Stock market is about raising capital by a company (issuer) for set objectives. Investor invest in company stock to create wealth from his or her saving’s money which otherwise may yield only 5-6% interest in a bank deposit.Investors buy the stocks thereby provide the capital required. On listing, company’s stock price movement is based on many factors, intrinsic and exterinsic. Major proponent is demand and supply of the stock. If an investor sees a futuristic value in the company stock price, he buys it. otherwise it is sold. Stock market operates on cash, delivery, intraday, futures and options. Products offered are stock of company, commodities, currency, Gold etc.Understanding, knowledge and discipline helps one to generate the desired wealth over time.

  • : Price change is dependent on the demand and supply , apart from intrinsic and external news.
  • : Fundamental analysis offers information about the company's intrinsic value . For example, revenue, Profit/loss, EPS, management team, its strength and weaknesses, new product launches etc.
  • : Technical analysis is only about Demand and Supply on the stock market. It is a reflection of people's buy/sell activities and is independent of intrinsic value of the company.
  • : Pro- Data will be available for long position. Cons- Not suitable for short term buy and sell Pro- Can provide insider view of the company and its value. Cons- Hard to get the data and may not always be accurate enough to rely upon.
  • : Fundamental analysis- Company info, Annual report. Technical analysis- Chart of the stock over a period of time to analyse demand and supply
  • : May not be correct as by the time the news reaches market, it would have been shared with internal, key external stakeholders like large institutional player . Resultant, stock price seen at the time of reciept of news may be incorrect ( higher or lower)
  • : Stock price can be manipulated though difficult as most of them are digitally managed by SEBI and has stringent punishment in place
  • : Pro- Provides clear picture of the futuristic value of the company stock price Cons- understanding and timing to read and react . Good for intraday, short term buy and sell.
  • : Due to non availability of proper data , stability of the company is questionable, may not help in generating enough profit after paying the levies and loads.
  • : Line , Bar, Candle are some of the charts
  • : Candle stick provides better insight about demand and supply of a company's stock at any given point of time. The trend allows one to take informed decision for short term trading.
1 Comment
  1. Suresh Surulimuthu 2 years ago

    @kalyanaraman
    I would like to provide my answer for Question 7 as below.
    The average daily turn over in NSE is Rs.32,475 Crores (Dec-2019)
    There are around 2000 companies are listed in NSE. Since NSE and major stocks are traded and followed by all major FIIs, DIIs, Govt bodies and traders, it is impossible to manipulate the stock price.

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