INDIAN STOCK MARKET OVERVIEW

The Bombay Stock exchange (BSE) and the National Stock exchange of India (NSE) are the two primary exchange in India. In addition to that there are 22 regional stock exchanges. However , the BSE and NSE have establish themselves as the two leading exchanges and account for about 80 percent of the equity volume traded in india ,the NSE and BSE are equal in size in terms of daily traded volume . The average daily turnover at the exchange has increased from Rs. 851 crore in 1997-98 to Rs. 1284 crore in 1998-99 and further to Rs. 2273 crore in 1999-2000. NSE has around 1500 shares listed with total market capitalization of around Rs. 921500 crore. The BSE has over 6000 stocks listed and as a market capitalization around Rs. 968000 crore . Most key stocks are traded on both the exchange and hence the investors could buy them on either exchange . Both exchange have different settlement cycle, which allows to investors to shift their positions on the bourses. The primary index of BSE is BSE Sensex comprising of 30 stocks. MSE has the S&P NSE 50 index 9 (Nifty) which consists of fifty stocks. The BSE Sensex is the older and more widely followed index. Both these indices are calculated on the basis of market capitalization and the contain the heavily traded shares from the key sectors. The markets are closed in Saturday s and Sundays . Both computerized mode of trading known as BOLT (BSE On line Trading ) and the NEAT (National Exchange Automated Systems . It Facilitates more efficient processing , automatic order matching , faster execution of trades and a transparency . The scribs traded on the BSE have been classified into A, B1 , B2, C, F, AND Z Groups. The A group represents those , which are in the carry forward systems . the Z group scrips are the black listed companies . The C group covers the odd lot securities A, B1, & B2 groups and Rights renunciations. The key regulator governing stock exchanges, Brokers, Depositories , depository participations , mutual funds , FIIs and other participants in Indian secondary and primary market is the securities and exchange Board of India ( SEBI).

There is no unique formula to ensure consistent gain before you venture into this market you should know the basics of stock trading . In the online investing your broker will connect to the exchange network and search for a buyer or the seller according to your idea. Electronic transaction is very common today. the NYSE has been on the television as part of News coverage. You have to approach in order to trade. The business in which you are investing provide you with the profit in terms of dividend. A share makes the holder a partial owner of the company and different types of share s has different types of rights associated with it. In the share market you are an anonymous player have made a reasonable profit.once the price is agreed upon. The floor check locates the floor traded from whom the shares can be bought . It is here the broker arranges for your arranges for your shares to be ordered. . the deal is finalized. Exchange floor scene must be familiar to you . Here too you require a broker but you receive confirmations. almost immediately. You can trade either electronically or on the exchange floor. It is the efficient and fast method of stock trading. If you are able to send your shares at a price more than its buying price than you are making a profit out of it that to you make a profit on the risk hat I incur a loss if the price falls.THE BASIC IDEA REGARDING SHARE TRADING The Share market immediately conjures up the stories of fortunes made and lost.

If a person is optimistic and believe that the stocks will go up. pigs are high investors looking for the big scores in a short period of time. And another strategy is to wait on the sidelines until you feel market is nearing its end. Picking stocks during a bull market is easier because everything is going up. he pr she is called a BEAR and said to have a bearish outlook. recession is looming and stock prices are falling. and sometimes they can lead to dangerous situations if the stocks become overvalued . Things are just plain rosy. people are finding jobs. Their overrides their need to make profits and so they turn only money to make market securities or to get out the money out of the markets entirely. GDP is growing . if a person is pessimistic . You are considered guaranteed never to see any return if you avoid the market completely and never take any risks . . believing that stocks are going to drop. The other animals on the farm ± CHICKENS and PIGS Chickens are afraid to lose anything.THE BULLS. THE BEARS AND THE FARM The Bulls A Bull market is when everything in the economy is great . One solution to this is to make money when stocks are falling using a technique called short selling. he or she is called a BULL and is said to have a bullish outlook. and the stocks are rising . The Bears A Bear market is when the economy is bad. only starting to buy on anticipation of a bull market. Bull markets cannot last forever though. Bear markets make it tough for investors to pick profitable stocks. Pigs buy on the hot tips and invests in the companies without doing their due intelligence . While its true that you should never invests in something over which you lose sleep.

