The Blog

WHY INVEST IN SHARE MARKET?

We invest in shares to build our wealth in the long run. While some people view shares to be a risky investment, many studies have proved that putting your money in the right shares for a long period of time (five to 10 years) can provide inflation-beating returns — and be a better investment option than real estate and gold.

People also have short-term strategies while investing in share markets. While shares can be volatile over a short period of time, investing in the right shares can help traders make quick profits.

Earlier, stockbrokers would converge around Banyan trees to conduct trades of stocks. As the number of brokers increased and the streets overflowed, they simply had no choice but to relocate from one place to another. Finally in 1854, they relocated to Dalal Street, the place where the oldest stock exchange in Asia – the Bombay Stock Exchange (BSE) – is now located. It is also India’s first stock exchange and has since then played an important role in the Indian stock markets. Even today, the BSE Sensex remains one of the parameters against which the robustness of the Indian economy and finance is measured.

WHAT IS SHARE MARKET?

A share market is where shares are either issued or traded in.

A stock market is similar to a share market. The key difference is that a stock market helps you trade financial instruments like bonds, mutual funds, derivatives as well as shares of companies. A share market only allows trading of shares. The key factor is the stock exchange – the basic platform that provides the facilities used to trade company stocks and other securities. A stock may be bought or sold only if it is listed on an exchange. Thus, it is the meeting place of the stock buyers and sellers. India’s premier stock exchanges are the Bombay Stock Exchange and the National Stock Exchange.

WHAT ARE THE FINANCIAL INSTRUMENTS TRADED IN A STOCK MARKET?

Below are the main four key financial instruments that are traded in Stock market:
1. Bonds
2. Shares
3. Derivatives
4. Mutual Fund

HOW TO INVEST IN SHARE MARKET

-Obtain a PAN card

-Hire a Stockbroker

-Open a Demat and a Trading account

-Open a Bank account

-Buy and sell shares