Concept of Odd Lots in Shares

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Ankit Bansal (Querist)
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08 March 2008 Hi. i today read that the concept of Dematerialisation has abolished Odd Lots in the Capital Market.
Can anybody tell me what do we understand by Odd Lots?

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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08 March 2008 Odd sized lots are those which do not conform to market lots, which used to be there when physical transactions were taking place.

R.V.RAO

R.V.RAO (Expert)
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08 March 2008 AFTER DEMAT STARTED BY SEBI AND STOCK EXCHANGES IN INDIA WAY BACK IN THE YEAR 1998 /1999,ONE CAN TRADE EVEN WITH ONE SHARE IN HIS DEMAT ACCOUNT.
THE LOT SIZE TO TRADE FOR A BUY OR SELL IS ONE SHARE.
BEFORE DEMAT STARTED IN INDIA,THE LOT SIZE WAS DIFFERENT FOR DIFFERENT COMPANIES.
BUT MOST COMPNIES HAVE 100 SHARES AS TRADING LOT.MEANING ONE CAN BUY OR SELL MINIMUM OF ONE HUNDRED SHARES IN THAT PARTICULAR SCRIP.
RARELY COMPANIES LIKE LAXMI MACHINE WORKS(LMW) HAVE 5 SHARES AS LOT SIZE IN VIEW OF HIGH MARKET PRICE. I STILL REMEMBER THE OTC EXCHANGE OF INDIA STARTED EVEN AN ODD LOT COUNTER FOR TRADING.
THE SALE RATE FOR ODD LOT SHARES IN OLDEN DAYS USED TO BE LESSER THAN MARKET RATE AS IT IS DIFFICULT TO FIND A BUYER FOR AN ODD LOT OF SHARES.
THERE WAS AT ONE TIME A DISTINCT AND SEPARATE DEMAND AND SUPPLY AND ALSO A CHARM FOR ODD LOT OF SHARES, AS SMALL SHAREHOLDERS WANTING TO BUY BLUE CHIP COMPANY SHARES PREFERRED SMALL LOTS TO BUY DUE TO HIGH MARKET PRICE.
BUT THERE WERE HASSLES OF SHARE TRANSFER STAMPS AND PHYSICAL TRANSFER OF SHARES, FINDIN OUT ADDRESSES OF COMPANIES/ REGISTRARS FOR TRANSFER AND POSTAL DELAYS AND WHEN ULTIMATELY YOU FIND SHARES TRANSFERRED IN YOUR NAME AND WHEN YOUR NAME APPEARS BEHIND THE SHARE CERTIFICATE AS TRANSFEREE, THE THRILL AND EXCITEMENT WAS VERY ENTICING.
R.V.RAO

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