Depositories Participant

PROJECT REPORT ON

ONLINE TRADING

BY

MR. AJAY SINGH

T.Y.B.B.I

SEMESTER V

THAKUR COLLEGE OF SCIENCE & COMMERCE

MUMBAI

PROJECT GUIDE

PROF. PRITI AGGARWAL

UNIVERSITY OF MUMBAI

2009-2010

DECLARATION

I, Mr.Ajay Singh of Thakur College of Science &

Commerce of T.Y.B.B.I. (Third Year Bachelor Degree of

Banking & Insurance Semester 5) hereby declare that I

have completed the project on “Online Trading” in the

Academic Year 2009-2010.

The information submitted is true and original to the best

of my knowledge.

SIGNATURE OF THE STUDENT

AJAY SINGH

CERTIFICATE

I Priti Aggrawal, hereby certify that Mr. Ajay Singh of Thakur College of Science & Commerce of T.Y.B.B.I. (Third Year Bachelor Degree of Banking & Insurance Semester 5) has completed his project on “Team Building” in the academic year 2009-2010.

The information submitted is true and original to the best

of my knowledge.

Signature of project Guide Signature of the

Principal

Prof. Priti Aggarwal Dr. Chaitali

Chakrobarthy

Date:

Place: Mumbai

ON-LINE TRADING

Acknowledgement

This project was made possible, by the efforts of many

people who supported me in this endeavor, whose names if not

mentioned would be inconsiderate on my part.

The project “Online Trading” is a result of co-operation, hard

work, and good wishes of many people. I student of Thakur

College would like to thank Prof. Priti Aggarwal my project guide

for her involvement and timely assessment which provided

inspiration and her valued guidance throughout my study on this

subject.

I am also indebted to Principal Dr.Chaitali Chakrobarthy for

giving us an opportunity to present a creative outcome in the

form of a project. I’m thankful to Mr Rajan my teacher for their

friendly guidance and constant encouragement.

I would also take this opportunity to express sincere

gratitude to the library staff that provided me with the right

information and study material at the right time.

GH THAKUR COLLEGE OF SCIENCE AND COMMERCE

ON-LINE TRADING

I extend my thanks to my college friends, family members,

for their efforts and creativity which helped in giving final shape

and structure to the project. I am also thankful to all seen and

unseen hands and heads which helped in direct and indirect

completion of the project.

INDEX

PART – 1: ONLINE TRADING.1. About Trading and Investors.

2. Introduction to Online Trading.

History

Objectives, Merits & Demerits

Dematerialization & Rematerialization

3. Place Where Trading Is Done.

The ‘Big Two’ Architectures

Who can invest in Indian Stock Exchange

4. Top Players in Online Trading.

5. Depository Systems.

About NSDL & CDSL


ON-LINE TRADING

Objective, Activity, Benefits of Depositories.

PART – 2: ICICI DIRECT.COM V\S

SHAREKHAN.COM

1. Introduction, Merits & Demerits

2. Products & Services

3. Brokerages

4. Types of Accounts

5. Case Study

6. Conclusion

EXECUTIVE SUMMARY

Subject of the Project: This project is about the latest trend in trading through online networking that is taking the business world by storm. Online trading networking or simply put ‘networking on the net’ is fast becoming the easiest, fastest, very focused and a most effective means of growing your chain of contract to help you climb the success ladder of investment faster than any other route can take you.

Scope:


ON-LINE TRADING

This project study covers the different genres of networking, be they the traditional trading through online or more relaxed.

Methodology: This project provides a clear objective insight into the phenomenon of online trading. This project has been a primary data based project right since it conception. Besides a minuscule number of statistics and research data which was found on research online, all the inferences and conclusions have been made on the basis of real time usage of networking websites by people through extensive surveys and research done for users of icicidirect.com and sharekhan.com.

Objective: The objective of this project is to bring in to focus the most innovative upcoming technology trading or investing. So that more and more people are connected each and every day as the world comes closer in a closely knit networking.

Recommendations: Going through the traditional meet and greet routines for extending and enriching our networks can be quite perfunctory and ineffective. Online trading has held


ON-LINE TRADING

the helm for many ship on the brink of capsizing, many success story has been written on the pages of online trading networking. A budding entrepreneur needs networking more than anything else; his ship is then assured of smooth sailing even in the rough seas.


ON-LINE TRADING

ABOUT

TRADING & INVESTOR'S


ON-LINE TRADING

Trading

A trading is the process in which someone who buys and sells financial

instruments such as stocks, bonds and derivatives. Traders are professionals, casual

investors or speculators in financial instruments traded in the stock markets,

derivatives markets and commodity markets, comprising the stock exchanges,

derivatives exchanges and the commodities exchanges.

Why Investor's do Trading

Investors can deal with stock exchange securities either for a genuine trading

purpose or for the purpose of speculative trading. Genuine investors generally

give/take delivery of shares with no intention to postpone the settlement to the next

period. Their primary motive is to get long term gains. On the other hand,

speculators do not take/give delivery of shares. They deal in differences in the

purchase and sale prices. Their main intention is to carry forward the transactions

and get short-term gains due to price differences.


http://en.wikipedia.org/wiki/Commodities_exchanges

http://en.wikipedia.org/wiki/Derivatives_exchange

http://en.wikipedia.org/wiki/Stock_exchanges

http://en.wikipedia.org/wiki/Commodity_markets

http://en.wikipedia.org/wiki/Derivatives_market

http://en.wikipedia.org/wiki/Stock_markets

http://en.wikipedia.org/wiki/Speculator

http://en.wikipedia.org/wiki/Investors

http://en.wikipedia.org/wiki/Derivative_(finance)

http://en.wikipedia.org/wiki/Bond_(finance)

http://en.wikipedia.org/wiki/Stock

http://en.wikipedia.org/wiki/Financial_instruments

http://en.wikipedia.org/wiki/Financial_instruments

ON-LINE TRADING

INTRODUCTION OF ON-LINE TRADING,

HISTORY OF ON-LINE TRADING

OBJECTIVES, MERITS & DEMERIT'S OF ON-LINE TRADING

DEMATERIALISATION & REMATERIALISATION


ON-LINE TRADING

On Line Trading

The Information Technology has brought out revolutionary change in the

operations of stock exchanges in India. The traditional method trading without the

use of technology was time consuming and inefficient further, it imposed limits on

trading volumes and efficiency. To overcome those defects and to provide efficient

and transparent services, the NSE has introduced a national-wide ON-LINE fully

automated Screen Based Trading System (SBTS). Now, other stock exchanges have

been forced to adopt SBTS and today India can boast that almost 100% trading take

place electronic order matching.

Under SBTS, a member can punch into the computers quantities of securities

and the prices at which he likes to transact the transaction. It is executed as soon as it

finds a matching sale or buy order from a counter party. Thus, technology is used to

carry the trading hall of the exchanges to the premises of the brokers. NSE has

carried the trading the internet and the hand held devices through WAP for the

convenience of the mobile investors.

