NSE, BSE, Or MSE: A Comparative Study Of Afamed Stock Exchanges

While many stock-brokerage platforms crowd the stock market, the number of most used standard stock exchanges registered with SEBI can be narrowed to three in India. Bombay Stock Exchange (BSE), National Stock Exchange (NSE), and Metropolitan Stock Exchange (MSE) all play an essential role in the magnanimous everyday stock trade in the nation. However, these institutions vary in the number of equity shares, popularity, and age. Moreover, they serve a slightly different purpose for stock traders and offer various products and services. 

When you’re choosing a stock exchange platform to guide you with the latest developments and market behaviours, you must get a good understanding of it. To achieve that, a comparative study on the stock exchanges that facilitate trading top-performing shares in India is what you need. Moreover, our list of important roles of a stock exchange will help you to derive your conclusions on major checked stock exchanges in India.

More Than Just Three 

Before we start comparing NSE, BSE, and MSE, it is essential to mention that there are other stock exchanges registered with the Security Exchange Board Of India. These are the Calcutta Stock Exchange, India International Exchange (India INX), Multi Commodity Exchange of India Ltd., and more. 

In cities like Bombay and Calcutta, stock trading was practised as early as in the 19th century in India. Gradually, trading became prevalent in major cities nationwide, such as Hyderabad, Delhi, Mangalore, Saurashtra etc. India, therefore, had numerous local stock exchanges closed off in the last decade. Calcutta Stock Exchange remains open, but no trading has been taking place there after a great scandal. However, it has plans to reinvent the stock exchange. 

India International Exchange (India INX) is India’s first international stock exchange, established in 2017, located in Gujrat. It is a subsidiary of the Bombay Stock Exchange and facilitates a high-speed stock exchange with a turnaround time of 4 microseconds. India INX was started with the vision of attracting international investments with world-standard trading quality. NSE IFSC, a wholly subsidiary of the National Stock Exchange, is a similar stock exchange to India INX.

NSE, BSE, & MSE – Trading Mechanism, Volume, Product Offering, User Base, Market Capitalization & More

You’d ask what the most practical approach to review the most popular stock exchanges is. Well, the answer is in the significant functions of a stock exchange. These are –

  1. Setting a price standard
  2. Provide a spectacular benchmark index
  3. Support the growth of industry and nation
  4. Safeguard investors’ interests
  5. Provide excellent secondary markets
  6. Help businesses raise capital

Let’s dive into the comparison now. However, before we start, you’d find a short overview of the essential terminologies in the share market quite helpful. 

Difference In Trading Mechanism

NSE was established in 1992 to provide an electronic and transparent way of stock trading. It relies on a fully integrated electronic mechanism of trading. In comparison, BSE is the oldest stock exchange in India and Asia and one of the ten oldest stock exchanges in the world. It employs an open outcry trading mechanism for the stock exchange. However, it is a high-speed trading mechanism with a turnaround time of 6 microseconds. The relatively young MSE offers a hi-tech, advanced electronic stock exchange. 

Listed Companies & Market Capitalization

NSE and BSE are one of the world’s largest stock exchanges in terms of market capitalisation. By 2021, NSE had crossed USD 3.7 trillion in market capitalisation and 2022 listings on the stock exchange. BSE became one of the top ten most prominent stock exchanges with a market capitalisation of more than USD 3.7 trillion, with the number of companies listed for the exchange amounting to a staggering 5439. Comparably, the market cap of MSE and the numbers of companies listed on MSE are low, and its estimated market cap is USD 65.81 million. 

Product Offerings & Indices

NSE began trading in the wholesale debt market section, while the cash market segment was added later. Today it allows trading equity shares, mutual funds, IPOs, security borrowing and lending, currency derivatives, equity derivatives, bonds, and futures. It has the famous Nifty 50 index, a benchmark of the top 50 companies traded on the stock exchange. 

BSE offers a wide range of products that includes derivatives, equity shares, currencies, debt instruments and mutual funds. S&P BSE SENSEX is the widely acclaimed index in countries like India, Brazil, Russia, South Africa and China. MSE launched its trading services in  2014 with cash-settled Interest Rate Futures (IRF). It has a similar stock index called SX40. 

In conclusion, BSE and NSE offer comparable products and services. The number of companies listed on the BSE is high and has a similar market capitalisation to the NSE. Metropolitan Stock Exchange of India is a young stock exchange registered with SEBI, began operations in October 2008, and has a limited line of product offerings. 

Invest In The Shares Of A Leading Stock Exchange

We’d cut to the chase here. There are two significant reasons why registering in the stocks of the major stock exchange institutions is a good investment strategy.  These stock exchanges are themselves a company with market capitalisation and equity shares. 

First, the stock trade market in India is growing at an enormous speed. More companies, equity shares, and traders join the share market every year. The volume traded daily, market activities and profits generated in this financial transaction will only increase in the future.

Secondly, the major stock exchanges are run by the financial bodies, the leading figures of capital trading and investment in the country. Moreover, the significant decisions these companies take can often define the fate of the stock market in the nation. Therefore, it is recommended to buy shares of the stock exchange that have incredible market knowledge and are guaranteed to grow paramountly in the long term. 

Stockify facilitates the trading of stock exchange shares and provides professional guidance to make suitable investments. Connect with our team now and start trading!

Table of Contents

Reviewing the stock exchanges based on their functions is the best approach. Let us discuss the various services offered by these stock exchanges.

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Piyush Jhunjhunwala
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Rahul Khatuwala
Rahul Khatuwala
Ex. Wipro & Finaco Founder
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Bangalore, India.