Indian Stock Market: The Indian stock market is the fourth largest equity market in the world, but in terms of market action, in some cases the domestic market is lagging behind smaller markets. The ratio of equity turnover on the exchange compared to the total market value is only 54 percent. However, in the case of the world's 13th largest stock market, South Korea, this figure i.e. turnover velocity is 172 percent. This speed is even higher than the world's largest market, the US market.

Turnover velocity is the ratio of the cash market turnover of domestic stocks and their market cap. It shows how much action there is in a stock or market in a trading session. Stocks with higher turnover are considered more liquid.

 

If we look at the stock markets of the world, the turnover velocity of the US market is 148 percent, China's is 283 percent, Canada's is 82 percent and Germany's is 68 percent. With a market value of 5.5 trillion dollars, India is the fourth largest market in the world after America, China and Japan. South Korea is at 13th place with a market value of 1.8 trillion dollars and Canada is at the sixth place with a market value of 3.3 trillion dollars. Retail share is increasing in India but still its turnover velocity remains low. The reason for this is the investors' focus on a few selected stocks and the promoter's high stake in the companies. On October 17, the turnover of the companies listed on NSE was only Rs 1 lakh crore. Out of this turnover, only 17 stocks had a quarter share which included Bajaj Auto, Reliance Industries, Mphasis, BSE and SBI. However, some market experts are also positive. According to experts of JM Financial, even a slight increase in turnover velocity can lead to a sharp change in share trading turnover. According to them, as the market matures, an increase in turnover velocity is seen. Apart from this, Indians still invest more money in other assets. 70 percent of Indians' savings are in gold and real estate. According to experts, this is much more than other developed countries. If a shift is seen in this trend, then an increase in exchange turnover can be seen.