The journey on Indian share trading from physical share certificates to modern technological trading platforms and share market online app is rather interesting. Over the years, the investment market in India has become a complex system making millions of people interested in buying stocks. It is this dramatic change in infrastructure investments that is an expression of a new economic reality and new approaches to life and accumulation of money by the Indians.
- The Historical Evolution of Indian Stock Markets
The share trading in India originally began with the proposal by the East India Company of the joint-stock firms in the 18th century. Although the BSE, which was established as ‘The Native Share & Stock Brokers Association ‘in 1875, was the first business establishment to start practicing share trading formally. Speaking of trading, the most predominant method of trading over the past century was the so-called ‘’open outcry’’, where traders and brokers communicate orally at the trading pit. Thus standing today as one of the most vibrant markets in the world thanks mainly to this glorious past despite National Stock Exchange NAS joining BSE in 1992 and bringing contemporary computerized trading to the front line.
- Technological Revolution: The Game Changer
Another major landmark in Indian share trading was the coming of screen based trading in 1994. Such things like trading on papers and being physically present in the stock exchanges were part of history. Technological revolution equally empowered real time market data, analysis, smartphone applications and internet trading. Today, courtesy of this digital revolution, anyone with a smartphone and internet connection can trade shares. This has been so due to automation of trading procedures and use of detailed analysis tools that makes investors make superior decisions from technical analysis and other real-time information and updates.
- Financial Literacy and Awareness: The Knowledge Revolution
Lack of adequate financial literacy and basic numeracy among the people of India is not mainly to blame for share trading becoming fashionable. Members of the public have thus benefited from the information regarding investment opportunities as well as the risks involved through the efforts of several players in the field, including firms, government agencies and education institutions. While the share trading was always considered as a complex, high risk and high return operation meant for the high net worth persons only, this form of availability of financial information has tried to make it relatively easy to invest and look for long term returns for a typical Indian person working towards accumulating capital.
- Economic Reforms and Market Regulation
To trade shares a lot of change happened with the opening of the Indian economy in the year 1991. The subsequent reforms paved for development of strong or strengthened regulatory measures that enhanced investor safety and transparency in the markets by establishing SEBI: the market regulator The burn has enhanced market participation by the, both domestic and international investors. Due to the many investor-friendly rules, simple KYC processes and stringent monitoring procedures many people have been encouraged to give share trading a try and the trading environment has become more secure, and efficient.
- Rise of the Retail Investor
Currently, the level of retail investors investing in the Indian stock market has grown tremendously with particular emphasis in the current decade. These are some antecedents to this phenomenon — increased availability of trading platforms, higher levels of financial enlightenment, and higher per capita disposable income. Recently, social profiles expressed high concern in equity investments especially to the Gen Z and the millennials who view them as a means to gain an independent wealth. Those from tier 2 and tier 3 cities who would not earlier have direct access to such investment avenues have been attracted to share trading due to SIPs and potential of investing with a small amount.
- Impact of Alternative Investment Options
The way people invest their money, especially in the stock market, has been compelled by the relatively lower returns on investment than the likes of gold, property and fixed deposits etc. As citizens of a country where bank interest rates are often below inflationary rates, several Indians have discovered that equity may offer greater long-term returns. They require less effort to join and to leave as compared to the other related markets, which has even extended this shift in the investment portfolios even further. Stocks form a desirable asset category through which anybody planning to build forms of wealth could invest in since they are easily divisible and can offer both capital gains and stable dividends.
- Professional Trading Tools and Research
Advance trading tools and research resource availability are the other factors that have seen share trading becoming more popular in the market. Unlike in the past when trading was only a preserve of large investors, the current systems in place offer charting capabilities, trend indicators and fundamental analysis. With the development of new algo-trading platforms and AI-based analytical tools, as well as carefully structured retail research papers, the modern retail investor is much more ready to make a proper data-based investment decision than ever before. In the course of the demutualisation of professional trading tools, share trading has now become more attractive to individual investors due to bringing parity between institutional and petty investors.
- Market Infrastructure Development
The promotion of share trading has been significantly facilitated by the competition in the development of market infrastructure. The current systems for settlement, clearing firms and depositories have enhanced the safety and effective means of trading. Moreover, the appearances of other specialized market segments including the debt markets, ETF and derivatives has offered investors a pool of opportunities to invest depending on the level of a tolerable risk and investment goals to be achieved. The global and cultural investors can now invest directly in the Indian stock markets with the aid of this sophisticated facility.
Conclusion
The historic process of share trading in the country is one of the best examples of growth and increasing the economic sophistication of the Indian market. Starting from the almost primitive outcry trading system up to modern digital trading and apps for share market trading, the change is revolutionary in the best way possible. This democratization of share trading has breached the walls of wealth, geography and knowledge and anyone, anywhere in India can invest in India’s growth story.
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