For stock brokers:1.Permission from stock exchange for net trading2.Net worth of Rs. 50 lac3.Adequate back-up system4.Secured and reliable software system5.Adequate, experienced and trained staff6.Communication of order (trade confirmation to investor by e-mail)7.Use of authentication technologies8.Issue of contract notes within 24 hours of the trade execution9.Setting up a website.:17:
The net is used as a medium of trading in internet trading. Orders arecommunicated to the stock exchange through website. Internet trading started inIndia on 1st April 2000 with 79 members seeking permission for online trading.The SEBI committees on internet based securities trading services has allowed thenet to be used as an Order Routing System (ORS) through registered stock brokerson behalf of their clients for execution of transaction. Under the Order RoutingSystem the client enters his requirements (security, quantity, price, and buy/sell) inbroker's site. They are checked electronically against the clients account and routedelectronically to the appropriate exchange for execution by the broker. The clientreceives a confirmation on execution of the order. The customer's portfolio andledger accounts get updated to reflect the transaction. The user should have theuser id and password to enter into the electronic ring. He should also have demataccount and bank account. The system permits only a registered client to log inusing user id and password. Order can be placed using place order window of thewebsite.Procedure for net tradingStep 1:Those investors, who are interested in doing the trading over internetsystem i.e. NEAT-IXS, should approach the brokers and get them selfregistered with the Stock Broker.:18:
Step 2: After registration, the broker will provide to them a Login name, Passwordand personal identification number (PIN). Step 3: Actual placement of an order. An order can then be placed by using the placeorder window as under: 1.First by entering the symbol and series of stock and other parameters likequantity and price of the scrip on the place order window.2.Second, fill in the symbol, series and the default quantity.Step 4:It is the process of review. Thus, the investor has to review the order placedby clicking the review option. He may also re-set to clear the values.Step 5:After the review has been satisfactory, the order has to be sent by clickingon the send option.Step 6: The investor will receive an "Order Confirmation" message along with the ordernumber and the value of the order. :19:
Step 7: In case the order is rejected by the Broker or the Stock Exchange for certainreasons such as invalid price limit, an appropriate message will appear at thebottom of the screen. At present, a time lag of about 10 seconds is there inexecuting the trade.