BSE vs NSE: Which Is the Best Choice for Beginners?

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The first decision an Indian trader must make is
choosing their place of trade. The National Stock
Exchange (NSE) and Bombay Stock Exchange (BSE)
are the two choices available to Indian
traders. Neither is lesser than the other, and
they both have exceptional reputations. You
should be proud to say you trade on either of
these stock exchanges. Both come with
exciting investment opportunities for people
with any risk tolerance. Beginners face an uphill
battle when choosing between BSE and NSE as their
starting point. This blog discusses how BSE
and NSE differ based on points. Hopefully, it
makes choosing easier for a beginner trader!
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What are BSE NSE?
The Bombay Stock Exchange and National Stock
Exchange are leading and growing Indian stock
exchanges. The NSE uses the Nifty 50 as a
benchmarking indicator to track the top 50
companies listed. The BSE uses the SP BSE Sensex
to track the most sizable top 30 companies listed
based on performance. Both options experience
regulation from an external and authoritative
board called SEBI. The SEBI (Securities and
Exchange Board of India) faces the task of
providing a safe trading ecosystem to every
Indian. The board ensures this by watching
processes and penalising participants who carry
out unethical activities. Despite a few
similarities, the NSE and BSE are, in no aspect,
equals! A stock training course will show the
contrast when comparing these two based on
qualities like liquidity and stock quantity. 1.
Liquidity A research analyst defines a higher
liquidity score as a rapid ability to sell stocks
to return your investment. It also refers to how
easily you can do this without creating any price
change. NSE is notable for higher liquidity,
especially regarding highly demanded stocks. It
helps a beginner occupy a position and exit it
fast when they desire. High liquidity is a
quality of BSE, but only for select stocks. So a
trader could find themself struggling to sell a
stock if it's not as liquid as others.
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2. Stock Trading Quantities

• The availability of trading quantities is another
  indication of BSE and NSE differences. Higher
  liquidity usually proves larger volumes of stocks
  are available.
• While both NSE and BSE show good liquidity, their
  trading volumes differ. The Bombay Stock Exchange
  trades lower quantities compared to the NSE. It
  doesn't make the former a poor trading option for
  beginners.
• Costs to Transact
• Both trade exchanges charge a transactional cost
  to participants. The amount or percentage does
• vary between the two.
• The BSE attracts a marginally lower transactional
  cost than NSE transactions. We do not consider
  this a significant reason to choose either option
  for beginner trading.
• Company Listings
• Stock listing numbers are a measurable factor that
  holds weight on the final choice of trade
• exchange.
• Being an aged and established stock
  establishment, the BSE holds a vast listing of
  companies. It is appealing to beginners who look
  primarily to small and mid-cap companies in which
  to invest.
• The younger stock establishment is renowned but
  houses comparatively fewer listed companies. It
  proves the better option only if you want
  large-cap companies with exceptional liquidity.

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5. Market Capitalisation
It refers to the total amount of the company
shares held by shareholders and
investors. Since NSE holds fewer listed companies
than its competitor exchange, it has a lower marke
t capitalisation. 6. Market Indices These
indicators help traders track market
performances, companies, and industry sectors. As
a young trader, you must look at market indices
to support a prospective transaction. The Sensex
indices assess the performances of 30 top
companies on the BSE. The data collected here
provides beginners with exceptional information
on market trends and overall health. Fifty
impactful companies listed on the NSE are
trackable using the Nifty index. This one is
slightly more extensive in terms of companies it
tracks. So, Which is Better for Trading
Beginners? A trader who wants to start trading
will naturally pick an option based on their
needs. It's crucial to assess personal
requirements before choosing an exchange without
being influenced by other traders.
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- Higher liquidity, more large-cap companies, and
significant trading volume needs will favour NSE.
- Good liquidity, more small and mid-cap
companies, lower trading volumes, and lower
transaction costs lead to the BSE. Another
benefit of this option is more trading options
due to extensive listed companies. Both allow
for online trading, and there are several
platforms that even an equity research analyst
can help you with. Conclusion Whether selecting
the National Stock Exchange or the Bombay Stock
Exchange, they give an adequate chance to a
beginner. The best way to overcome this
challenging decision is to assess your needs and
choose accordingly. Maybe a combination of the
two will best fulfil your trading requirements!
But we suggest you try this only after
experimenting on both exchanges. Getting a feel
of both can leave you with a preference for one.