Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.

Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Net trading set to revolutionise broking business - Views on News from Equitymaster
  • E-MAIL
  • A  A  A
  • Jan 24, 2000

    Net trading set to revolutionise broking business

    The Securities and Exchange Board of India (SEBI) is all set to approve the introduction of the order routing mechanism through the Internet.

    Internet trading or E-broking as it is more popularly known refers to the system by which investors can place orders for shares over the Internet. The movement of money and shares takes place electronically and in most cases is real time. The implementation of secure transaction systems and the flexibility offered by Internet trading have made it a rage in more developed markets like the US and Europe where it is estimated that orders over the Internet account for about 40-45% of trading volumes. South Asian countries like Japan and Korea have also jumped on the e-trading bandwagon.

    The first implication of the allowance of routing orders through the net will lead to a spurt in volumes. So far the volumes on the BSE and NSE put together aggregate Rs 77.85 bn with 182.1 million shares traded. These are expected to spurt almost 5 times within a year of the Internet trading in place (as and when payment gateways are put in place).

    This would in turn imply the beefing up of the back office operations of brokerage houses especially in terms of the service they offer to their clients.

    The second implication will be the possible cannibalisation of the existing broking house business through either their own net site operations if they have one in place or by those portals who could tie up with other brokerage houses. However, if the volumes were to shoot up as expected existing brokerages will get sufficient time to get their act together.

    The third implication, depending on what sort of regulations SEBI puts in place, is that if the orders are routed directly through their exchange then the identity of the buyer and the seller would not be known to the market at least till a day or two.

    Finally, as and when payment gateways are put in place, brokerage houses could tie up with banks or banks could get into the brokerage business itself. www.equitymaster.com is currently in the process of setting up an Internet trading module, which it will offer to its visitors shortly. Other prominent players who have announced their e-broking intentions are Motilal Oswal Securities, SSKI and ICICI.

    Thus, first it was the introduction of online transactions (putting an end to the outcry system) which changed the face of the broking in country. The start of Internet broking is likely to herald the second revolution.



    Equitymaster requests your view! Post a comment on "Net trading set to revolutionise broking business". Click here!


    More Views on News

    Insider Leaks Equitymaster Stock Picks (The 5 Minute Wrapup)

    Jul 25, 2017

    Equitymaster HQ has been infiltrated. Valuable stock ideas have been leaked. Who's responsible?

    Raymond and Other 'For Profit' Companies Who Don't Care about Shareholder Returns (The 5 Minute Wrapup)

    May 27, 2017

    What happens when minority shareholders are short-changed in the normal course of business?

    Why Commission Driven Model In Mutual Funds Should Be Eliminated... (Outside View)

    Feb 15, 2017

    PersonalFN believes SEBI has taken a step back-apparently in the admission of it going overboard with the regulations.

    This Book Changed How I Looked at the World of Man and Money (Vivek Kaul's Diary)

    Aug 24, 2016

    And here's your chance to claim a free copy of this book...

    The Developed World is Dying because of Demographics, Debt, and Deflation (Vivek Kaul's Diary)

    Aug 12, 2016

    And Why India's demographic dividend could turn out to be a doubtful debt...

    More Views on News

    Most Popular

    Demonetisation Barely Made Any Difference to Tax Collections(Vivek Kaul's Diary)

    Aug 7, 2017

    The data tells us quite a different story from the one the government is trying to project.

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    7 Financial Gifts For Your Sister This Raksha Bandhan(Outside View)

    Aug 7, 2017

    Raksha Bandhan signifies the brother-sister bond. Here are 7 thoughtful financial gifts for sisters...

    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms