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© 2025 GKSolver. Free AI-powered UPSC preparation platform.

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2 minEconomic Concept
  1. Home
  2. /
  3. Concepts
  4. /
  5. Economic Concept
  6. /
  7. Securities Market
Economic Concept

Securities Market

What is Securities Market?

The Securities Market is a component of the financial market where financial instruments like stocks, bonds, mutual funds, and derivatives are bought and sold. It facilitates capital formation and provides avenues for investment and risk management.

Historical Background

Indian Securities Market: Structure, Functions & Key Elements

This mind map provides a comprehensive overview of the Indian Securities Market, outlining its components, instruments, participants, and regulatory framework.

Key Trends in Indian Securities Market (2025)

This dashboard presents crucial statistics and trends reflecting the current state and recent developments in the Indian securities market, as of December 2025.

2 minEconomic Concept
  1. Home
  2. /
  3. Concepts
  4. /
  5. Economic Concept
  6. /
  7. Securities Market
Economic Concept

Securities Market

What is Securities Market?

The Securities Market is a component of the financial market where financial instruments like stocks, bonds, mutual funds, and derivatives are bought and sold. It facilitates capital formation and provides avenues for investment and risk management.

Historical Background

Indian Securities Market: Structure, Functions & Key Elements

This mind map provides a comprehensive overview of the Indian Securities Market, outlining its components, instruments, participants, and regulatory framework.

Key Trends in Indian Securities Market (2025)

This dashboard presents crucial statistics and trends reflecting the current state and recent developments in the Indian securities market, as of December 2025.

Indian Securities Market

Primary Market (New Issues)

Secondary Market (Existing Securities)

Equities (Shares)

Debt Instruments (Bonds, Debentures)

Derivatives (Futures, Options)

Mutual Funds & ETFs

Issuers (Companies, Govt.)

Investors (Retail, Institutional)

Intermediaries (Brokers, Merchant Bankers)

SEBI Act, 1992

SCRA, 1956

Depositories Act, 1996

Proposed Market Code Bill (Consolidation)

Connections
Components→Market Instruments
Components→Key Participants
Components→Regulatory Framework
Retail Investor Participation (Demat Accounts)+20% (YoY)
150 Million+

Reflects increased democratization of the market, driven by digital platforms and financial literacy initiatives. Significant growth post-COVID-19.

Data: 2025
Market Capitalization (BSE Listed Companies)+15% (YoY)
USD 5.5 Trillion

India's market cap has steadily grown, reflecting economic expansion and investor confidence. Positions India among the top global markets.

Data: 2025
T+1 Settlement CycleN/A
Fully Implemented

India moved to T+1 (Trade plus one day) settlement for equities in 2023, significantly reducing settlement time and enhancing liquidity and risk management.

Data: 2023-2025
Indian Securities Market

Primary Market (New Issues)

Secondary Market (Existing Securities)

Equities (Shares)

Debt Instruments (Bonds, Debentures)

Derivatives (Futures, Options)

Mutual Funds & ETFs

Issuers (Companies, Govt.)

Investors (Retail, Institutional)

Intermediaries (Brokers, Merchant Bankers)

SEBI Act, 1992

SCRA, 1956

Depositories Act, 1996

Proposed Market Code Bill (Consolidation)

Connections
Components→Market Instruments
Components→Key Participants
Components→Regulatory Framework
Retail Investor Participation (Demat Accounts)+20% (YoY)
150 Million+

Reflects increased democratization of the market, driven by digital platforms and financial literacy initiatives. Significant growth post-COVID-19.

Data: 2025
Market Capitalization (BSE Listed Companies)+15% (YoY)
USD 5.5 Trillion

India's market cap has steadily grown, reflecting economic expansion and investor confidence. Positions India among the top global markets.

Data: 2025
T+1 Settlement CycleN/A
Fully Implemented

India moved to T+1 (Trade plus one day) settlement for equities in 2023, significantly reducing settlement time and enhancing liquidity and risk management.

Data: 2023-2025
India's securities market has evolved significantly since independence, with major reforms initiated after the 1991 economic liberalization. The establishment of SEBI in 1988 (statutory powers in 1992) and the introduction of screen-based trading and dematerialization of shares transformed the market, enhancing transparency and efficiency.

Key Points

6 points
  • 1.

    Primary Market: Where new securities are issued for the first time by companies to raise capital (e.g., Initial Public Offerings (IPOs), Follow-on Public Offerings (FPOs)).

  • 2.

    Secondary Market: Where existing securities are traded among investors (e.g., stock exchanges like NSE and BSE). It provides liquidity to investors.

  • 3.

    Market Instruments: Includes Equities (shares representing ownership), Debt Instruments (bonds, debentures representing loans), Derivatives (futures, options), Mutual Funds, and Exchange Traded Funds (ETFs).

  • 4.

    Key Participants: Issuers (companies raising capital), Investors (retail, institutional), Intermediaries (brokers, merchant bankers, custodians), and Regulators (SEBI).

  • 5.

    Regulatory Framework: Governed by acts like the SEBI Act, 1992, Securities Contracts (Regulation) Act, 1956 (SCRA), and Depositories Act, 1996, which aim to protect investors and ensure fair trading practices.

