Today, through this blog post, we will try to understand what is share market ? Friends, the share market is a place where companies sell their shares and investors buy those shares. Those investors become shareholders of that company.
What is share market?
Friends, if you want to learn the share market, then you will get to learn a lot through this article. Let us first know what is share market? Share market is a place, where you can buy and sell shares. If you invest at young age, you can learn a lot of profit. you buy share of company, as that company grow, the value of your shares will also increase. you can earn profit by selling that share in the share market.
You may be wondering, why a company sell its shares to people? A company needs money for its development or expansion, that is why it collects money from people. The process by which a company brings its shares to the market is called IPO (Initial Public Offer).
Type of share market
There are two main types of share markets in India, primary market and secondary market.
Primary Market
Primary market, this is a market, where a company first registers to receive money. And by issuing a certain amount of shares of the company. It gets listed on the stock exchange. When company gets listed for the first time through an IPO ( Initial Public Offer ), then here the company, sell its shares for the first time, So that is why the primary market is also called the new issue market. Once the company’s shares are sold in the primary market, investors or traders buy and sell those shares in the secondary market.
Secondary Market
When a company sells its new shares in the primary market, those shares can be bought and sold by secondary market investors or traders, in the secondary market, investors get opportunity to buy and sell shares. In the secondary market, whatever is the current price of the share, and investor buys and sell that share to another investor at that price. An investor or trader buys or sells this share through brokers.
How does the share market work?
Friends, the share market in India works through SEBI (Securities Exchange Board of India). SEBI was established in 1992. There are two main stock exchanges in India.
1. Bombay Stock Exchange
2. National Stock Exchange
Bombay Stock Exchange
Bombay Stock Exchange is also known as Dalal Street. Bombay Stock Exchange was established in 1875. More than 5000 companies are listed on Bombay Stock Exchange. It is the oldest stock exchange in Asia. This stock exchange is a famous stock exchange of India, the investment of investors who invest in the stock market is well protected.
National Stock Exchange
National Stock Exchange is the trusted stock exchange of India. National Stock Exchange was established in 1992. More than 2000 companies are listed on the National Stock Exchange.
How are shares bought and sold?
In the Share market, bidding is done to buy and sell shares. In this bidding. the investor who is ready to sell his shares at the lowest price, and the investor who is ready to buy those shares at the highest price, exchange of shares between the two investors, those shares are bought by the investor at the highest price. the price at which the investor is ready to sell the shares is called Bid price. And the price at which the investor is ready to buy the shares is called Ask price.
How to buy shares?
To buy shares in the stock market, you need three things.
1. Bank Account
To work in the share market, you must have a saving account in any bank, so that you can pay money to buy shares in the share market.
2. Demat Account
When you buy shares of any company in the share market, you become a shareholder of the company, and the shares you have purchased are deposited in the demat account.
3. Trading Account
You can open a trading account with broker like ZERODHA, DHAN, so that you can trade your shares.
What is the share market timing
In India, share market is traded only at specific time. India shares market open from 9.15 am to 3.30 pm from Monday to Friday. The share market remains closed on government holidays. The share market timings for National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) are the same.
What is the opening and closing timing of the share market?
The pre-opening session of the share market starts at 9.00 am. At this time, you can place orders to buy or sell any share in the share market. You can modify or cancel the order placed.
From 9.08 am to 9.12 am, you cannot place a new order or modify or cancel an already placed order.
From 9.12 am to 9.15 am, this timing acts as a connection between the pre-opening session and the regular session. Even at this time you cannot place any new order or cancel any order.
This is a normal session from 9.15 am to 3.30 pm, during this time you can buy or sell shares of any company in the share market. You can modify or cancel any new order at this time.
From 3.30 pm to 3.40 pm, the closing price of the share is calculated at this time. The closing prices of Nifty and Sensex indices are also calculated.
From 3.40 pm to 4.00 pm, at this time you can place a new order in the share market, but sufficient number of buyers or sellers are required in the share market.
What are the advantages and disadvantages of share market?
We will learn about the advantages and disadvantages of the share market in detail below.
Benefits of share market
1. By investing in the share market, you can earn more profit than other options.
2. The share market is controlled by Sebi, so your investment remains safe.
3. You can invest directly in the share market by opening a demat account.
4. By buying shares of a company, you can become a shareholder of that company.
Disadvantages of share market
1. When you buy and sell shares in the share market, you have to pay more brokerage.
2. In the share market you have to pay short term capital gains tax of 20% and long-term capital gains tax of 12.5%.
3. Any positive news or negative news in the share market directly impacts the share market.
Summary
What is share market? It has been explained in detail, and other information related to the share market has also been given to you. So that you can take proper advantage of share market in future. Friends, we hope that you will like the information we have given about the share market in the article. So, you will like, share, and comment for this article.
FAQ
Which is the best book to learn share market?
The best book to learn investing in share market is “The Intelligent Investor”. This book is written by “Benjamin Graham”.
The best book to learn trading in share market is “Trading in The Zone”. This book is written by “Mark Douglas”.
Which is the number one share market in India?
In India, most trading takes place on the NSE (National Stock Exchange), but trading is also done by BSE (Bombay Stock Exchange) and NSE (National Stock Exchange).
What is the best trading to earn money in share market?
If you want to earn money every day in share market then intraday trading is best for you, and if you want to earn money for long term then investing is best for you.
How much money should one start trading in share market?
You can start trading in the share market with Rs 100, there is no such fixed price. If you are new to the share market, then start with minimum money.
Can you become rich in share market?
You can become absolutely rich in the share market, but you will have to invest in the share market for a long time. And there are ups and downs in the market, at that time you do not have to withdraw your investment from the market, only then you can earn good money in the share market.