Basics Of Stock Market In India:- Hello, reader of “Wealthsetup.com”, Here in this article, I explained the basics of stock market in India is how does it work.
If you guys are new to the stock market and want to learn the basics of stock market in India.
You are on the right page!
Here I explained everything that you want to know.
Which is important to understand for beginner traders/investors.
Entering in the stock market without proper and correct information is very risky.
So, read the complete article carefully and ask your doubt in the comment box.
What Is Stock Market?
When the Companys need funds to expand their business, they have two options 1st borrow from Bank and pay interest or issue the shares to the public and pay them profit share.
Most of the company not interested to borrow from Bank So, they issue the share to the public.
And they list their company at the stock exchange.
These stock exchanges are known as the stock market or share market.
In the stock market, traders buy and sell the shares of companies.
Most of the companies listed on both stock exchanges.
What Is the Difference Between BSE & NSE?
BSE & NSE both are stock exchanges. Where companies are listed for the trading of shares.
Some of the Companies are listed on the Bombay Stock Exchange (BSE) and some are listed on the National Stock Exchange (NSE).
Most of the companies are listed on both exchanges.
The only difference in both exchanges is the price of the stock.
The stock price may be different in both exchanges.
All other things are the same in both stock exchanges.
There are three types of works in the share market where people work.
- Cash market.
- Future market.
- Option market.
How to Buy or Sell Stocks?
To buy or sell stocks on the BSE (Bombay Stock Exchange) and NSE (National Stock Exchange).
You need a trading account which comes with the Demat account.
Using a trading account you can buy or sell the stocks of companies easily.
The share purchased by using a trading account is stored in Demat account.
Demat account is like your saving account.
In your saving account, you keep your cash in digital form.
And In the Demat account, you can keep the shares of the company in digital form.
You can open Demat account very easily.
Where and How Open Demat Account?
You can open a Demat account at any bank. Almost all banks allow the facility to open a Demat account.
You can open your Demat account at any Stock Broker like Sharekhan, Zerodha, Angel Broking, Samco, etc…
As per my personal opinion opening Demat account at the bank are costly than stockbrokers.
You can go with Samco & Zerodha because the trading charges of Samco & Zerodha are comparatively lower than banks trading charges.
Because of Zerodha is charge Rs.15/- per trade and Samco is charge Rs.20/- per trade which is very low compared to others.
And Samco is offering free for the first year which is best for beginners.
Documents Required for open Demate Account.
As you all know, you need to submit some basic documents to open a Demat account.
If your opening Demat account at your Bank or with any stockbroker the document requirement is the same.
Below is the list of documents required for open demate account.
- Account Opening Application Form.
- Pan Card
- Aadhaar Card
- One Cancel cheque
- Passport Size Photo
All documents must be self-attested and you need to read all the terms & conditions carefully before opening the Demat account.
I hope now you understand the basics of stock market in India and how to buy sell stocks. If anyone has any queries or suggestions regarding the stock market please ask in the comment box.Gashik