Introduction to Stock Market - Basics of Share Market

Stock Market is a place where Shares of Publicly Listed Companies are traded. Business Valuation is equal to the Number of Shares x the Value of each Share. Investors invest the money as Dividends in Stock Market.

There are different Analysis which one needs to know before entering Stock Market. Analysis of Fundamental and Analysis of Technical plays an important part in Stock Market. Stock Market is also known as 'Share Market'. There are certain factors that can decide the prices for Stock and those factors are -

1. Company Performance

2. Market Sentiments

One must have noticed about some prices that are shown on Television Channel (ETnow or CNBC) moving forward very fast. That is known as 'Last Traded Price' (LTP) where the price of the Previous Day Stocks shows.

Before starting to trade it invest, one must consult a Stock Broker where the Broker gives guidance about buying and selling of a Particular Stock in the Share Market.

Stock Market is linked with Brokers who are linked with Banks. They are inter-connected with Savings Account, Trading Account, and Dematerialization (Demat) Account. Savings Account is opened in Banks, Trading Account is opened by Brokers and Demat Account is opened by Depository Participant (DP).

There are some technical terms one needs to know before entering or gaining overall knowledge of Stock Market or Share Market and those terms are -

a) IPO - Initial Public Offering

b) NSE - National Stock Exchange

c) BSE - Bombay Stock Exchange

d) SEBI - Securities Exchange Board of India

e) Clearing House

f) Transfer Agents

g) Settlement Banks

h) Depository (NSDL, CDSL) and 

I) Depository Participant (mentioned earlier)

Banks are Brokers can be Depository Participants. Public Listed Companies buys shares in the form of an IPO in the Share Market where Investors trade and earn some income with the help of Brokers to open a Demat Account in Banks or specific companies.