SEBI

securities exchange board of India

Securities and Exchange Board of India

Topics to be covered

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Structure of Securities Market Participants in the Secondary Market Vision and mission Getting started Where to trade Trading a general understanding How to trade Post trade Charges by the stock broker Settlement Investor Protection Mechanism Investors Grievance Redressal
Securities and Exchange Board of India

Structure of Securities Market

The securities market in India can be divided into two segments

Primary Market Secondary Market

Securities and Exchange Board of India

VISION

Build permanent relationship with the Investors by investing in Total Quality for Investors delight. Improving the quality of life in the communities we operate in. Fostering a spirit of continuous learning and innovation. Having people who practice values and high standards of behavior. Seeking sustained and dynamic growth and securing long-term success. Taking responsible care of the surrounding environment

Securities and Exchange Board of India

MISSION

Ensuring equal access to investors through an appropriate communication network, Providing a fair, efficient and transparent securities market to investors using electronic trading systems, Enabling settlement cycles and book entry settlements systems without delays & defaults. Meeting the current international standards of securities markets. To protect investors from malpractices. To promote efficient services by brokers, merchant bankers and financial intermediaries. Prohibiting insider trading.

Securities and Exchange Board of India

Participants in the Secondary Market

Stock Exchange Clearing Corporation Depositories/ DP Trading Member (Stock Broker)/ Clearing Member Registrar to an Issue and Share Transfer Agent

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Securities and Exchange Board of India

Getting started

To start trading the following are required Trading account Member Client Agreement Risk Disclosure Document Demat account Bank account Permanent Account Number (PAN) Unique Client Code
Securities and Exchange Board of India

Where to trade

The secondary market is divided into two segments

Cash/ Equity segment Derivative segment

Equity Futures and Option (F & O) Index / Single Stock Currency Futures/ Option Interest Rate Futures
Securities and Exchange Board of India

How to trade

Trade through a SEBI registered Stock Broker, by Placing margins as required with the broker placing order over the phone email etc.

Internet Trading Wireless / Mobile Trading.

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Securities and Exchange Board of India

Post Trade

The stock broker is required to provide contract notes confirming the trades done within 24 hrs of executing the trade
The contract notes can either be in physical or electronic form

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Securities and Exchange Board of India

Charges by the Stock Broker

Brokerage charged by member broker (maximum 2.5%) Service tax as stipulated Securities Transaction Tax Penalties arising on specific default on behalf of client (investor)

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Securities and Exchange Board of India

Settlement

The settlement in the securities market is done on a T+2 Rolling Settlement Cycle (where T = Trading Day). FAILURE
T+2
SETTLEMENT Pay-in and Pay out (T2)

TRADE

TO PAY-IN
Auction (T3) Close out (T4)

Trading (T)

Option of Early Pay-in (T1)

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Securities and Exchange Board of India

Settlement - Auction

Incase there is a shortage in Pay-in of shares at the time of settlement on T+2, the Stock Exchange purchases the requisite quantity in the Auction Market and gives them to the buying trading member.

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Securities and Exchange Board of India

Settlement - Close Out

If the shares could not be bought in the auction i.e. if shares are not offered for sale in the auction, the transactions are closed out as per SEBI guidelines

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Securities and Exchange Board of India

Investor Protection Mechanism

Investor Protection Fund or Consumer Protection Fund (IPF/ CPF) is set up by the Stock Exchanges to meet the legitimate investment claims of the clients of the defaulting members that are not of speculative nature

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Securities and Exchange Board of India

Investor Grievance Redressal

Complaints can be filed with OIAE department of SEBI against companies for delay or non-receipt of shares, refund orders, etc., and with Stock Exchanges against brokers on certain trade disputes or non receipt of payment/securities.
Arbitration Court of Law
Securities and Exchange Board of India

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THANK YOU

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Securities and Exchange Board of India