What is Stock
The stock market is usually not a new terminology. We always hear about the stock market from newspapers, channels, and from televisions. The stock market is an integral part of today’s world economy. We cannot think economy without stock market.
Economic growth is dependent on the stock market. Stock market exists at every corner of the world. Stock market directly corresponds to run countries economy. Indian stock market is the oldest market in Asia region.
When people talk about stock market usually they are talking about companies. Stock market provides a platform for any business owner to raise fund. The company sells ownership in percentage in terms of selling its shares.
The stock market is directly proportional to the dynamic health of the economy. World economy runs by the stock market. Any countries economical background, strength, and stability can be easily judged by respective countries stock market.
Stock markets are running via stock exchanges. The stock exchange is an exchange of shares across stock brokers and traders in terms of buying and selling shares of the company. To buy and sell shares of a company, the respective company should be listed on stock exchange.
Stock valuation is depending on many factors. East India Company is the first traded company. Early days buying selling of a share is done at restaurants or shops. These stocks were written on paper or sheet which in turn traded by investors.
The Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) are two leading primary stock exchanges in India. BSE and NSE are primary exchanges come with BSE index known as Sensex and NSE index which is known as Nifty 50 index.
NSE and BSE volumes are equal. Nifty 50 comes with fifty stocks whereas Sensex comes with thirty stocks. The Bombay stock exchange (BSE) is located at Dalal Street Mumbai. BSE is oldest and worlds largest stock exchange. More than 5000 companies are listed under BSE. Its capitalization is more than 2 trillion US Dollar.
Bombay Stock Exchange (BSE) was the first exchange which is being recognized by the government of India. BSE was founded in 19th century by Premchand Roychand. BSE has introduced centralized internet trading system, which enables investor and trader to invest and trade on BSE from any corner of the world.
The National Stock Exchange (NSE) is located in Mumbai. The NSE was established in 1992, which offers Internet-based centralized trading. Vikram Limaye is Managing Director (MD) and Chief Executive Officer (CEO) of NSE. National Stock Exchange (NSE) is a 12th largest stock exchange having more than 1.4 trillion US Dollar market capitals.
National Stock Exchange (NSE) enables traders to trade in future and option segment. NSE launches index future in June 2000. Future and Options segment facilitate traders to trade in NIFTY 50, NIFTY IT, and Bank Nifty segment. The average daily turnover of NSE in Future and Options segment is around 24 billion US dollar.
The market operates in two different modes of functionality i.e. Primary Market and Secondary Market. Primary Market is the market whereby issuing shares company and industry raises long-term fund via initial public offer (IPO). Secondary Market is a market where post-transaction can be executed after listing IPO, in secondary market investor or trader can buy the share or sell the share to other investor or trader.