Securities Trading and Settlement

Topics: Stock market, Stock exchange, Stock Pages: 13 (4118 words) Published: August 30, 2013
  PROJECT REPORT

“SECURITIES TRADING AND SETTLEMENT”

Submitted to: Submitted By: Dr. Sarika (H.O.D) Poonam (7931) Deptt .Of Commerce M.Com (IInd)

CONTENTS
* Introduction to securities trading and settlement
* Traditional Trading Mechanism
* Traditional v/s modern trading system
* Offline and Online Trading
* Settlement system and clearing house
* Trading and settlement at Bombay Stock exchange
* National stock Exchange
* Summary of trading and settlement
* Appendix
* Bibliography

INTRODUCTION

Securities Trading
Individuals and organizations are always looking for a way to increase revenues. An anticipating concept to do this is to invest in securities. While all securities pose a risk of losing the capital investment, trading in securities increases the chance of profits and losses. There are many factors involved when considering trading securities.

Securities
Securities are equities or debentures of publicly traded companies that are bought and sold through brokerage firms. Securities fluctuate in value and pose a risk to the principal investment. Trading

* Trading is the purchase or sale of a specific security. It can be either an equity or debenture and is done via a brokerage firm. * Individuals can do trading either through a registered representative (a licensed Financial Industry Regulatory Authority broker) or make trades without a broker through an online brokerage trading firm. * Trading can be done either in a cash account or through a margin account. Cash accounts require all transactions to be paid for in full by the settlement date three days after the trade execution. Margin accounts allow the investor to borrow money for the purchase of securities in hopes that they will not go down in price and a margin call for the difference is demanded by the brokerage firm.

Trading Securities
Trading securities is the act of buying and selling securities with the intention of making a quick profit.

TRADITIONAL TRADE MECHANISM:

TRADITIONAL V/S MODERN TRADING MECHANISM

MODERN

Difference Between Online and Offline Stock Trading

* The introduction of the Internet has surprisingly changed our way of life as a society. It has defined the way we do business and the way we correspond. The Internet has opened many opportunities for online trading. The financial industry revolves around the Internet. Everything is just a few clicks away. * But there are still investors who prefer the old fashion way of offline trading and they mainly prefer offline trading for security reasons. Internet has introduced a way for consumers to manage their money online. * Private investors to gain straight access to different markets and online tools that were at one point only reserved by the use of investment professionals. Consumer investing and online trading has dramatically changed over the last decade. * Online Services have expanded to include integrated management of additional financial accounts. It has subsequently expanded in conjunction with ground-breaking improvements to the traditional trading interface, such as telephone interface systems. Of course, online trading has many pros. There are several wonderful reasons to invest online and consider online trading. Money saving opportunities: The amount of money you save depends primarily on the online brokerage firm that you choose. No two firms are the same. There may be different regulations, similar to bank regulations. There are minimum deposits required that must be maintained. As mentioned above, this will depend on the online brokerage firm. Instant online access: You can gain instant access to your account,...

Bibliography: Settlement
The settlement cycle on the BSE is Trade plus two days, or T+2, as per a Sebi directive implementing this new cycle from April 1, 2003
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