ZENITH International Journal of Business Economics & Management Research
Year : 2014, Volume : 4, Issue : 12
First page : ( 63) Last page : ( 71)
Online ISSN : 2249-8826.

A study on customer awareness on Demat-online trading in secondary market

 Shelkadhanda

Asst. Prof. in Commerce, SGGJ Girls College, Raikot

Online published on 28 January, 2015.

Abstract

The trading on stock exchanges in India used to take place through open outcry without use of information technology for immediate matching or recording of trades. This was time consuming and inefficient. This imposed limits on trading volumes and efficiency. In order to provide efficiency, liquidity and transparency, NSE introduced a nation-wide on-line fully automated screen based trading system in 1996 where a member can punch into the computer quantities of securities and the prices at which he likes to transact and the transaction is executed as soon as it finds a matching sale or buy order from a counter party. Screen based electronic system electronically matches orders on a strict price/time priority and hence cuts down on time, cost and risk of error, as well as on fraud resulting in improved operational efficiency. A Dematerialized account is opened by the investor while registering with an investment broker (or sub-broker). The Dematerialized account number is quoted for all transactions to enable electronic settlements of trades to take place. Every shareholder will have a Dematerialized account for the purpose of transacting shares. After the introduction of the depository system by the Depository Act of 1996, the process for sales, purchases and transfers of shares became significantly easier and most of the risks associated with paper certificates were mitigated.

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Keywords

Demat account, depository system, NSDL.

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