Do You Know - Stock Exchange

DO YOU KNOW

NIFTY

The word Nifty originates from 2 words, `National' and 'Fifty'. Nifty basically means  the index of the 50 most actively traded stocks from across all sectors. Nifty represents the top stocks of the NSE and when we talk about Nifty going up, it means that all the heavyweight stocks of NSE across all sectors are moving up. Most of the stock trading in the country is done through NSE and BSE.

There are other stock exchanges as well, like the Calcutta stock exchange, but they are not that popular. Nifty consists of top 50 companies from 24 different sectors. Nifty is computed from the performance of top stocks from different sectors. Some mutual funds use Nifty as a benchmark. The performance of the mutual funds is assessed against the performance of the Nifty. On NSE, futures and options are available for trading with the Nifty as an underlying index. Nifty is calculated by using the market capitalization weighted method according to which weights are assigned according to the size of the company. Larger the size, larger the weightage..

SENSEX

Sensex is an index of the stocks in BSE (Bombay Stock Exchange).

Sensex has a list of 30 stocks. BSE decides the stocks that are to be listed on Sensex. The criteria for picking a stock to be listed on Sensex is volume of the trade of that stock and total volume of the stock in BSE.

Based on the above said factors, BSE regularly prepares a set of 30 stocks which will be together called as SENSEX. BTW Sensex means sensitive Index Now each stock is allotted a weight-age according to a criteria and the criteria also keeps on changing with time. So now stocks are normally traded in BSE each day and price of stocks is determined according to demand and supply

Stock Trading Timings in India

There are two major stock exchanges in India- Bombay stock exchange (BSE) and National stock exchange (NSE). However, the timing of both BSE & NSE is the same. First of all,you need to know that the stock market in India is closed on weekends i.e. Saturday and Sunday. It is also closed on the national holidays. The normal trading time for equity market is between 9:15 a.m to 03:30 p.m, Monday to Friday.

The trading time for commodity (MCX) market is between 10:00 a.m. to 11:30 a.m. Monday to Friday.

The normal trading time for Agri-community (NCDEX) market is between 10:00 a.m. to 05:00 p.m. Monday to Friday. In addition, there is no lunch break or tea break in the Indian stock market timings. The timings of the Indian stock market are divided into three sessions:

1. Normal session (also called continuous session)

2. Pre-opening session

3. Post-closing session

Future Market

A Future market is an auction market in which participants buy and sell commodity and futures contracts for delivery on a specified future date. Examples of futures markets are the New York Mercantile Exchange, the Kansas City Board of Trade, the Chicago Mercantile Exchange, the Chicago Board of Options Exchange and the Minneapolis Grain Exchange. Originally, trading was carried on through open yelling and hand signals in a trading pit, though in the 21st century, like most other markets, futures exchanges are mostly electronic.

Options Market

An 'Option' is a type of security that can be bought or sold at a specified price within a specified period of time, in exchange for a non- refundable upfront deposit. An options contract offers the buyer the right to buy, not the obligation to buy at the specified price or date. Options are a type of derivative product. The right to sell a security is called a ‘Put Option', while the right to buy is called the ‘Call Option‘.

They can be used as:

Leverage: Options help you profit from changes in share prices without putting down the full price of the share. You get control over the shares without buying them outright.

Hedging: They can also be used to protect yourself from fluctuations in the price of a share and letting you buy or sell the shares at a pre-determined price for a specified period of time

Dalal Street

Dalal Street is an area in  downtown Mumbai, India, that houses the Bombay Stock Exchange (BSE) – the largest stock exchange in India – and other reputable financial institutions. It received the name Dalal Street after the Bombay Stock Exchange moved to the area in 1874 and became the first stock exchange recognized by the Indian Government.

The literal translation of Dalal in Marathi is a broker or intermediary. Today, Dalal Street is a metonym for the entire Indian financial sector much like Wall Street in the United States.

Lombard Street

Lombard Street, London, is a street notable for its connections with the City of London's merchant, banking and insurance industries, stretching back to medieval times. 

From Bank junction, where nine streets converge by the Bank of England, Lombard Street runs southeast for a short distance before bearing left into a more easterly direction, and terminates at a junction with Grace church Street and Fenchurch Street. Its overall length is 260 metresIt has often been compared with Wall Street in New York City

Wall Street

Wall Street is a street in lower Manhattan that is the original home of the New York Stock Exchange and the historic headquarters of the largest U.S. brokerages and investment banks. The term Wall Street is also used as acollective name for the financial and investment c o m m u n i t y , which includes stock exchanges and large banks, brokerages, securities and underwriting firms, and big businesses. Today, brokerages are geographically diverse, allowing investors free access to the same information available to Wall Street's tycoons.