Hello
readers, we are happy to announce that our team of MoneyWiseMind.com launched a
new section "𝐈𝐧𝐯𝐞𝐬𝐭𝐢𝐧𝐠 𝐈𝐧𝐬𝐢𝐠𝐡𝐭𝐬: 𝐖𝐞𝐞𝐤𝐥𝐲 𝐐&𝐀 𝐅𝐨𝐫 𝐒𝐭𝐨𝐜𝐤 𝐌𝐚𝐫𝐤𝐞𝐭 𝐍𝐞𝐰𝐛𝐢𝐞𝐬", to spread the basic stock
market knowledge to the beginners.
This is your go-to
resource for demystifying the stock market from the scratch. Each day, we will
present 10 carefully curated questions with answers that will cover essential
concepts, strategies, and terminologies. Whether you have just entered into the
market, or trying to starting your stock market journey, or looking to
strengthen your foundation, our weekly post will guide you through the basics
and beyond, making investing accessible and understandable for everyone. Happy
reading.
Day 2: Basic Stock Market Concepts
1. What is Sensex?
Sensex is the basket of India's top
30 companies according to their market capitalizations listed on the
Bombay Stock Exchange (BSE). Full form of Sensex is Stock Exchange Sensitive
Index. Deepak Mohoni coined the term Sensex in 1989, and Sensex was then only
750 points.
2. What is
SEBI?
SEBI stands
for Securities and Exchange Board of India. It is the regulator of the
securities market to look after any fraudulent transaction and fake and illegal
activities done by any of the market participants like investors, traders,
brokerage firms in any way.
3. What is Demat?
Demat means
dematerialized account, is a form of an online portfolio account of the
customers or shareholders. Shares of the customers are kept in it in electronic
format or dematerialized form. Investing in stock market without a demat cannot
be possible.
4. What
is a stock index?
A stock index
is a measurement of the performance of a group of stocks, representing a
particular market or sector. Examples include Nifty 50(made of top 50 stocks of
India), the S&P 500, Dow Jones Industrial Average, and NASDAQ Composite.
5. What
is a portfolio?
A portfolio is
a collection of investments owned by an individual or institution. It can
include stocks, bonds, mutual funds, ETFs, and other assets, diversified to
manage risk.
6. What is ETFs?
ETF stands for
Exchange Traded Funds. It is a basket of securities which tracks multiple
stocks or other securities to let you invest in a sector or an industry or
an underlying index. An ETF is a type of investment fund that trades on stock
exchanges similar to a stock. By buying a unit of ETF, you can get a broader
market exposure. As an example: if you buy one unit of Nifty50 ETF, you will get
exposure to top 50 companies of India.
7. What is a Mutual Fund?
A mutual fund is a pooled investment vehicle
that collects money from multiple investors to buy a diversified portfolio of
stocks, bonds, or other securities. It is actively managed by professional fund
managers unlike ETFs which are passively managed.
8. What is BSE?
BSE stands for Bombay
Stock Exchange. It is the first securities exchange market in India which was
established in 1875.
The Native Share and
Stock Brokers' Association founded this oldest exchange. The man behind it was
Premchand Roychand. It provides investors to trade in stocks, equities, mutual
funds, derivatives, commodities etc.
9. What is NSE?
NSE stands for National Stock
Exchange which is one of the leading stock exchanges of India.
NSE is the biggest stock exchange of
India and fourth largest stock exchange in the world in terms of equity trading
volume.
10. What is Nifty?
The full form of Nifty
is National Stock Exchange Fifty. It is also known as Nifty 50 or Nifty
CNX.
Nifty is the benchmark
index of NSE in India comprises of India's top 50 companies.
Sensex is the
benchmark index on BSE or Bombay Stock Exchange, similarly, Nifty is the benchmark
index on NSE or National Stock Exchange.
If you have any other questions in your mind
relating to stock market basics or need any clarification, please put your
query into the comment box, We will try our best to clarify the same.
Disclaimer: The information provided on MoneyWiseMind is for educational and informational purposes only. It is not intended to be financial advice, and you should not rely on it as such. Before making any financial decisions, you should consult a licensed financial advisor.
𝐈𝐧𝐯𝐞𝐬𝐭𝐢𝐧𝐠 𝐈𝐧𝐬𝐢𝐠𝐡𝐭𝐬: Last Week's Topic
Weekly Q&A For Stock Market Newbies: Part - 1
