An Introduction

Introduction to Shares & Stocks

What is share / stock market? What is BSE / NSE Index? How it is calculated? How to buy a share? What is Initial Public Offer (IPO)? What is primary market? What is secondary market? Who is trading member? What is inside trading? The questions are endless. You will learn everything about shares and stock market in this website. Many people are afraid about share trading because they don't know these technicalities. These jargons are really scary to them.

Basically a share is a ownership in a public limited company. A private limited company's shares are owned by its proprietors and partners. In India a company should be registered with registrar of Companies in order to be called a company and get the benefits of a company. In the long run a company may need funds for expansion and new projects. So a company may want to collect the fund from the public or people willing to invest. So a company may go public. The company will become public limited as it is owned by public. An Initial Public Offer or IPO is the first issue of shares to public. A company must be listed on Stock Exchange in-order to trade its shares. BSE (Bombay Stock Exchange) is India's popular stock exchange. NSE is other popular Stock Exchange.

Once the shares are listed they are traded in secondary market. A company will sell shares at a face value (Normally Rs.10). A popular and big company may sell it share with a premium i.e Face value + extra premium. People will still want to buy its shares because it a valuable company.

When you buy a company's share you buy part of the ownership of the company. Why should you buy a share? You want to make an investment and you want returns from your investment. By investing in Shares you will get yearly dividend and also your share value may increase. It may also decrease and you will lose your money.

How to avoid losses in share market? How to become a successful trader? Please read on.