Knowledge of the Stock market
Stock market is a place where everyone goes to earn but there is a big question in everyone’s mind whether our money is safe in the stock market or not.
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| Basic to Advance Guide of Stock Market |
If you look at any business in the world, there are risks in every business, then how can the stock market remain untouched by it? But if you keep learning and practicing continuously and execute trading plans with discipline, then achieving success in the stock market is not a big deal.
If you want to remain successful in the stock market, you will always have to control your thoughts and sentiments.
What is Stock Market?
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| What is the Stock Market? |
All companies need money to run their business smoothly. To further expand their business, companies want to take their products to the worldwide level, for this they need money. Companies earn profit by selling products or by selling services but that is not enough for the companies.
So that the need for more money can be met, companies invite common people like you and me to invest money in their company. So that companies can run their business properly. In return, investors get a share of whatever profit the company makes.
IPOs are brought because companies want their funding needs to be met and awareness about investing should be created among the common people.
Let us understand the basics of the stock market:
What are Stocks?
Stocks are an asset in which you invest your money. If you invest money in the stock of a company, it means that you own a share of that company.
Stock investment is a great method to create wealth.
You can invest stock in very successful companies like Reliance Industries, Tata Steel, Bharti Airtel, HDFC Bank, Aditya Birla Fashion Ltd., ICICI Bank, Axis Bank, Ambuja Cement, and Sun Pharma. There are many more companies in which you can start investing by buying stocks.
Before investing, please consult your financial advisor. The names of these companies mentioned are not recommendations, they are just given as examples to make you understand.
How Does Stock Market Works?
Companies bring IPOs into the stock market. Actually, through IPO, companies sell their stakes to investors. These equity stakes are known as shares of stock.
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| How Does the Stock Market Work? |
When the shares of the companies are listed in the stock market, then the companies can easily raise money and they do not even need to take loans from outside. Investors and traders also benefit by investing money in listed shares.
As the profits of companies increase, the money invested by investors also increases. Not talking about any individual stock as the performance of any stock may be different but overall, historically the stock market has always rewarded investors.
The stock market gives an average return of 10% every year. The stock market is a good source to grow your money continuously.
How to be successful in stock market?
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| How to get success in stock market? |
- TO BE SUCCESSFUL IN THE STOCK MARKET YOU SHOULD READ DAILY NEWS PAPER.
- WATCH BUSINESS NEWS CHANNELS. WATCH THE MARKET DAILY, AND MAKE NOTES ON PAPER.
- START READING THE CHARTS. IF YOU TO DO INTRADAY TRADING, THEN READ THE DAILY CHARTS OR 15-MINUTE CANDLE PATTERN.
- IF YOU ARE A POSITIONAL TRADER THEN START READING WEEKLY AND MONTHLY CHARTS.
- START APPLYING MOVING AVERAGES ON CHARTS. APPLY THESE 5 SIMPLE MOVING AVERAGES: 12,21,50,100,200. THERE IS NO NEED TO ADD ANYTHING TO CHARTS.
- TRY TO KNOW THE FINANCIAL HEALTH OF THE COMPANIES. LOOK AT FII AND DII DATA, AND SEE SHAREHOLDER PATTERNS IN COMPANIES.
FAQ (FREEQUANTLY ASKED QUESTION):
Q. What is the difference between stocks and shares?
A. stocks and shares are used interchangeably to refer to financial equities. Specifically, securities that denote ownership in the company.
Q. What is trading in the stock market?
A. Trading is the process of buying and selling company shares. There are 5 types of trading in the stock market:
Q. What is a Dividend in the stock market?
A. Dividend is like a reward for investors. Companies distribute some part of their profit to their shareholders; this is called dividend.
Q. What is an Index in the Stock Market?
A. Index in Stock Market is a statistical source that measures financial market fluctuations. They are performance indicators that indicate the performance of a certain market segment or the market as a whole.
Q. What are bear and bull markets in the stock market?
A. in a bull market When customers spend more, the economy grows, which means companies earn more profits. When there is a recession in the market, it is called a bear market.
Q. What is Nifty 50 and Sensex in the stock market?
A. Nifty 50 and Sensex are the benchmark indexes used by the NSE and BSE respectively to determine the overall performance of a stock market. Nifty 50 is a collection of the top 50 listed companies. According to market capitalization, India’s top 30 companies are listed in Sensex.
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