The School Of Stock Market

What is actually Stock or Share? Let's  begin from something that we already know. The price of Pen Reynolds-045 is Rs 6, so one needs to pay Rs 6 to  buy it and own it wholly. Now let's assume there is a company named XYZ of total worth(price) is Rs 10,000. You need to pay Rs 10,000 to  buy it and own that company wholly. This total worth or net worth of the company is termed as Company's Capital . The statement "You need to pay the Company's Capital to own the company wholly" is technically correct  but in reality Company's Capital is so huge that a single person can't pay in order to  buy the whole company.  One single person usually doesn't own the whole company the way you can own R-045 Pen  by paying Rs 6. For example the Capital Amount of Reliance Industries Limited (RIL) company is around  Rs 10 Lac Crore and thus as an individual if you want to own Reliance company wholly you need to pay Rs 10 Lac Crore =Rs 10,00,000

To Learn from very beginning click here     Day - 1 >> How to get the shares of a company? IPO, Share Market, Stock Exchange, NSE, BSE. As we have seen earlier any big company with huge Capital is funded from money of many other participants other than the owner. These participants can be an individual or some  organizations. In the beginning phase of business owner takes money from friends & relatives or some financial individual or organization (In order to keep this article simple we won't dig about those) to run the company. But when a company wants to raise huge funds to expands their businesses at large scale where they can't ask this huge funds from some individual or even from financial organizations then company invites the public to buy their shares.  When company offers public to buy shares for the first time this process is knows as   IPO   (Initial Public Offer). Let's say company sold 500 shares in IPO among 100 public on average 5 sha

To Learn from very beginning click here      Day - 1 >> What is Demat & Trading Account, Depository & Stock Broker? Let's say a person Aryan had bought shares in IPO from XYZ company and now Aryan is willing to sell it via Stock Exchange NSE. At the same time Tejas is the person who is willing to buy those shares from Aryan. In this case Tejas also has to go through the same mediator i.e. NSE. Now the point is   how will Tejas pay money to Aryan for buying shares? . We will not go into  much detail but you just know that for the smooth operation you need to maintain a separate   Trading Account   where you will keep money to buy shares. Once you buy the shares money will be deducted from your  Trading Account . You can think that's the reason we maintain a separate  Trading Account  and link this  Trading   Account  with Bank Account instead of transferring the money directly from your Bank Account for buying the shares. Only one particular Bank Account wi

To Learn from very beginning click here       Day - 1 >> Trading  :  Trade - In real life when we make a deal such as exchange of products or services with money it is known as  Trade . So basically in real life Trade means a deal. In stock market when we buy the shares with money or sell the shares to get the money this is also a Trade . So in core terminology exchanging of shares with money is termed as Trade and hence whoever will buy/sell the shares of a company will be considered as Trade r. But in stock market we use the term Market Participants to refer the person or organization who is involved in buying/selling(transact) the shares in stock market. Here we reserve the word Trader for those kind of   Market Participants who buy/sell (transact) shares  to make money quicker without bothering about the fundamentals of business. He just takes care of price fluctuation in the market. We categorize the Trader s based on time span they hold the Position .

To Learn from very beginning click here   Day - 1 >> Investing:  When you buy shares with the intent to stay invested for as long as your prospects about the  business is good i:e with the intent to being a partner of company it's known as  Investing . Since we are actually participating in business so we do a thorough research on the concerned company before  Investing . The research done with this intent is known as   Fundamental Analysis . Demand vs Supply, Price vs Value. Price  never moves in straight line in stock market, every second it keeps changing. Do you think any company's fundamentals or profits or businesses changes within seconds? Absolutely NO. This is just Market Participant's   Sentiment   which drives the market up and down, in Investing field the  Sentiment  is known as   Noise .  Traders sees the   Price   and Investors calculates the   Value   of Share. Let's understand the difference between  Price  and  Value . You manufac

To Learn from very beginning click here     Day - 1 >> What does the term " Portfolio " mean in the context of Stock Market? Portfolio - In simple terms collection of stocks is termed as Portfolio . Let's say you bought shares of Tata Motors, Reliance Industries and Few more. Among them some stock can perform good i:e their price can rise while other stocks can perform poorly i:e their price can fall. So as as an investor you have to manage the whole Portfolio (bucket having all stocks of yours). There is a special designation who manages other people's Portfolio known as Portfolio Manager . What is actually  Sensex & Nifty that we hear in financial world like Sensex is falling, Nifty has gone down etc. Earlier we have seen that in IPO process public buys shares from company directly and if the public want to sell those shares to other public they can do it via stock market or share market or stock exchange e.g - NSE, BSE. But we should rem