STOCK MARKET TRADING - NextGen

STOCK MARKET TRADING

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     STOCK MARKET




POINTS COVERED

  1. WHAT IS STOCK MARKET?
  2. WHAT HAPPENS IN STOCK MARKET
  3. WHAT IS BUYING AND SELLING OF SHARES
  4. WHAT ARE DIFFERENT STOCK EXCHANGES IN INDIA ?
  5. WHAT ARE INDEX  ?
  6. HOW TO TRADE STOCKS?

1. WHAT IS STOCK MARKET

Stock market is a virtual market where you can buy or sell the shares of any company that is LISTED IN STOCK EXCHANGES  and no any company that is available in the country you can buy or sell as much shares according to your capacity and prices



                                               

  AS its mandatory to for the company to list itself in the stock market for the trading of its share the company is launched by IPO - its called as initial public offering i.e its the pre sale of trades of company before its  listed in the Index of the country 

2. WHAT HAPPENS IN THE STOCK MARKET

As we have read that there is trading in short buying and selling of stock of company BUT WHERE THESE STOCK COME FROM AND HOW MUCH  this question has a bit of its answer in previous para the term IPO that is pre sales  the  amout of stocks is decided by the company itself  as there is  SEBI which decides the rules an percent of shares a company should have for example 75% the company should have so remaining share will be listed in the company bey IPO
Then after the ipo is  launched then after a specific date the company is listed and then you can trade the stocks of particular company on the exchanges depending upon on which index it is listed

3. What is buying and selling of shares 

After the company is listed and available  to trade you can buy the shares once you buy the shares it comes into your demat account after 2 days of the buying  not  immediately the time u bought it  so buy the time of buying the stock is in the middle account that is it is in the intermediate  account and after 2 days it comes finally in the  then you can take it for long term or as per your final profit goal 
There are 2 types of order 
  1. CNC
  2. MIS
CNC order is placed when you want to keep the stock for more than a day  or even for a long term even you can sell it on another day or the day after you bought it

 MIS this type of order is placed when you do not  want to carry the stock forward from that day you have to end the trade before 3:25 pm of the day   and end that trade right way and finish it off you can even take leverage on your intraday trade that will be explained in the coming post of nextgen and will be linked here 

4. WHAT ARE DIFFERENT STOCK EXCHANGES 

There are mainly 2 stock exchanges 

  1. NATIONAL STOCK EXCHANGE (NSE)
  2. BOMBAY STOCK EXCHANGE (BSE)

These are the stock exchanges in india  
BSE:

The Bombay Stock Exchange is the oldest stock exchange in Asia. Its history dates back to 1855, when 22 stockbrokers would gather under banyan trees in front of Mumbai's Town Hall. The location of these meetings changed many times to accommodate an increasing number of brokers. The group eventually moved to Dalal Street in 1874 and became an official organization known as "The Native Share & Stock Brokers Association" in 1875.

On August 31, 1957, the BSE became the first stock exchange to be recognized by the  INDIAN Goverment under the Securities Contracts Regulation Act. In 1980, the exchange moved to the PHIROJ JEJEEE towers  at dalal street fort area In 1986, it developed the S&P BSE SENSEX index, giving the BSE a means to measure the overall performance of the exchange. In 2000, the BSE used this index to open its derivatives market, trading S&P BSE SENSEX futures contracts. The development of S&P BSE SENSEX options along with equity derivatives followed in 2001 and 2002, expanding the BSE's trading platform.
NSE:

The National Stock Exchange of India Limited (NSE) is the leading stock exchange of India, located in Mumbai. The NSE was established in 1992 as the first dematerialized electronic exchange in the country. NSE was the first exchange in the country to provide a modern, fully automated screen-based electronic trading system which offered easy trading facility to the investors spread across the length and breadth of the country. Vikram Limaye is Managing Director & Chief Executive Officer of NSE.
National Stock Exchange has a total market capatilisation  of more than US$2.27 trillion, making it the 11 largest in asia as of April 2018. NSE's flagship index, the NIFTY 50 the 50 stock index is used extensively by investors in India and around the world as a barometer of the Indian capital markets. Nifty 50 index was launched in 1996 by the NSE.However, Vaidyanathan (2016) estimates that only about 4% of the Indian economy / GDP is actually derived from the stock exchanges in India.
Unlike countries like the United States where nearly 70% of the GDP is derived from larger companies and the corporate sector, the corporate sector in India accounts for only 12-14% of the national GDP (as of October 2016). Of these only 7,800 companies are listed of which only 4000 trade on the stock exchanges at BSE  and NSE. Hence the stocks trading at the BSE and NSE account for only around 4% of the Indian econamy which derives most of its income-related activity from the so-called unorganized sector and households.

5. INDEX IN INDIA 

There are basically 2  main index in India 
1.  SENSEX
2. NIFTY50

SENSEX:

The BSE SENSEX (also known as the S&P Bombay Stock Exchange or Sensitive Index or simply the SENSEX) is a free-float market-weighted stock market index of 30 well-established and financially sound companies listed on Bombay Stock Exchange. These 30 companies are known as Blue chip companies.The 30 component companies which are some of the largest and most actively traded stocks, are representative of various industrial sectors of the Indian economy. Published since 1 January 1986, the S&P BSE SENSEX is regarded as the pulse of the domestic stock markets in India. The base value of the SENSEX was taken as 100 on 1 April 1979 and its base year as 1978–79. On 25 July 2001 BSE launched DOLLEX-30, a dollar-linked version of the SENSEX.
As of 07 February 2020, the full market capitalisation of SENSEX was about ₹76,112.3149 billion (US$1 trillion) (37% of GDP) while its free-float market capitalisation was ₹43,272.7852 billion (US$607 billion). During 2008–12, Sensex 30 Index share of BSE market capitalisation fell from 49% to 25% due to the rise of sectoral indices like BSE PSU, Bankex and BSE-TECk.

NIFTY 50 :

The NIFTY 50 index National Stock Exchange of India's benchmark broad based stock market index for the Indian equity market. Full form of NIFTY is National Index Fifty. It represents the weighted average of 50 Indian company stocks in 13 sectors and is one of the two main stock indices used in India, the other being the BSE Sensex.
Nifty is owned and managed by India Index Services and Products (IISL), which is a wholly owned subsidiary of the NSE Strategic Investment Corporation Limited. IISL had a marketing and licensing agreement with Standard & Poor's for co-branding equity indices until 2013. The Nifty 50 was launched 1 April 1996, and is one of the many stock indices of Nifty.
NIFTY 50 Index has shaped up as a largest single financial product in India, with an ecosystem comprising: exchange-traded funds (onshore and offshore), exchange-traded options at the NSE in India, and futures and options abroad at the SGX. NIFTY 50 is the world's most actively trade contract. WFE, IOMA and FIA surveys endorse NSE's leadership position.


6. HOW TO TRADE STOCKS 

To trade stocks you need DEMAT account by a sebi regstered brokers there are many brokers for example 
 ZERODHA  , UPSTOCKS, MOTILAL , SHERKHAN etc
 you have be  18 years of age to have your own demat account and you should have a pan card and adharcard and an bank account (major )  of your own then you have to kyc with the broker and then you can start trading in both the exchanges   CHOOSE THE BROKER  WISELY AS THERE ARE BROKERAGE FEES WHEN YOU TRADE SO TRADE WISELY AND START WITH SMALL AMOUNT AND DON'T PUT ALL YOUR MONEY AT ONCE OR IN ONE SHARE 


 STAY SAFE STAY STRONG AND KEEP INVESTING

                                                         




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