By listening the word 'share market' whats come to our minds>?? A big building with the investors standing in front of it and watching the index bulletin. Right ,lets have the basic view of the Lion markets.
Let first analyze the word 'share market'. Daily we go to market for buying or selling goods, in the similar way share markets are nothing but a place where the selling and buying of 'shares' or securities takes place,so the word 'share market'... We came to know what the share market is,but even we don't know what actually the 'share' is...
Before going to do that,i'll give you a simple example for the better understanding.
Think a person went to a fruit market ,he finds an apple which costs Rs. 100 but he cannot afford to pay such huge amount but he want to buy it ,then he have two alternatives to buy.
1. He can borrow the money from others,
2. He can collect the money from others and buy it.
If the person choose the first way then he need to pay it after a predefined time,it is nothing but a LOAN.
If he choose the second option then he need to give appropriate division(or share) from the apple depending upon the contribution they made.If they were 10 members who contributed Rs. 10 in buying the apple,then the person can divide the apple into 10 parts and he should give one piece per one member...This one part is nothing but the share. share may give profit or even loss. If the apple was rotten after it was cut into pieces then all 10 members need to bear the loss...
Now,just think that apple is a company and the cost is the capital,a single person cannot afford to start the big company ,so he need others to take the contribution (nothing but share).People who held the contribution are the share members or SHARE HOLDERS.If the company gets profit , all the members can enjoy their profit and if it gets a loss then they need to bear it depending upon the contribution or the share they owned,company's profit which distributed among the share holders is called DIVIDEND ...
SHARE: A joint stock company divides its capital into units of equal denomination. Each unit is called a share.
we will be discussing about the IPO's and FPO's in upcoming posts...
(I will be glad if you send your suggestions or feedback to the mail id basiclionmarket@yahoo.com )
Let first analyze the word 'share market'. Daily we go to market for buying or selling goods, in the similar way share markets are nothing but a place where the selling and buying of 'shares' or securities takes place,so the word 'share market'... We came to know what the share market is,but even we don't know what actually the 'share' is...
Before going to do that,i'll give you a simple example for the better understanding.
Think a person went to a fruit market ,he finds an apple which costs Rs. 100 but he cannot afford to pay such huge amount but he want to buy it ,then he have two alternatives to buy.
1. He can borrow the money from others,
2. He can collect the money from others and buy it.
If the person choose the first way then he need to pay it after a predefined time,it is nothing but a LOAN.
If he choose the second option then he need to give appropriate division(or share) from the apple depending upon the contribution they made.If they were 10 members who contributed Rs. 10 in buying the apple,then the person can divide the apple into 10 parts and he should give one piece per one member...This one part is nothing but the share. share may give profit or even loss. If the apple was rotten after it was cut into pieces then all 10 members need to bear the loss...
Now,just think that apple is a company and the cost is the capital,a single person cannot afford to start the big company ,so he need others to take the contribution (nothing but share).People who held the contribution are the share members or SHARE HOLDERS.If the company gets profit , all the members can enjoy their profit and if it gets a loss then they need to bear it depending upon the contribution or the share they owned,company's profit which distributed among the share holders is called DIVIDEND ...
SHARE: A joint stock company divides its capital into units of equal denomination. Each unit is called a share.
we will be discussing about the IPO's and FPO's in upcoming posts...
(I will be glad if you send your suggestions or feedback to the mail id basiclionmarket@yahoo.com )
3 comments:
Perfect knowledge about investment by experts, Keep it Up nice work.
Trade India Research
Hey blogger amaing article it is well maintained
precious metals free commodity tips
Very few people are having this deep knowledge. I would say that thanks for awesome share and the post provide good tips to invest in share market.
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