National Securities Depository Limited · BSE:NSDL
National Securities Depository — Investor Presentation
77 slides from National Securities Depository's investor presentation
Slide 1: Secondary Market: How to Buy & Sell Shares in Stock Exchange?
Secondary Market - How to Buy & Sell Shares in Stock Exchange?
Slide 2: Disclaimer
DISCLAIMER The information contained in this material is for only educational and awareness purposes related to securities market and shall be used for non-profitable educational and awareness activities for general public. No part of this material can be reproduced or copied in any form or by a
Slide 3: Flow of Presentation
Flow of Presentation Pre-Trade Preparation How to Place Orders? Post Trade Checks Margin Payment and Pledge/ Re-Pledge of Securities 3
Slide 4: Pre-Trade Preparation
Pre – Trade Preparation 4
Slide 5: Why is Pre-Trade Due Diligence needed?
Why is Pre-Trade Due Diligence needed ? Pro active approach Investment without enabling investors to analysis is like know about the driving on a highway prospective blindfolded. investment. Better understanding about the past performance and secure future growth of the investment 5
Slide 6: Due Diligence to be done
Due Diligence to be done Underlying factors that affect a company’s actual business and its future prospects. Questions to ask before investing include - Is the company Is the company’s Is the company able actually making a revenue increasing? to repay it’s debts? profit? Is the company in a pos
Slide 7: Due Diligence to be done
Due Diligence to be done Stock Company Industry Exchange Website Research Website Newspapers/ Social Media Magazines 7
Slide 8: How to do Due Diligence?
How to do Due Diligence? Review : - Data related to current economic environment affecting company’s growth and stock price. - Company’s financial health : examining cash flow statement, income statement and balance sheet for at least past 2 years. - Latest price and volume, historical data, corpora
Slide 9: Important factors and metrics for Due Diligence
Important factors and metrics for Due Diligence Reputation of Promoters & Shareholding / pledged shares of the Company. Scope/Growth/Competition/Profitability/Structure of Industry of the Company. Financials of the Company viz. Earnings per Share (EPS), Price to Earnings Ratio (P/E), Book Valu
Slide 10: How to Place Orders?
How to Place Orders? 10
Slide 11: Place Order: Modes
Place Order: Modes Visit to broker’s Office. Trade via Phone Call. Through an email to Stock Broker. By using Stock broker’s website / app on mobile (Online). 11
Slide 12: Place Order: Visit to Broker's Office (1/2)
Place Order : Visit to Broker’s Office (1/2) Check whether the Stock Broker Offers facility to trading by visit to Stock Broker’s Office. Need to select Offline Mode of trading in the Account Opening Form. On opening a new Account, Stock brokers provide a Welcome Kit to every new investor. C
Slide 13: Place Order: Visit to Broker's Office (2/2)
Place Order : Visit to Broker’s Office (2/2) Steps for Trading by visit to Stock Broker’s Office Visit the Designated Branch of the Stock broker and make an entry in the visitor’s register at the premises of the Stock Broker. Get quote for the scrip you want to trade on. Mention scrip, price, quanti
Slide 14: Place Order: By Phone Call & Trade
Place Order : By Phone “Call & Trade” Check whether Stock Broker offers facility to trade via Phone Call. All phone calls for placing orders with dealers are recorded. Steps for Trading by Phone Call Call the phone number given by the Stock Broker for placing of Orders from the Mobile number regis
Slide 15: Place Order: By Email
Place Order : By Email Check whether Stock Broker offers facility to trade via Email. All phone calls for placing orders with dealers are recorded. Steps for Trading by Email Send Email with Trades are Email must be Select “Email details of trade subject to – name of scrip, sent from the based tra
Slide 16: Place Order: Online (Website/App)
Place Order : Online (Website/ App) Steps for Trading Online Link your Trading, Demat and Bank Account. Sign the IBT (Internet based trading) agreement after checking the costs involved and the facilities provided. Visit website of the Stockbroker / Install the Online Trading app. Investor must logi
Slide 17: Place Order: Online (Website/App) Market Watch
Place Order : Online (Website/ App) Market Watch Section : Allows investor to check details of the stock that he wants to buy/ sell. Information Displayed in Market Watch: - Last Traded Price (LTP). - Percentage change – % Change from previous day close. - Previous day close – At what price did
Slide 18: Place Order: Online (Website/App) Order Availability
