Easy way to learn Financial Market

Easy way to learn Financial Market. Share Market is a place which provides the platform to do the trading on shares of various companies which are listed on the share market either on BSE (Bombay Stock Exchange) or NSE (National Stock Exchange). In simple words share market means a place where we can buy or sell the shares of the listed companies. Now there are broadly two types of share market. One is Primary share market and second is Secondary share market. Primary share market means a place where unlisted companies place their initial public offer (I.P.O.) to get listed on the share market either on BSE or NSE to get the advantage of market capitalization. Second type is secondary share market where shares of the listed companies are traded which means buying and selling is done. In India broadly two stock exchanges are popular i.e. one is BSE (Bombay stock exchange) and second is NSE (National stock exchange).

On the Bombay stock exchange only shares of 30 companies are considered for the weightage purpose it means Bombay stock exchange includes 30 companies. On the National stock exchange shares of 50 companies are considered for the weightage purpose. It means national stock exchange includes 50 companies so it is called as Nifty50.

Now one question that comes is How to trade? Or how to Buy and sell the shares?

Now it has become very simple to trade on the share market. Firstly you have to open the Demat Account with the CDSL or NSDL services provider. There are so many financial and security services companies which are offering Demat Account services. So open the Demat Account with your choice company and start investing in share market.Easy way to learn Financial Market

Next question is where to trade?

Answer is, there are many instruments of NSE and BSE. We can buy and sell the share of the companies which are listed on both the share markets i.e. BSE and NSE. But on BSE we can only buy and sell the shares on spot basis. On NSE we can buy and sell the shares on spot and futures. NSE offers future trading like Nifty future, Nifty options, I.T. future, FMCG future, Fin nifty, Bank nifty.

Now lets understand what is Nifty Futures?

Nifty futures is a derivative contract which means it gets its value from the behavior of its underlying asset. Nifty futures’ underlying asset is the Nifty50 index itself. If the value of the index goes up, then the value of the futures contract also increases. Similarly, if Nifty drops, then so do the Nifty futures. 

What is Bank nifty?

A futures contract  is traded on an Exchange. BANK Nifty futures Contract would be based on the index BANK NIFTY index. 

What is Finnifty?

Fin nifty futures contracts would be based on the fin nifty index.

Now understand what means by Options trading?

Options trading allows you to buy or sell stocks, ETFs etc. at a specific price within a specific date. This type of trading also gives buyers the flexibility to not buy the security at the specified price or date.

In the Options trading we can buy PUT option or CALL option. Easy way to learn Financial Market

Call option:- If our research shows that market can go up or share of the particular company can move up then we can buy the Call options it means market goes up then call options also increases or go up. 

Put option :-If our research shows that market can go down or shares of the particular company can move down then we can buy the Put options it means market goes down or decreases then put option increases or move up. 

One advantage of the option trading is that of limited risk. In the option trading loss is limited upto our buying value but the profit is unlimited. In the Options trading capital requirements also minimum.

In the option trading we can buy and sell the nifty option, Banknifty option, finnifty option and so on.

Now What is Expiry or what means expiry of the future and options?

In the future and options trading there are two types of expiry.one is weekly expiry and second is monthly expiry. Every Thursday of the month validity of the contract expires. On weekly expiry options validity expires on weekly basis and same like in monthly expiry options validity expires on monthly basis means last Thursday of the month.Easy way to learn Financial Market