1. A
Journey
into
Stock Markets
Prof. Mallikarjun Bali

2.  An instrument- that signifies an ownership
position (called equity) in a corporation, and
represents a claim on its proportional share in the
corporation’s assets and profits.
 For example, if a company has 1000 shares of
stock outstanding and a person owns 50 of
them, then he/she owns 5% of the company.
 Most stock also provides voting rights, which give
shareholders a proportional vote in certain
corporate decisions

3. A stock market is a market for the trading
of publicly held company stock and
associated financial instruments (including
stock options, convertibles and stock index
futures).

4.  Primary market
-Channel for creation of new securities
 Secondary market
-The new securities issued in the primary
market are traded the secondary market

5.  1. Initial Public Offer;
 2. Rights Issue (For existing Companies); and
 3. Preferential Issue.

6. Formal organizations, approved and
regulated by the Securities and Exchange
Board of India (SEBI), that are made up of
members who use the facilities to
exchange certain common stocks.

7. Two National Level Exchanges are
1. National Stock Exchange (NSE)
2. Bombay Stock Exchange (BSE)
Total 24 Exchanges are there in India
National and Regional level, all exchanges
conducts 100% computerized trading.

8. STOCK EXCHANGES IN INDIA
BSE NSE

9. STOCK MARKET

10.  Established In 1875 As "The Native Share
And Stock Brokers Association".
 Oldest Stock Exchange In Asia.
 Around 7000 Companies Are Listed.
 Around 935 Main Brokers And 5617 Sub
Brokers.
 Non Corporate: 210 - Corporate : 710
 Daily Traded Companies Are Around 3500
 Average Daily Turnover Of Rs. 7500 Cr.
 30 Companies scripts are taken to calculate
index value SENSEX

11. Name of company Weightage
RIL 13.10
Infosys Tech 9.37
L&T 8.44
ICICI Bank 7.67
HDFC 5.71
ITC 5.46
Bharti Airtel 4.87
HDFC Bank 4.64
SBI 4.13
ONGC 3.67
BHEL 3.26
HUL 2.50
TCS 2.25
Tata Steel 1.88
Tata Power 1.78
Name of Company Weightage
Maruti Suzuki 1.75
Sterlite Industries 1.71
Grasim Industries 1.69
NTPC 1.69
RCOM 1.61
Jaiprakash Associates 1.60
M&M 1.56
Wipro 1.53
Reliance Infra 1.49
DLF 1.41
Hero Honda 1.25
Tata Motors 1.22
Hindalco 1.09
Sunpharma 0.82
ACC 0.75

12.  Established In November 1992.
 Around 3500 Companies Are Listed
 Around 850 Main Brokers And 10000 Sub
Brokers.
 Non Corporate : 35 - Corporate : 725
 Daily Traded Companies Are Around 100%
 Average Daily Turnover Of Rs. 15000 cr.
 50 Companies scripts are taken to calculate
index value NIFTY

13. Name of company Weightage
RIL 11.23
Infosys Tech 8.02
L&T 7.23
ICICI Bank 6.58
HDFC 4.89
ITC 4.67
Bharti Airtel 4.17
HDFC Bank 3.98
SBI 3.53
ONGC 3.15
BHEL 2.87
HUL 2.14
TCS 1.93
Tata Steel 1.61
Jindal Steel 1.58
Tata Power 1.53
Name of Company Weightage
Maruti Suzuki 1.50
Axis Bank 1.48
Sterlite Industries 1.46
Grasim Industries 1.45
NTPC 1.45
RCOM 1.38
M&M 1.34
Wipro 1.31
Reliance Infra 1.27
DLF 1.21
Unitech 1.19
GAIL 1.19
Hero Honda 1.07
Tata Motors 1.04
Idea Cellular 1.01
Cipla 1.00

14. Name of
company
Weightage
Hindalco 0.93
Cairn 0.90
Rel Capital 0.79
SAIL 0.75
PNB 0.71
Sun Pharma 0.70
ACC 0.64
Ambuja Cement 0.64
Siemens 0.61
ABB 0.61
BPCL 0.52
Name of
Company
Weightage
HCL Techno 0.50
Power Grid 0.49
Reliance Pow 0.46
Suzlon Energy 0.44
Ranbaxy Lab 0.39
Tata Comm 0.27
NALCO 0.22

15. HOW THE INDICES ARE CALCULATED?
1. Find out the “free-float market cap” of all the 30 (BSE) and 50
(NSE) companies that make up the Sensex and Nifty
2. Add all the “free-float market cap’s” of all the companies!

16. Trading on the equities segment takes place on
all days of the week (except Saturdays and
Sundays and holidays declared by the exchange in
advance)
The market timings of the equities segment are:
Normal market open : 9:00 am hours
Normal market close : 3:30 pm hours
The closing session is held between 15.50 hours
and 16.00 hours in NSE and 15.40 hours and
16.00 hours in BSE

17. Types of Market
Bull Bear

18. • D-Mat Account
• Saving Bank Account
• Permanent Account Number (PAN)
• Trading Account with Recognized Stock
Broker
The Most Important is
Transaction Process
(How To Start Trading And Investing)

20. Rules for earning money in
the market
• Rule 1: Never lose
your money in the
market.
• Rule 2: Never forget
Rule 1.

21. Settlement Procedure
For Cash Markets
• Settlement is done on T+2 basis for cash markets.
• Trades entered in to on a particular day are settled
on third day.
• E.g. If u purchase shares on Monday, the settlement
day would be Wednesday.

22.  Promotes the savings
 Provide liquidity to investors
 Profitable activities for companies
 Permits for the investor to have a
political power in the companies
 Possibility of diversifying your
portfolio

23.  Economic Factors
 Market trends & rumors
 Global Market indicators
 Govt Policies and Regulations
 Company wide factors

24.  Dematerialization in short called as 'demat' is
the process by which an investor can get
physical certificates converted into electronic
form maintained in an account with the
Depository Participant. The investors can
dematerialize only those share certificates
that are already registered in their name and
belong to the list of securities admitted for
dematerialization at the depositories.

25. A bank or company which holds funds or securities
deposited by others, and where exchanges of these
securities take place.
 National Securities Depository Limited
 Central Depository Services Limited

26. In India, a Depository Participant (DP) is described as
an agent of the depository. They are the
intermediaries between the depository and the
investors.

27. Sectoral Indices
• Realty
• PSU
• Auto
• Power
• Consumer Durables
• Oil & gas
• Bankex
• FMCG
• Capital Goods
• Metal
• Teck
• IT

28. Capitalisation
• Large Cap - Above 750 cr.
• Mid Cap : Between Rs 75 cr. and Rs 750 cr.
• Small Cap : Below Rs. 75 cr.

29.  Intra-day Trading
 Delivery based Trading

30. • Buying and Selling on the same day.
• Brokerage will be different for intra-day and
delivery based trading, intra-day being lesser

31. Delivery Trading
• Buying and Selling are on different days
• Brokerage will be higher than intra-day
• Delivery charges

32. Foreign Markets
• Dowjones
• Nasdaq
• Nikkei
• Shanghai

33. Derivatives