If you want to trade any commodity you need a market. Same goes for equity or shares. There must be some place where trade can happen. For trading of shares there are two options of Bombay Stock Exchange and National Stock Exchange.
So today we are going to discuss about the two most famous exchange and will compare them and try to give you an idea that in which exchange is better for you as both the exchange has their own positive and negative side. In this article we will discuss for the retail traders like you and me.
Let’s start talk about facts first.
Bombay Stock Exchange was established at 1875 and it was the oldest stock market exchange in India. More than 5000 companies are listed in BSE. It is also itself a publicly listed company.
National Stock Exchange was established at 1992 which is comparatively newer. It has more than 2000 companies listed in their exchange. It is a private limited company as of now. Both this exchange are regulated by SEBI.
Battle For Volume:
Liquidity is a thing which is needed to convert the shares in money and vice versa. It is very important for intraday traders and swing traders. To check this we have to check turnover of this two stock exchange which means how much trade happen in the exchange in particular time. It seems that NSE has the 80 % of share and BSE has the 20 % share. It means NSE have more traders and more trade happens in NSE. So it is easier to entry and exit, lower slippages and better spreads in NSE .
In this case also we got same result where 90 % trading volume is there in NSE and rest 10% is in the BSE. So in this segment NSE is the clear winner.
Variety of Stocks:
There are 5000 companies in BSE and NSE has 2000 company listed. The reason behind this is there are strict rules and regulation in NSE to listed whereas it is easier to listed in the BSE. So the variety of trades are more in BSE as you will find but same time it is also a fact that many start up companies fail. So you should not go for unknown company blindly.
As BSE has large number of companies listed you can found some potential companies which you will feel that they are going to profit in higher amount. So you can get higher returns. But in the large cap companies will not have that much of profit as it is in their saturated state, so if you want higher returns which may have higher risk you can find companies in BSE. So in this section BSE won.
Cost of Trading:
If you compare the cost of trading it is more or less same in both exchange. So you don’t have to worry about that at all.
In term of liquidity in cash market and derivatives NSE is the winner. For the retail trader NSE will be the best option. But for the investor BSE will be best as they can find low value company as well which can give them higher profit.