Small beginning

Compared to the Western countries, ON-LINE trading is still in its infancy in

India. With trading turnover at around Rs. 10 crores per day from ON-LINE trading

compared to a combined gross turnover of around Rs. 9000-10,000 crores handled

by the BSE and NSE together, ON-LINE trading has a long way to go. With some

ten dotcom players, such as icicidirect.com, investsmart, 5paisa.com, India bulls, and


ON-LINE TRADING

a host of brokers, such as kotakstreet, sharekhan, motilaloswal, Geojit Securities and

duttstock, entering the ON-LINE ring promises exciting times ahead.

History of On Line Trading

ON-LINE stock trading is very old concept for big institutions who trade

thru private networks owned by Reuter's "Instinet" and a system called

"Posit" since 1969. But it becomes internet based for lay men only in late 90s.

Funny, that actually idea was first time used by a company making Beer

called "WIT beer" to help its shareholders trade its shares. That’s how "WIT

Capital" was born which is considered pioneer of this concept. It was made

mainstream and household name by a offshoot of Charles Schwab & Co called

eSchwab which is used by millions of people in USA. Lot of NRI's i know play

in US stock market even when they come to India for holidays via website

of eSchwabe.

There are other serious players like E*trade, DATEK ON-LINE etc. All this

companies ask you to start account with US $5000 and you can buy and sell

stock using these funds. They also issue you a check book which you can use

to make payments from this account. Or use their ATM card to withdraw cash

from your stock trading account.

Today practically every big name brokerage firm offers ON-LINE stock

trading as it reduces their costs. Earlier they had army of brokers on phone with

clients executing trade, which is done by computers accepting orders from


ON-LINE TRADING

clients directly. This firm now offers human access to high net worth accounts, and

to rest at charge per trade.

Objectives of Internet trading:

Increase transparency in the markets.

Enhance market quality through improved liquidity, by increasing quote

continuity and market depth.

Reduce settlement risks due to open trades, by elimination of mismatches.

Provide management information system (MIS).

Introduce flexibility in system, to handle growing volumes easily and to support

nationwide expansion of market activity.

Besides, through Internet trading three fundamental objectives of securities

regulation can be easily achieved, these are: Investor protection, creation of a fair

and efficient market and, reduction of the systematic risks.

Merit’s Of On-Line Trading

The Merit of On-line Trading are as follows:

Faster Trading


ON-LINE TRADING

Technology driven trading is faster than manual trading. Once the

order is matched, it is executed immediately.

Accessible to All

It provides full anonymity by accepting order from members

irrespective of the size of the order – whether big or small without disclosing their

identity. Thus, it provides equal access to all.

Faster Incorporation of Price Sensitive Information

The SBTS allows faster incorporation of price sensitive

information into the prevailing prices and thus, it increases the information

efficiency of the markets.

Widening the Market

It also widen the market by enabling the market participants to trade

with one another simultaneously irrespective of their geographical locations.

Thus, it improves the depth and liquidity of the market.

Saving of Time and Cost

The SBTS electronically matches order on strict price condition as well as on

time priority basis. Hence, it cuts down cost as well as time in executing orders.


ON-LINE TRADING

Fully Transparent

ON-LINE trading is fully automated and screen-based. Everything is

transparent on the screen and hence, there is no possibility to play any hide and

seek game.

No Errors and Frauds

The price conditions, quantity conditions etc. are puched into the

computers by the members themselves. So, the risk of error is very less moreover,

the trading is fully automated and screen-based and hence frauds can not enter

into the system

Perfect audit trail

It also provides perfects audit trail which helps to resolve disputes by

logging in the trade execution on entirety. Thus, on-line trading measures

efficiency, liquidity and transparency in the trading on stock exchanges.

Demerits of On-Line Trading (Website based):

Website performance - sometime the website is too slow or not enough user

friendly.

Little long learning curve especially for people who doesn't know much about

computer and internet.

Brokerages are little high.


ON-LINE TRADING

Dematerialisation:

Dematerialisation is the process by which a client can get physical

certificates converted into electronic balances maintained in its account with the DP.

Features:

Holdings in only those securities that are admitted for dematerialisation by NSDL

can be dematerialised.

Structure of holding in the securities should match with the account structure of

the depository account

If the shares are in the name of X and Y it cannot be dematerialised in to the

account of either X or Y alone. Further, if the shares are in the name of X first and

Y second and the account is in the name of Y first and X second, then these shares

cannot be dematerialized in this account. The dematerialisation process can be


ON-LINE TRADING

initiated only by X first and Y second and for this a depository account will have

to be opened in the name of X first and Y second.

Only those holdings that are registered in the name of the account holder can be

dematerialised.

Rematerialisation:

Rematerialisation is the process by which a client can get his electronic

holdings converted into physical certificates. The client has to submit the

rematerialisation request to the DP with whom he has an account. The DP enters the

request in its system which blocks the client's holdings to that extent automatically.

The DP releases the request to NSDL and sends the request form to the Issuer/ R&T

agent. The Issuer/ R&T agent then prints the certificates, despatches the same to the

client and simultaneously electronically confirms the acceptance of the request to

NSDL. Thereafter, the client's blocked balances are debited.

Features:


ON-LINE TRADING

A client can rematerialise his dematerialised holdings at any point of time.

The rematerialisation process is completed within 30 days.

The securities sent for rematerialisation cannot be traded.

PLACE WERE TRADING IS DONE


ON-LINE TRADING

THE 'BIG TWO' ARCHITECTURES

WHO CAN INVEST IN INDIAN STOCK EXCHANGE

WERE DOES TRADING DONE:

Trading basically done in Stock Exchange. There 22 stock exchanges in

India which are situated in Ahmedabad, Bangalore, Calcutta, Chennai, Delhi etc.

There are two major Stock Exchange functioning in India there are as follows:

1. Bombay Stock Exchange in India.


ON-LINE TRADING

Bombay Stock Exchange Limited (the Exchange) is the oldest stock

exchange in Asia with a rich heritage. Popularly known as "BSE", it was established

as "The Native Share & Stock Brokers Association" in 1875. It is the first stock

exchange in the country to obtain permanent recognition in 1956 from the

Government of India under the Securities Contracts (Regulation) Act, 1956.The

Exchange's pivotal and pre-eminent role in the development of the Indian capital

market is widely recognized and its index, SENSEX, is tracked worldwide. Earlier

an Association of Persons (AOP), the Exchange is now a demutualised and

corporatised entity incorporated under the provisions of the Companies Act, 1956,

pursuant to the BSE (Corporatisation and Demutualisation) Scheme, 2005 notified

by the Securities and Exchange Board of India (SEBI).Bombay Stock Exchange

Limited received its Certificate of Incorporation on 8th August, 2005 and Certificate

of Commencement of Business on 12th August, 2005. The 'Due Date' for taking over

the business and operations of the BSE, by the Exchange was fixed for 19th August,

2005, under the Scheme. The Exchange has succeeded the business and operations of

BSE on going concern basis and its recognition as an Exchange has been continued

by SEBI.


