Now and Depository Participants: Stock Brokers: Stock brokers

Now let’s understand the stock market intermediaries: Market intermediaries are the entities, which help investors to invest in stock market and link investors to stock exchanges and other required entities, these intermediaries are independent to one anotherSome of the stock market Intermediaries is:·         Stock Broker, Sub Brokers and Depository Participants,·         Depositories, ·         Clearing Corporations,·         Banks, Debenture Trustees, Merchant Bankers,·         Credit Rating Agency (CRA),·         Portfolio Managers and Portfolio management System (PMS),·         Asset Management Companies (AMC).  Stock Broker, Sub Brokers and Depository Participants:  Stock Brokers: Stock brokers holds the broking license and these are corporate entity, registered as trading members with the stock exchange, who helps investors to open Trading and Demat account. Sub Brokers: A sub brokers works like an agents to the stock brokers.Depository Participants: Investors can not directly interact with depositories; depository participants are those who connect investors to depositories. Depositories:Depositories acts like a vault for the number of shares you purchased. Shares are maintained electronically in Demat account. We have two depository entities in India.·         NSDL: The National Securities Depository Limited.·         CDSL: Central Depository Services Limited Clearing Corporations:Clearing corporation are the entities, which ensure guaranteed settlement of your transactions.The two types of clearing corporate entities in India are:·         NSCCL: National Security Clearing Corporation Ltd,·         ICCL: Indian Clearing Corporation.    Role: These entities identify the buyer and seller and match the debit and credit process also ensures no defaults. Banks, Debenture Trustees, Merchant Bankers:Banks:Banks play an important role in market ecosystem. Banks transfers funds from your bank account to trading account. The money to come in and go out of your trading account a given specified bank account has been linked t your trading account. The three financial intermediaries operate via three different accounts while transacting that is your trading account to trade transactions, your DEMAT account to store your securities and your Bank account to pay in and pay out process. Debenture Trustees: Most of the banks in India, acts as a trustee to corporate debenture. When companies are in need of loans to expand the business they can issue debenture against which they promise to pay interest. Merchant Bankers:Merchant Bankers helps company in IPO process, or in the primary market. Credit Rating Agency (CRA):If a corporate or government entity wants to avail loan to expand their business the credit rating agencies checks the worthiness of these entities and examine whether the entity is worthy of giving loan or not.  Portfolio management System (PMS) and Portfolio Managers:Portfolio management system works similar to mutual funds and here the minimum investment is Rs.25, 00,000.Portfolio Managers:Portfolio managers are those who professionally handle portfolio management scheme. While looking for a fund investing a portfolio manager is one of the most important factors to be considered. Asset Management Companies (AMC):These are the entities which offer mutual fund schemes. Asset management companies pools the investors money and maintain it in one account, invest that money in different deviations to generate wealth to investors. Note: The Indian stock market is regulated by SEBI (The Security Exchange Board Of India). Market participants and Market intermediaries must follow the set of rules and regulations prescribed by SEBI.