Place Order : Online (Website / App) Always check the Orders available for the shares of the scrip before placing your order. This gives idea of supply and demand (what quantity available for what price) of the shares. Sample Order Availability Screen SCRIP NAME BID ORDERS QTY BID ORDERS QTY 240
Slide 19: Place Order: Stock Quote
Place Order : Stock Quote Stock Quote: - Contains data points about stock of a company. - Valuable tool to get a brief snapshot of a company. Details in a Stock Quote Company 52 week Stock High / Close name and High / Price Low Price symbol Low Net Dividend PE Ratio Volume Change Details 19
Slide 20: Place Order: Types of Orders - Product Codes
Place Order : Types of Orders PRODUCT CODES MIS – Margin Intraday Square- - For Intraday training. off - Investor needs to pay margin uner intraday framework to use leverage provided by Stock Broker. - Positions automatically squared off at EOD. CNC – Cash and Carry - For delivery based trades. - No
Slide 21: Place Order: Types of Orders - Order Type
Place Order : Types of Orders ORDER TYPE Limit (L) - Buy only if price falls to certain level. Market (Mkt) - Buy/Sell at price offered on market Stop Loss (SL) - Sell as soon as price goes below a certain level (Trigger Price). 21
Slide 22: Place Order: Sample Order Screen
Place Order : Sample Order Screen ORDER PLACEMENT Order Type Limit Market Quantity ______ Price Rs. _______ Trigger Price (Stop loss) Rs. ___________ Validity Day IOC Place order (IOC – Immediate or Cancel: An order to buy or sell a security that attempts to execute all or part order immediately a
Slide 23: Place Order: Client Order Book
Place Order : Client Order Book Purpose of Order Book : Keeps a record of all Check order the orders put details of past by the client order Check Status of Order Modify the (Open / orders Completed / Rejected) Trading History : - Once Order is placed and trade get executed, details are trade ar
Slide 24: Precautions for online modes (1/3)
Place Order : Precautions to be taken for online modes (website/apps) (1/3) Fully understand the system, features and meaning of each option. Good practices for Trading Password - Make your trading password complicated and difficult to guess. - Avoid simple hack-able passwords like your name, yo
Slide 25: Precautions for online modes (2/3)
Place Order : Precautions to be taken for online modes (website/apps) (2/3) Avoid accessing your internet account from cyber cafes. Most of the cyber cafes do not use proper anti-virus and anti-phishing software, which means your password can be easily stolen. On your personal PC or laptop, alwa
Slide 26: Precautions for online modes (3/3)
Place Order : Precautions to be taken for online modes (website/apps) (3/3) Avoid accessing your internet trading account through free wi-fi offered at airports, malls etc. These are often unsecure networks. Before you trade ensure that your trading address starts with https:// and not http:// t
Slide 27: Post-Trade Checks
Post-Trade Checks 27
Slide 28: Post-Trade: Trade Confirmation by Stock Exchange
Post-Trade: Trade Confirmation by Stock Exchange Trade Confirmation by SMS - At End of Day, Exchange sends SMS & Email containing information of trade. - SMS: Contains value traded on a day (Sample SMS provided) Example of Trade Confirmation: “Dear (PAN No.), Your Traded Value for <Date> <Seg> <Rs
Slide 29: Post Trade: Trade Confirmation by Email
Post Trade: Trade Confirmation by Stock Exchange Trade Confirmation by Email - Contains breakup of trades executed through a TM on a day - Email will come from domain of Stock Exchange Source : https://www.nseindia.com/ 29
Slide 30: Trade check on Stock Exchange Website (1/4)
Post Trade: Trade check / verification on Stock Exchange Website (1/4) Trade verification facility available on the Exchange Website - The data on trades would be available on T+1 day. - At any given point in time 10 trading days' data would be available for verification. - Please ensure to provide
Slide 31: Trade check on Stock Exchange Website (2/4)
Post Trade: Trade check / verification on Stock Exchange Website (2/4) Source : https://www.nseindia.com/ 31
Slide 32: Trade check on Stock Exchange Website (3/4)
Post Trade: Trade check / verification on Stock Exchange Website (3/4) Source : https://www.bseindia.com/ 32
Slide 33: Trade check on Stock Exchange Website (4/4)
Post Trade: Trade check / verification on Stock Exchange Website (4/4) Source : https://www.msei.in/ 33
Slide 34: Post Trade: Contract Note
Post Trade: Contract Note What is a Contract note? • Record of any transaction. • Confirmation of trade done. • In case of discrepancy, contact your broker immediately. What does a Contract Note contain? • Details of transaction. • Date, Time, Price, Quantity, Trade ID, various charges/ levies, etc.
