Learning outcomes
Foundation about 5 min
After this module you should be able to:
- Name the role of each Indian market institution (SEBI, NSE, BSE, NSE Clearing, ICCL, NSDL, CDSL, the broker) and trace one trade from order entry to shares in your demat account.
- Compute the equilibrium price of a call auction by hand, and prove that maximising executable volume selects the price where cumulative demand crosses cumulative supply (Proposition 1.1).
- Simulate a continuous limit order book with price-time priority, and compute the volume-weighted fill price and slippage of a market order against it.
- Compute the full statutory cost of an Indian equity, futures or options round trip at current rates, and derive the break-even price move as a function of the charges (Proposition 1.2).
- Classify the tax treatment of delivery, intraday and F&O income for an Indian resident individual, and compute the tax on a given set of trades.
- Derive the free-float index level and show why the divisor must change on some corporate actions but not on others (Propositions 1.3–1.4).
- Derive theoretical ex-prices for splits, bonuses, rights issues and dividends, build an adjusted price series, and state exactly which return the adjusted series measures (Proposition 1.5).
- Read SEBI's retail-loss studies and its 2024–2026 derivatives rules as evidence about who wins in Indian markets and why.