All about Share Market- Part 2

4. What do you mean by purchasing share?

→ Lets say that any listed company issued 10 lakhs shares in NSE ( National Stock Exchange ) . You buy as many shares according to the offer of that company, you owned that part of the company. You can sell your part of the shares to any other buyer whenever you want to sell ( during market hours ).

The number of shares to be given to a person or a group when a company issues shares is up to its discretion. To buy a share or shares of a listed company or to sell shares you own , we need to take the help of a broker for both the process.

Brokers charges some commission, whenever we need to buy or sell the shares. Chargers are different for different brokers.

The value of shares of a listed company is recorded in NSE/BSE. The values of all listed companies fluctuates according to their profit making potential. All the stock markets are controlled by the SEBI (Securities and Exchange Board Of India).

5. Why there are ups and downs in share market?

→ The valuation of a company is done on the basis of information such as functioning of a company, getting order or orders getting cancelled, results being better, profits increasing/decreasing. Since the listed companies continues to do business everyday and its condition changes everyday, on the basis of this valuation, the price of its shares fluctuates due to the decrease in demand or increase in demand.

If the company does not comply with the conditions attached to the listing agreement, then it is delisted from the NSE/BSE by the SEBI (Securities and Exchange Board Of India).