Anil Nagrath thought he had a clear edge over other investors: a thorough
understanding of the stock market, and Internet-savvy, backed by fiber to his
desktop in Mumbai—for 24-hour high-speed Net access.
Two months ago, he got a tip—the market was likely to move upward. He
quickly checked the balance in his demat and bank accounts and looked at the
current prices of his favorite stocks on his broker’s Web site. In a few
minutes, he had placed his orders with the broker.
BSE’s Net Sortie:
How To
1. The investor can log on to www.BSEWebx.com
and select the broker (or his sub-broker or branch). To register, however,
the investor has to contact the broker off-line
2. The broker receives the intent of registration through the
BSEWebx system and sets up the risk management limits (including exposure
limits for purchase/sale, trade categories, types of scrips, carry forward
and delivery) according to the profile of the investor. The investor is
then sent an e-mail confirming the registration. It also contains the
password for future transactions. The investor is now ready to trade
online.
3. The investor places an order for a scrip that is part of his
profile. The order undergoes a risk management validation to ensure that
it doesn’t go beyond the investor’s risk profile. Once through, it’s
sent to BOLT for execution. In case of any rule violation, the order is
either rejected or sent to the broker for a real-time review
4. The review is done at the broker’s end in real-time using
the ‘broker administration terminal’. The broker may revise the
profile and decide whether to release or reject the order
Much later, Nagrath found that his "instant online" prices were
more than 15 minutes old, putting him at a disadvantage enough to get his
profits down significantly. Because that morning, prices fluctuated severely.
Clearly, the much-touted online trading was not a real-time affair. And there
were further time lags between various stages of the transaction.
Nagrath and other online investors are better off now. There’s BSEWebx.com,
an "exchange-enabled" system of Web-based order routing. The system
allows almost instant brokering, as all the brokers are nestled on the BSE’s
own network, and all the registered users’ database is centrally managed.
Kalpana Maniar, GM, BSEWebx.com, says, "Exchanges without such a facility
do nothing except opening up the messaging structure to their trading system in
respect of orders routed to them through the Internet."
Integrating All the
Clicks
It’s only to complete the formalities of registration
that an investor needs to contact the broker offline. Everything else,
from placing an order to validation, review and execution, is done
online. All this is centrally managed by the BSEWebx system
Created with an investment of around Rs 15 crore, BSEWebx.com is aimed at
providing capital market services like content, wired and wireless Internet
trading, and payment and depositary interfaces. The investors use a private
network while brokers are connected through the BSE’s own network system. BSE
has opened up the messaging structure to its trading system, and is providing
the centralized infrastructure and software applications to its member-brokers
so that they need not create their own systems. Other aspects include
centralized trading and risk management and a possible multi-routing to other
exchanges in the future.
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