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Published by Suchi Jaiswal

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Published by: Suchi Jaiswal on Nov 09, 2011
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1CONTENTS1. INVESTMENT BASICS....................................................................................................... 7What is Investment?...................................................................................................................7Why should one invest? .............................................................................................................7When to start Investing?...........................................................................................................7What care should one take while investing?......................................................................8What is meant by Interest?......................................................................................................8What factors determine interest rates?...............................................................................8What are various options available for investment?......................................................9What are various Short-term financial options available for investment?.............9What are various Long-term financial o ptions available for investment?............10What is meant by a Stock Exchange?................................................................................11What is an
Equity
/Share?......................................................................................................11What is a
Debt Instrument
?.................................................................................................12What is a Derivative?................................................................................................................12What is a Mutual Fund?............................................................................................................12What is an Index?.......................................................................................................................13What is a Depository? ...............................................................................................................13What is Dematerialization?.....................................................................................................132. SECURITIES ...........................................................................................................................14What is meant by
Securities
?..............................................................................................14What is the function of Securities Market?.......................................................................14Which are the securities one can invest in?.....................................................................142.1 REGULATOR ................................................................................................................................15Why does Securities Market need Regulators?...............................................................15Who regulates the Securities Market?................................................................................15What is SEBI and what is its role?.......................................................................................152.2 PARTICIPANTS ............................................................................................................................16Who are the participants in the Securities Market?......................................................16Is it necessary to transact through an intermediary?..................................................16
 
What are the segments of Securities Market?................................................................163. PRIMARY MARKET............................................................................................................17What is the role of the
Primary Market
? .........................................................................17What is meant by Face Value of a share/debenture? ..................................................17What do you mean by the term Premium and Discount in a Security Market?.173.1 ISSUE OF SHARES......................................................................................................................18Why do companies need to issue shares to the public? .............................................18What are the different kinds of issues? .............................................................................18What is meant by Issue price?..............................................................................................19What is meant by Market Capitalisation?..........................................................................19What is the difference between public issue and private placement?...................20What is an Initial Public Offer (IPO)?..................................................................................202Who decides the price of an issue? .....................................................................................20What does
price discovery through Book Building Process
mean?......................20What is the main difference between offer of shares through book building andoffer of shares through normal public issue?..................................................................21What is Cut-Off Price?...............................................................................................................21What is the floor price in case of book building? ...........................................................21What is a Price Band in a book built IPO?........................................................................21Who decides the Price Band?.................................................................................................22What is minimum number of days for which a bid should remain open duringbook building?..............................................................................................................................22Can open outcry system be used for book building?...................................................22Can the individual investor use the book building facility to make anapplication?...................................................................................................................................22How does one know if shares are allotted in an IPO/offer for sale ? What is thetimeframe for getting refund if shares not allotted?....................................................22How long does it take to get the shares listed after issue?.......................................22What is the role of a
Registrar
to an issue?...................................................................23Does NSE provide any facility for IPO?..............................................................................23What is a Prospectus?...............................................................................................................23What does
Draft Offer document
mean?........................................................................24What is an
Abridged Prospectus
?...................................................
 
....................................24Who prepares the
Prospectus
/
Offer Documents
?......................................................24What does one mean by
Lock-in
?......................................................................................24What is meant by
Listing of Securities
? ..........................................................................25What is a
Listing Agreement
?..............................................................................................25What does
Delisting of securities
mean? ........................................................................25What is SEBI
s Role in an Issue?..........................................................................................25Does it mean that SEBI recommends an issue? ............................................................26Does SEBI tag make one
s money safe?...........................................................................263.2 FOREIGN CAPITAL ISSUANCE..................................................................................................26Can companies in India raise foreign currency resources?.......................................26What is an American Depository Receipt?........................................................................26What is an ADS? .........................................................................................................................27What is meant by Global Depository Receipts?..............................................................274. SECONDARY MARKET.....................................................................................................284.1 INTRODUCTION...........................................................................................................................28What is meant by Secondary market?...............................................................................28What is the role of the Secondary Market?......................................................................28What is the difference between the Primary Market and the Secondary Market?...........................................................................................................................................................284.1.1 Stock Exchange .........................................................................................................29What is the role of a Stock Exchange in buying and selling shares?.....................29What is Demutualisation of stock exchanges?................................................................29How is a demutualised exchange different from a mutual exchange?..................29Currently are there any demutualised stock exchanges in India?...................Error!Bookmark not defined.4.1.2 Stock Trading ..................................................................................................................30What is Screen Based Trading?............................................................................................30What is NEAT?..............................................................................................................................303How to place orders with the broker? ................................................................................30How does an investor get access to internet based trading facility?.....................30What is a Contract Note?........................................................

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