NSE Trading

Stock exchanges play a crucial role in a country’s capital market. They provide a secure, systematic and transparent trading platform. However, you need an intermediary (broker) to trade in the bourses. And the right intermediary can make all the difference. Read all about NSE Trading and how TradeSmart can alleviate your trading experience.NSE or National Stock Exchange of India Ltd. is one of the leading stock exchanges of India. It was set up in the year 1992 with the core objective of bringing transparency and simplicity in the capital market dealings.

Important things to know about NSE:

  1. NSE’s headquarters are in Mumbai.
  2. It was India’s first stock exchange to offer the facility of electronic trading.
  3. Currently it is India’s largest and worldwide fourth largest stock exchange, in terms of trade volume.
  4. NSE Trading is available in these segments – Equities (including mutual funds, ETF, etc.), debt and derivatives. For instance, the WDM (Wholesale Debt Market) segment deals with NSE Bond trading.
  5. Nifty50 (also known as S&P CNX Nifty) is NSE’s benchmark index. It consists of the top 50 and most actively traded stocks on the NSE trading platform.

The NSE Trading software operates on NEAT (National Exchange for Automated Trading) system. This is a completely automated and screen-based platform which works on the order driven trading principle (rather than a quote driven system). This arrangement has enabled NSE to bring down the jobbing spreads and transaction costs.

Mechanism of trading in NSE

1. In order to trade on the National Stock exchange, you need to contact a broker or broking firm. These registered members trade on your behalf. They are also sometimes referred to as NSE trading members. You can access the list of authorized brokers on the NSE Trading app or website www.nseindia.com.There are primarily two types of brokers:

  • Full-service brokers
  • Discount brokers

Full service brokers are traditional trading members who offer a wide range of trading services. Discount brokers offer cost-effective trading solutions. For instance, Trade Smart which offers services across stocks, commodity as well as currency trading segments. We not only help you place your buy or sell orders at NSE, but also offer NSE trading tips or help you form your own NSE trading strategy.

2. The foremost pre-requisite for NSE Trading is a demat and trading account. Trading account is the account through which all your trading transactions or orders will get placed. Demat Account is the electronic storage vault for all your stocks or other investments. Your chosen broker can assist you in opening these two mandatory accounts after completing the KYC (Know your client) formalities. Once the accounts are opened, your broker will share a unique number (Client Code) that you need to quote for all your trades.

Why trade in NSE with TradeSmart?

If you are wondering why you need to partner with TradeSmart for your NSE Trading needs, here are your answers:

  1. Technological edge:TradeSmart is equipped with robust technological capabilities which ensures that our investors have an edge over others and have a smooth user experience.
  2. Instant fund transfer:TradeSmart has partnered with over 26 banks to offer the facility of instant fund transfer to investors.
  3. Cost-effectiveness:The brokerage charges of TradeSmart are amongst the lowest in the market. We pass on the benefits of lower transaction costs (due to advanced technological operations) as reduced (and flexible) brokerage plans to investors.
  4. Best Exposure:When you trade with TradeSmart, you can take big decisions without worrying about limited funds. You have on offer one of the best intraday exposures available in the industry.
  5. Ease of operation:Simple yet effective is the core principle of TradeSmart operations. For instance, our single trading interface gives you access to multiple exchanges such as NSE Virtual Trading app, etc.
  6. Continuous support:The 100+ team members at TradeSmart extend their expertise to investors through multiple mediums – phone, chat and email.

FAQs

What are the NSE trading hours?

The regular NSE trading session starts from 9.15 am and closes at 3.30pm. There is a 15-minute pre-open session (which starts at 9 am) and the closing session is held between 3.40pm and 4pm.

How is NSE’s benchmark index (Nifty50) calculated?

The Nifty 50 is calculated by considering float-adjusted, weighted market capitalization of top 50 stocks across numerous sectors. The Nifty is calculated by taking the top 50 stocks that are actively traded on NSE. The base period is taken as 3rd November, 1995.

Can one take part in NSE trading on their own i.e. without a broker?

No. All the trades on NSE need to be placed via an authorized broker or brokerage firm, as the stocks are listed on the secondary market platform, the National Stock Exchange.

What is the trading platform used by NSE?

The NSE Trading platform is known as NOW and has been operational for over 12 years. It provides direct connectivity for trade execution and real-time data feed across NSE trading terminals. (The platform will be discontinued w.e.f. September 14, 2020)

What are the brokerage rates for NSE trading?

The rates vary from one broker to another. However, the upper limits have been specified by NSE (for WDM segment). These are the maximum brokerage rates for NSE trading online services.

  • Govt. Of India Securities and T-Bills – Between 5ps and 25 ps (per Rs. 100) basis the order value
  • State Govt. Securities & Institutional Bonds – Between 5ps and 50 ps (per Rs. 100) basis the order value
  • PSU & Floating Rate Bonds – Between 10ps and 50 ps (per Rs. 100) basis the order value
  • CP and Debentures   1% of the order value