Topics: Stock exchange, Stock market, NASDAQ Pages: 3 (835 words) Published: August 30, 2010
Over The Counter Exchange of India(OTCEI)
Over The Counter Exchange of India(OTCEI) was incorporated in October 1990 under Section 25 of the Companies Act, 1956 with the objective of setting up a national, ringless, screen-based, automated stock exchange. It is recognised as a stock exchange under Section 4 of the Securities Contracts (Regulations) Act, 1956. It was set up to provide investors with a convenient, efficient and transparent platform for dealing in shares and stocks; and to help enterprising promoters set up new projects or expand. their activities, by providing them an opportunity to raise capital from the capital market in a cost-effective manner. Trading in securities takes place through OTCEI’s network of members and dealers spanning the length and breadth of India. OTCEI was promoted by a consortium of financial institutions including : • Unit Trust of India.

• Industrial Credit and Investment Corporation of India. • Industrial Development Bank of India.
• Industrial Finance Corporation of India.
• Life Insurance Corporation of India.
• General Insurance Corporation and its subsidiaries.
• SBI Capital Markets Limited.
• Canbank Financial Services Ltd.
Salient Features of OTCEI:
1. Ringless and Screen-based Trading: The OTCEI was the first stock exchange to introduce automated, screen-based trading in place of conventional trading ring found in other stock exchanges. The network of on-line computers provides all relevant information to the market participants on their computer screens. This allows them the luxury of executing their deals in the comfort of their own offices. 2. Sponsorship: All the companies seeking listing on OTCE have to approach one of the members of the OTCEI for acting as the sponsor to the issue. The sponsor makes a thorough appraisal of the project; as by entering into the sponsorship agreement, the sponsor is committed to making market in that scrip (giving a buy sell quote)...
Continue Reading

Please join StudyMode to read the full document

Become a StudyMode Member

Sign Up - It's Free