Difference between NSE and BSE
The Bombay Stock Exchange (BSE) and the National Stock Exchange of India Ltd (NSE) are the two primary exchanges in India. In addition, there are 22 Regional Stock Exchanges. However, the BSE and NSE have established themselves as the two leading exchanges and account for about 80 per cent of the equity volume traded in India.
Let’s discuss more about the difference between NSE and BSE.
Bombay Stock Exchange Limited 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 was 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 National Stock Exchange of India was promoted by leading financial institutions at the behest of the Government of India, and was incorporated in November 1992 as a tax-paying company. In April 1993, it was recognized as a stock exchange under the Securities Contracts (Regulation) Act, 1956.
Some figure and facts:-
Both are the stock exchange recognized by SEBI(Securities and Exchange Board of India).
The NSE and BSE are equal in size in terms of daily traded volume. The average daily turnover at the exchanges has increased from Rs 851 crore in 1997-98 to Rs 1,284 crore in 1998-99 and further to Rs 2,273 crore in 1999-2000 (April – August 1999). NSE has around 1500 shares listed with a total market capitalization of around Rs 9,21,500 crore (Rs 9215-bln). The BSE has over 6000 stocks listed and has a market capitalization of around Rs 9,68,000 crore (Rs 9680-bln). Most key stocks are traded on both the exchanges and hence the investor could buy them on either exchange.
Anyone can deal in securities by any of the exchange. A person need to open a demat account to buy and sell securities in any of the exchange.
This index is comprised of 30 of the largest and most actively-traded stocks on the BSE.
Other index in BSE are;BSE 500, BSE 100, BSE 200, BSE PSU, BSE MIDCAP, BSE SMLCAP, BSE BANKEX, BSE Teck, BSE Auto, BSE Pharma, BSE Fast Moving Consumer Goods (FMCG), BSE Consumer Durables (SYMBOL: Cons Dura), BSE Metal.
The BSE Sensex is the older and more widely followed index.
This index is comprised of 50 of the largest and most actively-traded stocks on the BSE.
NSE also set up as index services firm known as India Index Services & Products Limited (IISL) and has launched several stock indices, including: S&P CNX Nifty, CNX Nifty Junior, CNX 100 (= S&P CNX Nifty + CNX Nifty Junior), S&P CNX 500 (= CNX 100 + 400 major players across 72 industries), CNX Midcap (introduced on 18 July 2005 replacing CNX Midcap 200).
Why NSE when BSE was already in place?
The main objective behind NSE is to establish trading facility nationwide for all types of securities. It also ensures equal access to all investors in the country through the process of an appropriate telecommunication network(VSAT). NSE was able to achieve its objectives within a very short span of time. NSE has national reach to major market segments like equity or capital markets, futures and options or derivatives market, wholesale debt market, mutual funds, initial public offerings and so on.
Now both the exchanges have switched over from the open outcry trading system to a fully automated computerized mode of trading known as BOLT (BSE On Line Trading) and NEAT (National Exchange Automated Trading) System. It facilitates more efficient processing, automatic order matching, faster execution of trades and transparency.
Difference between BSE and NSE(BSE vs NSE):-
1)Both are stock exchange of India.
2)NSE has around 1500 shares listed whereas the BSE has over 6000 stocks listed.
3)NSE has capitalization of around Rs 9,21,500 crore (Rs 9215-bln). The BSE has market capitalization of around Rs 9,68,000 crore (Rs 9680-bln).
4)NSE index is caleed as NIFTY whereas BSE index is SENSEX.
5)NSE has 50 companies for NIFTY whereas BSE has 30 companies for SENSEX.