Equity shares are instruments issued by companies to raise capital and it represents the title to the ownership of a company. You become an owner of a company by subscribing to its equity capital (whereby you will be allotted shares) or by buying its shares from its existing owner(s).
NSE (National Stock Exchange) and BSE (Bombay Stock Exchange)
The key factor in a stock market is the stock exchange – the basic platform that provides the facilities used to trade company stocks and other securities. A stock may be bought or sold only if it is listed on an exchange. Thus, it is the meeting place of the stock buyers and sellers
What is an Index?
An index is a statistical measure. It refers to a bunch of stocks grouped together, where each stock has a value. If the value of one or more stocks increases, then the index value will increase. If the value of one or more stocks decreases, then the index value will decrease Nifty is the Index for NSE and Sensex is the Index for BSE.
What is the role of a Depository?
It holds the securities in an account. It transfers securities between accounts on the instruction of account holder NSDL – National Securities Depository Limited and CDSL – Central Depository service Limited
What is the role of a clearing corporation?
It provides funds to those who have sold their shares. It receives the shares from the sellers and delivers it to the buyers. It provides a financial guarantee for all transactions. Example of a clearing corporation:
NSCCL: National Securities Clearing Corporation, which is a subsidy of NSE.
What is the role of a broker?
Mediator between you and exchanges, depositories, Clearance Corporation, banks etc.
Bank account Pumps money Demat account holds the securities Trading account to buy and sell securities
- : Stock Market is an organized place where the buyers and sellers meet to buy and sell securities through a Stock Exchange
- : Purpose of the Stock market is to raise capital for a company from the Primary and secondary market.
- : Similarities of other market and Stock market are it is a place where buyer and seller come to a place to buy and sell their products. The difference all the Buy and Sold products are Deposited in the Depositories such as NSDL & CDSL
- : Protecting the interests of investors in securities and promoting and regulating the development of the securities market Regulating the business in stock exchanges Registering and regulating the working of stock brokers, sub–brokers, share transfer agent etc. Registering and regulating the working of venture capital funds, collective investment schemes (like mutual funds) etc Promoting investor’s education and training intermediaries Promoting and regulating self-regulatory organizations Prohibiting fraudulent and unfair trade practices Calling for information from, undertaking inspection, conducting inquiries and audits of the stock exchanges, intermediaries, self – regulatory organizations, mutual funds and other persons associated with the securities market.
- : Shareholder one who by the stocks in the Primary and secondary market. A stock promoter is a firm or person who promotes a stock, seeking to induce potential investors to buy it as part of an IPO or in the secondary market Director is the Decision-maker of they might or might not have the share of the company.
- : The marketplace for new shares is called the primary market. The place where formerly issued securities are traded is known as Secondary Market. Type of Purchasing Direct in primary market Indirect in the secondary market. Financing Buying and Selling between Company and Investors in the primary market. only with Investors in the secondary market.
- : IPO is an Initial Public offer First time a company collecting their capital from the Public in terms of Equity share After getting the Approval of SEBI can company can go for IPO
- : No To run the business Stable shareholder can't ask for money back instead of that shareholder can exchange the share to the investor through the secondary market. Company decision maker is the only person to decide to the Dividends to the shareholder. Decision makers are Board of Director Executive Members and Chairman and CEO
- : The goal of a Trader making profits in the financial markets. The goal of an investor is to gradually earn wealth over an extended period of time through the buying and holding of a portfolio of stocks, mutual funds, bonds, and other investment instruments.
- : FACE Value is the value to the securities when the come for IPO Dividend wich equally divides the percentage of profit among the shareholder in cash. Bounus which equally divides the percentage of profit among the shareholder in Share .
- : Sensex is the Sensitive index of the BSE (Bombay Stock Exchange) Nifty is the Index of the National Stock Exchange
- : In NSE Volume of trade is more than BSE NSE is the first exchange move towards electronically
- : When a company go for Split share ?
- : What happens when FPO is issued ?