This session was useful to learn about the work module of stock trading and the different types stock options

  • : Buyers / Sellers place order through brokers trading platform, brokers send the order details to exchange to execute the order.
  • : Brokers need to pay caution deposit to exchange, in case of any default by a buyer or seller brokers need to sort it out within a certain period or the exchange will complete the transaction and collect the amount from brokers caution deposit with penalty charges
  • : People assume stock trading gives more returns for their investment when compared to traditional investments like FD, gold etc
  • : Yes, but there will be some difficulties, 1. The company should be listed in both exchanges 2. There may be difference in price at both exchanges so there is chance of loosing the money
  • : Even if we quote higher price system will understand we ready to pay the said amount but execute the order for current market price Share price of Axis bank is Rs. 750, if we quote for Rs. 755. System will execute the order for 750 only, incase the price increases our order will be executed with next price available upto Rs. 755
  • : We need to have Demat account for stock trading, buying using the Buy / Sell option we can place order Types of order 1. Market order Validity - Immediate Order placed to market order are executed immediately with current market price 2. Limit order Validity - until the given price matches Order placed by limit order are executed only if the market price reaches the amount given by us during the particular trading day, after that the order stands cancel 3. VTC order Validity - 45 days Same order type as limit order but the duration will be for 45 days from the date of placing the order.
  • : Long - buying a share at current market price and sell it later with a higher price Short - selling a share at current market price and sell it later with a lower price, the order need to be completed within the days closing time Long unwinding - selling a stock which a trader holds for a long time either to make profit or to exit the trade Short covering - buying back a share to cover the short position either in profit or loss
  • : Stock market trading is measured by the approach of a trader and by the risk and returns involved in it If the amount of risk is greater than returns it called gambling If the amount of returns is greater than risk it called business. So we need to know the basics of trading before involving in the trade
  • : Both Buyers and Sellers collectively decide the stock price. Only Sellers cannot decide the stock price there should be a buyer to buy at the price given by seller or else the trade will not happen. Vice versa for buyer
  • : Positional trading holding a share for longer time, it can be days or months or years Intraday trading - trade executed on the same day
  • : When a trader predicts if the price of a share will go down, he can sell the stock with current market price and later on buy it at a lower price. But the trade need to completed before the end of days trading time. Sometimes the price may not fall down as expected in that case the trader will end up in loss.
  • : Trade plan is systematic method to identify and execute a trade in profitable way and also to identify and minimize the loss
  • : Stock price doesn't affect the company monetary aspect directly but if there is fall in share price it will affect the companies capitalization and market value
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