The document discusses the stock market, including definitions of key terms like stock exchange and demat account. It describes the major stock exchanges in India - the National Stock Exchange and Bombay Stock Exchange - and their key features. It also covers types of trading in the stock market, investments, benefits, causes of price fluctuations, and classifications of markets. The role of the market regulator SEBI is outlined. Speculation and different types of speculators are defined. The Greece debt crisis of 2009 and its effects on the Indian economy are briefly summarized.
2. INDEX
Definition of stock exchange
Types
Trading in stock exchange
Demat account
Importance
Investments
Benefits
Causes of price fluctuation
Classification of market
Greece crises
3. STOCK MARKET
Stocks are issued by company in
order to raise capital and bought by
investors in order to acquire the
portion of the company.
Stock market is a place where
buying and selling of stocks take
place.
4. TYPES
1. NORMAL MARKET :Order traded in
regular lot size.
2. ODD LOT MARKET: Orders are not
traded in regular lot size but both prices and
quantities should tally with each other.
3. SPOT MARKET: Its a market in which
instruments are traded for immediate delivery.
4. AUCTION MARKET: Initiated by
exchanges on behalf of members for settlement
related reasons.
5. BIG STOCK EXCHANGES
New York stock exchange
NASDAQ- America
Dow Jones
Tokyo stock exchange
London stock exchange
Bombay stock exchange
National stock exchange
7. STOCK EXCHANGES IN INDIA
NATIONAL STOCK EXCHANGE : It is
the ninth largest exchange in the world by
market capitalization and largest in India
by daily turnovers.
BOMBAY STOCK EXCHANGE : Its the
oldest stock exchange in Asia
with a rich heritage of
over 137 years of existence.
8. NATIONAL STOCK EXCHANGE
Location : Mumbai
Index : nifty
Consists : group of 50 stocks
Launch : April 1994
Base period : 1993-1994
Members : 726
9. BOMBAY STOCK EXCHANGE
Location : Mumbai
Index : Sensex
Consists: group of 30 stocks
Launch : 30 Jan ,
Base year : 1978-1979
Members : 852
10. TRADING IN STOCK MARKET
The market regulator SEBI has made
it compulsory to open a DEMAT
account to buy and sell stocks.
A person wants to buy/sell shares in
stock market has to first place an
order with a broker or can do
themselves using online trading
system.
The stock purchased shall be sent to
your DEMAT account . This process
is called Rolling Settlement Cycle.
11. DEMAT ACCOUNT
DEMAT stands for dematerialization
. It is a process through which
physically held shares are converted
into paperless (computerized) form.
In India there are 2 depositories
NSDL and CDSL
12. INVESTMENTS IN VARIOUS TYPES OF
TRADING
1. SHORT TERM TRADING :Stock
trading done for one week to couple of
months is called short term trading.
2. MID TERM TRADING: Stock trading
done for one month to a couple of
months is called mid term trading.
3. LONG TERM TRADING : Stock
trading done for a couple of months to a
couple of years is called long term
trading
13. BENIFITS
Possibility of increase in value of
share.
Income from dividend
Easy liquidity
Tax benefits on income earned
Effective way to make money
Diversification and capital growth
Wealth maximization of share holder
14. CAUSES OF PRICE FLUCTUATION
Demand and supply
Bank rate
Speculative pressure
Auction of underwriters
Change in companies board of
directors
Financial position
Trade cycle
Political factors
15. CLASSIFICATION OF MARKET
SECURITY MARKET:
1. EQUITY MAKET
2. DEBT MARKET
3. DERIVATIVE MARKET
FOREIGN EXCHANGE MARKET: Its
a global decentralization market for the
trading of currencies . In terms of
volume of trading it is by far the most
and largest market in the world.
16. PRIMARY MARKET: it deals in
issuance of securities and shares
are traded for the first time
SECONDARY MARKET: its a market
where previously issued securities
are bought and sold.
FINANCIAL MARKET
17. SPECULATION AND SPECULATORS
SPECULATION: It is a transaction of
members to buy or sell securities on
stock exchange with a view to make
profits to anticipate raise or fall in the
prices of securities
SPECULATOR: The dealer in stock
exchange who indulge in speculation is
called speculator. They do not take
delivery of securities by them , but only
pay or rescue the difference between the
purchase and sale price.
20. BULL (TEJIWALA)
He is the speculator who expects the
future raise in price of securities to
sell them at future date at a higher
price.
He is called a bull because his
activities resembles as a bull, as the
bull tends to throw its victims up in
the air through its horns. In simple
the bull speculations tries to raise
the price of securities by placing a
big purchase order.
22. BEAR ( MANDIWALA)
He is a speculator who expects
future fall in price ,he does an
agreement to sell securities at future
date at the present market value.
He is called as bear because his
attitude resembles with bear ,as the
bear tends to stamp its victims down
to earth through its paws .In simple
the bear speculator forces of prices
of securities to fall through his
activities.
24. STAG (Deer)
He operates in new issue of market
He is just like a bull speculator. He
applies large number of shares in
the issue market only by paying
,application money , allotment
money. He is not a genuine investor
because, he sells the allotted
securities at a premium rate and
makes profit. He is caution in his
dealing . He creates an artificial rise
in price of new shares and makes
profit.
26. LAME DUCK
He is a speculator when the bear
operator finds it difficult to deliver
the securities to a consumer on a
particular day as agreed upon, he
struggle as a lame duck to fulfill his
commitment .this happens when the
prices do not fall as expected by the
bear and the other party is not
willing to postpone the settlement to
the next period
27. The SEBI was constitute on 12 April
1988 under a revolution of the
government of India .
The companies act was given certain
power to SEBI as regards the issues
and transfer of securities and non
payment of dividend.
28. FUNCTIONS
Regulating the business in stock
exchange and any other securities
market.
Promoting and regulating self regulatory
organization.
Registering and regulating the work of
collective investments , including mutual
funds.
Prohibiting fraudulent and unfair trade
practices relating to securities market.
Promoting education and training of
intermediaries of securities market.
29. POWER OF SEBI
1. Power to approve the bye laws of stock
exchange .
2. Power to inspect the books of accounts.
3. Power of dealing in certain areas.
4. Power to try directly the foliation of
certain provision of the companies act
30. GREECE CRISES
The Greek government started in late
2009 as the one of 4 sovereign debt rises
in euro zone later referred to collectively
as a European crises.
Route cause of its eruption was a
combination of structured weakness in
the Greek economy .
Greek became the first country who failed
to make IMF 1.6 billion loan repayment on
June 30 2015.
35. EFFECT ON INDIAN ECONOMY
Since India tracks international economy
indicators and the value of the dollar the
fallout of Greek crises is bound to impact
the Indian stock market.
For some time market of India would stay
in a state of flux and rupee may loose
ground if situation in Greece is worsen
There is a need for India to double its
effort to strengthen the economy in terms
of domestic demand