What Is The Stock Market And Its Way Of Working?


The stock market is the place where sellers and buyers come together to trade in different financial instruments. A stock market comprises multiple stock exchanges. For example, NSE and BSE are the two major stock exchanges in India. The price movement of top 50 companies listed in NSE are tracked by Nifty50 and the price movement of top 30 companies listed in the BSE is tracked by SENSEX. The platform for trading is provided by the stock exchanges and the trading activities are managed by a regulatory body like SEBI. 

The share markets are of two types. The primary market is where the companies register to introduce their shares in the stock market. The secondary market is where investors can buy and sell these shares once the IPO (Initial Public Offering) of a company gets listed. You must have a Demat account to bid for an IPO. To understand the working of a stock market, you must understand the role of different parties involved in trading like stock exchanges, brokers, registered companies, etc. The stockbrokers act as a bridge between the stock exchange and the investors to make the trading process simpler. 


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