India has been in the forefront of utilizing technology to enhance its stock market performance.
Both the stock exchanges’ (BSE and NSE)web sites provide a real-time update of various indices,
streaming quotes of stocks, the news updates, screen-based order matching system, and major
development like “screen-based bookbuilding”, where securities are auctioned through an anonymous
screen-based system, and the price at which securities are sold is discovered on the screen. This
perhaps eliminates the delays in risk associated with traditional procedures.
Further reforms on practices like rolling settlements, trade guarantee, demat settlement and derivative
trading have certainly added depth (volume of a particular stock) and breadth (number of stocks traded) to the market.
The liberalization of FII flows into the Indian capital market since 1993 has had a considerable
impact on market practices, say s. And many of the moves to modernize the equity markets in
the past decade may be attributed to pressure from foreign investors. For instance, FII investment in
the Indian market only took off after paperless trading was introduced in the late 1990s. Earlier, most
funds were scared to punt in the market because of fake shares and transfer. To make the process of
share transfer and delivery easier and quicker, the regulator, SEBI introduced dematerialization of
shares where the shareholders were compulsorily asked to trade shares in the demat form.
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