Any study of the Indian share market invariably leads to two terms- SENSEX and NIFTY. The SENSEX is synonymous with the terms BSE 30, and the BSEIndia SENSEX. It invariably is linked with Bombay Stock Exchange. It is a free float market capitalisation or a weighted stock market index of well established and financially well off institutions, which are registered in the Bombay Stock Exchange. It is also a measure of the rise and fall of the stock values throughout the country as Bombay (now Mumbai) is the financial capital of the nation. All major companies are registered in Mumbai so a rise or fall in their stock is a measure of the nation-wide stock value.
NIFTY
NIFTY is an index, which is calculated from the stock values of the top fifty performing companies registered in the National Stock Exchange or NSEIndia. NIFTY is an abbreviation which stands for National Stock Exchange’s Fifty. Since, it is a nationwide index it consists of various sectors or fields in the NSE, out of which 24 are registered in NIFTY. It is yardstick of performance of various mutual fund investments against the performance of the NIFTY registered companies. The live share market keeps a record of the prices of stocks of each company listed at the stock exchange. The traders use the nifty live charts to make predictions about the future market trends.
Equity
Equity stock is a measured stock or preferred stock of a company; the holder of which is entitled to get a dividend from the profit obtained in one financial year after all the terms and conditions are fulfilled. The equity is released in the share market India as a document whose value is regulated by the stock exchange, based on its quarterly performance. The advantage granted to the holder of the equity stock is that, practically he holds apportion of the company itself. This enables the company to raise cash from the Indian market without accepting obligations from numerous financial institutions.
Mutual funds:
A mutual fund is managed type of collective investment scheme that draws money from many investors at a time. It is almost like pulling money from the Indian market. It is a structured open ended kind of investment. Any open ended venture uses public as the source. For the open-end mutual fund, one must be prepared to acquire back its shares from its purchasers at the end of every working day or financial unit. By policy, the mutual funds are circulated in the market as bonds. Hence, these bonds can be exchanged. In case they are not in the form of bonds and instead are in money-market form, they can be capitalised in equity values to provide security to the equity investments. They ensure protection of the invested amount while aiming for optimum returns.
Thus individuals who are looking out for trading in the share market must ensure that they are aware of the terms and the mechanism of the share market before they invest their money. Market trading is a skill which one gains with experience. Besides the offline share market, the individual should know how to trade at share market live.
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