Share Market – how it’s work and create a account
Share Market Explained – Step by Step
1. What is the Share Market?
The share market (stock market) is a place where people buy and sell shares of companies.
A share means a small ownership part of a company.
When you buy a share, you become a small owner of that company.
Example:
If a company is divided into 1,000,000 shares and you buy 100 shares, you own a small part of that company.
Well-known stock markets include:
•NSE (National Stock Exchange) – India
•BSE (Bombay Stock Exchange) – India
•NYSE – USA
•NASDAQ – USA
2. Why Companies Sell Shares
Companies sell shares to raise money for business growth.
They may need money for:
•Opening new branches
•Developing new products
•Paying debts
•Expanding business
When a company sells shares to the public for the first time, it is called an IPO (Initial Public Offering).
Example:
A company launches an IPO and sells shares at ₹100 each to raise funds.
3. Who Can Invest in the Share Market?
Anyone above 18 years with:
•Bank account
•PAN card
•Demat account
•Trading account
A Demat account stores your shares digitally.
Popular brokers in India:
•Zerodha
•Groww
•Upstox
•Angel One
4. How the Share Market Works
The share market works through buyers and sellers.
Steps:
1.A company lists its shares on a stock exchange.
2.Investors buy shares through brokers.
3.Share prices change based on demand and supply.
If many people want to buy, the price goes up.
If many people want to sell, the price goes down.
Example:
•Tata share price = ₹500
•High demand → price becomes ₹550
5. How Investors Make Money
Investors earn money in two main ways.
1. Capital Gain
Buying shares at a lower price and selling them at a higher price.
Example:
Buy share at ₹100
Sell share at ₹150
Profit = ₹50 per share
2. Dividend
Some companies share their profits with investors.
Example:
If you own 100 shares and the company gives ₹5 dividend per share
You receive ₹500.
6. Types of Share Market Investors
Long-term investors
They hold shares for years.
Goal:
•Wealth growth
•Dividends
Example:
Investing in companies like Reliance or TCS for 10 years.
Traders
They buy and sell shares quickly to earn short-term profit.
Types of trading:
•Intraday trading (buy and sell same day)
•Swing trading (few days or weeks)
•Scalping (very short time)
7. What Affects Share Prices
Many factors influence stock prices.
Company performance
If a company makes good profits → share price increases.
Economic conditions
Inflation, interest rates, and economic growth affect markets.
News and events
Government policies or global events can impact prices.
Investor sentiment
People’s expectations and emotions also move markets.
8. Risks in the Share Market
The share market can be profitable but also risky.
Main risks:
•Market volatility
•Company losses
•Economic recession
•Poor investment decisions
Example:
If a company performs badly, its share price may fall.
9. Tips for Beginners
Important tips for new investors:
•Start with small investments
•Invest in strong companies
•Do proper research
•Avoid emotional decisions
•Diversify investments
Diversification means investing in different companies or sectors.
10. Benefits of Investing in the Share Market
Advantages:
•High potential returns
•Ownership in companies
•Dividend income
•Protection against inflation
Many successful investors build long-term wealth through the stock market.
Conclusion
The share market is a platform where people buy and sell company shares. It allows companies to raise funds and investors to grow their money. While it offers good profit opportunities, it also involves risks, so investors should learn and invest wisely.