ON-LINE TRADING

With demutualisation, the trading rights and ownership rights have been

de-linked effectively addressing concerns regarding perceived and real conflicts of

interest. The Exchange is professionally managed under the overall direction of the

Board of Directors. The Board comprises eminent professionals, representatives of

Trading Members and the Managing Director of the Exchange. The Board is

inclusive and is designed to benefit from the participation of market intermediaries.

In terms of organisation structure, the Board formulates larger policy

issues and exercises over-all control. The committees constituted by the Board are

broad-based. The day-to-day operations of the Exchange are managed by the

Managing Director & CEO and a management team of professionals.

The Exchange has a nation-wide reach with a presence in 417 cities and

towns of India. The systems and processes of the Exchange are designed to

safeguard market integrity and enhance transparency in operations. During the year

2004-2005, the trading volumes on the Exchange showed robust growth.

The Exchange provides an efficient and transparent market for trading

in equity, debt instruments and derivatives. The BSE's On Line Trading System

(BOLT) is a proprietory system of the Exchange and is BS 7799-2-2002 certified.

The surveillance and clearing & settlement functions of the Exchange are ISO

9001:2000 certified.

2. National Stock Exchange in India.


ON-LINE TRADING

The National Stock Exchange (NSE) is India's leading stock exchange

covering various cities and towns across the country. NSE was set up by leading

institutions to provide a modern, fully automated screen-based trading system with

national reach. The Exchange has brought about unparalleled transparency, speed &

efficiency, safety and market integrity. It has set up facilities that serve as a model

for the securities industry in terms of systems, practices and procedures.

NSE has played a catalytic role in reforming the Indian securities market

in terms of microstructure, market practices and trading volumes. The market today

uses state-of-art information technology to provide an efficient and transparent

trading, clearing and settlement mechanism, and has witnessed several innovations in

products & services viz. demutualisation of stock exchange governance, screen

based trading, compression of settlement cycles, dematerialisation and electronic

transfer of securities, securities lending and borrowing, professionalisation of trading

members, fine-tuned risk management systems, emergence of clearing corporations

to assume counterparty risks, market of debt and derivative instruments and intensive

use of information technology.


ON-LINE TRADING

THE 'BIG TWO' ARCHITECTURES

NSE and BSE, the 'big two' exchanges believe in updating and upgrading its

technology systems to keep delivering according to commitments and promises

made to its members, partners, and customers.

NSE architecture – NEAT

NSE has deployed NIBIS (NSE's Internet Based Information System) for

real-time dissemination of trading information over the Internet and NEAT a client-

server-based application to help its operations.

NEAT stores all trading information in an in-memory database at the server

end to achieve minimum response time and maximum system availability for users.

The trading server software runs on a fault-tolerant STRATUS mainframe and the

client software runs on Windows PCs.

The telecommunications network uses the X.25 protocol and is the backbone

of the automated trading system. Each trading member trades on the NSE with other

members through a PC located in the trading member's office.

The trading members on the Wholesale Debt Market segment are linked to

the central computer at the NSE through dedicated 64 Kbps leased lines and VSAT

terminals. These leased lines are multiplexed using dedicated 2 MB optical-fiber

links. The WDM participants connect to the trading system through dial-up links.


ON-LINE TRADING

The exchange uses RISC-based Unix servers from Digital and HP for

backoffice processing. Applications like Oracle 7 and SQL/Oracle Forms 4.5 front

ends are used for the exchange functions.

BSE architecture – BOLT

BSE has deployed an On-Line Trading system (BOLT) on March 14, 1995. It

works on a Tandem S74016 platform running on 16 CPUs. The Tandem Himalaya

S74016 machines act as the backend to more than 8000 Trader Workstations

networked on Ethernet, VSAT and Managed Leased Data Network (MLDN). The

systems claim to handle up to two million trades a day.

BOLT has a two-tier architecture. The trader workstations are connected

directly to the backend server which acts as a communication server and a Central

Trading Engine (CTE). Other services like information dissemination, index

computation, and position monitoring are also provided by the system. A transaction

monitoring facility in the Tandem architecture helps keep data integrity through non-

stop SQL.

With the help of MTNL, BSE has setup a MLDN Network comprising 300 2

Mbps lines and 1500 64 Kbps lines which connect all regional stock exchanges and

offices in Mumbai. Access to market related information through the trader

workstations is essential for the market participants to act on real-time basis and take

instantaneous decisions. BOLT has been interfaced with various information vendors

like Bloomberg, Bridge, and Reuters. Market information is fed to news agencies in

real time. The exchange plans to enhance the capabilities further to have an

integrated two-way information flow.


ON-LINE TRADING

WHO CAN INVEST IN INDIAN STOCK EXCHANGE

As you might know, most investors in any stock market in the world can be

divided into two broad groups- Individual investors and Institutional investors .

*Individual investor* means an investor like you and me who is investing own

money.

On the other hand, an *institutional investor* is a mutual fund, pension fund or a

company like Microsoft who is investing others' money (I mean clients' money or

shareholders' money).

Another dimension for looking at investors is- Foreign or Domestic. So an

Individual Investor can be placed in one of the two groups: Resident or the Non-

Resident. Citizen or non-citizen Similarly an institutional investor can be domestic or

foreign.

So broadly speaking, there are 4 different types of market participants when

it comes to investing in any country or stock market. Countries like the USA have

free markets and few investing/ trading restrictions but most emerging countries

have different rules and restrictions for different entities. So let us take a look at

investing implications for these four groups in India.

1. Resident Indian Individuals: They can, directly or thro stock market,

invest/trade in India without much restrictions. So if you are a citizen of

India who lives in India, there are no restrictions on you to invest/trade in

Indian stocks. (SEBI and NSE/BSE's regulations like Insider trading in India

still apply to you like any other market participant in India.)


ON-LINE TRADING

2. Domestic Institutions: Subject to the Articles of Association and MoA of the

charter and subject to SEBI's rules and regulations, a domestic company

(including mutual funds, financial institutions) can also freely invest, directly

or through stock market, in Indian securities.

3. People who are not resident of India. Let us divide them in two subgroups

1. Nonresident Indians (NRIs) and institutions controlled by them:

Subject to certain special provisions, more or less, NRIs can also,

directly or thro Indian stock exchanges, invest/trade in Indian stocks.

(Remember to read this whole article for details about how an NRI can

buy and sell stocks bonds real estate in India.)

2. Foreign *Individual* Investors: Sorry, if you are a citizen of any

other country (other than Nepal, Bhutan, Pakistan) and if you, or your

parent or grandparents, had no ties with India at any time, currently you

can **not** invest directly or through Indian Stock Exchanges in India.

However there are some indirect ways for you to invest in India. Two

most prominent ways are through ADRs (American Depository

Receipts) issued by Indian companies in foreign markets or through

mutual funds floated by foreign or domestic Institutional Investors.

(Remember to read toward end of this page for details about how you

can invest in India stocks and securities.)

