Share Market: Basic (Part 1)
Updated: Sep 26, 2020
Hey guys, want to understand the Share Market in deep If Yes, then you are at the right place. We are bringing a series of Share Market where you can learn Share Market from the Basic level to the advanced level. So, let's start.
Having a basic understanding of the share market is always better before we go for investment. So, let's go through the basics of the share market
We are going to cover the following question in Part 1.
What is Share Market?
Why the company's issued share?
From where you can buy and sell shares?
How Share Market work?
1) What is Share Market?
A share market is a place where a company lists a share (units) to the general public or specific people. For example, Subh.info issues 10,000 units of share of Rs 100 each, and you purchase 500 shares, then your percentage of ownership in the company is 5%.
Now, the question is how?
Ans: 500/10000*100 = 5%.
Number of unit purchase/ total number of share listed*100
2) Why the company's issued share?
The company's issues shares to raise capital or money for the development of the company, and there is various other reason also.
When company's issues stock for the first time it is known as an initial public offer (IPO). We will cover IPO in Part 2
3) From where you can buy and sell shares?
There are two bodies in India BSE (Bombay Stock Exchange) and NSE (National Stock Exchange). These are two major stock exchange bodies in India. These bodies regulate by SEBI (Securities and Exchange Board of India).
You can find your country stock exchange bodies by search
ing on google.
4) How Share Market work?
You need to open a DEMAT Account or TRADING Account to deal in shares. You can open theses two accounts from the bank, financial institution, and also nowadays you can open a Demat account online very easily through a simple process.
Brokers act as an intermediary between the stock exchange and the investors. In upcoming articles we will see brokers in more detail.