National Stock Exchange of India

The National Stock Exchange (NSE) is India’s largest and most technologically advanced stock exchange. It serves as a critical infrastructure for capital markets, offering a secure and transparent environment for trading in equities, derivatives, debt instruments, and currencies. As a driving force behind India’s financial evolution, the NSE plays a central role in facilitating investments, raising capital, and promoting financial inclusion.

The National Stock Exchange (NSE) is India’s largest and most advanced stock exchange, offering a platform for trading in equities, derivatives, bonds, and other securities. Established in 1992, NSE introduced electronic trading, improving transparency and efficiency. It is known for its flagship index, the Nifty 50, which tracks the performance of the top 50 companies. NSE plays a key role in India's financial markets by ensuring fair, fast, and reliable trade execution for investors.

The NSE was established in 1992 with a mission to bring transparency, efficiency, and accessibility to Indian markets.

• 1993: Recognised by SEBI as a stock exchange
  

• 1994: Launched equities trading, replacing the manual outcry system
  

• 1996: Introduced the Nifty 50 Index, one of the most widely tracked indices in India

By pioneering electronic trading systems, the NSE laid the foundation for India’s modern capital market infrastructure.

How Does NSE Work?

The NSE operates through an electronic trading system where buyers and sellers place orders online. These orders are matched automatically based on price and time priority. NSE uses a clearing corporation to settle trades and ensure timely payments and delivery of securities. It functions under SEBI regulations, ensuring fair, transparent, and efficient trading for investors across various asset classes like stocks, derivatives, and bonds.

• Primary Market Access: Enables companies to raise funds via Initial Public Offerings (IPOs) and follow-on issues
  

• Secondary Market Trading: Facilitates the trading of stocks post-listing, offering liquidity to investors
  

• Index Management: Maintains several benchmark indices like Nifty 50, Nifty Bank, and sectoral indices
  

• Market Surveillance: Monitors trades in real time using advanced algorithms to detect manipulation or unusual activity

• Electronic Trading

NSE offers a fully automated, screen-based trading system ensuring speed and transparency.

• Wide Product Range

It supports trading in equities, derivatives, ETFs, bonds, and more.

• Benchmark Index – Nifty 50: 

Tracks the performance of the top 50 listed companies.

• Nationwide Access

Investors across India can trade through brokers connected to NSE’s platform.

• Efficient Settlement

Fast and secure settlement through its clearing corporation.

• Regulated by SEBI

Ensures investor protection and market integrity.

• Equity Market: Stocks of listed companies across sectors
  

• Equity Derivatives: Futures and options on stocks and indices like Nifty and Bank Nifty
  

• Currency Derivatives: Contracts on USD/INR, EUR/INR, and other global currencies
  

• Interest Rate and Debt Market: Includes bonds, debentures, and government securities for fixed-income investors

• Increased Visibility: Companies gain wider recognition and attract more investors.

• Enhanced Liquidity: Shares can be easily bought and sold, improving trade volumes.
  

• Access to Capital: Listing helps raise funds from the public for business growth.
  

• Transparency & Credibility: NSE’s strict regulations boost investor confidence.
  

• Valuation Benchmark: Market-based pricing helps in fair company valuation.

The NSE plays a vital role in India's economic development by:

• Facilitating capital formation for businesses
  

• Providing transparent and regulated investment avenues for retail and institutional investors
  

• Enabling financial inclusion via digital access and investor education
  

• Attracting foreign institutional investments (FIIs) that enhance market liquidity and depth

• Nifty 50: Represents the top 50 companies by free float market capitalisation
  

• Nifty Bank: Covers leading banking stocks, a key barometer of financial sector health
  

• Nifty Midcap & Smallcap: Capture market sentiment in emerging and growth-stage companies

These indices serve as benchmarks for mutual funds, ETFs, and portfolio performance comparisons.

The National Stock Exchange of India has transformed how financial markets operate—bringing accessibility, speed, and trust to investors across the spectrum. From retail participants to global institutions, the NSE provides a reliable platform for investment, wealth creation, and capital mobilisation. As India’s economy continues to grow, the NSE will remain a key enabler of that journey by fostering innovation, inclusion, and financial transparency.

This content is for informational purposes only and the same should not be construed as investment advice. Bajaj Finserv Direct Limited shall not be liable or responsible for any investment decision that you may take based on this content.