Stock Market is a place for trading of Shares.
Two major stock markets are in India – NSE and BSE.
Stock Market is regulated by SEBI.
Stock Market is the secondary market where trading of shares is happening.
Primary Market is the one where the securities or shared are created by the promotors using IPO or Bonds.
Different terminologies are used in stock market like Shareholder, Promotor, Face Value, Dividend, Company, Stock Split, Bonus, Support and Resistance.
In India, Stock Market trading time is 9.15AM to 3.30PM. Pre-Market time is 9AM to 9.15AM where the buy and sell booking of the shares only allowed.
- : Stock Market is the place where each individual investor, exchange or trade their shares. It is similar to other market like Vegetable Market. NSE and BSE are two stock markets in India.
- : Similar to other market (like Vegetable Market), we need a regulated, common place for trading. This is the reason for the need of Stock Market, where the registered demat account holder trade their shares in the stock market.
- : It is nothing but same. Only the product differs. In vegetable market, the product is Vegetable whereas in Stock Market, it is shares or stocks. Functional difference will be there compared other market considering number of investors involved, investing amount etc., and it is more regulated and secured.
- : Securities and Exchange Board of India (SEBI) is a regulatory body of India which regulates the Indian stock markets. It monitors and regulates the securities market and protects the interests of the investors by enforcing certain rules and regulations
- : Share Holder are the People together invest their company and share their profit, capital and assets. Ex., Retail Investor who owns a share in a company. Promotor is the person who promotes the company from base. Not necessary a owner of the company. Ex., Adani Power. Director is a person or group of person (Board of Directors) who directs or provides the strategies to run the company.Ex., Gantam Adani is one of the Director.
- : Primary market is where the new stocks/bonds are created and sold to investors. Ex., IPO. Secondary Market is where the stocks/bonds are traded by the investors. Ex., NSE, BSE.
- : IPO - Initial Public Offer. Promotors who requires the capital for running the company, goes to public for the first time to collect the capital and intern the share the profit with the investors. The process is the promotors advertise the company details along with the raise in capital, face value, IPO Price, Open Date and Close Date. It happens through Primary Market. Recent Example: Data Patterns IPO. Opening Date: Dec 14/21, Closing Date: 16/21, IPO Price: Rs. 555 - 585 per equity share. Listing date: Dec 24/21 and listing price: 805 per share.
- : No the share holders don’t have the rights to ask for the refund and dividend since the amount is already invested by the company and based on the profit, company alone has the rights to share the profit through dividend.
- : Investing is a long term plan of buying and hold the shares which provides a good return. It is based on the fundamental analysis. Ex., SIP Investment. On the other hand, Trading is a short term plan of buying and sell the shares in short term with good profit. It is based on the technical analysis. Ex., Buy and sell the shares of Infosys in short term.
- : Face Value: It's a denomination used to describe the value per share. For ex., Face Value is 10Rs for the capital of 100Rs with 10 investors. Dividend: Profit shared by the company to the people who invested. For Ex., Dividend will be 10 for the profit of 100Rs with 10 investors. Bonus: it is the additional shares given to the shareholders without any additional cost. For Ex., if the company declares 5:1 bonus, then the investor gets 5 free shares for every one share. Split: It is the division of existing shares into multiple shares to increase the liquidity of the company. A 2 for 1 stock split means that the investors will get two stocks for every one stock they hold.
- : Sensex (Stock Exchange Sensitive Index) is the main index used by Bombay Stock Exchange and it the weighted average of 30 stocks in it whereas Nifty (National Stock Exchange Fifty) is the main index used by National Stock Exchange and it the weighted average of 50 stocks in it.
- : Earlier there were lot of stock exchanges like Madras stock exchange but due to operational issues and digitalization, it has reduced to NSE and BSE. NSE is more popular than BSE since NSE has more liquidity compared to BSE and it has more stocks with different industry types and more investors for trading compared to BSE.