Basics of The Indian Stock Market

What is the stock market?

Stock Market is a platform where buyers and sellers trade listed securities. These securities are generally stocks of a company. Stocks represent part ownership in the company. So, anyone who basically wishes to invest or partly own the company can buy the shares of that particular company and vice versa.

The Indian stock market has 5,000 listed companies on BSE and over 1,600 companies on NSE.

The Indian stock market is regulated by Security Exchange Board of India (SEBI). This regulator acts in the favour of investors and prevents any illegal activities or trading in the market.

Open a Dematerialization (Demat) Account:

A demat account has to be opened to invest in the stock market or anywhere in the world. This demat account should be opened with a registered SEBI broker. The shares you have purchased are kept electronically in your demat account. When you want to sell these securities, they are debited from your demat account. So, basically demat acts as a store for your securities.

There are many brokers where you can open your demat. But I personally like Angel Broking. Because buying stocks in Angel Broking for a long time does not require any brokerage. Angel Broking currently has more than 2.5 million users.If you want to open a demat account then I would advise that you open an account with Angel Broking.ZWhen can you trade?

The markets open at 9:15 am and are open till 3:30 pm. The days of operation are from Monday to Friday. Saturday and Sunday the markets remain shut.

Where can you trade?

In India there are two exchanges where you can trade.

• The National Stock Exchange (NSE)
• The Bombay Stock Exchange (BSE)

What are the timings?

As we all know the normal trading hours in the Indian Markets start from 9:15 am to 3:30 pm, but there are other trades also that happen prior to this and probably even post this timing.

Below is the list of the timings and what trading activities happen during these hours:

Morning Block Deal Window:

Takes place between 8:45 am till 9:00am. Block Deals are deals where shares are directly sold between 2 parties and not via markets. These Block deals are huge in terms of quantity of shares

Pre-open market:

It happens between 9:00 am to 9:15 am. In this time all the matters are matched at a single price which becomes that day’s opening price.

Normal Trading Hours:

During this period the normal trading activities of the stock markets takes place where everyone participates in trading. The timings are from 9:15 am to 3:30 pm

Closing:

It happens from 3:30 pm to 3:40 pm where the closing price of the stock is decided based on the last trades of the day.

Post Close:

Execution of the trades at the closing prices are determined during this time. This activity happens from 3:40 PM to 4:00 PM.

Summary:

So, in conclusion, we come to know that the first step for entering and investing is to open a Demat account. You may have different approaches towards making money by short term trading or long-term investing, there is no correct way. You must follow that suits you well.

But, as in the previous article we saw, long term compounding gives unreal gains in the market. As Ramdeo Agarwal has said “Buy right, sit tight” can be a good way of investing. In conclusion, you can follow big investors like Rakesh Jhunjunwala, Ramesh Damani, Sankaran Narain, and try developing a mindset like them.