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INVESTMENT OPPORTUNITIES Equity markets

EQUITY MARKET

There are two segments in the equity market Primary market Secondary market

SECONDARY MARKET FOR EQUITY

Secondary market is where a person can buy and sell securities previously issued by companies Stock exchange is the secondary market There are 23 stock exchanges in India NSE and BSE are the two largest A share has to be listed on the stock exchange for it to be traded there Beside equity, debt and derivatives are also traded on a few exchanges

MARKET CAPITALIZATION

Market capitalization for a company is obtained by multiplying the share price with the total number of equity shares issued by the company. The leading companies in terms of market capitalization are:
Oil & Natural Gas Corporation Ltd. Reliance Industries Ltd. Hindustan Lever Ltd. Indian Oil Corporation Ltd. Wipro Ltd. Infosys Technologies Ltd. State Bank of India

INDEX

An index represents the market or a sector in the market. Movements in the index indicates movements in the market.
NIFTY and BSE Sensitive Index represent the largest shares S&P CNX 500 and BSE500 represent the broader market CNX Midcap 200 represents the medium sized companies

INDEX MOVEMENT

In a strict sense, movement of the index is influenced by the movement of the price of shares in the index Generally index movement indicates the broad market sentiment However, investors should not automatically assume that all shares will move up in a bull run Sometimes, a few persons artificially push up some small shares during the bull run and investors should be careful about such manipulations.

TRANSACTING First open a demat account Approach a broker with SEBI IN THE registration and track record SECONDARY Ensure you are investing in companies that are not EQUITY delisted and not in Z group MARKET Keep a diversified portfolio Review the investments regularly Equity investment needs patience In the short run equity investment can be risky

FOR SMALL INVESTORS

Try to invest small amounts regularly Try Systematic Investment Plan (SIP) This is called Rupee Cost Averaging method This method is superior as it gives you lower average purchase cost Do not try to trade too actively in the market unless you have high risk bearing capacity Try to work only in the demat segment

OPENING A DEMAT ACCOUNT

Opening a depository account is as simple as opening a bank account. You can open a depository account with any depository participant DP- convenient to you. Obtain the account opening form from the DP and fill it up. Sign the DP-client agreement. It defines the rights and duties of the DP and the person wishing to open the account.

SOURCES OF INVESTMENT INFORMATION

Read a reputed financial daily to understand the economy and the market Watch the business news on television Subscribe to the publications of investor associations Attend the investors meetings of the investor associations regularly Browse the websites of SEBI, NSE and BSE

THANK YOU
IIPM-PG-FW-10-12