National Stock Exchange of India
The National Stock Exchange of India is one of the fastest growing exchanges in the world, which is largely the result of the strong growth of the Indian economy as a whole. However it also due in large part to the fact that a lot of companies are choosing to move from other exchanges in the country because of the benefits that being listed on the NSE offers to them. This is largely down to the many innovations that the exchange has pursued.
The National Stock Exchange of India was founded in 1992 as the collaboration of a number of banks who realized that the exchanges that existed in the country at that time were not up to the task of handling the volume of trading that nations growing economy required. The exchange is actually the second busiest in the world in terms of the number of transactions that are made, however because of the low price on the stocks that are listed it is much further down in terms market capitalization. Over the years the NSE has proven to be one of the most innovative stock exchanges in the world.
One of the biggest Innovation s that the National Stock Exchange of India made was to be amongst the first exchanges to introduce exchange traded funds. These are funds that are based on the composite of a number of different stocks, in this case the CNX Nifty which is the main index of the exchange. These exchange traded funds proved to be very popular and are now offered on almost all stock exchanges around the world.
Perhaps the most important innovation that has been made by the NSE was the introduction of the first clearing corporation in India. This has greatly simplified the process of making trades and has also greatly increased the confidence that investors have in making trades since they know that there is now a clearing company to keep track of them. This has encouraged investment in the country which was after all the whole reason that the NSE was created in the first place. This has naturally played an important part in the development of the economy of India as a whole as it is now much easier to invest in the country.
Another important innovation that has occurred on the NSE is that they were the first stock exchange in the world to use satellite communication for trading. This has not only greatly increased the speed of communication but it also ensures that everybody is playing on a level field since it takes the same length of time for communication from anywhere. This used to be a problem since there were huge differences in how long it took for communication to go through putting some traders at a serious disadvantage. Removing this was important for the development of the market.