Stock Market Trading
Stock Market Exchange (NSE & BSE)
Stock Market Types of Ordering
Long, Short, Long Unwinding and short covering
Positional Trading and Indraday Trading
Stock Market is a Business or Gambling
Trade Plan

  • : Stock Trading takes place through stock exchange. Investor who wants to trade in Stock exchange has to have a demat account. Stock exchange is regulated by SEBI. Brokers like Sharekhan provides the platform for trading in Stock Exchange for each investor who has to get the account in brokerage platform.
  • : Stock Exchange ensure that it is the responsibility of the brokers for the counter party risk, since the trading is done through their platform. Broker inturn ensures that this risk is avoided by like putting the penality, selling their shares etc.,
  • : People choose stock trading to earn higher returns compared to other investments like deposits in Bank, Bonds etc.,
  • : Yes, it is possible to buy in one exchange and sell it in other exchange provided the shares are credited in DEMAT Account. It means that on intraday we cannot buy in one exchange and sell it in other exchange.
  • : It will be executed to the current market price, even if we quote the higher than the market price. For ex., if we quote to buy a share with the value of 100 Rs and and the current market price is 99 Rs, then the buy value would be only 99Rs.
  • : Trader has to place the ordering of the shares (Buy Order & Sell Order) in the stock exchange using the Brokers platform. It get executed based on the market price in the stock exchange. Most common types of ordering are Market Order, Limit Order and Stop Loss Order. The validity of the order with on same day which 3.30PM for the Indian Stock Market.
  • : Long: Buy the share and sell it when the price goes up for making the profit. Short: Sell the share in high price and buy it when the price goes low for making the profit. But this has to done on the same day. Long Unwinding: Selling of stocks owned for a longer period to book profit considering the share reaches its resistance. Short Covering: Purchasing of shares to cover an open short position.
  • : Business is differentiated with Gambling using Risk and Reward. If reward is more than the risk, it is a business. If the risk is more than the reward, it is a gambling. If the trader does the trading with the knowledge and discipline and making profit with lesser risk, then it is a business for that traders.
  • : Buyers and Sellers decides the stock price based on different parameters like company's performance, profit and loss etc.,
  • : Positional Trading: It is a long term trading in which the trader invest the amount in shares and hold it for long period of time (Usually weeks or months) before making the decision to sell. Intraday Trading: It is a short term trading in which the trader buy and sell the shares on a same day.
  • : Traders can sell the shares without holding it considering that the share prices may go down and buy it when it goes low. It has to be done a same day of trading. If it goes down, traders can make the profit. If it is not, it will be an expense for the traders.
  • : Trade plan: It is a strategic plan for trading i.e., approach to select the share, how much quantity to buy, when to buy and sell, how long to hold it etc., Without the proper trading plan, it is a gambling rather than business. Entry level has to be on market price, Target should be higher than the buying price and stop loss has to be lesser than the selling price. Ability to fix the percentage and quantity is based on the knowledge of the market (Technical analysis).
  • : Zero Sum Game is a gain for one and a loss for other but no change in the net value. And stock market is not a zero sum game. Yes, the stock market price affects the company's capital value.
  • : pl. explain with detail about the counter party risk?
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