India is fast becoming a hotbed for global investment and Indian stock market is witnessing the advent of multiple stock trading options from different areas of the globe. This has had a diversely impactful meaning for Indian stock market, with many repercussions. Here is a list of 10 things to know about Indian stock market:
Direct investment in equity:
Equity investment is a rather risky venture, traditional Indian stock investment has been quite limited in this domain. Out of a major portion of core investor segments, a very limited number of investors have tied their funds in equity. There are many reasons for this. Generally, Indian investors prefer safer returns over some time, for future financial goals. Short-term yields are not so much encouragement. However, this trend is gradually changing as more and more thrust is being laid on a balanced investment portfolio in the Indian stock market.
Lack of deep awareness and participation:
The number of stockholders in Indian stock market that comes from the local populace is quite limited. This can be seen from the fact the number of Demat account holders is quite low in India.
The decision of Indian government to encourage Foreign Direct Investment (FDI) is core segments in Indian stock market has allowed Indian stocks to grow at rapid rates. Moreover, institutional re-enactment has meant that foreign investment holds a bigger stake in listed stock valuation in Indian stock market. This has increased competition and has also given local business ventures a push towards innovation and technological diffusion.
Stock inflow statement:The stock inflow in Indian stock market is quite limited and majorly taken care of by foreign investors. The core participation of local investors has sadly been not up to the mark.
Total Market Cap to GDP:
As per the latest norms, the total market cap to GDP through Indian Stock Market is at an optimum high. The trend of this continued capping is set to remain set.
Enablement of foreign investment:
The ease with which foreign investment has been enabled in Indian markets has been a landmark change for business segments here. This has allowed global platforms to compete here, bringing about a quality shift altogether on the ground. The stock availability and also the availability of services have risen manifold and there has been a sharp increase in customer awareness in the local markets as well.
Indian stock market has seen a boom in the rate of exchange trading in recent times. The major Equity Trdaing stock exchanges in India i.e. Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) have witnessed a sharp increase in trading volumes for major listed stocks. This means that the daily rate of rading volume has increased to a large extent in recent years.
In the derivatives market, National Stock Exchange (NSE) owns a lion’s share and features prominently in global rankings. The net trading volume is very high both within the Indian Stock Market as well as international markets.
The overall turnover of businesses:
he emerging preferred destination for global trade that India is becoming has had a very positive impact on the overall trading options here. The traders have been exposed to platforms where they can leverage the global markets for their potential growth in a significant way. The equity market has grown manifold and there are a lot of options for budding investors in India today than were about a decade ago.
The major share in the Indian Stock Market revolves around trading done by brokerage firms. As many potential investors seek professional assistance for investment, this figure features prominently. There are certified brokerage firms that offer credible professional services and constitute a large portion of the Indian Stock Market.
Overall trading mechanism:
Since the overall trading scenario is based on the foreign participation majorly, the mechanism offers dependable platforms for both local as well as foreign traders. The market potential is immense and one of the biggest in the entire world.
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