We always hear about the stock market from newspapers, channels, and from televisions. The stock market is integral part of today’s world economy. Countries economic growth is directly related to the stock market. Stock market directly corresponds to run countries economy. When people talk about stock market then they talk about the different company’s base valuation. Stock market provides a platform to business owner to raise fund. Once stock of specific companies listed then business owners are capable to sells companies ownership in percentage by 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 those countries stock market.
How Stock Trading Works?
Stock markets are run by 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, company should be listed on stock exchange. 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 then traded by investors.
India’s Popular Stock Exchanges
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.
What is Bombay Stock Exchange (BSE)?
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.
What is National Stock Exchange (NSE)?
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 12thlargest 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.
U.S.A ’s popular Stock Exchanges
Three major U.S. financial security markets are,
- NYSE New York Stock Exchange:
NYSE is a New York based stock exchange, this sock exchange merged with a European stock exchange in April 2007 to form NYSE New York Stock Exchange.
2. Nasdaq National Association of Securities Dealers Automated Quotation System:
Nasdaq is the largest electronic screen based market in United States. It offers a least listing fees than NYSE.
3. AMEX American Stock Exchange:
This exchange mostly focuses on exchange traded fund. This is a type of investment fund that is traded on a stock market.
- What is Primary Market
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).
- What is Secondary Market
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 another investor or trader.
How Stocks Can Make you Rich:
If you want become rich via stock market then you need to be a “Smart Investor”. If We would like to sum up all questions which are currently in your mind, by simple one line then we will quote that line:
“Buy the Right Equity Stock At Appropriate Time & Then Hold Your Holdings for Longer Time period”
Yes, this is as sample as that, you need to act as investor than the trader. Being smart investor, you need to figure out what is the good fit for you then accordingly you should do the steady investment for a long time period and then you will see the magic of stock which can makes you a rich.
In order to become a successful smart investor, you should keep below “FOUR R” in your mind:
- Buy Right
- Enter into Right at Right Time
- Define Right Stop loss
- Do Exit from your Right Holding at Right Time.