Indiabulls-Selling Stocks bought on Nse on Bse

#1
I have an account with indiabulls. Recently i tried selling one of the stocks i had. My Rm told me that this particular stock had been suspended from trading in NSE temperorily and that he cant sell the same stock on BSE as Indiabulls or me(i dont remember ) will go short on this stock on BSE.

Now Rm's arent supposed to know what arbitrage means? Cant stocks bought on NSE be sold on BSE and vice versa.
 
#2
hey im interested in opening a/c wit indiabuls, want ur firsthand comments on it. hows the software power indiabulls? is it necessary to purchase it or can i get it copied from existing IB customer like u? thnks
 

pkjha30

Well-Known Member
#3
Hi arshadm

I think your Rm is giving you some cock and bull story.
Companies are listed in different exchanges and thier stocks are traded in such exchanges. It can not be traded in exchangex where the company is not listed. One company may be listed in one or more exchanges including regional exchanges and bse/nse. Stocks brought on one exchange can be sold in another exchange. In demat for it is fungible i.e. shares can not be distinguished by their folio number. The whole lot will carry the same number and IT department applies FIFO method i.e. first in first out as per the date to determine their holding period for capital gains purpose. As far as exchanges are concernec they are not concerned with which one of them if going in or out. Like money one 100 rupee note is as good as another 100 rupee note and while exhnaging you dont distinguish by numbers.

So what is brought on nse can be sold on bse and vice versa provided it is listed on both exchanges. Prices are different in both exchanges(Could be same as well) depending on demand / supply and market conditions and some lag in market reactions in both exchanges. This difference in price gives rise to arbitrage. You can have both exchanges connected by different computers or on the same computer and do buy/sell operation based on prices and earn minute margins.

Short is somthing different. If you have shares and want to sell it why do you want to short? Just sell it in bse. If you don't have and want to go short, do that as per rules of exchanges and your broker.

Normally if one company is banned in one share other also bans it. But may not happen. So you can sell where it is not banned.

Hope above will clear some doubts.

Pankaj
 

biyasc

Well-Known Member
#4
Hi arshadm

I think your Rm is giving you some cock and bull story.
Companies are listed in different exchanges and thier stocks are traded in such exchanges. It can not be traded in exchangex where the company is not listed. One company may be listed in one or more exchanges including regional exchanges and bse/nse. Stocks brought on one exchange can be sold in another exchange. In demat for it is fungible i.e. shares can not be distinguished by their folio number. The whole lot will carry the same number and IT department applies FIFO method i.e. first in first out as per the date to determine their holding period for capital gains purpose. As far as exchanges are concernec they are not concerned with which one of them if going in or out. Like money one 100 rupee note is as good as another 100 rupee note and while exhnaging you dont distinguish by numbers.

So what is brought on nse can be sold on bse and vice versa provided it is listed on both exchanges. Prices are different in both exchanges(Could be same as well) depending on demand / supply and market conditions and some lag in market reactions in both exchanges. This difference in price gives rise to arbitrage. You can have both exchanges connected by different computers or on the same computer and do buy/sell operation based on prices and earn minute margins.

Short is somthing different. If you have shares and want to sell it why do you want to short? Just sell it in bse. If you don't have and want to go short, do that as per rules of exchanges and your broker.

Normally if one company is banned in one share other also bans it. But may not happen. So you can sell where it is not banned.

Hope above will clear some doubts.

Pankaj
hi,

is that possible to buy at nse & sell at bse or vice versa. i just ant to square up my positions on intraday basis.
 
#7
Hi arshadm

I think your Rm is giving you some cock and bull story.
Companies are listed in different exchanges and thier stocks are traded in such exchanges. It can not be traded in exchangex where the company is not listed. One company may be listed in one or more exchanges including regional exchanges and bse/nse. Stocks brought on one exchange can be sold in another exchange. In demat for it is fungible i.e. shares can not be distinguished by their folio number. The whole lot will carry the same number and IT department applies FIFO method i.e. first in first out as per the date to determine their holding period for capital gains purpose. As far as exchanges are concernec they are not concerned with which one of them if going in or out. Like money one 100 rupee note is as good as another 100 rupee note and while exhnaging you dont distinguish by numbers.

So what is brought on nse can be sold on bse and vice versa provided it is listed on both exchanges. Prices are different in both exchanges(Could be same as well) depending on demand / supply and market conditions and some lag in market reactions in both exchanges. This difference in price gives rise to arbitrage. You can have both exchanges connected by different computers or on the same computer and do buy/sell operation based on prices and earn minute margins.

Short is somthing different. If you have shares and want to sell it why do you want to short? Just sell it in bse. If you don't have and want to go short, do that as per rules of exchanges and your broker.

Normally if one company is banned in one share other also bans it. But may not happen. So you can sell where it is not banned.

Hope above will clear some doubts.

Pankaj
A couple questions, if you could help:

Aren't there still some basic regulatory restrictions that are impeding DMA trading in India? Is SEBI moving to remove these restrictions or will DMA continue to be hampered?

Also, for clearing purposes, aren't there still some problems with respect to the fungibility of trades on BSE and NSE?

Are the vast amount of securities in India cross listed between both BSE and NSE?

Thanks
QuidLik
 
#8
hi guys , do you know any online broker who allows buying a share on bse and selling that same share on nse intraday. I have a account with sharekhan, but it does not allow to do so .
 

alroyraj

Well-Known Member
#9
hi guys , do you know any online broker who allows buying a share on bse and selling that same share on nse intraday. I have a account with sharekhan, but it does not allow to do so .
Its not possible. Let me explain, for arbitrage intraday the share is not delivered so its not possible to trade to same on the other exchange. Secondly the brokerage for delivery being typically 0.5% translates with statutory levies etc into 1.6%. This rules out any chance of arbitrage using delivery.Thirdly most brokers offer trading only in NSE and in BSE through margin trading which typically has higher interest charges. Fourthly only the larger listed companies are listed in both exchanges whereas most midcaps and smallcaps are listed only on BSE. So arbitrage may not be an option.
 

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