Share trading means buying and selling the shares of companies listed on the stock exchange with an aim to make profit. Online share trading involves buying and selling of stocks through online platform. Using the online share market trading account, you may buy or sell share stocks, mutual funds, bonds and other securities easily, without the need of intermediate, broker or agent.
A stockbroker also known as a broker is a financial market representative who operates in securities. Their primary job role dictates obtainment of purchase and sale orders and execution of the same. Market participants or investors rely on their expertise and knowledge regarding market dynamics to invest in stocks and other investment options.
Share Training Details
What happens when you buy a share?
When you buy a share, it means you start owning some stake in the company. For example, if a company has issued 1000 shares, of which an investor owns 100 shares, it menas he owns 10% stake in the company. Shareholders get a say in the company governance and can vote on key decisions of the company.
While this may be advantageous for those who control larger portion's of company shares, for a retail investor, the benfit of owning a share is derived from their potential price appreciation in the share market. Investors try making profits from share trading by selling shares at a higher price than the purchase price. But then the question arises, what causes the share prices to change in the share market.
How share prices are determined?
The method of determination of share prices are very simple yet not known by many. The share prices are determined by the demand and supply of the shares. In simple terms, if the company is expected to earn better profits, more investors flock in to buy the shares, leading to its price rise. In the same way, a negative sentiment about the company make more investors to sell the shares, making the price of shares towards down. Profit seeking investors either buy and sell on the same day or will take a position for days before squaring it off.
How to start share training?
To start a share trading the first step is to open a Trading Account or a Demat Account as it is not possible to trade directly in the stock exchange. A stock broker registered under SEBI (Securities and Exchange Board of India) and stock exchange provides you the facility to open Demat and Trading Accounts. Demat Account holds the shares in digital format and trading account helps you transact in the stock exchange as both are essential to trade in the share market.