Evolution Amsterdam Stock Exchange(1602) first official stock exchange , in 22 sep. 2000 merged with Brussels Stock Exchange and Paris Stock Exchange In April 4, 2007 Euronext merged with NYSE group
Index: SENSEX Sensex means sensitive index Founded: 1875 Base Index Value:100 30 Stocks Listed Co. : over 6000 Free Float Market Capitalization Market Cap: $1.1 Trillion
SENSEX Growth 1000, July 25, 1990 14,000, December 5, 2006 2000, January 15, 1992 16,000, September 19, 2007 4000, March 30, 1992 18,000, October 09, 2007 6000, February 11, 2000 20,000, October 29, 2007 8000, September 8, 2005 21,000, January 8, 2008 10,000, February 6, 2006 12,000, April 20, 2006
Index: Nifty Founded: June 1992 Base index value:1000 50 Stocks Market Cap: $1.46 Trillion Method of calculation: Free Float Market Capitalization
Functions of SE Promotes the investment Provide liquidity to investors Profitable activities for companies Permits for the investor to have a political power in the companies Possibility of diversifying your portfolio
SPECULATION : Definition : it involves the buying,holding,selling,short- term selling of stocks,bonds.commodities,currencies,collectibles or any valuable financial instrument to profit from fluctuations in its price as opposed to buying it for use or for income via method like dividends or interest.
Kinds of speculationBull Market (Tejiwala): In case of that they purchase the shares at current prices to sell at a higher price in the near future and makes a profit if his expectations come true.he is also called a long buyer.
Kinds of speculation Bear Market (Mandiwala) : He sells security in the hope that he will be able to buy them back at lesser price. It is also called “short selling”.
FROM THE COMPANY POINT OF VIEW A better reputation . Diversification Financing Communicate to investors The market for the shares of such a company is naturally widened. Increase the bargaining power of the company in the event of a takeover, merger or amalgamation.
FROM THE INVESTORS POINT OF VIEW 1.Transparency 2. Under the knowledge of investors 3. Investment Opportunity 4.The present net worth of investments can be easily known by the daily quotations. 5.His risk is considerably less when he holds or purchases listed securities.
CAUSES OF PRICE FLUCTUATION Demand And Supply Global Cues Bank rate Speculative pressure Actions financial institutions
CONT…….. Change in company’s board of directors Financial position of the company Trade cycle Political factors
OTHER FACTORS: Expected monsoon Changes in exchange rate Border tension Stock brokers scam like Harshad Mehta and Ketan Parekh Strikes and lock-out of the company. New budget proposals
Selection of Stocks Market Capitalization Growth Prospectives Fundamental Analysis Technical Analysis Trading Frequency Number of Trades Industry Representation Listed History Track Records
SEBI Founded in 1992 Protect investors Transparency in the system Watchdog Prohibiting insider trading in securities
Recommendation Spend time to understand the market Fundamental + Technical Analysis Wait and Watch Watch market every day but don’t try to trade everyday“ stock market is like a test match spend time in the middle respect good balls and punish poor balls”