it isn¶t going to stay in business . there would be greater supply than the demand and the price would fall. There are many answers to this problem and just any investor you has their own ideas and strategies y The most important factor that affects the value of the company is its earnings . If a company results surprise i.Remember . y Theoretically. then the price moves up. if more people want to to buy a stock than sell it. Public companies are require to report their earnings for times a year.e. If it is vice-versa then the condition is reverse. The reason behind is the that analyst base their future value of accompany on their earnings projection. but there are indicators that investor use to predict stock price . Understanding supply and demand is easy . it is the investor¶s sentiments . better than expected . This comes down to figuring out what news is positive for a company and what was news is negative. What is difficult to comprehend is what makes people like particular stock and dislike another stock .. If a company never makes money . Conversely if more people wanted to sell than buy it. the price jumps up.WHAT CAUSES STOCK PRICE TO CHANGE? Stock price changes everyday due to following reasons: y The main reasons which cause it to change is the market forces that is the demand and supply. earnings are what affect investor¶s valuation of a company. attitude and expectations that ultimately affect stock prices . y The various ratios are also responsible for the stock price to change such as price earnings ratio while others a re extremely complicated and obscure with names like chaikin oscillator or moving average convergence divergence. earnings are the profit that company makes and in the long run no company can survive without it. It makes sense when you think about it.

DRIPs & DIPs Dividend reinvestment plans (DRIP) and direct investment plans by which individual companies for a minimal cost . Discounts brokerage offer little in the way personal attention but are much cheaper. Full-service brkrge offer you erxpert advice and can manage your account . they also charge a lot. allow shareholders to purchase stock directly from the company . Brokerage come in two different flavors. 2. only the wealthy could afford since only the expensive .BUYING STOCKS 1. Drips are a great way to invest small amounts if money at regular intervals. Brokerage :.The most common method to buy stocks is to use a brokerage. With the interest came the exploitation of online discount brokers. full service bokers were available. . At one time .

there are many factors influencing prices the most important of which is earnings y y y To buy stocks you can either use a Brokerage or DRIP. This is generally why stocks are considered riskier investments and require a higher rate of return y You can loose your investments with stocks the flip side of this is to you can make a lot of money if you invest in right company y The two main types of stock markets are common and preferred . Bondholders are guaranteed a return on their investment and have a higher claim than shareholders.STOCKS BASICS CONCLUSION y Stock means ownership As an owner. but pigs get slaughtered . it is also possible for a company to create different classes of stock y Stock markets are places where buyers and sellers of stock meet to trade. The NYSE and the NASDAQ are the most important change in the United states y Stock process change according to the supply and demand . you have a claim on the asset and earnings ofa company as well as voting with your shares. y Stock is the equity bonds are debt. Stock tables actually aren¶t that hard to read once to know what everything stands for Bulls make moneuy bears make money .

The volume and price are put on . This is because until a person predicts the move of any stock or stock index. stock charts are referred to as time series plots. In statistical terms. An investor who plots information about share prices and trading volumes on a stock chart. The stock market charts are used mostly for providing the graphical representation of the trends pertaining to the stock market index or a mutual fund or a particular stock. The black line represents price movement during the period of time.STOCK CHARTS A Stock Market Chart is a sequence of prices or volumes plotted over a specific timeframe. looking for patterns is a Chartist. but a person must be able to decipher the highs and lows of the stock market chart. The use of these charts depends upon the motive of a person. he cannot take decision and the stock market chart is the perfect way to know the moves. Stock market charts are considered as important tools for making investment in the stock market. All the big investors that have made huge money in the stock market are using the stock market chart from sure. On this chart volume is represented by blue bars that are draw out by blue line (Volume Moving Average). Doesnt matter if the information is provided by the stock market chart in line and bar graph or pie chart.

098.49% 0.05% 0.17 4.642.08% 0.13 2.the same chart for easier understanding volume/price relationship.13% 0. Investors.88 382.31% 0.27 821.30% 0.69% 0.As of 4/20/2010 10:40 @ MarketVolume. DOW Comp.40% 0. Market Indicators Index AMEX Comp.66 1.com Last 1.786.202. technical analysts and chartists use stock market chart to analyze and forecast future price movements.487. NASDAQ Comp.957.611.61 11.78 7. NYSE Comp. DJI DJT DJU S&P Financials S&P 100 S&P 500 S&P 400 Delayed .60% 0.16% 0.45 549.40 223. how one affects other.67 3. Any security with price data or volume data over a period of time can be represented by a stock chart for analysis.33 % 1.39% . To see more detailed explanation of all features of our live Java stock charts you can in our "Chart Help". The red vertical and gray horizontal navigation bars will help you to trace this relationship over timeframe.