How to earn money by Learning Share market?? To earn money from various sources you have to first learn about products that
industry or any knowledge regarding that source. So we will starts from Basic. What is share market? Share market is a tool to build up a capital for companies. Companies sells there small part of ownership for capital is called “SHARES” of A common platform where buyers and sellers come together to transact in stocks and shares. It may be a physical entity where brokers trade on a physical trading floor via an "open outcry" system or a virtual environment. I think this theory is enough to just clear the concepts. Now we will see main two types of Trading? Intraday/Short Trading-: In this type of trading Investor can not keep stocks in there accounts he clears the balance of stock on same day. for e.g. if suppose Mr. A purchases 100 share of IDBI on Monday and sells 100 shares of IDBI on same day Monday then it is called as intraday trading. For
investors information intraday trading brokerage is very low as compared to Delivery Trading. Delivery/Long Trading-: In this type of trading, Buyer of the stock keeps the stock for long term more than one day. This is one of the most safest and profitable type of trading way. So this is basic information to trade in secondary market. Online Trading-:Now a days online facility is available for Investors and traders, trader can trade right from sitting at home from internet and make profit by buying and selling online. Traders must have to open Online Demat account to any broker. What is a Margin?? Margin is additional credit facility given by Broker for traders for Trading. It may be in 4 Times 10 times of amount deposited by the investor into trading account. It gives Traders extra exposures for Trading we can take one e.g. suppose Mr. a is deposited Rs 10000/ in his demat account then he is able to trade for 40000 in a day he will get additional 30000/ margin for Trading. The exposure may vary from broker to broker that should be considered while trading. Remember If you use exposure for Trading (Margin) and your stock falls below of Purchase price then you have only following options A) Take Delivery (Long) and Pay all exposure money to broker and wait for Rise in price (prise+Delivery brokerage Taxes) B) Sell out stock in same day (Intraday) the loss will deduct from basic amount deposited. What exactly will be the criteria for Choosing Stock? When the objective of the
analysis is to determine what stock to buy and at what price, there are two basic methodologies. Fundamental analysis maintains that markets may mispriced a security in the short run but that the "correct" price will eventually be reached. Profits can be made by trading the mispriced security and then waiting for the market to recognize its "mistake" and reprice the security. Technical analysis maintains that all information is reflected already in the stock price, so fundamental analysis is a waste of time. Trends ''are your friend'' and sentiment changes predate and predict trend changes. Investors'' emotional responses to price movements lead to recognizable price chart patterns. Technical analysis does not care what the ''value'' of a stock is. Their price predictions are only extrapolations from historical price patterns. Investors can use both these different but somewhat complementary methods for stock picking. Many fundamental investors use technicals for deciding entry and exit points. Many technical investors use fundamentals to limit their universe of possible stock to ''good'' companies. Fundamental analysis-: Fundamental analysis of a business involves analyzing its income statement, financial statements and health, its management and competitive advantages, and its competitors and markets. The analysis is performed on historical and present data, but with the goal to make financial projections. There are several possible objectives: to conduct a company stock valuatioits probable price evolution, to make projection on its business performance, to evaluate its management and make internal business decisions, to calculate its credit risk.