3. Foreign Institutional Investors (FIIs): Subject to certain

regulations by India's central bank, Reserve Bank of India, and India's

security markets watchdog, SEC like entity- Securities and Exchange

Board of India (SEBI), foreign institutions investors can invest/trade

almost in any Indian securities


http://jayesh.profitfromprices.com/Investing_in_India_by_FIIs.htm

http://jayesh.profitfromprices.com/invest_in_india.htm#F%23F

http://jayesh.profitfromprices.com/invest_in_india.htm#F%23F

http://jayesh.profitfromprices.com/Investing_in_India_by_FIIs.htm

http://jayesh.profitfromprices.com/Investment_In_India_NRI.htm

ON-LINE TRADING

THE TOP '5' PLAYERS IN ON-LINE TRADING

VIEWS OF SOME GREAT VISIONER


ON-LINE TRADING

THE TOP '5' PLAYERS IN ON-LINE TRADING

ICICI Direct

ICICI Direct has been our example throughout this article and they are

without doubt one of the best. They normally give you three accounts 1. savings, 2.

trading 3. DMAT. With these three accounts you are ready to go. Through their

extensive demo sections available ON-LINE at icicidirect, you can begin to trade

fairly easily.

Apart from ICICI ON-LINE trading service which can be visited at

icicidirect.com, there are many other well known share trading facilitators in

India. Some of those have been listed below. A serious evaluation of their services,

charges, and efficiency is beyond our scope and intention.

Sharekhan

Headquartered in Mumbai, they have branches across the country and these

branches provide full fledged services to its members. Portal address is sahrekhan.com.

"SSKI, a veteran equities solutions company with over eight decades of experience

in the Indian stock markets" they state on their website. They also proclaim that

"they help you make informed decisions and simplifies stock investments". "In fact

Sharekhan runs India's largest chain of share shops with over hundred outlets across

213 cities!" according to them.


http://www.sharekhan.com/

http://www.icicidirect.com/


ON-LINE TRADING

Geojit

Geojit is another well known name. Like sharekhan, they also have

countrywide branches and offices overseas. From their website: "Mr. C.J. George

and Mr. Ranajit Kanjilal founded Geojit as a partnership firm in the year 1987."

They also have major operations in the United Arab Emirates. " Barjeel

Geojit Securities, LLC, Dubai, is a joint venture of Geojit with Al Saud Group

belonging to Sultan bin Saud Al Qassemi having diversified interests in the area of

equity markets, real estates and trading". They are headquartered in Kochi in Kerala.

They have a vast presence in Kerala and the rest of the country.

Motilal Oswal

They have a very impressive portal. Their site claims " Motilal Oswal

Securities is a leading research and advisory based stock broking house of India,

with a dominant position in both institutional and retail broking. Asiamoney Brokers

Poll 2005 has ranked us the best Indian brokerage firm." Rediff.com, in one of their

evaluation available on the web, rates Motilal highly for their response and customer

care.

HDFC

The ON-LINE share trading segment of HDFC bank is quiet impressive.

Their portal is called HDFCSec.com. Like ICICI, HDFC also provide many features as

well as a well laid out and simple portal. Charges and services may differ slightly.

However they are another


http://www.hdfcsec.com/

http://www.geojit.com/

ON-LINE TRADING

DEPOSITARY SYSTEM

ABOUT NSDL & CDSL

OBJECTIVE, ACTIVE, BENEFITS OF DEPOSITARY


ON-LINE TRADING

\

DEPOSITARY SYSTEM

A depository is an organisation which holds securities of investors in

electronic form at the request of the investors through a registered Depository

Participant. It also provides services related to transactions in securities.

It can be compared with a bank, which holds the funds for depositors. A

Bank – Depository Analogy is given in the following table:

BANK-DEPOSITORY – AN ANALOGY

BANK DEPOSITORYHolds funds in an account Hold securities in an accountTransfers funds between accounts on the instruction of the account holder

Transfers securities between accounts on the instruction of the account holder

Facilitates transfer without having to handle money

Facilitates transfer of ownership without having to handle securities

Facilitates safekeeping of money Facilitates safekeeping of securities

At present two Depositories viz. National Securities Depository Limited

(NSDL) and Central Depository Services (I) Limited (CDSL) are registered with

SEBI.


ON-LINE TRADING

NSDL

Although India had a vibrant capital market which is more than a century old,

the paper-based settlement of trades caused substantial problems like bad delivery

and delayed transfer of title till recently. The enactment of Depositories Act in

August 1996 paved the way for establishment of NSDL, the first depository in India.

This depository promoted by institutions of national stature responsible for economic

development of the country has since established a national infrastructure of

international standards that handles most of the securities held and settled in

dematerialised form in the Indian capital market.

Using innovative and flexible technology systems, NSDL works to support the

investors and brokers in the capital market of the country. NSDL aims at ensuring

the safety and soundness of Indian marketplaces by developing settlement solutions

that increase efficiency, minimise risk and reduce costs. At NSDL, we play a quiet

but central role in developing products and services that will continue to nurture the

growing needs of the financial services industry.

In the depository system, securities are held in depository accounts, which is

more or less similar to holding funds in bank accounts. Transfer of ownership of

securities is done through simple account transfers. This method does away with all

the risks and hassles normally associated with paperwork. Consequently, the cost of


ON-LINE TRADING

transacting in a depository environment is considerably lower as compared to

transacting in certificates.

CSDL

The CDSL has been set up by Bombay Stock Exchange and co-sponsored by

SBI, Bank of India, Bank of Baroda and HDFC Bank. It commenced its operation on

March 22, 1999.

Upto March 2000, 680 companies made available their shares for demat. The

market value of dematerialised securities amounted to Rs. 8,188 crore. The number

of beneficial owners stood at 28,545.

Objectives of Depository

A depository enables the capital market to achieve the following objectives:

1. Reduce the time for transfer of securities.

2. Avoid the risk of settlement of securities.

3. Enhance liquidity and efficiency.

4. Reduce cost of transaction for the investor.

5. Create a system for the central handling of all secuirites.


ON-LINE TRADING

6. Promote the county's competitiveness by complying with global standards.

7. Provide service infrastructure in a capital market.

Activities of the Depository

The main activities of the depository are as follows:

1. Accepting deposit of securities for custody.

2. Making computerised book entry pledges of securities in its custody.

4. Providing for withdrawal of securities.

5. Undertaking corporate actions like distribution of dividend and interest.

6. Redemption of securities on maturity.

Benefits of Depositories Services:

o A safe and convenient way to hold securities;

o Immediate transfer of securities;

o No stamp duty on transfer of securities;

o Elimination of risks associated with physical certificates such as bad

delivery, fake securities, delays, thefts etc.;

o Reduction in paperwork involved in transfer of securities;


ON-LINE TRADING

o Reduction in transaction cost;

o No odd lot problem, even one share can be sold;

o Nomination facility;

o Change in address recorded with DP gets registered with all companies

in which investor holds securities electronically eliminating the need to

correspond with each of them separately;

ICICI DIRECT.COM V/S SHAREKHAN.COM

v/s


ON-LINE TRADING

INTRODUCTION, MERITs & DEMRITs

OF

ICICI DIRECT.Com & SHAREKHAN.Com


ON-LINE TRADING

ICICI Direct.Com

ICICI Direct brings you the international experience of ON-LINE investing.

