1.An overview of Indian Share MarketK.LOGASAKTHIAssistant
ProfessorKnowledge Business SchoolKakapalayam, Salem-637504
2. INDIAN SHARE MARKET It was in 1875 that the Indian Share
Market first started functioning The first share trading
association in India was known as the NativeShare and Stock Brokers
Association, only to become the BombayStock Exchange (BSE) later
on. This trading association started off its operations with around
318members. 3. Main components of Indian Share MarketBombay Stock
Exchange (BSE)Bombay Stock Exchange is known to be the oldest stock
exchange in theentire Asian region .It started functioning in 1875
with the name The Native Share and StockBrokers Association.Under
the Securities Contracts (Regulation) Act, 1956, the association
gotits recognition as a stock exchange in 1956. 4. BSE Products
Trading items in Bombay Stock Exchange - Equity or Shares
Derivatives (Futures and Options) Debt Instruments 5. Continue..
The main index of BSE is known as the BSE SENSEX orsimply SENSEX
(Sensitivity Index). It is an index whichcomprises of 30
financially sound company scrips. The index calculation is based on
the Free-float MarketCapitalization methodology ? ? ? ? 6.
Free-Float Methodology A method by which the market capitalization
of an indexsunderlying companies is calculated. Free-float
methodology market capitalization is calculated bytaking the
equitys price and multiplying it by the number ofshares readily
available in the market. Instead of using all of the shares
outstanding like the full-market capitalization method, the
free-float method excludeslocked-in shares such as those held by
promotersand governments. 7. Calculated as:Read
more:http://www.investopedia.com/terms/f/freefloatmethodology.asp#ixzz23PMINOVs
8. National Stock Exchange (NSE) National Stock Exchange (NSE) is
considered to be theleader in the stock exchange scenario in terms
of thetotal volume traded. The market capitalisation the National
Stock Exchangetouched about $921.31 billion at the end of May 2009
. The National Stock Exchange received the recognition ofa stock
exchange in July 1993 under SecuritiesContracts (Regulation) Act,
1956 9. The products that are traded in the National StockExchange
are:- Equity or Share Futures (both index and stock) Options (Call
and Put) Wholesale Debt Market Retail Debt Market NSE has a fully
automated screen based trading systemwhich is known as the NEAT
system. The transactions are carried on with speed, efficiency,
andare all transparent. The risk management system of the National
StockExchange is world class and can be considered as thebenchmark
for other bourses 10. Continue,, The leading index of NSE is known
as Nifty 50 or justNifty. It comprises of 50 diversified benchmark
Indian companyscrips and is constructed on the basis of
weightedaverage market capitalization method. 11. Regulatory
Authority of Indian Share Market SEBI or Securities and Exchange
Board of Indiais the market watchdog and has theresponsibility of
protecting the investorsinterests, develops regulatory norms and
helpsin the development of the securities market inIndia. 12. Why
to invest in Indian share market ? An investor does not require a
lot of money to startinvesting in India share market unlike buying
propertyand paying off a monthly mortgage. Time of trading involved
spans from small to big. Onecan trade for a short period of time or
even a lengthyspan. It helps you to see fast cash if the market is
in robustmood and helps in fast liquidation. 13. Essential rules of
Indian Share Market Whenever share market is at its crest it is
bound to dip atsome point of time. If the share market is down, it
will only increase if thereare no external aspects influencing it.
14. Continue, Unlike the common belief of investing in booming
sharemarket, it is advisable not to block your hard earnedmoney in
already flourishing Sensex and NIFTY. It isbetter to wait for
market bottom trend and then purchaseshares at lower cost in order
to trade it later. The excellent time for investment is when the
market islow keeping the basics in consideration. 15. Continue..
Seek the advice of professionals who will not only provideyou tips
on best investment options but also on favourablemarket conditions.
Update yourself on the prevailing market conditions Whenever market
witness an upward trend alwayspurchase first and then sell the
securities, and when themarket dips always buy later and sell
first. 16. Tips on investing intelligently in Indian Share Market
Consider selling the shares which you have bought longtime back and
are indicating gains.Even if they are not willing to offer you
considerablegains then its time to get rid of them are invest
yourmoney in productive schemes. 17. Continue. Diversify your
shares buy investing in different sectors. Also consider investing
in equity funds and to stabilizeyour equity investments invest a
part in fixed incomeoptions like the bonds, Public Provident Fund,
NationalSavings Certificates and post office deposits. You can also
consider a balanced or debt fund if youhave restrained budget. 18.
Do not consider the shares based on laymans advice.Stride carefully
and invest in shares that you arecomfortable investing in. Judge
the firm by its past records and assess itpersonally. Take the
advice of the fund manager who manages thatspecific fund. 19.
Continue If you have allocated more than half of your investmentsin
equity, then stick to your plan. Do not surpass that pre-decided
perimeter and believe inthe performance of the market. 20. Thank
you
