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Stocks Market | |||||
Market involving
trading of listed stocks and derivatives in exchange is known stock market.
Summary:
1.
How does stock market help in raising funds for an organization. 2.
What is a stock market. 3.
Who benefits from it. 4.
Advantages of stock market. 5.
How people make money through stock market 6.
Types of trading The
source for raising funds for a concern or an organization is done through
stock market and it is the major fund that
each concern gets by trading in these markets. Each company raises an
additional capital for their businesses by way of going to public for
expansion and newly assigned projects. These stock
market provide liquidity for the investors and quickly access to
buy and sell securities. These markets have the most attractive feature
of investment, compared to other investments which generate lesser options
to generate money. These markets give varieties of options to generate
money for small investors to big shots through numerous ways like equity,
intra day, future and options. Real-time
trading is processed through the exchange for the listed securities, facilitating
smooth process. These markets are the indicators that show the economic
boom for any country. It shows the positive and negative signs of any
countrys economic growth whether one has to invest or not in them or not.
Through these markets, many new industries from their host countries are
ready to set up their own industries and generate revenue through this
by investing in these markets. The
increase in the share prices in the market shows increased business turnover
and investment and vice versa. These stocks become a source of income
for many households and it may be useful to run a family. Nowadays, stock
market behavior is controlled for smooth operation of trading functions
to decrease the malpractices and fraud taking place and set up a board.
These are governed by the rules and regulations of the governing board.
All the countries have their own governing board for financial stability
of the stock exchange and ultimately their country. Stock
market operate through the stock exchanges who act as the clearinghouse
for each transaction in which they collect and deliver the shares, and
guarantee payment to the seller of a security. Stock
markets are the key areas for the indirect income for many people relating
to different fields especially web sites relating to stocks, news channels,
and technical analysts, one who play an important role for trading in
stock market, and so on. He analyzes each and every stock with many factors
and releases their report showing their statistical growth. Transactions
are maintained for stock market by the brokerage firm who generate lot
of money through the investor and trader. Even the trader has to pay to
the brokerage firm whether he loses or gain while trading in the stock
market. In this way brokerage firms are beneficial. Stock
markets promote the production of goods, services and many employment
opportunities for the developing nations. In this way, it contributes
to increased prosperity. Shares are issued in stock market to increase
the demand of the company needs. First, the shares comes to the primary
market through initial public offer in which a governing body of the country
fixes a price band for company, the opening and closing dates of that
issue. The issue will be given advertisement through hoardings and pamphlets.
The offer will be subscribed by the general public when the issue opens
and closes at the given dates. Then depending upon the number of times
of subscription, the issue will be listed on the exchange which is known
as secondary market, where the actual trading taking place. There
are many stock markets all over world. Each country maintains the exchange
where stocks can be traded to generate the revenue for them. Stock market
will have many exchanges depending upon the flow of money. Generally they
are kept in major cities. These markets depend upon the economy of country.
This factor makes any one, a small trader to fund manager trade the stock
comfortably. Many foreign investors are the major investors who are the
deciders of the stock market. Nowadays, markets are very volatile so one
should be careful in investing huge amount in these shares. They make
traders to gain or lose. It
is important that people know about the stock market and how would they
make money by investing in it. Fundamental analysis and Technical analysis
are the two basic approaches that help people understand about the stock
they would invest in, and also how that investment would help them make
money. When the companies are analyzed by their financial statements found
in business trends, general economic conditions, and so on, it is known
as fundamental analysis. The study of price actions in markets through
the use of charts and quantitative techniques to attempt to forecast price
trends regardless of the company's financial prospects is known as technical
analysis. Index
method is another way many people would opt for investing. A weighted
or un-weighted portfolio consisting of the entire stock market or some
segment of the stock market is held by the investor in this method. Maximizing
diversification, minimize taxes from too frequent trading, and ride the
general trend of the stock market are targeted and aimed in this method.
People, illegally get the inside information, and this type of trading
is known as insider trading. In almost all the developed world stock markets,
this method is considered illegal.
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