Stock market institute in Delhi

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Institute of Career In Financial Market
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ICFM - Institute of Career In Financial Market
is a market leader in the segment of financial
market education. It is a unit of career pro
ventures limited, a diversified education
corporate. At ICFM, we deliver the cutting edge
training to people willing to make career in
financial markets. Our programs are not ordinary
"run of the mill" programs. Our programs bring
extensive focus on "next generation technologies"
which give you edge in ever competitive
employment opportunities.
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Chapter 1.1 Basics Of Share Market Explained
WHY DO WE INVEST?To make sure we have enough
funds to be prepared for the future. Simply
earning and saving is not enough. Inflation the
price-rise beast eats into the value of your
money. To make up for the loss through inflation,
we invest and earn extra. This is the investment
fundament. The stock market is one such
investment avenue. It has a history that goes way
back to the 1800s.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 Indias 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.
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So Lets Start With Share Market Basics.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.
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Kinds Of Stock Market There are two kinds of
share markets primary and second markets.

• Primary Market

• Secondary Market

• This where a company gets
• registered to issue a certain
• amount of shares and raise
• money. This is also called getting
• listed in a stock exchange.
• A company enters primary
• markets to raise capital. If the
• company is selling shares for the
• first time, it is called an Initial
• Public Offering (IPO). The
• company thus becomes public.

• Once new securities have been sold in
• the primary market, these shares are
• traded in the secondary market. This is to
• offer a chance for investors to exit an
• investment and sell the shares. Secondary
• market transactions are referred to trades
• where one investor buys shares from
• another investor at the prevailing market
• price or at whatever price the two parties
• agree upon.
• Normally, investors conduct such
• transactions using an intermediary such as
• a broker, who facilitates the process.

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WHAT ARE THE FINANCIAL INSTRUMENTS TRADED IN A
STOCK MARKET?Now that we have understood what a
stock market is, let us understand the four key
financial instruments that are traded
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Four keys of financial instruments

• Bonds
• Companies need money to undertake projects. They
  then pay back using the money earned through the
  project. One way of raising funds is through
  bonds. When a company borrows from the bank in
  exchange for regular interest payments, it is
  called a loan. Similarly, when a company borrows
  from multiple investors in exchange for timely
  payments of interest, it is called a bond.

• Secondary Market
• The share market is another place for raising
  money. In exchange for the money, companies issue
  shares. Owning a share is akin to holding a
  portion of the company. These shares are then
  traded in the share market. Consider the previous
  example your project is successful and so, you
  want to expand it.

• Mutual Funds
• These are investment vehicles that allow
• you to indirectly invest in stocks or bonds. It
• pools money from a collection of investors,
• and then invests that sum in financial
• instruments. This is handled by a
• professional fund manager.
• This is either through a rise in the value of
• the units or through the distribution of
  dividends-money to all unit-holders

• Derivatives
• The value of financial instruments like
• shares keeps fluctuating. So, it is difficult
• to fix a particular price. Derivatives
• instruments come handy here.
• These are instruments that help you
• trade in the future at a price that you fix
• today. Simply put, you enter into an
• agreement to either buy or sell a share or
• other instrument at a certain fixed price.

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WHAT DOES THE SEBI DO?

• Stock markets are risky. Hence, they need to be
  regulated to protect investors. The Security and
  Exchange Board of India (SEBI) is mandated to
  oversee the secondary and primary markets in
  India since 1988 when the Government of India
  established it as the regulatory body of stock
  markets. Within a short period of time, SEBI
  became an autonomous body through the SEBI Act of
  1992.

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Chapter 1.2 Getting familiar with market-related
concepts

• WHAT IS MARKET CAPITALIZATION?
• Different companies issue varied amounts of
  shares when they get listed. The value of one
  share also differs from that of another companys
  stock. Market capitalization smoothens out these
  differences. It is the market stock price
  multiplied by the total number of shares held by
  the public. It, thus, reflects the total market
  value of a stock taking into consideration both
  the size and the price of the stock. For example,
  if a stock is priced at Rs. 50 per share, and
  there are 1,00,000 shares in the hands of public
  investors, then its market capitalization stands
  at Rs. 50,00,000.

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WHAT DOES COST AVERAGING MEAN?

• Rupee-cost averaging is a concept when you buy a
  stock in small bunches, instead of buying in
  lump-sum. This helps reduce the average cost of
  your investment.
• Let us use an example. Suppose you bought 100
  shares of a company costing Rs. 10 each, your
  total investment cost is Rs. 1000. Instead of
  that, if you buy 50 shares for Rs. 100 and 50 for
  Rs. 95, your total cost of investment would be
  lower. Not just that, even your average cost per
  share would be lower. This is called rupee-cost
  averaging. This concept comes handy when a
  stock falls after you have bought it. The fall in
  share price gives you an opportunity to buy more
  and reduce your average cost of investment. This
  way, when you finally sell the shares at some
  time in the future, you end up making more
  profits.

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Chapter 1.3 HOW DOES SHARE MARKET WORK?

• Ask any layman about the share market investing,
  and they will tell you that they dont know about
  stock trading. Yet, the stock market is one of
  the largest avenues for investment. As many as
  rs. 6 lakh crore-worth stocks have been traded in
  the two stock exchanges in india on some
  occasions. Stock market investing is often called
  a gamble. It would cease to be a gamble if you
  understood the basics of the share market.
• In the previous section, you were introduced to
  the different market participants and other share
  market basics. Lets try to stitch these
  narratives together and understand how the stock
  market works.

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STOCK MARKET PARTICIPANTS
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Your broker passes on your buy order to the
exchange, which searches for a sell order for the
same share. Once a seller and a buyer are fixed,
a price is agreed finalized, upon which the
exchange communicates to your broker that your
order has been confirmed.

• Stock brokers and brokerage firms are entities
  registered with the stock exchange. They act as
  an intermediary between you, as an investor, and
  the stock exchange

• Once listed, the stocks issued can be traded by
  the investors in the secondary market. This is
  where most of the trading happens. In this
  market, buyers and sellers gather to conduct
  transactions to make profits or cut losses.

• The exchange ensures that the trade is honoured
  during the settlement. Whether the seller has
  the required stock to sell or not, the buyer will
  receive his shares. If a settlement is not
  upheld, the sanctity of the stock market is lost,
  because it means trades may not be upheld.

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HOW YOUR ORDER IS PROCESSED
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WHAT ARE STOCK INDICES?From among the stocks
listed on the exchange, some similar stocks are
selected and grouped together to form an index.
This classification may be on the basis of the
industry the companies belong to, the size of the
company, market capitalization or some other
basis. For example, the BSE Sensex is an index
consisting of 30 stocks. Similarly, the BSE 500
is an index consisting of 500 stocks.
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The values of the grouped stocks are used to
calculate the value of the index. Any change in
the price of the stocks leads to a change in the
index value. An index is thus indicative of the
changes in the market.Some of the important
indices in India are1. Benchmark indices BSE
Sensex and NSE Nifty2. Sectoral indices like BSE
Bankex and CNX IT3. Market capitalization-based
indices like the BSE Smallcap and BSE Midcap4.
Broad-market indices like BSE 100 and BSE 500
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HOW IS INDEX VALUE CALCULATED?
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Contact DetailsU 135, Ground 1st Floor, Laxmi
Nagar, Infront of Gate No. 3, Laxmi Nagar Metro
Station, Delhi-110092.Direct 91 9971333795 /
91 9971900635E Mail info_at_icfmindia.com
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