India's new exchange starts trading, setting up battle with NSE
As of late Monday morning, the value of shares traded on the MCX-SX was 1.5 million rupees ($28,000), its web site showed, compared to 34.3 billion rupees on the NSE.
"Earliest we can know whether MCX has made a mark in equities is five years from now," said Phani Sekhar, a fund manager at Angel Broking.
Brokers are cheering on MCX-SX, which quickly built one of the country's top commodity bourses, in the hope it will push down trading costs and drive development of trading products.
Although trading volumes are expected to rise in line with the government's goal of bringing more retail investors into stocks, the exchanges face a gruelling battle for market share that will essentially be a zero-sum game in the near term.
"MCX is known for product innovation, so only when they come up with truly meaningful innovations is when they would get successful," Sekhar said.
Policymakers have long sought to bring more retail investors into stocks via mutual funds, which owned only 3.6 percent of the broad BSE index last year, according to Citigroup data.
Gold and property are preferred by investors in India, where fewer than 5 in every 100 people buy equities either directly or through mutual funds, regulatory data show. By comparison, more than half of Americans own stocks, many
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