The Basics of the Process of stock trading and regulatory bodies and frameworks surrounding it. How to create Long position short position and where to place stop loss order

  • : When Company wishes to go public it should seek the help of SEBI and can get listed by means of giving an RHP and offer an Initial Public offering. After that the existing holders can buy and sell the stock in the stock exchange which is the secondary market. All these are regulated by SEBI and they don't have the power to control profitable or non profitable companies.
  • : In the case of any default the brokers might be charged in place of the stock exchange. The broker in turn can charge their client.
  • : To maximize their profits by trading with the help of knowledge and Discipline
  • : It is possible and the process is called arbitrage. There are many entities that do that and thus the difference of prices of companies traded on both the exchanges is small.
  • : The Exchange will give us the Price in which it is currently trading at i.e., Lowest price quoted by sellers in the market
  • : For Buy order F1 is the short key which can be done in the broker's portal liker Kite. For sell order it is F2 if you wish to short in a stock. If your order is queued the validity is one day until the market closes
  • : When you Buy a stock expecting the price to go up you can buy it first and sell after the price reaches our target, this is Long and Selling the long position later is called Long Unwinding or Long Exit. When we sell a stock first and buy it later its known as short and when you buy back the shares for exiting the short position it is called short covering
  • : When our risk to reward ratio is higher, then stock trading is a Business. But if we take high risk for smaller returns it is Gambling
  • : The Buyers and Sellers of a stock exchange decide the stock price.
  • : Intraday trading is Buying and selling a share in a same day or short position too. Whereas Positional is waiting for weeks or months on an End
  • : Such a trade is called short position and the trader has to buy the share or hefty auction charges may be levied by the exchange
  • : Trade plan is when to enter and exit the stock the rule of thumb should be that the stop loss should be at the level of previous bottom or previous top. Entry point to be when the Price breaks the Previous Top or Bottom.
  • : Not at all, stock exchange is for the buyers of a stock to meet the sellers and vice versa

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