Buying and selling of shares is just a click away. Our powerful 3-in-1 concept will

enable you to tie in your saving bank account and your demat account to your

brokerage account electronically. This integration ensures that money is transferred

to/from your bank account and the shares are transferred from/to your demat account

automatically without any paperwork.

ICICI Direct keeps track of the transactions, the settlement dates and stock

exchange rules, hence relieving you of the inconvenience of tracking stock exchange

trading calendars, settlement dates, writing cheques and Transfer Instructions For

Debit (TIFD). A multitude of resources like ON-LINE quotes, charts, news,


ON-LINE TRADING

research, fundamental database and detailed analysis is just a click away to help you

make smarter and better decisions.

The URL ICICIDirect.com is owned by ICICI and managed by ICICI Web

Trade Limited. ICICI Web Trade Limited facilitates trading and related services on

the internet through maintenance of the website. Trades put through

ICICIDirect.com are executed by ICICI Web Trade Limited, which is a trading

member of the National Stock Exchange and The Stock Exchange, Mumbai. SEBI

registration numbers for NSE and BSE are INB 231147639 and INB 011147635

respectively.

A bout ICICIdirect e-invest account

Your ICICIdirect e-Invest account is more than a brokerage account. It offers

you a unique 3-in-1 feature, which integrates your Brokerage, Bank and one or more

Demat accounts. This means that you can buy and sell shares and forget about the

hassles of settlements. Transfers of shares from/to your Demat account and transfer

of money from/to your Bank account take place automatically with no paperwork.

ON-LINE investing is just a click away and settlements is no longer a problem.

3-IN-1 concept

ICICIdirect e-Invest account allows you to integrate your ICICIdirect

Brokerage Account, your Bank account and one or more Demat accounts. Currently

the Demat Account has to be opened with ICICI Bank Ltd as the Depository

Participant (DP) and the Bank Account has to be opened with ICICI Bank Ltd. as the

Banker. You can choose the branch closest to you to open your bank account.


ON-LINE TRADING

No. of Demat and Bank Account with ICICI Direct.com

you can link multiple Demat accounts to your e-Invest accounts with a

maximum of 5 accounts but can't open more link more than one Bank accounts to

your e-invest accounts

Procedure Of Trading In ICICI Direct.Com

Deposit a cheque/cash in your Bank Account by filling the pay-in slip in case

u don’t have any balance in account above minimum balance require in saving

account. In case of a cheque, the money should come into your Bank account as soon

as the cheque is cleared. Once you have funds in your bank account, you need to

allocate the required amount for trading. Alternatively you can sell some shares from

your Demat Account in the Cash Segment and use the money to purchase the shares

you want to buy. The amount of money required before placing a buy order or a

margin sell order would depend on the value of the order.

Sharekhan.com

SSKI GroupSharekhan is ON-LINE stock trading company of SSKI Group,

provider of India-based investment banking and corporate finance service.

ShareKhan is one of the largest stock broking houses in the country. S.S. Kantilal

Ishwarlal Securities Limited (SSKI) has been among India’s leading broking houses

for more than a century.


http://www.sski.co.in/

http://www.sski.co.in/

ON-LINE TRADING

Sharekhan's equity related services include trade execution on BSE, NSE,

Derivatives, commodities, depository services, ON-LINE trading and investment

advice. Trading is available in BSE and NSE. Along with Sharekhan.com website,

ShareKhan has around 510 offices (share shops) in 170 cities around the country.

Share khan has one of the best state of art web portal providing fundamental

and statistical information across equity, mutual funds and IPOs. You can surf across

5,500 companies for in-depth information, details about more than 1,500 mutual

fund schemes and IPO data. You can also access other market related details such as

board meetings, result announcements, FII transactions, buying/selling by mutual

funds and much more.

Advantage & Disadvantages Of ICICI Direct.Com And Sharekhan.Com

Advantages of ICICI Direct 1. 3-in-1 account integrates your banking, broking and demat accounts. All

accounts are from ICICI and very well integrated.

2. Investment ON-LINE in IPOs, Mutual Funds, GOI Bonds, and Postal

Savings Schemes all from one website. General Insurance is also available

from ICICI Lombard.

3. Trading is available in both BSE and NSE.

Disadvantages of ICICI Direct 1. Getting access to ICICIDirect.com website during market session can be

frustrating.


ON-LINE TRADING

2. ICICI Direct brokerage is high and not negotiable.

3. Not all stocks are available under Margin Plus.

Advantages of Sharekhan 1. Trading terminal is fast

2. Their research report are excellent

3. Trading is available is both BSE and NSE

4. Excellent phone trading facility

Disadvantages of Sharekhan

1. Connot trade mutual funds or bonds

PRODUCTS AND SERVICES


ON-LINE TRADING

PRODUCTS AND SERVICES OFFER BY ICICI DIRECT

ICICI direct.com offers a wide range of products to suit the investment need

for every investors. Products which are available for investor and in which they can

invest are as follows:

Equity

Derivatives,

IPO

Government of India bonds (GOI bonds) and,

Mutual funds

This products can be futher classified, and which are shown through charts:


ON-LINE TRADING

ICICI DIRECT

Cash on Spot:

Cash on spot is another unique offering from ICICI direct.com If customer

sells the shares, the money would be credited to you’re their account only on T+2

days. However, cash on spot helps you in liquidating shares in cutomer demate

account and realizing the sale proceeds on the same day before 5.00 PM.

Buy Today Sell Tomorrow® (BTST®)

Buy Today Sell Tomorrow® (BTST®) is a facility offered by ICICIDirect

wherein the customer will be able to sell the shares that he has purchased even


EQUITY DERIVATIVES MUTUAL FUNDS IPOS BONDS

Cash

Margin

BTST

Spot

Futures

Options

Margin Plus

Transfer in

Switch in/out

SIP & SWP

Redemption

Purchases

ON-LINE TRADING

before he receives the delivery of the shares from the Exchange. He will not have to

wait till the time he receives the delivery from the Exchange thus increasing his

liquidity.

Sale in BTST® is permitted only till on T+1 (and not on T+2 i.e. pay-in/pay-

out date of the Exchange). In other words, BTST® shall be permitted only up to the

day prior to the scheduled payout of shares from the Exchange.

Margin:

I In margin trading, you take buy/sell positions in stock(s) with the

intention of squaring off the position within the same settlement cycle. If, during the

course of the settlement cycle, the price moves in your favour (rises in case you have

a buy position or falls in case you have a sell position), you make a profit. In case the

price movement is adverse, you incur a loss. However, you also have the option to

take/give delivery of buy/sell position respectively if you have sufficient

cash/securities to do so.

Normally to buy shares, you have to place (ensure availability of limit) 100%

of the order value, while to sell shares, you need to have shares in your demat

account. However, margins are blocked only to safeguard against any adverse price

movement. At present, you have to place 33.33% of the order value as margin. With

margin trading, you can leverage on your trading limit by taking buy/sell positions

much more than what you could have taken in cash segment. However, the risk

profile of your transactions goes up.

