Essential knowledge to navigate the Indian stock market confidently. Learn the basics, master the strategies, and manage your risk effectively.
Start your investment journey with these fundamental concepts.
A share represents a unit of ownership in a company. When you buy a share, you become a part-owner of that company and are entitled to a portion of its profits (dividends) and voting rights.
Sensex tracks the performance of 30 well-established companies on the BSE. Nifty tracks 50 companies on the NSE. They are the primary indicators of the overall market health.
To trade, you need a Demat Account (to hold shares electronically) and a Trading Account (to place buy/sell orders) with a SEBI-registered broker.
Choose the trading style that matches your risk appetite and time availability.
Buying and selling securities within the same trading day. All positions are squared off before the market closes.
Buying shares and holding them for the long term (months or years) in your Demat account.
Futures & Options are derivative contracts used for hedging or speculation. They offer high leverage.
Buy Today Sell Tomorrow (BTST) or Sell Today Buy Tomorrow (STBT) to capture overnight price movements.
Tools used to analyze price charts and predict future market movements.
Measures the speed and change of price movements. RSI above 70 indicates overbought, and below 30 indicates oversold conditions.
Moving Average Convergence Divergence helps identify trend reversals and momentum by comparing two moving averages.
Smooths out price data to identify trends. The 50-day and 200-day SMAs are widely used by traders.
The golden rules to protect your capital and ensure long-term survival in the markets.
Never enter a trade without a predetermined Stop Loss (SL). It limits your loss if the market moves against you.
Never risk more than 1-2% of your total trading capital on a single trade. This protects you from significant drawdowns.
Don't put all your eggs in one basket. Spread your investments across different sectors and asset classes.
Greed and fear are the biggest enemies of a trader. Stick to your trading plan and avoid impulsive decisions.
Common terms explained in simple language.
A market condition where prices are rising or expected to rise, encouraging buying.
A market condition where prices are falling or expected to fall, leading to widespread selling.
The rate at which the price of a security increases or decreases. High volatility means larger price swings.
The ease with which an asset can be bought or sold in the market without affecting its price.
Price-to-Earnings ratio. It measures the current share price relative to its per-share earnings.
A portion of a company's earnings distributed to its shareholders, usually quarterly or annually.
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