Exchange (NSE) and Over the Counter Exchange of India (OTCEI) are demutualised.

In a mutualised stock exchange, all three functions viz. Ownership, management and trading are concentrated into a single group. Here, the broker members of the exchange are both the owners and the traders on the exchange and they manage the exchange as well. Thus, all the operations are carried out by the same set of people. On the other hand, in a demutualised exchange, all three functions, i.e. The ownership, management and trading are in separate hands.