Margin Plus:


ON-LINE TRADING

Margin plus is a unique offering of ICICI direct.com this is ideal for

customer who require very high leverage to do intra day trading. In Margin plus,

trader have to specify a stop loss order at the time taking the position. Due to this

trader risk is limited only to the extent of their stop loss price. Margin Plus offers an

order placement features through which you can take an intra-day potion in the

equity segment an at the same time, place a core order for this specifying the Stop

Loss Trigger Price and limit price. This cover order will help you to limit the loss, if

any, on the position. At the time of taking a position in Margin Plus, you would also

be required to specify a stop loss order, and hence limiting your loss to that extent.

Since the risk is now limit to the difference between your Buy/Sell rate and the Limit

price, margin will be primarily based on this difference.

Features:

Margin Plus in available for intra day trding in more than 60 stocks on ICICI

direct.com

Helps to limit your loss through a Stop Loss Order

Open Margin Plus position can be closed any time before the End of Settlement

timings as specified by ICICI direct.com

Auto Square off process to help you close your open positon at the End of the

Day.

Derivatives:

Customers with different types of risk profile can use derivatives:


ON-LINE TRADING

Hedging the cash market position- ideal for low risk profile.

Taking advantage of arbitrage opportunity in equity and derivatives

Taking a view on stock/index for as long as 3 - month period - medium risk

profile.

Speculatives trading - high - risk profile

ICICI direct.com offer ON-LINE investment in Futures and Option, with benefits of

automated settlement and ON-LINE risk monitoring system.

Futures Trading

As a customer of ICICIdirect now, you can trade on index and stock futures

on NSE. It comes with a comprehensive tracking cum risk management solution to

give you enhanced leveraging on your trading limits.

In futures trading, you take buy/sell positions in index or stock(s) contracts expiring

in different months. If, during the course of the contract life, the price moves in your

favor (rises in case you have a buy position or falls in case you have a sell position),

you make a profit. In case the price movement is adverse, you incur a loss.

To take the buy/sell position on index/stock futures, you have to place certain

% of order value as margin. With futures trading, you can leverage on your trading

limit by taking buy/sell positions much more than what you could have taken in cash

segment. However, the risk profile of your transactions goes up.

Investing in Mutual funds:


ON-LINE TRADING

ICICIdirect.com brings you the ON-LINE convenience while investing in

Mutual funds also - Hassle free and Paperless Investing.

You can now invest on-line in 20 Mutual Funds through ICICIdirect.com.

Alliance MF HDFC MF Reliance Capital MFBirla Sun Life MF HSBC MF SBI MFChola MF ING Vysya

MFStandard Chartered MF

DSP Merrill Lynch MF

JM MF Sundaram MF

Deutsche MF Kotak Mahindra MF

Tata MF

Franklin Templeton MF

Principal MF UTI MF

Fidelity MF Prudential ICICI MF

You can invest in mutual funds without the hassles of filling application forms or

any other paperwork. You need no signatures or proof of identity for investing.

Once you place a request for investing in a particular fund, there are no manual

processes involved. Your bank funds are automatically debited or credited while

simultaneously crediting or debiting your unit holdings. In case of investments from

the NRE account, the debit certificate is also submitted automatically to the Mutual

Fund so as to enable repatriation of sale proceeds subsequently.

You also get control over your investments with ON-LINE order confirmations and

order status tracking. Get to know the performance of your investments through ON-

LINE updation of MF portfolio with current NAV.

IPOs


ON-LINE TRADING

IPO is another way of investing in equity market through primary

market i.e., buying share from th company. Whenever a company comes out with an

initial public offerig the customers may choosse to apply for the shares. Based on

number of valid applications received, the company woul than allot the shares to the

applicants. The offline way of investing in an IPO is by filling physical appliation

forms, cheques, and submitting the forms through respective broker. With ICICI

direct.com all customer have to do is fill in number of share on site and submit.

8% GOI bonds

Investing in government of India bonds is a risk free investment option

available to investors. Investment in government of india bonds offline, would

involve filling physical application forms and writing cheques.

ICICI direct.com offers a hassle free, paper less investment mode. All interst

payment and redemption would be credited to the customers account through ECS

facility. Also cutomers would receive physical holding statement by RBI

SHAREKHAN PRODUCTS AND SERVICES:


ON-LINE TRADING

Equity Trading

1. Trading accounts

With a Sharekhan ON-LINE trading account one can buy and sell shares in

an instant. Any time, from anywhere.

A Sharekhan ON-LINE trading account comes with a depository

participant account where investor's can keep all your shares, in safe custody

with National Securities Depository.

You can also link a Sharkehan ON-LINE trading account to an Internet

banking account of your choice, so that you can move cash in and out of this

account easily, without the bother of writing cheques all the time.

Sharekhan offers two types of trading accounts to suit your trading habits:

Sharekhan Classic account and Sharekhan SPEEDTRADE account.

2. Trading services

Trading is super fast, extremely safe and highly secure at Sharekhan.

Apart from providing the most advanced trading platform in the country,

Sharekhan also offers facilities like instant cash transfer, after-market order, limit

against shares and four times exposure on margin.

Mutual funds:


ON-LINE TRADING

Sharekhan "Mutual Fund" section provides exhaustive information on various

mutual fund schemes. You can also download from our site forms of various mutual

fund schemes including HDFC MF, JF MF, Pioneer ITI MF, Prudential ICICI MF,

Templeton MF and Zurich India MF.

Derivatives trading

Sharekhan also provide derivatives trading services through our ground

network of share shops. With Sharekhan you can invest in index and stock

futures as well as stock and index options on the NSE.

Keep track of the derivatives market with "Derivatives Info Kit" and find out

which strike to buy/sell using Black & Scholes Option calculator

SHAREKHAN SERVICES

GH THAKUR COLLEGE OF SCIENCE AND COMMERCE Equity Trading

Depository Services

Dial and tradeCommoditiesOnline ServicesDerivatives TradingPortfolio

ManagementShare shopsFundametal

ResearchTechnical Research

ON-LINE TRADING

BROKERAGEs

TYPES OF ACCOUNT

HOW TO TRADE ON DIFFERENT SEGMENT


ON-LINE TRADING

DOCUMENT REQUIRE TO OPEN ACCOUNT IN ICICI

DIRECT.COM AND SHAREKHAN

BROKERAGE OF ICICI DIRECT.COM & SHAREKHAN

ICICIdirect.com can be opened for a one time non refundable fee of Rs 750/-

Where as Sharekhan Trading account opening charges is also Rs750/- so opening

charges of both ICICI direct.com and Sharekhan.com is same.

ICICI direct.com charges 0.1% to 0.15% for margin trades where as

Sharekhan.com charges 0.1% all inclusive for intra-settlement trades

Note: subject to a minimum brokerage of 5 paise per share (intra-settlement trade)


ON-LINE TRADING

ICICI direct.com charges 0.2% to 0.425% for squared off trades and 0.4% to

0.85% on delivery based trades Where as Sharekhan.com charges 0.5% all

inclusive for trades that result into delivery [Note: 10 paise per share (delivery

trade).]

