When I first entered the world of the stock market, I spent a lot of time googling the basic terms of the stock market used on the stock exchange. While there are many terms that a trader needs to know, these are some of the terms for the stock markets that are commonly used.
This basic knowledge of these stock market conditions is essential if you want to enter the stock market and succeed.
In this blog, we will introduce an elementary guide for beginners to help them understand the basic stock market terms that are used in the stock exchange.
Talking about marketing, We’re confident that most of you are familiar with the four P’s of marketing. This topic will be a throwback for many skilled and seasoned marketers. It may be a common issue, yet it is critical for every marketer.
Equity
Equity (in the stock market) refers to the number of shares owned by companies. When you buy shares in a company as an investor, you buy an equivalent level of ownership in that company. A stock market where these company shares (equity) are bought and sold from one investor to another. The word “shares” equals the word “equity”.
Ask/Offer
The ask price or offer price is the lowest amount of money for which a seller of a stock is ready to accept for a share of that stock.
Bid
The offer relates to the maximum amount of money that a potential buyer per share is willing to pay per share. If there are several buyers of shares, the offer between the buyers ends when the buyer enters an offer that other buyers cannot or do not want.
Spread
The price the seller charges for an item and the price the consumer is willing to pay for it are always at odds. There is a discrepancy between the bid and ask prices in the stock market, and supply is usually lower than the ask price. The spread or spread between supply and demand is the name for this disparity, which is primarily determined by supply and demand.
Exchange
The stock market refers to an area, such as the electronic marketplace, where various securities are sold. ie one of the many stock exchanges in the country or around the world where shares are bought and sold. The current stock exchanges in the country are the National Stock Exchange of India (NSE) and the Bombay Stock Exchange (BSE).
Broker
When trading stocks, an investor must have an intermediary who contacts the stock exchange, known as a broker. They have no securities, but buy or sell shares for the investor in exchange for a small commission.
Bull Market / Bear Market
These two concepts are indicators of the current trend that the stock market is currently experiencing. The bull market refers to a period when stock prices are rising and therefore the market is on an upward trend. The bear market indicates a period when stock prices are falling and therefore the market is in a low trend.
Trading Account
Today, the stock market has become electronic, which is why traders are required to open an online trading account with a registered broker in order to trade electronically. All orders to buy or sell shares are made through this trading account.
Volatility
Volatility refers to the rate at which a component’s price changes. Highly volatile stocks are experiencing daily rises and falls in their price. Some traders take advantage of the risks associated with extremely fast stocks, others have long preferred to invest in less fast stocks.
Yield
Another popular stock exchange term is yield. Yield essentially refers to the return on investment on the stock. The return on investment is expressed in terms of percentage.
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