The National Stock Exchange of India (NSE) stands as India’s largest financial market. Incorporated in 1992 and launched in 1994, the NSE has transformed into a cutting-edge electronic market.
By December 2023, the NSE ranked as the sixth-largest stock exchange globally in terms of market capitalization. In January 2024, the combined market capitalization of the NSE and the Bombay Stock Exchange (BSE) reached a substantial $4.33 trillion, positioning India as the fourth-largest stock market worldwide.
Key Highlights
- The NSE is India’s largest financial market.
- It introduced modern, fully automated electronic trading in India.
- The NSE operates the largest private wide-area network in India.
- A pioneer in Indian financial markets, the NSE laid the groundwork with the first electronic limit order book to trade derivatives and ETFs.
Exploring the National Stock Exchange of India
Trading on the NSE commenced in 1994 with the launch of the wholesale debt market, followed by the cash market segment. Currently, the NSE handles transactions in the equity, wholesale debt, and derivative markets.
With a strong market infrastructure, the NSE is instrumental in driving India’s economic growth. The exchange maintains high operational standards and corporate governance focusing on investor protection and access to capital.
The NSE also features market indices that track various market capitalizations, volatility, specific sectors, and factor strategies. Among these indices, the Nifty 50 Index , is particularly notable. It tracks the largest and most liquid assets in India’s equity market, comprising 50 firms across 14 sectors.
U.S. investors can gain exposure to this index by investing in ETFs such as iShares India Index ETF (XID).
As of December 2023, the NSE’s market capitalization reached $4.3 trillion, with equity shares traded worth $247.55 billion for that month.
Fact at a Glance: 2,370
The number of companies listed on India’s National Stock Exchange in December 2023.
Additional Insights
Based in Mumbai, the NSE is owned by some of India’s leading financial institutions. It was founded to enhance transparency in the Indian capital market.
The NSE introduced fully automated electronic trading and an electronic limit order book for trading derivatives and ETFs in India.
With its focus on modern systems, it provides investors with an efficient, transparent, and increasingly popular securities market.
Supporting over 2,500 Very Small Aperture Terminals (VSAT), the NSE maintains the largest private wide-area network in India.
Ashishkumar Chauhan serves as the Managing Director and CEO of the NSE.
NSE: A Premier Marketplace
For companies aiming to list on a major exchange, the NSE is a prime choice. The high volume of trading activity and the use of automated systems improve transparency in trade matching and settlement, thereby boosting market visibility and investor confidence. Cutting-edge technology also enables efficient order fulfillment, enhancing liquidity and ensuring accurate pricing.
Historical Perspective: How Old Is India’s NSE?
The NSE was established in 1992 but commenced operations in 1994.
The Essence of the NSE’s Purpose
The NSE is committed to improving the financial well-being of people. It epitomizes reliability, expertise, innovation, and trust.
Defining the Roles of the NSE
The exchange sees its role encapsulated in diverse functions – alongside being an exchange, it acts as a regulator, index provider, data and analytics source, IT service provider, educator, and market developer.
Conclusion
India’s National Stock Exchange has experienced remarkable growth in value and popularity. As the largest stock exchange in India, it eclipses the BSE. With the combined market capitalization reaching $4.33 trillion in January 2024, the NSE now secures its place as the fourth-largest stock market globally.
Related Terms: Bombay Stock Exchange, BSE, equity market, derivative market, Nifty 50 Index.
References
- National Stock Exchange of India. “History & Milestones”.
- World Federation of Stock Exchanges. “Market Statistics - February 2024”.
- Bloomberg. “India Tops Hong Kong as World’s Fourth-Largest Stock Market.”
- National Stock Exchange of India. “About Us: Introduction”.
- National Stock Exchange of India. “About NSE Indices.”
- NSE Indexogram. “Nifty 50”. Page 1.
- BlackRock. “iShares India Index ETF (XID)”.
- World Federation of Stock Exchanges. “Market Statistics - February 2024”. Select EOB Value Traded.
- World Federation of Stock Exchanges. “Market Statistics - February 2024”. Select Domestic Market Capitalization.
- World Federation of Stock Exchanges. “Market Statistics - February 2024”. Select Listed Companies.
- Money Management India. “Indian Stock Exchanges”.
- National Stock Exchange of India. “Board of Directors”.
- National Stock Exchange of India. “Purpose, Vision & Values”.
