What is share?
Share is a Small partnership of the company. I bought some popular shares of a company called Reliance now when I bought the shares called invest money in stock market.
I was very happy because the definition of shares told me that I become the owner of the enterprise part owner that is so then we went out with friends on an outing so we stopped by at the petrol pump which was owned and managed by Reliance and we fill petrol, so then the attendant came and said the you fill petrol so you pay money. I said excuse me I am the owner of the company because I have got shares of Reliance so I won't pay why should I pay. Owners don't pay right, it's my patrol pump now, so he said stop kidding early in the morning if you have filled the petrol, please pay up I said look boss you can't just ask me to pay I am the owner. I am the shareholder of company. He said you won't understand like this let me get my manager,so he got his manager and his manager came in and he said what happened what's the matter if you filled in petrol you got to pay. I said look boss I am the shareholder of Reliance and the definition of shareholder says that whoever buys equity shares of any company becomes a part owner so how can you ask me for money I will not pay money because I am the owner. He said, no sir that's not true. I said, Who told you all this if you buy petrol you have to pay money now I won't pay money if you buy Patrol you have no choice but to pay money look mister manager if the CEO of your company comes, would you charge him for petrol?
Certainly not then how can you charge me I am the owner, I am the shareholder, I have shared of your company.Manager said, look mister whoever you are understand one thing if the CEO comes apart from being the shareholder he is also the employee of the company and as per his salary package he is entitled to car and petrol so I won't charge him. are you an employee of our company? I said no. Then you have to pay okay. Do you mean you don't you charge the owners of course we charge the owners just because you are the shareholder you don't get to run the company so take care next time just by buying shares you don't own the company per you just own a part of risk and reward of being the owner and you can seize to become the owner. The day you sell your shares is that clear okay. Thank you so much so after that conversation with the manager I did some research on equity shares what I understood is that if you buy shares you are becoming a part owner yes but you don't get to run the company or you cannot own the products and services and assets of the company.
What I learn from this incident was that by becoming a shareholder you become a part of an owners package whereby you take risk on the enterprise as an owner and for taking that risk you are rewarded how in two ways one you get dividend when the company performs very well and the management decides to pay, Second if the company is doing very well in the market the price of the shares will go up and the appreciation you can materialize that appreciation when you sell those shares so that's little bit about equity shares today and one last thing if you are still wondering why the prices of shares go up and down up and down so frequently so radically and so fast let me tell you in the short run on a day-to-day basis it's more like demand and supply. You know why vegetable prices go up and down for the same reason share prices go up and down but in the long run if you hold the shares for more number of years the increase in share price in the long run is positively correlated with the performance of the company and most people they sell off the shares for two reasons either they are not happy with the performance that the company is giving or the performance is so well that they want to materialize the wealth so generated from the increase in price of shares. Basic difference between flat rate of interest in reducing rate of interest is that if you borrow 100 thousand where you can repay it in 10 months then the interest on 100 thousand would be charged only for the first month and then on 90 thousand for the second and 80 thousand for the third month and so on.
What is a stock exchange?
Stock exchange is an exchange with stock brokers and traders can buy or sell stocks and securities. If you have read about capital markets, I think you know about shares, bond and debentures. These are some examples of securities.How many stock exchanges are working in India?
So there are around 22 stocks exchange are working in India. There are main two stock exchange in India.- BSE-Bombay Stock Exchange
- NSE-National Stock Exchange
BSE - Bombay Stock Exchange
Amazing stock exchange of India, which is BSE stands for Bombay Stock Exchange, which is an Indian stock exchange, which was founded on 9th of July 1875 by an Indian businessman, a famous businessman, Mr. Prem chand Roy chand and an Indian businessman known as Cotton King.
Mr. Ashish Chauhan CEO of BSE on the stock exchange. Location of headquarter of Bombay Stock Exchange is located at the Dalal Street, Mumbai.The number of companies which are listed in Bombay Stock Exchange, so you will find there are about More than five thousand companies are listed in Bombay Stock Exchange.The name of indexes on of indices of Bombay Stock Exchange(BSE) is the BSE Sensex, BSE 500 beats SmallCap, BSE midcap.These are an example of indices of Bombay Stock Exchange. BSE so fast stock exchange of Asia. Sensex an over all rise in the price of shares of a group of companies and instead would be, sensex include the 30 largest and most actively traded stocks on Bombay stock exchanges.You can say Sensex stands for Sensitive Index.
NSE - National Stock Exchange
Now another stock exchange with its stock exchange of India is NSE, Here NSE is National Stock Exchange, which was founded in 1992.Headquarter of NSE (National Stock Exchange) is located again in Mumbai,Maharastra.
Thank you.
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