For all trades done through ICICIdirect.com there are NO separate charges.

However, for all other trades and services like demat, pledge, annual maintenance

charges etc, the charges shall be as per the existing rate card of ICICI demat.

Where as in Sharekhan.com No transaction charges for depository participant (DP)

account (Note: our non-trading DP clients are charged 0.02% and 0.04% of trade

value for purchase and sale transactions respectively.) DP account maintenance

charges (Rs75 per quarter) waived until October 31, 2002

About the bank account details.

A minimum quarterly average balance of Rs 5000/- needs to be maintained.

TYPES OF ACCOUNT IN ICICI DIRECT AND SHAREKHAN

Types of Account in ICICI Direct

1. Share Trading Account


ON-LINE TRADING

Share Trading Account by ICICI direct is primarily for buying and

selling of stocks in BSE and NSE. This account allows Cash Trading, Margin

Trading, MarginPlUS Trading, Spot Trading, Buy Today Sell Tomorrow and

Call and Trade on phone. ICIC direct.com Website is the primary trading

platform for this trading account. They also provide installable application

terminal based application for high volume trader.

2. Wise Investment Account

Along with stock trading and IPO investing in BSE and NSE, wise

investment account also provide options to invest in Mutual Funds and Bonds

ON-LINE. ON-LINE Mutual funds investment allows investment allows

investor to invest on-line in around 19 Mutual Fund companies. ICICI direct

offers various options while investing in Mutual Funds like Purchase Mutual

Funds, Redemption and switch between different schemes, Systematic

investment plans, Systematic withdrawal plan and transferring existing Mutual

Funds in to electronic mode. This account also provides facility to invest in

Government of India Bonds and ICICI Bank Tax Saving Bonds. ICICI

Direct.com website is primary tool to invest in Mutual Funds, IPOs, Bonds and

Stock trading.

3. Active Trader Account


ON-LINE TRADING

Active Trader account gives more personalized investment options to

the investors. It allows investor to use ON-LINE and offline stock trading. It

also provides with independent market expertise and support through a

dedicated Relationship Manager from ICICI. Active Trader also provides

commodity trading.

Types of Account in Sharekhan

1. Classic account

Allow investor to buy and sell stocks ON-LINE along with the

following features like multiple watch lists, Integrated Banking, demat and

digital contracts, Real-time portfolio tracking with price alerts and Instant

credit & transfer.

a.ON-LINE trading account for investing in Equities and Derivatives

b.Free trading through Phone (Dial-n-Trade)

I. Two dedicated numbers for placing your orders with your cellphone

or landline.

II. Automtic funds tranfer with phone banking (for Citibank and HDFC

bank customers)

III. Simple and Secure Interactive Voice Response based system for

authentication

IV. Get the trusted, professional advice of our telebrokers

V. After hours order placement facility between 8.00 am and 9.30 am

c.Integration of: ON-LINE trading + Bank + Demat account

d.Instant cash transfer facility against purchase & sale of shares


ON-LINE TRADING

e.IPO investments

f.Instant order and trade confirmations by e-mail

g.Single screen interface for cash and derivatives

2. SpeedTrade account

This accounts for active traders who trade frequently during the day's trading

session. Following are few popular features of SpeedTrade account:

a.Single screen interface for cash and derivatives

b.Real-time streaming quotes with Instant order Execution & Confirmation

c.Hot keys similar to a traditional broker terminal

d.Alerts and reminders

e.Back-up facility to place trades on Direct Phone lines

HOW TO TRADE ON DIFFERENT SEGMENTS


ON-LINE TRADING

Cash

Cash order can be used if the customer intend to transact in order to take

delivery of asset. Cash trading can also be termed as delivery based trading.

To Trade in Cash:

Allocate funds in the equity segment through “Modify Allocation”. This will

give the cutomer the limits to make their purchase.

Click on buy on the equity trading page

Select the Exchange i.e. NSE or BSE.

Put in the first 2 alphabets of the script name in which the customer wish to

trade and click on “Find Stock Code” to search for the relevent stock code.

Select “Market” if customer wishes to buy at the best-offered price in the

market.

Select “Limit” if customer wishes to quote the price at which customer want

to buy the script.

Click on “Buy Now” to go through with deal. Clicking on “proceed” on the

verification page, which will send the customer order, detail to the

exchange.


ON-LINE TRADING

For placing “Sell Order”, allocate shares for trading through “Allocates

shares” link on “Demat Balances”. The other procedure is similar.

View the status of order in the “Order Book”.

To view the detail of exact date of credit/debit of shares/ money, check

“Security/Cash Projection” link.

BTST

BTST (Buy today Sell tommorrow) is a facility that allows the customr or

trader to sell shares enver one day after the buy trade date without having to wait for

the receipt of share in to your demat account.

To order on BTST:

Once the customer buy shares of any company allowed to be sold under

BTST can be availed on “T+1” and “T+2” days.

The customer can get the lilst of stock allowed for trading under BTST

through “Stock list”.

Margin

With Margin Trading (Intra Day Trading) cutomers can do intra settlement

trading upt to 5 time with their available funds. Customers can also take buy/sell


ON-LINE TRADING

position in stock with intention of squaring off the position withing the settlement

cycle.

To Trade in Margin (Intra Day):

Click on “Buy/Sell” link on the equity-trading page

Select the exchange as NSE.

Put the first 3 alphabets of the script name in which the customer wish to

trade an click on “Fine stock code” to search for the relevant stock code.

Select “market” if customer wishess to Buy/Sell at the best-offered price in

the market. Select “Limit” if when cutomer or trder wish to quote the price

at which he want to buy the scrip

Click on “Buy now/ Sell now” to go through will the deal. Clicking on

“proceed” on the verificatioin page will send the customer order detail to

the exchange

The customer can monitor your position through “Open Margin Postioin”.

He can also choose to convert his open Margin Position to Delivery Based

Position. To do the same click on “Convert To Delivery” link in open

Margin Position

Points to be remember in Margin Trading:

All position taken in Margin have to be squared off same ay


ON-LINE TRADING

If you do not square off customer position, ICICI direct will initiate a

Auto Square off process where by all open positin will be squared off

at the market rate.

The extract timing for Auto Square off wouold be displayed in the “Open

Margin Position” link.

Margin Plus

Margin Plus offer trade an order palcement feature through which they can take

intra day position in the equity segment and at the same time, place a conver order for

this position specifying the Stop Loss Trigger Price and Limit Price.

To place a Margin Plus Order :

Allocate the funds trading in equity segment

Select the link “Margin Plus Order” on the trading page

Select the Buy/Sell order can only be a market order.l

At the time of placing this ordr also select a cover Stop Loss Trigger Order.

Demat and Saving account

In ICICI Direct.com offer there customer facilities to open Demat and Saving

Account in one form. Demat account is open with ICICI web trade and Saving


ON-LINE TRADING

account is open with ICICI Banks both of them are linked together. So while

transaction transfer of money became easier and faster.

