Question

Difference between screen based trading and internet trading

Answer 1

Answer:

Trading refers to the purchase of sale of securities in the financial market.

Explanation:

Trading in Indian stock exchanges used to be done by open outcry, with no use of information technology for instant matching or recording of deals. This took a long time and was inefficient. NSE launched the screen-based trading system , wherein the user may enter the number of shares and prices upon which someone wishes to transact into the a computer. The transaction is completed as quickly as a trading member's quote finds a matching sale or purchase quote from the opponent.

On the other hand Internet Based Trading (IBT) enables Members and their clients to trade on the Exchange Trading System by allowing them to connect to members' IBT servers through the internet wherever in India. Order routing systems route customer orders to exchange trading systems for execution, allowing Internet trading to take place.

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Answer 2

1. Screen Base Trading

• The NSE introduced the screen-based trading system (SBTS), in which a member can enter the number of shares and prices at which he wishes to transact into a computer.
• The transaction is completed as soon as a trading member's quote finds a matching sale or buy quote from the counterparty.
• SBTS electronically matches the buyer and seller in an order-driven system or finds the best price available in a quote-driven system, reducing time, cost, and error risk, as well as the possibility of fraud.

2. Internet Based Trading

• Internet Based Trading (IBT) enables Members and their clients to trade on the Exchange Trading System by allowing them to connect to members' IBT servers via the internet from anywhere in India.
• Order routing systems route client orders to exchange trading systems for execution, allowing Internet trading to take place.

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