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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.

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

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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
 Objective, Activity, Benefits of Depositories.

PART – 2: ICICI DIRECT.COM V\S SHAREKHAN.COM


1. Introduction, Merits & Demerits

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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:
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

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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
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.

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ABOUT

TRADING & INVESTOR'S

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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

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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.

INTRODUCTION OF ON-LINE TRADING,

HISTORY OF ON-LINE TRADING

OBJECTIVES, MERITS & DEMERIT'S OF ON-LINE


TRADING
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DEMATERIALISATION & REMATERIALISATION

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.

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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
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

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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
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.

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 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

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

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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.

 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.

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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.

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.

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 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
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

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client and simultaneously electronically confirms the acceptance of the request to
NSDL. Thereafter, the client's blocked balances are debited.

Features:

 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.

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PLACE WERE TRADING IS DONE

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.

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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.

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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.

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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.

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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.

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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.

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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.)

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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

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THE TOP '5' PLAYERS IN ON-LINE TRADING

VIEWS OF SOME GREAT VISIONER

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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.

Geojit

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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

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DEPOSITARY SYSTEM

ABOUT NSDL & CDSL

OBJECTIVE, ACTIVE, BENEFITS OF DEPOSITARY

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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 DEPOSITORY
Holds funds in an account Hold securities in an account
Transfers funds between accounts on the Transfers securities between accounts
instruction of the account holder on the instruction of the account holder
Facilitates transfer without having to Facilitates transfer of ownership
handle money 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.

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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
transacting in a depository environment is considerably lower as compared to
transacting in certificates.

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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.

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

7. Provide service infrastructure in a capital market.

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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;
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;

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
ICICI DIRECT.COM V/S SHAREKHAN.COM

v/s

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

INTRODUCTION, MERITs & DEMRITs

OF

ICICI DIRECT.Com & SHAREKHAN.Com

THAKUR COLLEGE OF SCIENCE AND COMMERCE


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,
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.

About 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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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.

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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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.

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.

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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.
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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

PRODUCTS AND SERVICES

PRODUCTS AND SERVICES OFFER BY ICICI


DIRECT

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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:

ICICI DIRECT

EQUITY DERIVATIVES MUTUAL FUNDS IPOS BONDS

C
Cash
C F
Futures P
Purchases
P

Redemptio
M
Margin
M O
Options
O
n

B
BTST
B S
SIP & SWP
S

Switch
S
Spot
S
i
in/out

Margin
T
Transfer in
T
P
Plus
P

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ON-LINE TRADING
 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
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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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:

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

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ON-LINE TRADING
 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:

 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.

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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:

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 MF
Birla Sun Life MF HSBC MF SBI MF
Chola MF ING Vysya Standard Chartered
MF MF
DSP Merrill Lynch JM MF Sundaram MF
MF
Deutsche MF Kotak Tata MF
Mahindra MF
Franklin Templeton Principal MF UTI MF
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.

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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
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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

SHAREKHAN PRODUCTS AND SERVICES:

 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.

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

 Mutual funds:

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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

SHAREKHAN SERVICES

Equity
Trading

Technical Research Depository


Services

Fundametal Dial and trade


Research

Share shops Commodities

Portfolio Online Services


Management

Derivatives
Trading

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

BROKERAGEs

TYPES OF ACCOUNT

HOW TO TRADE ON DIFFERENT SEGMENT

DOCUMENT REQUIRE TO OPEN ACCOUNT IN ICICI


DIRECT.COM AND SHAREKHAN

1
.

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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)
 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.

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

TYPES OF ACCOUNT IN ICICI DIRECT AND


SHAREKHAN
 Types of Account in ICICI Direct

1. Share Trading Account

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.

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

3. Active Trader Account

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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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
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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

HOW TO TRADE ON DIFFERENT SEGMENTS

 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.

THAKUR COLLEGE OF SCIENCE AND COMMERCE


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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
 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


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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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 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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

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
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 card
4. Two Photographs

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

CASE STUDY

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING

CASE STUDY: SHAREKHAN


The company

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.

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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.

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

THAKUR COLLEGE OF SCIENCE AND COMMERCE


ON-LINE TRADING
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
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
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ON-LINE TRADING

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.
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

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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.

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.

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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.

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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.

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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