Slide 35: What should a Contract Note Contain?
Post Trade: What should a Contract Note Contain? Basic details: Client Code Client PAN Trade Date Details for each trade executed (Buy/ Sell): Scrip Code/ ISIN/ Traded Order No. Trade No. Trade Time Contract Price Details Brought Brokerage & Trade forward Charges (as Net Rate Position (only Quan
Slide 36: Sample Contract Note (1/2)
Post Trade: Sample Contract Note (1/2) 36
Slide 37: Sample Contract Note (2/2)
Post Trade: Sample Contract Note (2/2) 37
Slide 38: How to make payment to Stock Broker (Buy Trade)?
Post Trade: How to make payment to Stock Broker (Buy Trade)? PAY-IN OF FUNDS: PAY OUT OF SECURITIES: - Stocks: Before T+2 - Derivatives: Before T+1 - Shares should be received in - Only Cheque / NEFT / RTGS to TM Beneficiary Account of investor within 24 hours of payout. - Transfer from the bank acc
Slide 39: How to make payment to Stock Broker (Sell Trade)?
Post Trade: How to make payment to Stock Broker (Sell Trade)? PAY-OUT OF FUNDS: PAY-IN OF SECURITIES: - Stocks: On T+2 - Investor is advised to confirm the - Derivatives: On T+1 availability of shares prior to executing sale of shares. - Stock Broker to transfer funds to the client (investor) within
Slide 40: Default of pay-in obligation and short delivery of shares
Post Trade: Default of pay-in obligation and short delivery of shares Default of Pay- In Obligation and Short Delivery of Shares Delayed payment • Levied when investor delays the payment Charges: beyond the pay-in time on the settlement day. • Levied to discourage delayed payment from investors. Auc
Slide 41: Settlement Process & Running A/C
Post Trade: Settlement Process & Running A/C Settlement of Funds: - Pay-Out happens on T+2 Basis. - Settlement of funds and / or securities to be done within one working day of the pay-out (unless it is a “Running Account”). Running Account Authorization : - Authorize by Client to the Broker (in wri
Slide 42: Checking Credit of Shares (Delivery Trades)
Post Trade: Checking Credit of Shares (Delivery Trades) Credit of shares happens on T+2 day Shares debited from Seller Client A/C: Around 11 AM. Subsequently shares come to Pool A/C of Broker Broker credit these shares to Account of Buyer by EOD. Investor should insist that shares be transferred to
Slide 43: Checking Credit of Shares (Delivery Trades)
Post Trade: Checking Credit of Shares (Delivery Trades) Check your Demat statement on Depository website: NSDL – NSDL : IDeAS CDSL– CDSL : Easi https://eservices.nsdl.com/ https://www.cdslindia.com/Footer/Easi.ht ml 43
Slide 44: IDeAS: Registration Process (1/2)
IDeAS : Registration Process (1/2) Step 1 Step 2 Step 3 Step 4 44
Slide 45: IDeAS: Registration Process (2/2)
IDeAS : Registration Process (2/2) Step 6 Step 5 Step 7 Step 8 45
Slide 46: SPEED-e: Registration Process (1/4)
SPEED-e: Registration Process (1/4) 46
Slide 47: SPEED-e: Registration Process (2/4)
SPEED-e: Registration Process (2/4) 47
Slide 48: SPEED-e: Registration Process (3/4)
SPEED-e: Registration Process (3/4) 48
Slide 49: SPEED-e: Registration Process (4/4)
SPEED-e: Registration Process (4/4) 49
Slide 50: SPEED-e: Downloading Statement of Transactions
SPEED-e: Downloading Statement of Transactions 50
Slide 51: SPEED-e: Sample Statement of Transactions
SPEED-e: Sample Statement of Transactions 51
Slide 52: SPEED-e: Sample Statement of Transactions
SPEED-e: Sample Statement of Transactions To a specific entity (individual / To Clearing Member (usually the company, etc.) Stock Broker) for pool account 52
Slide 53: Easi: Registration Process (1/2)
