Indian Stock Market Basics: What Every Beginner Should Know
In 2023, about 3% of India’s population actively invested in the stock market, and in January 2024, more than 5.4 million new investors joined the stock market. Yes, the Indian stock market is the playground of every financially savvy individual who understands market basics. If you too want to be one of those finance people who dip their toes into the lucrative world of stocks, you are at the right place.
There’s no denying that the stock market is one of the most exciting and easiest ways to grow your wealth. However, if you are just starting out, you will need more than a helping hand and a bit of luck. You will need to enrol in one of the Best Stock Trading Courses in Delhi if you want to secure your investment.
Want to learn about the stock market basics? Here’s a fair idea to help you get started.
What is the Stock Market?
In layman’s terms, the stock market is a place where people buy and sell shares of companies. You can think of it as a giant marketplace, but instead of fruits and gadgets, it’s a place where you will be dealing with stocks- small pieces of ownership in companies. So, when you buy a stock, you are becoming a part-owner of that company.
In India, we have two major stock exchanges where all the trading action happens: the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). While the BSE is one of the oldest stock exchanges in Asia, the NSE is known for its advanced technology and efficiency.
Key Concept Every Beginner Should Know
Investing in the stock market isn’t just for seasoned traders; it’s a way for people to grow their money over time. In fact to simplify things for you, here are some key concepts in trading that Stock Trading Courses for Beginners have to offer:
Sensex and Nifty
Sensex, short for Sensitive Index, represents the market index of the Bombay Stock Exchange. On the other hand, Nifty, often referred to as Nifty 50, is the index of the National Stock Exchange, comprising the top 50 most actively traded companies.
- Sensex represents the top 30 companies listed on the BSE.
- Nifty 50 represents the top 50 companies on the NSE.
These two tell you how well the market is performing.
Demat and Trading Accounts
To start investing, you will need two accounts:
- A Demat account to hold your shares electronically.
- A Trading account to buy and sell shares.
Think of the Demat account as your wallet and the trading account as your shopping app.
Types of Stocks
Every stock is different. Some are large-cap (big, established companies), others are mid-cap or small-cap (smaller, high-growth potential companies). Your choice depends on your risk tolerance and goals.
Market Orders and Limit Orders
When you are ready to buy or sell a stock, you will need to decide how to place your order:
- A Market Order executes immediately at the current price.
- A Limit Order sets a specific price at which you are willing to buy or sell.
IPO (Initial Public Offering)
An IPO is when a company offers its shares to the public for the first time. It’s your chance to invest in a company right from the start.
Conclusion
If you are just starting, start small, do your homework, diversify your investments, and the most important thing of all stay patient. Looking for Professional Stock Market Courses in Delhi? Check out what the Stock Market Learning Pro Academy has to offer.
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