History of BSE & NSE

By Research Desk
about 4 years ago

NSE (National Stock Exchange) and BSE (Bombay Stock Exchange) are the two most popular stock exchanges in the country (out of the 20+ exchanges in India). While the BSE was established in the year 1875, and is one of the oldest stock exchanges in Asia, the NSE is much younger and was established in the year 1992. These two exchanges account for most of the share transactions in the country.

Historically, an open outcry floor trading exchange, in 1995 the BSE switched to electronic trading.

The key stock market index on the BSE is the BSE 30 / BSE SENSEX also known as just SENSEX. It is a free float market cap weighted index of 30 top companies representing the various sectors of the economy. The CNX NIFTY or sometimes simply referred as NIFTY is the benchmark stock market index on the NSE. The CNX stands for CRISIL NSE Index, and it is also a free float market cap weighted index, but comprising of shares of 50 companies. Other sectoral indices on the NSE such as Bank Nifty and CNX IT have also gained prominence in the last few years and have become actively traded in the market.

While there are more than 5,500 listed companies on the BSE, NSE has a little over 1,500 listed companies. The current market cap of all BSE listed companies stands at more than Rs. 90 lakh crores.

In the equity derivatives market, the NSE has a monopoly (>90% market share) and ranks high among the top exchanges globally for the number of contracts traded. In fact, derivatives volumes make up for most of the daily trading turnover on the NSE (>80% daily turnover).

Even though new exchanges such as MCX-SX have entered the Indian landscape, BSE and NSE continue to dominate the equity market space.

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