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Trading in Indian stock exchanges is limited to listed securities of public limited companies, they are broadly divided into two categories, that is, specified securities (forward list) and non-specified securities (cash list). Equity shares of dividend paying, growth-oriented companies with a paid-up capital of minimum Rs.50 million and a market capitalization of minimum Rs.100 million and having above 20,000 shareholders are, usually, put in the specified group and the balance in non-specified group.
Two types of transactions can be carried out on the Indian stock exchanges, that is, a. spot delivery transactions "for delivery and payment within the time or on the date stipulated when entering into the contract which shall not be in excess of 14 days following the date of the contract": and b. forward transactions "delivery and payment can be extended by further period of 14 days each so that the in general period does not go beyond 90 days from the date of the contract". The latter is permitted only in the case of particular shares. The brokers who carry over the outstanding pay carry over charges which are generally determined by the rates of interest prevailing.
A member broker in an Indian stock exchange can act as an mediator, buy and sell securities for his clients on a commission basis and also can act as a trader or dealer as a principal, purchase and sell securities on his own account and risk.
The nature of trading on Indian Stock Exchanges are that of age old conventional style of face-to-face trading with bids and offers being made by open outcry, but, there is a great amount of effort to revise the Indian stock exchanges in the very recent times.