Easi : Registration Process (1/2) Step 1 Step 2 Step 3 Step 4 44
Slide 54: Post Trade: Delivery Instruction Slip
Post Trade: Delivery Instruction Slip What is a Delivery Instruction Slip (DIS)? • Like a “Cheque Book” for a DEMAT Account. • Issued by DP when you open a Demat A/C. • Client needs to fill, sign and submit the DIS to transfer shares. Types of DIS • Intra Depository (CDSL to CDSL or NSDL to NSDL). •
Slide 55: Post Trade: Sample DIS - CDSL
Post Trade: Sample DIS - CDSL 54
Slide 56: Post Trade: Sample DIS - NSDL
Post Trade: Sample DIS - NSDL 55
Slide 57: Post Trade: Information to be filled in DIS
Post Trade: Information to be filled in DIS INFORMATION DETAILS Client ID Client ID given by the DP (8 digit / 16 digit). Client Name Fill your name (same as in the Demat A/C). Date Date of submitting the DIS. ISIN number ISIN of security to be transferred. Security Name Name of the security to be t
Slide 58: Post Trade: Information to be filled in DIS
Post Trade: Information to be filled in DIS INFORMATION DETAILS Execution date (Optional) Specify the date on which the instructions are to be executed. A/C Transfer within CDSL - Transfer to another Individual's CDSL DEMAT account. BO-BO A/C Transfer within CDSL - Transfer to a Clearing Member/Brok
Slide 59: Do's and Don'ts of keeping funds in Trading Account: Do's
Post Trade: Do's and Don'ts of keeping funds in Trading Account Do’s: Investor should make sure funds to the extent of obligation (Pay-in & Margin) is available in your trading account. Investor should transfer funds to the Stock broker for obligation only. Ensure all the documents are receive
Slide 60: Do's and Don'ts of keeping funds in Trading Account: Don'ts
Post Trade: Do's and Don'ts of keeping funds in Trading Account Don’ts: Investors are advised not to keep idle funds lying with the Stock Broker. Investors are advised not to provide cheques in the name of any “Authorized Person ” / 3rd party. Pre-Signed Blank Cheques and DIS Slips should NOT
Slide 61: Margin Payment and Pledge/Re-Pledge
Margin Payment and Pledge/ Re-Pledge 60
Slide 62: Pre Trade: Payment of Margins
Pre Trade : Payment of Margins On buying a Stock, investor may Pay Entire Buy it on margin or pay only a % price of its price upfront (called margin) Payment Of Margin: - Check your margin requirement on Stock Broker’s website while placing the trade. - Pay the margin amount to the Stock broker /
Slide 63: Pre Trade: Payment of Margins (Early Pay-in)
Pre Trade : Payment of Margins (Early Pay-in) Payment of funds / deliver shares (in case of buy/sell) to the Exchange by pay-in time on settlement date. Early Pay-In: Choice of paying funds / delivering shares before this designated time. Exemption upon early pay-in of Funds: - No margin needs
Slide 64: Pre Trade: Payment of Margins (Haircut)
Pre Trade : Payment of Margins (Haircut) Haircut: - %age by which market value of your pledged shares is reduced for the purpose of calculating the collateral value. - Eg: Market value of your pledged shares = Rs. 10 lac Haircut = 20% Collateral value = Rs. 8 lac. {10-(0.20*10)} Sample: Approved
Slide 65: Pre Trade: Payment of Margins - Margin Calculators
Pre Trade : Payment of Margins NSE margin Calculator : BSE margin Calculator: https://www1.nseindia.com/live_marke https://www.bseindia.com/markets/equ t/dynaContent/live_watch/margincalc/ ity/EQReports/margin.aspx CMInputMargincalc.jsp 64
Slide 66: What is a Pledge? : Simplified
