Sharemarket
11
SHARE MARKET-An INTRODUCTION
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Transcript of Sharemarket
SHARE MARKET-An INTRODUCTION
A share market or equity market is a public entity for the trading of
company shares and derivatives at an agreed price.
The stock exchange is a place where stocks are listed and where
buyer and sellers of the organizations to a listing of stocks and securities
together.
SHARE MARKET
HISTORY OF SHARE MARKET
During the American Revolution, the Colonial Government needed
money to fund its wartime operations they were selling bonds and
parts or shares of their own companies.
Wall Street was becoming a major center of these transactions, and
in 1792 twenty-four men signed an agreement that started the New
York Stock Exchange (NYSE).
Major Stock Exchanges (Top 20 by Market capitalization)as at 31 December 2012
RANK STOCK EXCHANGE ECONOMY HEADQUARTERS
MARKET CAPITALISATION(USD
BILLIONS)
1 NYSE EuronextUnited States/
New York City 14,085 Europe
2NASDAQ OMX Group
United States/
New York City 4,582 Europe3 Tokyo Stock Exchange Japan Tokyo 3,4784 London Stock Exchange United Kingdom London 3,396
5 Hong Kong Stock Exchange Hong Kong Hong Kong 2,831
6Shanghai Stock Exchange
China Shanghai 2,5477 TMX Group Canada Toronto 2,0588 Deutsche Börse Germany Frankfurt 1,486
9 Australian Securities Exchange
Australia Sydney 1,386
10Bombay Stock Exchange India Mumbai 1,263
11 National Stock Exchange of India
India Mumbai 1,23412 SIX Swiss Exchange Switzerland Zurich 1,23313 BM&F Bovespa Brazil São Paulo 1,22714 Korea Exchange South Korea Seoul 1,179
15 Shenzhen Stock Exchange China Shenzhen 1,15016 BME Spanish Exchanges Spain Madrid 99517 JSE Limited South Africa Johannesburg 90318 Moscow Exchange Russia Moscow 82519 Singapore Exchange Singapore Singapore 76520 Taiwan Stock Taiwan Taipei 735
BASIC TERMINOLOGEIS
A share of stock is literally a share in the ownership of a company.
Assets include everything the company owns (buildings,
equipment, trademarks), and earnings are all of the money the
company brings in from selling its products and services.
EXCHANGES are where the sellers are matched with buyers to
both facilitate trading and to help set the price of the shares.
Sensex is an index,basically a indicator that gives the idea about
whether most of the stocks are gone up or down.
Nifty is an indicator of all the major companies of NSE.
STOCK EXCHANGE
PHYSICAL EXCHANGE
EX:Newyork Stock Exchange
VIRTUAL LISTED EXCHANGEEX:NASDAQ
• PHYSICAL EXCXHANGE: Also referred to as a listed exchange – only stocks listed with the exchange may be traded, with a hybrid market for placing orders both electronically and manually on the trading floor.
• VIRTUAL LISTED EXCHANGE: Trading is done over a computer network.
HOW SHARE MARKET WORKS
1
6 5 2
4
3
INDIVIDUAL(BUYER)
Note: Member of X Deposited in X
TRADING COMPANY(MEDIATOR X)
COMPANY – A(SELLER)
EXCHNANGENETWORK(STOCK
EXCHANGE)
1.A person request ‘N’ number of shares of company A
2.The intermediate trading company X requests stock exchange for ‘N’
shares of company A
3.The exchange process request in the name of company X.
4.The share of company A is given.
5.The exchange sells ‘N’ shares of company A to company X.
6.The company X registers ‘N’ shares in the name of individual.
BUYING AND SELLING TERMINOLOGIES
• DAY TRADING: Buying and selling the same stock or option
position in one day's trading session, thus ending the day with no
position.
• DELIVERY: When referring to stock options, delivery is the process
of delivering stock after an option is exercised.
• SHORT: As a noun refers to people who have sold stock or options
without owning them first. As an adjective, it refers to a position of
short stock or options. Compare to long.
• STOP LOSS:A type of order that turns into a market order to buy or
sell stock or options when and if a specified "stop" price is reached.
FOR EXTENSIVE READING
• http://online-stock-trading-review.toptenreviews.com/buying-and-
selling-options-definitions-and-common-terms.html
• http://money.howstuffworks.com/personal-finance/financial-
planning/stocks.html
• http://www.marketwatch.com/getting-started.
• https://www.thinkorswim.com/tos/displayPage.tos?
webpage=dictionary&page=s
