How to invest in Stock Market to raise your monetary fund

 

What is the share market?

A share market is a place where you can buy or sell something. The stock market is the share capital of a listed company. We have two major stock exchanges in India, the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

 

In BSE or NSE, shares of a listed company are purchased through a broker. However, bonds, mutual funds, and derivatives also trade in the stock market.

 

A share is a share that we buy from a company and become a partner of that company. First, understand why the company makes a stake by making itself public.

When a company grows or makes a good profit, the company owner and the good businessman do not sit idly by, continuously thinking about how to develop their company. Once the plan is to grow their company, the subject comes up: capital, that is, money. Now, if the owner has enough capital, then the dream of growing the company will remain just a dream.

 

So what to do at such a time? Where should all this money come from? At such times the company owner makes his own company public and offers people to invest money in his own company. People who trust that company or want to make money sitting at home by investing in the company put money in the company and the capital of the company owner is created. This is called the stock market.

History of Share Market in India

BSE i.e. Bombay Stock Exchange is the first stock exchange in Asia which was established in 1875.

The BSE was founded in 1875 as the Native Stock Brokers Association, later renamed the Bombay Stock Exchange.

There are two leading stock exchanges for trading in the Indian stock market BSE & NSE

 

1)BSE- BSE stands for Bombay Stock Exchange located at Dalal Street, Mumbai.

The Bombay Stock Exchange was established in 1875 and is known as the oldest stock exchange in Asia.

BSE was founded by Premchand Roychand who was a great businessman of the 19th century.

 

The BSE was recognized by the government in 1957 and the online system was implemented in the BSE in 1995.

The BSE is the 9th largest stock exchange with a market cap of ₹ 2,18,730 billion as of 2021.

 

The BSE lists more than 5400 companies in which we can buy and sell shares. The BSE includes the following indexes.

 

· BSE SENSEX

· S&P BSE SmallCap

· S&P BSE MidCap

· S&P BSE LargeCap

· BSE 500

2) NSE -The second most important of the two major stock exchanges in India is the NSE - National Stock Exchange.NSE India is headquartered in Mumbai, the financial capital of India.

The National Stock Exchange was established in 1992. As of 2021, the NSE is the most traded stock exchange in India with a market cap of US $ 3.1 trillion.

There are more than 1900 companies listed on the National Stock Exchange in which you can buy and sell shares. The NSE includes the following indexes.

 

· NIFTY 50

· NIFTY Next 50

· NIFTY 500

 

NSE India's most famous index is the Nifty 50 Index which includes 50 major companies from 12 different regions in India.

The 12 sectors include information technology, financial services, consumer goods, entertainment and media, financial services, metals, pharmaceuticals, telecommunications, cement and its products, vehicles, pesticides and fertilizers, energy, and other services.

What is Share and how to gain capital?

When a company first brings its shares to the market, they go for IPO (Initial Public Offer) and then the shares are bought by the investors, then the same investor sells those shares in the exchange, and then those shares are bought. Trading starts from shares and then people make a profit in exchange for shares. These shares are called company shares.

Shares are your stake in a company. If you have bought shares of a company, it means that you own a part of that company. That means you have invested some money in that company, then if the company makes less profit or goes into profit, you also make a profit and if the company makes a loss, then you also lose. Today you can buy and sell shares of someone's company online through a home broker.

What does a company have to do to get listed in the stock market?

Suppose you need 20 lakhs. So you can easily raise Rs 20 lakh by listing your company in the stock market, for this, you first have to list your company on the stock exchange (BSE or NSE), and bring your company's shares to the market, those shares will be bought by people and you Money can be raised.

 

BSE is the Bombay Stock Exchange on which more than 4000 companies are listed. And the NSE is the national stock exchange on which more than 1500 companies are listed.

So to get your company listed on the stock exchange, you have to go to SEBI first. You have to give all the details of your company to SEBI and once SEBI verifies and approves your company. You can then list your company on the stock exchange.

 

So now you are going to sell the shares of your company for the first time and also you need 20 lakhs so you can take out 20,000 shares at 200 and this is called IPO i.e. initial public offering, i.e. when a company starts. It's the first time. If the shares are removed and listed on the stock exchange, it is called an IPO.

After that, when people buy the shares of your company and when all the shares are sold, Rs 20 lakh will be deposited in our bank account.

 

1)What is Equity Share

When a company listed on a stock exchange issues its shares, those shares are called equity

shares.If you have invested money in the company and you have bought some shares in the company,

it means that you own the company, that is, equity.

2) What is Preference Share

Preference shares have a lot of names in the stock market after equity shares, while there is not

much difference between preference shares and equity shares. For example, a preference shareholder can never vote at a company meeting. Because the preference shareholder does not have that many right And the profit the preference shareholder gets is already fixed at the end of the year. Thus the preference share is thus different from the equity share.

3) DVR Share- DVR share is different from equity and preference shares, it is different because DVR shareholders get benefits like Equity Share but they do not get voting right.

     

What is INTRADAY Trading

Intraday traders buy and sell shares on the same day after the market opens and before closing

People who want to make a lot of profit from the market buy and sell shares on the same day. Of course, they do intraday to make more profit i.e. they sell the shares on the same day they buy and hence they are called Intraday Trading and Intraday Trade.

What Is A systematic Investment Plan (SIP)

A systematic Investment Plan (SIP )is an investment method through which an investor can make a continuous investment. SIP is not a scheme, it is just a means to an end. In which a certain amount is added to your investment on a certain day. This is the easiest and most effective way to invest in a mutual fund. The investor can consistently invest a minimum amount in this. When investing in a SIP, the

investor has to decide in advance what the frequency of the SIP will be. That means you have to set a date to invest in SIP. The investor can then choose the date of his choice. The date of SIP can be weekly,

monthly, quarterly, or even annually. The investor has to pay his SIP amount on the due date. The period of SIP is the period for which the investor wants to continue his SIP. This means that the investor has

to decide whether to continue his SIP for one year, for two years, for 5 or 10 years or until he closes the SIP himself.