What is Share Market?

What is Share Market:-

Hello friends! Welcome to Earning Hub, today we are going to tell you about the Stock Market. Stock Market is where stocks are either issued or traded in them. A Stock Market is similar to a stock exchange. The main difference is that a stock market helps you to trade in financial instruments such as bonds, mutual funds, derivatives, as well as companies' shares. A Stock Market only allows trading of shares. The main factor is the stock exchange - the original platform that provides the facilities used to trade the company's stock and other securities. A Stock can be bought or sold only when it is listed on the exchange. Thus, it is a meeting place for buyers and sellers. The major stock exchanges of India are the Bombay Stock Exchange and the National Stock Exchange.

Types Of Stock Market:-

There Are Two Types Of Shared Markets - Primary And Second Markets:-

1.Main Market:-

This is where a company is registered to issue shares of a certain amount and to raise money. It is also said to be listed on the stock exchange. A company enters the primary markets for raising capital. If the company is selling shares for the first time, then it is called an Initial Public Offering (IPO). Thus the company becomes public.

2.Secondary market:-

Once new securities are sold in the primary market, then these shares are traded in the secondary market. It is for investors to get out of investment and to sell shares. Secondary market transactions are referred to for trades where an investor buys shares at the current market price from another investor, or at whatever price both sides agree. Typically, investors use such intermediaries to conduct transactions such as a broker, which facilitates the process. Different Brokers offer different plans.

Why Do We Invest In The Stock Market:-

To ensure that we have enough money for the future Just earning and saving is not enough. Inflation - Value added animal - eats in the value of your money. Investment is the answer to inflation. For losses through inflation, we invest and earn extra. This is a fundamental investment. The stock market is such an investment avenue. It has a history that goes back to the 1800s. Earlier, stockbroker will conduct convergence around the banyan trees to conduct stock trades. As the number of brokers increased and the roads became overflow, they had no choice except to move from one place to another. Finally, in 1854, he transferred to Dalal Street, the place where Asia's Oldest Stock Exchange - The Bombay Stock Exchange (BSE) - is now located. It is also India's first stock exchange and since then has played an important role in the Indian stock markets. Even today, BSE Sensex is one of those criteria, against which the Indian economy and the strength of the finance are measured. In 1993, the National Stock Exchange (NSE) was formed. Within a few years, trading on both exchanges moved from an open-out system to the automated trading environment. This shows that India's stock exchanges have a strong history. Even then, on its face, especially when you consider investing in the stock market, it often looks like a maze. But once you start, you will realize that the basic elements of the investment are not very complicated. One of the fundamental aspects of investment is the basic financial plan.

How to bye online Shares:-

First of all, you need to open a Trading Account and a Demat Account. This Trading And Demat Account will be linked to your Savings Account for the smooth transfers of money and shares. Note that the Demat And Trading Accounts are different and you can read about the difference between them here.

What Are The Financial Instruments Prepared In A Stock Market:-

Now that we understand what is the basics of the Stock Market and what the investment is, then let us understand the four major financial instruments of trading:

1. Bonds:-Companies need money to start projects. Then they pay back using the money earned through the project. One way of raising money is through bonds. When a company takes a loan from the bank instead of regular interest payment, then it is called a loan. Similarly, when a company borrowed from many investors instead of paying interest at the time of interest, then it is called Bond.
For example, imagine that you want to start a project which will start making money in two years. To begin the project, you will need an initial amount to get started. Therefore, you receive the requisite amount from a friend and write the receipt of this loan saying, 'I have to pay you a loan of Rs 1 lakh and you will have to pay the original loan amount for five years, and by that time every year 5% Interest will be paid. When your friend keeps this receipt, it means that he has lent money to your company and has just bought one bond. You promise to pay 5% Interest at the end of every year, and at the end of the fifth year, you pay the original amount of 1 lakh rupees. Thus, a bond is a means of investing money by lending to others. For this reason, it is called a loan instrument. When you invest in bonds, it will show face value - borrowing money, coupon rate or yield - the interest rate that the borrower will have to pay, coupon or interest payment, and the time limit for withdrawing money, called maturity date is.

2.Secondary Market:-The Stock Market is another place to raise money. Companies in turn offer shares in exchange for money. To hold a portion of the company, a share is proprietary. These shares are then traded in the stock market. Consider the previous example; Your project is successful and therefore, you want to expand it.
Now, you sell half of your company to your brother for 50,000 rupees. You keep this transaction in writing - new my new company will issue 100 Shares of stock. My brother will buy 50 Shares in 50,000 rupees 'Thus, your brother has bought only 50% of your company's stock shares. He is now a shareholder. Suppose that your brother needs 50,000 rupees immediately. He can sell the secondary market and get the money. It can be less than or equal to 50,000 rupees. For this reason, this is considered a risky tool. The shares are as follows, the certificate of ownership of a corporation. Thus, as a shareholder, you can share a portion of the profits the company is doing and also be a part of the loss to the company. As the company will continue to improve, the value will increase in your shares.

Mutual Funds:-These are investment vehicles which allow you indirectly to invest in the Stock Market or bonds. It collects money from the collection of investors and then invests that amount in financial instruments. It is controlled by a professional fund manager. Every mutual fund scheme releases units, which have a fixed value like a stock. When you invest, you become an entity holder. When the equipment investing in the MF scheme earns money in the form of a unit holder, you get the money. It either happens through the increase in the value of units or through the distribution of dividends - money to all the unitholders.

Derivatives:-There is fluctuation in the value of financial instruments such as stocks. So, it is difficult to decide on a particular price. Agricultural Instruments come from here. These are tools that help you to do business in the future in the future. Simply put, you enter an agreement to buy or sell a stock or other equipment at a fixed price.