Basics of Share Market What is the share market? First of all, what is a share? A share is equity ownership in any company, so to simplify this let us understand it with an example if you own a 100% stake in a company worth Rs. 10,000, you are in need of some money so you decide to sell your 25% stake in the company worth Rs. 2500, here you have two options that you can sell your stake to huge net worth or institutional investors or you can sell it in public, so if you opt to sell it in public you need to divide it into small parts called shares so if you keep the price as Rs. 100 per share so means that by buying one share the investor becomes an owner of 1% in the company, in reality, the ownership of one share is very low. Didn't got it that what is a share? Just read it again you will get it. Note: Share market is also called the stock market, so don't get confused when someone says stock market. A share market is a place where the trading and listing of shares takes place
What is Nifty 50 and Sensex? Sensex was launched in 1986 by BSE and Nifty 50 was launched on 22 April in 1996. Nifty 50 and Sensex are the indices of India. Nifty 50 represents the top 50 companies of India listed on NSE and Sensex shows represent the top 30 companies of India on BSE. Indices represent the country's stock markets. Almost every having a portfolio in the same market of indices can compare their portfolio returns with indices and even mutual also compare their fund returns with indices. How to Nifty is calculated? Step 1: Calculate IWF(Investible Weight Factors) IWF is a unit of floating stock available for trading. IWF is total shares minus (addition of shareholding of the promoter, government holding in the capacity o strategic investor, shares held by promoters through ADR/GDRs, cross-holdings by associates or group companies, Employee Welfare Trust and Shares under lock-in category) and the answer is then divided by total shares. For this, an example is given b