Share market - Krishnakumare

SHARE MARKET

B.KRISHNAKUMARE

WHAT IS A STOCK?A stock is a

small share that represents a partial ownership of a company.

SHARE MARKET

The place where selling and buying takes place.

TO START A BUSINESS

Initial investment

From one personFrom more no. of

personsFrom one or two

persons

Proprietorship Partnership Limited company

WHY DOES THE COMPANY ISSUE A STOCK?

The reason is that at some point every company

needs to raise money. To do this, companies can

either borrow it from somebody or raise it by

selling part of the company, which is known as

issuing stock. A company can borrow by taking a

loan from a bank or by issuing bonds.

WHO WILL RUN THE COMPANY?

Being a shareholder of a public company does not mean you have a say in the day-to-day running of the business. Instead, one vote per share to elect the board of directors at annual meetings is the extent to which you have a say in the company.

INITIAL PUBLIC OFFERING

The first sale of a

stock, which is issued

by the private company

itself, is called the

initial public offering

(IPO).

IF YOU ARE UNABLE TO BUY A SHARE DIRECTLY FROM THE COMPANY

WHAT WILL YOU DO?

BOMBAY STOCK EXCHANGE(BSE)

Oldest and first stock exchange of India (1875)

First it was started under banyan tree opposite to town hall of Bombay over 22 brokers.

NATIONAL STOCK EXCHANGE(NSE)Leading stock

exchange of India (1994) covers 360 towns and cities in the country.

Established by 21 financial institutions & banks like IDBI, ICICI, LIC, SBI

OTHER EXCHANGES

London stock exchangeNewyork “ “Shanhai “ “Australia “ “ Tokyo “ ” Hong Kong “ “Toronto “ “NASDAQ

Calcutta stock exchangeCochin stock exchangeMulti commodity

exchangeDerivatives exchangeOTC exchangePune stock exchangeInterconnects exchange

A stock is represented by a stock certificate. This is a fancy piece of paper that is proof of your ownership.

DEMATERIALIZATION

• In today's computer age, you won't actually get to

see this document because your brokerage keeps

these records electronically, which is also known as

holding shares "in street name". This is done to

make the shares easier to trade. In the past, when a

person wanted to sell his or her shares, that person

physically took the certificates down to the

brokerage.

BROKERS

He is one acts as an intermediary on behalf of others. A broker in a stock exchange is a commission agent who transacts business in securities on behalf of non members.

TRADE

SPECULATION

The activity of

buying and selling

goods or shares in a

company in the hope

of making a profit but

with the risk of losing

money.

SPECULATOR

Bull

Bear

Stag

Lame duck

BULL MARKET

A situation at the stock exchange in which the prices of shares are rising and people known as bulls buy shares in order to make a profit by selling them later at a higher price.

BEAR MARKET

A situation at the stock exchange in which company share prices are falling rapidly. People who sell their shares, hoping to buy them back later at a lower price, are called bears.

HOW TO MEASURE THE VALUE OF A SHARE?

SENSEX

NIFTY

HOW TO READ A STOCK TABLE?

HOW TO CHOOSE STOCKS?

Read as much as you can.

Start with industries with which you are

familiar.Think of products you like or companies that

provide services you think are good or popular.Decide how much money you are willing to risk.Learn how to identify stocks with criteria that

may indicate potential for future price appreciation.

Determine a method of knowing when to be buying a stock and when to avoid adding new money to your investments.

Don't place orders overnight.Do not impulse buying stocks.Don't sell when a stock falls unless you're sure

it's only going to drop further.

WARNINGS