What is a Pledge? : Simplified PLEDGE: Deposit of some personal property as collateral for a Debt. To borrow some funds to pay margin, you can pledge the securities (viz. shares, bonds, etc.) owned by you in order to get these funds. Pledged securities act as collateral for this loan. If bor
Slide 67: What is a Pledge? : Simplified
What is a Pledge? : Simplified - Pledger borrows funds from Pledgee - Deposits Shares as Collateral for funds borrowed. PLEDGER PLEDGE PLEDGEE - Pledgee lends funds to Pledger - Accepts Shares as Collateral for the funds lent. 66
Slide 68: Margin Pledge: Previous Process
Margin Pledge : Previous Process Investor wants to Pledge his stocks to obtain margins. Securities transferred from investor’s demat account to Stock Broker’s Demat Account - Through Title transfer collateral arrangements or Power of Attorney in respect of client’s demat account Stock Broker pledges
Slide 69: Margin Pledge: The new way
Margin Pledge : The new way Stocks stay in the investor’s Demat account. No change of ownership of stocks happens. Investor makes a pledge in favor of the Stock Broker. Stock broker is required to open a separate demat account labelled ‘TMCM – Client Securities Margin Pledge Account’ for thi
Slide 70: Margin Pledge in Depository System: Explained
Margin Pledge in Depository System : Explained Effective from September 01, 2020. Investors can now provide margin in form of “Securities”. - By pledging securities in favour of specially designated demat account of Stock Broker. What’s New?: - Stock Brokers can accept securities (viz. shares)
Slide 71: Margin Pledge in Depository System: Explained
Margin Pledge in Depository System : Explained What does the Investor need to do?: o Give instruction to create margin pledge on securities. o Instruction may be given in: - Physical form - Electronically through “SPEED-e” (for NSDL) and “Easi/Easiest” (for CDSL). Pledged to whom? o Created in f
Slide 72: What is a Re-Pledge?
What is a “Re-Pledge”? “Re-pledge” of securities by Stock Broker, that it received as “pledge” from investor, in favour of Clearing Member (CM). CM can “re-pledge” the same securities in favour of Clearing Corporation (CC) in respect of approved securities. Stock Brokers who are trading as wel
Slide 73: Sample Margin Pledge Form
J Sample Margin Pledge Form ic PP Logo FORM 43 — MARGIN PLEDGE FORM oa NSDL Participant Name Serial Number Participant Address Date | a DPID a I I I I I Client 1D Prestamped I/We request you to execute margin pledge instructions as per following details. Further, I/we hereby give my/our express cons
Slide 74: Margin Pledge Creation by Investor
Margin Pledge Creation by Investor On receipt of margin pledge instruction, depository shall send a link to ‘Confirm Margin Pledge Transaction’ through SMS and email to Investor. Receive Confirmation Link Investor must verify the Investor needs to Click the information displayed and if link received
Slide 75: Margin Pledge Closure by Investor
Margin Pledge Closure by Investor Client can submit instruction for Closure of Margin Pledge existing in his / her demat account in physical form or electronically through SPEED-e / IDeAS facility Submit Closure Instruction Alternatively, stock broker Pledge will be closed when it can give an instru
Slide 76: Invocation of Margin Pledge / Re-pledge
Invocation of Margin Pledge / Re-pledge IF RE- TM SUBMITS SECURITIES PLEDGED BY VALIDATION INSTRUCTION DEBIT TM If the client defaults Upon successful If the securities have in payment, then: execution of Pledge Validation of the been re-pledged by Invocation instruction margin pledge - Stock Broker
Slide 77: Thank You
Thank You 76
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