This document provides an overview of stocks and stock trading. It defines what a stock is, how trading works through exchanges, and the different types of trades. It also outlines key terms like support and resistance in technical analysis. The document discusses how to select stocks through fundamental analysis of financial ratios and technical patterns. It provides tips for new traders, such as using paper trading before investing real money.

1. Basic of Stocks

2. What to expect?
• What is Stock?
• How trading happens?
• How to trade in stocks?
• Kinds of Trades
• Basic Terms and terminologies
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3. What is a Stock
 It’s a means to own a company.
 It is a kind of security.
(The definition of ‘Securities’ as per the Securities
Contracts Regulation Act (SCRA), 1956, includes
instruments such as shares, bonds, scrips, stocks or
other marketable securities of similar nature in or of
any incorporate company or body corporate,
government securities, derivatives of securities, units
of collective investment scheme, interest and rights in
securities, security receipt or any other instruments
so declared by the Central Government.)
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4. Prerequisites for Trading
• We need to have DP(DEPOSITORY
PARTICIPANT) account.
• We need to have a Trading account.
• And of course money 
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5. How Trading Happens?
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Stock Exchange
Ex : PSE,NYSE
People using
terminal provided
by their brokers

6. Which companies one can trade
• Ones which are listed in that exchange
• IPO
• Secondary market
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7. Kinds of Trading
• Intra-day Trading
• Delivery based Trading
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8. Intra-Day Trading
• Buying and Selling on the same day
• Brokerage will be different for intra-day and
delivery based trading, intra-day being lesser
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9. Delivery Based Trading
• Buying and Selling are on different days
• Brokerage will be higher than intra-day
• There will be minimum delivery charges
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10. How to select stocks?
• Fundamental Analysis
• Technical Analysis
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11. What is fundamental Analysis?
• Analyzing a stock based on the fundaments of
the country, the sector, and the company
individually.
• It includes going through balance sheet and
profit-loss statement of the individual
company and checking various ratios.
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12. 3 Important Ratios
• EPS : PAT – Dividend/ No of shares
• PE : Present share Price / EPS
• P/BV Present share price / Book value
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13. What is Technical analysis
• Forecasting the future direction of prices
through the study of past market data,
primarily price and volume. In its purest form,
technical analysis considers only the actual
price and volume behavior of the market or
instrument.
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14. Basic definitions in Technical analysis
• Support : Where one buys
• Resistance : Where one sells
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15. Some tips for primary market
• Please Read DRHP
• Read about the promoter's group.
• Understand their business, and compare them
With the companies listed already in market
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16. How Stocks Trade
• 1. Primary Market – where Securities are
created by means of an IPO.
• 2. Secondary Market – what people are
referring to when they talk about the stock
market.

17. Some Exchanges
• Physical Locations – transactions are carried
out on trading floor.
• Virtual – composed of a networks of
computers where trades are made
electronically.

18. Stock Markets
• The New York Stock Exchange “Big Board”
• The Nasdaq
• American Stock Exchange
• London Stock Exchange
• Hong Kong Stock Exchange

19. What Causes Stock Prices To Change?
• 1. Supply
• 2. Demand

20. Buying Stocks
• 1. Using Brokerage
• a. Full-service Brokerage
• b. Discount Brokerage
• 2. DRIPs and DIPs

21. The Bulls, Bears and The Farm
• 1. Bull Market – when everything in the
economy is great, people are finding jobs, GDP
is growing and stocks are rising.
• 2. Bear Market – when the economy is bag,
recession is looming and stock prices are
falling.

22. The Other Animals on the Farm
• 1. Chicken – are afraid to lose anything
• 2. Pigs – are high-risk investors looking for the
big score in a short period of time.

23. Some Tips to newbie’s
• Execute couple of paper trades before you
actually execute the real trade, we have many
simulators and games available now
• Always follow strict entry and exit points
• Always execute a limit order
• Never buy and sell for full amount in one go,
Spread it across a range, it will give much better
bottoms and tops
• Never average a losing trade
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24. How to Read a Stock Table

25. How to Read a Stock Table
• Columns 1 & 2 – 52week HI and Low
• Columns 3 – Comapany Name & Type of Stock
• Column 4 – Ticker Symbol
• Column 5 – Dividend Per Share
• Column 6 – Dividend Yield
• Column 7 – Price/Earnings Ratio
• Column 8 – Trading Volume
• Column 9 & 10 – Day High & Low
• Column 11 – Close
• Column 12 – Net Change