India, at present has become a giant corporate game reserve. So Indian companies are sprucing up their acts like never before to face up to the realities of fiercely competitive post-liberalization era. Gone are the days of monopolies and with the advent of consumerism more and more business corporations are beginning to realize that the ultimate cutting edge of any business over its rival will be provided, by its people. Provision of providing broking service is a very crucial activity. It has a lot of legal complications & various norms, rules n regulations have to be followed. I have realized this fact after completion of my summer training project. Despite of various difficulties and limitations faced during my summer training project on the topic "Future Prospects Of Broking Firm", I have tried my level best to find out the most relevant information from the organization to complete the assignment that was given to me. After completion of my summer training project I gained lot of experiences in the field of securities market. I got the opportunity to deal with various people. This summer training project has given me the opportunity to have first experience in the corporate world.
Theoretical knowledge of a person remains dormant until it is used and tested in the practical life. Through training I got an opportunity to apply my theoretical knowledge that I have acquired in my classroom to the real business world. In spite of few limitations and hindrances in the summer training project I found that even though the work was challenging but was fruitful in many ways. It gives enough knowledge about the online trading process undertaken by the company. It provided the practical knowledge of the working process of Religare Securities Limited . Also this summer training project has enhanced my capability in order to manage business effectively and in my career in future.Moreover it was the first experience to mould the theoretical knowledge into practicality. In our course material whatever we read about stock market, research work, growth pattern of the Indian financial market, the emergence of broking firms etc, all were seems to be factual and I tried to apply those classrooms learning into my corporate life. So through this training I got the realization that although our organizational working style was quite practical but it was either an exaggerate form of our bookish theory or completely based upon the very fact of our bookish theory.
Emergence of Online Trading
Online trading in India is the internet based investment activity that involves no direct involvement of the broker. There are many leading online trading portals in India along with the online trading platforms of the biggest stock houses like the National stock exchange and the Bombay stock exchange. The total portion of online share trading India has been found to have grown from just 3 per cent of the total turnover in 2003-04 to 16 per cent in 2006-07.
Online trading is the service offered on the internet for purchase and sales of shares. In the real world you place orders on your stock broker either verbally or in a written form. In online trading you will access a stock broker's website through your internet enabled PC and place orders through the brokers internet based trading engine. These orders are routed to the stock exchange without manual intervention and executed their own in the matter of a few seconds. From the past two years the volume of the internet trading has increased largely.
Traditionally stock trading is done through stock brokers, personally or through telephones. As number of people trading in stock market increase enormously in last few years, some issues like location constrains, busy phone lines, miss communication etc start growing in stock broker offices. Information technology (Stock Market Software) helps stock brokers in solving these problems with Online Stock Trading.
Online Stock Market Trading is an internet based stock trading facility. Investor can trade shares through a website without any manual intervention from Stock Broker.
In this case these Online Stock Trading companies are stock broker for the investor . They are registered with one or more Stock Exchanges. Mostly Online Trading Websites in India trades in BSE and NSE.
There are two different type of trading environments available for online equity trading.
Installable software based Stock Trading Terminals
These trading environment requires software to be installed on investors computer. These software are provided by the stock broker. These softwares require high speed internet connection. This kind of trading terminals are used by high volume intra day equity traders.
Orders directly send to stock exchanges rather then stock broker. This makes order execution very fast.
It provides almost each and every information which is required to a trader on a single screen including stock market charts, live data, alerts, stock market news etc.
Location constrain - You cannot trade if you are not on the computer where you have installed trading terminal software.
It requires high speed internet connection.
These trading terminals are not easily available for low volumn share traders.
Web (Internet) based trading application
These kind of trading environment doesn't require any additional software installation. They are like other internet websites which investor can access from around the world through normal internet connection.
Below are few advantages and disadvantages of Online Stock Market Trading :-
Advantages of Online Stock Trading :
Real time stock trading without calling or visiting broker's office.
Display real time market watch, historical datas, graphs etc.
Investment in IPOs, Mutual Funds and Bonds.
Check the trading history; demat account balance and bank account balance at any time.
Provide online tools like market watch, graphs and recommendations to do analysis of stocks.
Place offline orders for buying or selling stocks.
Set alert to inform you certain activity on the stock through email or sms.
Customer service through Email or Chat.
Disadvantages of Online Stock Trading :
Website performance - sometime the website is too slow or not enough user friendly.
Little long learning curve especially for people who don't know much about computer and internet.
Brokerages are little high.
Indian equity brokerage turnover has been growing at more than 30% CAGR since FY1999-2000 primarily attributed to the growth in trading turnover in the derivative segment, which commenced operations in FY00-01 and now accounts for almost ~75% of total turnover.
Equity brokerage turnover at National Stock Exchange and Bombay Stock Exchange, combined, reported a decline of 19% in FY08-09 against the backdrop of the global market meltdown and higher base effect of FY07-08, which was a bumper year for domestic capital markets.
Majority of the broking firms entered the business post 1990. A majority of members have memberships in more than one stock exchange and across equities, equity derivatives and commodities futures in domestic and International stock exchange.
The recession in America though had its effect on Indian economy for quite sometime but the European crisis didn't have much effect.
Religare Securities Limited is the only broking firm which is providing interest on unutilised cash while no other broking firm does so.
The brokerage charged by Religare Securities Limited is the lowest when compared to other broking firms.
The market share & broking volume of Religare Securities was maximum in the year 2007-08, while it went down in 2008-09 due to the global slow down caused by the American crisis. The market share then further increased in 2009-10.