  • 6.

    Functions: Facilitates capital formation, provides liquidity to investors, enables price discovery, and offers avenues for risk management and diversification.

Visual Insights

Indian Securities Market: Structure, Functions & Key Elements

This mind map provides a comprehensive overview of the Indian Securities Market, outlining its components, instruments, participants, and regulatory framework.

Indian Securities Market

  • ●Components
  • ●Market Instruments
  • ●Key Participants
  • ●Regulatory Framework

Key Trends in Indian Securities Market (2025)

This dashboard presents crucial statistics and trends reflecting the current state and recent developments in the Indian securities market, as of December 2025.

Retail Investor Participation (Demat Accounts)
150 Million++20% (YoY)

Reflects increased democratization of the market, driven by digital platforms and financial literacy initiatives. Significant growth post-COVID-19.

Market Capitalization (BSE Listed Companies)
USD 5.5 Trillion+15% (YoY)

India's market cap has steadily grown, reflecting economic expansion and investor confidence. Positions India among the top global markets.

T+1 Settlement Cycle
Fully ImplementedN/A

India moved to T+1 (Trade plus one day) settlement for equities in 2023, significantly reducing settlement time and enhancing liquidity and risk management.

Related Concepts

Parliamentary Standing CommitteeLegislative Process in India

Source Topic

Market Code Bill Faces Scrutiny Over Centralized Powers

Economy

UPSC Relevance

Essential for UPSC GS Paper 3 (Economic Development), particularly the 'Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment' section. Frequently asked in Prelims (e.g., types of markets, instruments, regulators) and Mains (e.g., role in capital formation, regulatory challenges, investor protection).

On This Page

DefinitionHistorical BackgroundKey PointsVisual InsightsRelated ConceptsUPSC RelevanceSource Topic

Source Topic

Market Code Bill Faces Scrutiny Over Centralized PowersEconomy

Related Concepts

Parliamentary Standing CommitteeLegislative Process in India
India's securities market has evolved significantly since independence, with major reforms initiated after the 1991 economic liberalization. The establishment of SEBI in 1988 (statutory powers in 1992) and the introduction of screen-based trading and dematerialization of shares transformed the market, enhancing transparency and efficiency.

Key Points

6 points
  • 1.

    Primary Market: Where new securities are issued for the first time by companies to raise capital (e.g., Initial Public Offerings (IPOs), Follow-on Public Offerings (FPOs)).

  • 2.

    Secondary Market: Where existing securities are traded among investors (e.g., stock exchanges like NSE and BSE). It provides liquidity to investors.

  • 3.

    Market Instruments: Includes Equities (shares representing ownership), Debt Instruments (bonds, debentures representing loans), Derivatives (futures, options), Mutual Funds, and Exchange Traded Funds (ETFs).

  • 4.

    Key Participants: Issuers (companies raising capital), Investors (retail, institutional), Intermediaries (brokers, merchant bankers, custodians), and Regulators (SEBI).

  • 5.

    Regulatory Framework: Governed by acts like the SEBI Act, 1992, Securities Contracts (Regulation) Act, 1956 (SCRA), and Depositories Act, 1996, which aim to protect investors and ensure fair trading practices.

  • 6.

    Functions: Facilitates capital formation, provides liquidity to investors, enables price discovery, and offers avenues for risk management and diversification.

Visual Insights

Indian Securities Market: Structure, Functions & Key Elements

This mind map provides a comprehensive overview of the Indian Securities Market, outlining its components, instruments, participants, and regulatory framework.

Indian Securities Market

  • ●Components
  • ●Market Instruments
  • ●Key Participants
  • ●Regulatory Framework

Key Trends in Indian Securities Market (2025)

This dashboard presents crucial statistics and trends reflecting the current state and recent developments in the Indian securities market, as of December 2025.

Retail Investor Participation (Demat Accounts)
150 Million++20% (YoY)

Reflects increased democratization of the market, driven by digital platforms and financial literacy initiatives. Significant growth post-COVID-19.

Market Capitalization (BSE Listed Companies)
USD 5.5 Trillion+15% (YoY)

India's market cap has steadily grown, reflecting economic expansion and investor confidence. Positions India among the top global markets.

T+1 Settlement Cycle
Fully ImplementedN/A

India moved to T+1 (Trade plus one day) settlement for equities in 2023, significantly reducing settlement time and enhancing liquidity and risk management.

Related Concepts

Parliamentary Standing CommitteeLegislative Process in India

Source Topic

Market Code Bill Faces Scrutiny Over Centralized Powers

Economy

UPSC Relevance

Essential for UPSC GS Paper 3 (Economic Development), particularly the 'Indian Economy and issues relating to planning, mobilization of resources, growth, development and employment' section. Frequently asked in Prelims (e.g., types of markets, instruments, regulators) and Mains (e.g., role in capital formation, regulatory challenges, investor protection).

On This Page

DefinitionHistorical BackgroundKey PointsVisual InsightsRelated ConceptsUPSC RelevanceSource Topic

Source Topic

Market Code Bill Faces Scrutiny Over Centralized PowersEconomy

Related Concepts

Parliamentary Standing CommitteeLegislative Process in India