Basics about share market

1. SHARE MARKET
B.KRISHNAKUMAR
E

2. 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.

3. TO START A BUSINESS
Initial investment
From one person
From more no. of
persons
From one or two
persons
Proprietorship Partnership Limited company

4. 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.

5. 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.

6. INITIAL PUBLIC OFFERING
The first sale of a
stock, which is issued
by the private company
itself, is called the
initial public offering
(IPO).

7. IF YOU ARE UNABLE TO BUY A SHARE
DIRECTLY FROM THE COMPANY
WHAT WILL YOU DO?

8. 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.

9. 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

10. OTHER EXCHANGES
London stock exchange
Newyork “ “
Shanhai “ “
Australia “ “
Tokyo “ ”
Hong Kong “ “
Toronto “ “
NASDAQ
Calcutta stock exchange
Cochin stock exchange
Multi commodity
exchange
Derivatives exchange
OTC exchange
Pune stock exchange
Interconnects exchange

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

12. 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

13. 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.

14. TRADE

15. 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.

16. SPECULATOR
 Bull
Bear
Stag
Lame duck

17. 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.

18. 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.

19. HOW TO MEASURE THE VALUE OF
A SHARE?
 SENSEX
NIFTY

20. HOW TO READ A STOCK TABLE?

21. 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.

22. 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