| Fundamentals on Share Market involves a wide array of topics :- Present forms of Exchanges Classification of Socks Nature of Stock Markets' Buyer and Seller Stock Market Analysis For a novice, understanding the fundamentals on share market is a prerequisite. Present Forms of Exchange Shares in the Share Market are either traded through :- Stock Exchange These are organized market places where stocks, bonds are other equivalents are traded between the buyers and sellers. Exchange acts as a counter-party to both the participants in case of any default. For example, NYSE, NASDAQ, NSE, NIKKEI, etc. Over-the -Counter These are not centralized exchanges. Here, the trade takes place through a network of dealers. Classification of Stocks Generally, Stocks are of three types :- Common Stock It gives an ownership right to the holders of the stock and hence the share holders are entitled to the earnings of the company according to their stake. Holders also get dividends on those stocks as and when given by the company. Preferred Stock These stocks also give ownership right to its holders. Its holders enjoy the privilege of receiving dividends from the company in preference to any other common share holders. Convertible Preferential Stocks There is also another type of Stock called Convertible Preferential Stocks where the holders of these stocks have the option of converting them to common stocks of the issuing company. The nature of participants of a stock market also differ according to their trading styles. |