Where as Sharekhan is only ON-LINE trading house so customer of

sharekhan has to open saving account with bank specified by sharekhan trading

houses and at time settlement has been made by debiting or crediting the from his

cutomers account

Document require to open account in ICICI direct.com and sharekhan

1. Proof of residence (Address proof)

Driving License

Voter's ID

Passport

Photo credit card


ON-LINE TRADING

Photo ration card

Utility Bill (Telephone, Electricity etc.)

Bank Statement

2. Proof of Identity

Driving License

Voter's ID

Passport

Photo ration card

3. PAN card4. Two Photographs


ON-LINE TRADING

CASE STUDY

CASE STUDY: SHAREKHAN

The company


ON-LINE TRADING

Sharekhan, a sister concern of SSKI Investor Services Pvt. Ltd is a retail securities

and equities solutions provider.

The need

The company was growing its business at a fast pace and needed to have systems

that could support a large and growing user base in an efficient and reliable manner.

A moment's downtime will result in large financial losses and loss of faith among

customers, both critically bad for business.

The solution

The company deployed BEA's WebLogic solutions and ran its trading and risk

management functions on this platform.

The benefits

The platform has the business logic to interface with the various technology aspects,

and provides encrypted transactions. The various components of Web trade like bank

interfaces, depository participants, and broker accounts have been integrated into a

single scalable entity. This helps optimize the architecture and provide scalability.

And the transaction volume has increased by around four times over a period of six

months, without the addition of any hardware, and with minimum performance

issues.

CASE STUDY: NATIONAL STOCK EXCHANGE OF INDIA LTD.


ON-LINE TRADING

NSE data center manager has trouble-free days and nights with StorageTek®

solutions.

Business issues at NSE

As the Indian economy grew, data at the National Stock Exchange of India (NSE)

was also growing at an increasing rate. Given the nature of the business, data

protection and high availability of the data are crucial. Downtime is unacceptable.

Coping with the growth of data backup needs and a shrinking backup window was

fast becoming a nightmare. To further complicate matters, NSE was faced with the

challenge of online backup of their Oracle databases. The existing backup process

involved 400 gigabytes of data to be backed up daily and 900 gigabytes for the

weekend, over multiple servers and across different platforms such as HP, NT and

Sun. This involved various types of backup media as well as a large number of

cartridges. Heavy manual intervention was required as the jobs were manually

queued and cartridges manually mounted. Additionally, intensive supervision was

required to ensure that the entire backup process was executed in a disciplined and

consistent manner. As a result, backup was a tedious and laborious process requiring

logs to be maintained. The data center needed additional personnel to cope with the

demands.

The solution

To meet the backup requirements of NSE, a StorageTek® distributor, CMS

Computers Ltd., proposed and implemented a SAN-based LanFree Backup solution

comprised of a StorageTek L700 tape library (400 slots) with four DLT drives,

Brocade switches and Fibre Channel bridges, and backup software from VERITAS

and BMC. To implement the solution, NSE’s servers were connected to the Brocade


ON-LINE TRADING

switches using Fibre Channel. The tape drives were then connected to the Brocade

switches via bridges to implement a heterogeneous SAN comprising HP, NT and

Alpha servers. VERITAS NetBackup Data Centerwas installed on the servers.

Business benefits

Today, NSE boasts of being the only stock exchange in India with a live disaster

recovery site. With a more efficient and reliable backup process, NSE is assured of

meeting the demands for high availability and business continuity, even with

growing data needs and shrinking backup windows.

Financial benefits

The solution reduced the number of cartridges used daily. More importantly, by

automating all its manual tasks, NSE has saved more than 50 percent of the hours

previously required in the backup process. NSE can now ensure higher productivity

and re-deploy its personnel for more efficient utilization while ensuring that backup

activity is carried out in a consistent, disciplined and reliable manner.

Technology benefits

With SAN-based direct-connect technology and the use of automated tape backup,

NSE enjoys better throughput and more reliable backup avoiding issues such as LAN

network bandwidth bottlenecks and collision of data packets. NSE is able to

maintain a respectable backup window and restoration is systematic and fast. Guided

recovery for Oracle databases was also put in place. This solution allows the pooling

of tape drives to be shared among the multiple connected servers, across

heterogeneous platforms, and eliminates the need to back up servers individually.


ON-LINE TRADING

NSE is able to seamlessly and efficiently manage its backup process and storage

devices from a single management console. The solution also provides the scalability

to increase storage capacity as NSE’s requirements grow.

CASE STUDY: BOMBAY STOCK EXCHANGE

The product - BOLT: Bombay Online Trading System

The online trading system in use at the Stock Exchange, Mumbai, since 1995

The client - Mumbai Stock Exchange (BSE)

India's oldest stock exchange, it's 30-share sensitive index (Sensex) of the most-

traded securities is indicative of the health of the country's securities markets, and is

the Indian equivalent of the Dow Jones index.

CMC took over the task of developing the software for computerised securities

trading knowing full well that it would be an extremely complicated job. No

software company in India had ever tried developing software for automated trading.

The BOLT system became operational in 1995. On March 14, 1995, 818 scrips were

transferred to the screen-based trading system. It is one of the few stock trading

system in the world that handles hybrid / mixed modes of trading; both order-driven

and quote-driven. It supports the normal segment, the auction segment, the odd-lot

segment and continuous net settlement. There are now more than 6000 BSE trading

terminals spread across the country.


http://www.cmcltd.com/case_studies/banking_finance/BOLT.htm#odd

http://www.cmcltd.com/case_studies/banking_finance/BOLT.htm#odd

ON-LINE TRADING

The main achievements of the BOLT system are:

An average response time of less than two seconds On an average, 3.4 million market queries are handled daily The system can support more than 10,000 users

BOLT implementation and maintenance is one of the major successes of CMC. A

group of about 50 engineers continue to work for the maintenance and enhancement

of the BOLT system.


ON-LINE TRADING

CONCLUSION

On-line Trading in shares and securities has been already started in India. It

has been made possible due to introduction of demat. Many other institutions have

been started the online trading system from this ICICI Direct.com and Sharekhan is

one of them. The investors can carry out buying and selling of securities while sitting

in the house or office. Here ICICI and Sharekhan both provide the online trading

system. Here the comparison is done between them.

So to trade in shares investors have to open an account with these institutions.

There are three account opened into one place DEMAT ACCOUNT, BANK

ACCOUNT and ON-LINE TRADING ACCOUNT. A password is given to each

investor which is secret. Investors can carry out buying and selling securities at BSE

and NSE during normal trading hours.

It is important to note that trading in demat shares is possible only in those

stock exchange whose clearing houses are linked to the depository. So the investors

can trade easily with these institution which is convenient to them.


ON-LINE TRADING

Bibliography

Books Referred :

Financial Markets and Services -------- E Gordan, K

Natrajan by Himalaya

Publication

Financial Management ------------------- M.Y.Khan & P.K. Jain

Websites :

1. www.icicidirect.com

2. www.sharekhan.com

3. www.internet news.co.in



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