An Introduction to the Stock Market

An Introduction to the Stock Market

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Stock Market is probably a  a New investors taking their first steps towards learning the basics of stock trading should have access to multiple sources of quality education. Just like riding a bike, trial and error coupled with the ability to keep pressing forth will eventually lead to success.

One great advantage of stock trading lies in the fact that the game itself lasts a lifetime. Investors have years to develop and hone their skills. Strategies used twenty years ago are still utilized today. The game is always in full force.

So for new investors wanting to take their first steps, We offer answers to the simple question, “How do I get started?”

Few Basics you should Know about the Stock Market

No one likes to lose money. Moreover, the pain threshold of some is greater than it is with others. If you’re considering an investment in the stock market and the thought of a loss upsets you, you probably shouldn’t invest.

However, when you invest there are several things you should know to increase your chances of winning. That’s the subject of this article. Although there are numerous details and caveats, this article will help you understand the basics of how the stock market works and why stocks react as they do.

What is a Stock Market?

The stock market is a complicated system where shares of publicly-traded companies are issued, bought and sold. To some it is a indistinct, dark gulf where people bet or gamble.

Actually, it is not betting at all. Why? Let’s say you put $100 on one roll of the dice. If you win, you win $X. If you lose, you lose the entire $100. When you invest in stocks, you will win $X or lose $Y.

It’s rare to lose it all, unless of course you invest in a company that goes bust. You could say that the stock market is a group of people pitting their expertise against one another.

What Makes Stock Market Prices Go Up and Down?

There are many factors that determine whether stock prices rise or fall. These include the media, natural disasters, the opinions of well-known investors, political and social unrest, risk, supply and demand, and the lack of or abundance of suitable alternatives.

The compilation of these factors, plus all relevant information that has been disseminated, creates a certain type of sentiment and a corresponding number of buyers and sellers.

If there are more sellers than buyers, stock prices will tend to fall. Commonly, when there are more buyers than sellers, stock prices tend to rise.

The Trading in the Indian stock market takes place on its two biggest stock exchanges. One of them is the Bombay Stock Exchange (BSE) and the other one is National Stock Exchange (NSE).

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