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| Discuss Buying in BSE and Selling in NSE at the Beginners Guide within the Traderji.com - Discussion forum for Stocks Commodities & Forex; I have a question. If a certain stock is listed on both BSE and NSE, ... |
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#1
12th October 2007, 01:47 PM
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Buying in BSE and Selling in NSE
I have a question.
If a certain stock is listed on both BSE and NSE, is it possible to buy shares of the stock in the BSE and sell those in the NSE. I am asking in regards to both Futures and Cash Market. Thanks. 
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#3
18th October 2007, 09:21 PM
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Re: Buying in BSE and Selling in NSE
Yes it can be done in cash mkt but there is a risk element.
The stocks you sold in cash mkt has to be settled with delivery ,which you are to get from another exchange,hence any time or qty gap means auction & penalty charges. Hence retailers avoid that,if the stock lending starts then it will be easy.Infact the arbrittagers do THESE type of trades everyday in bulk qty & that is the precise reasons why this significant disparity in price between 2 exchanges do not last for more than few mins.
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#4
19th October 2007, 07:02 AM
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Re: Buying in BSE and Selling in NSE
Quote:
What is Stock Lending?? If delivery of stock is imperative to perform arbitrage, how do traders take advantage of the price difference between the two exchanges??
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#5
19th October 2007, 07:59 AM
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Re: Buying in BSE and Selling in NSE
Stock Lending is a concept toyed by SEBI to facilate 'Short Selling' ,yet not implemented.
Arbritragers are HNI/ Brokers they have nothing to do with Fundamental or Technical of a scrip ,they just Lock in the price difference if it is more than short term Bank Deposit retuns & with their previledged status they get the tacit support of broker house & can temporarily access Huge pool of Scrips ( being held by large no of long term investors in demats accessable by brokers ). Their brokerages are miniscule & this guys lock 0.25% to 0.5% price difference if any; in large qts,hence at end of T+2 a substantial sum of money is earned,here the cache is when you sell your a/c is credited & when you buy your a/c is debited hence you actually dont cough up any money but in case of accident (say short delivery) your net-worth should mentally satisfy & justify the broker to allow you to take the trades.
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