HOW TO START INVESTMENT

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HOW TO START INVESTMENT : 

Harsh Thakkar HOW TO START INVESTMENT Presented by MBA SEM 1 FINANCE GROUP

TEN STEPS REQURIED TO START INVESTMENT : 

Harsh Thakkar TEN STEPS REQURIED TO START INVESTMENT

1. What are Markets? : 

Harsh Thakkar 1. What are Markets? Market is a place where buyers and sellers of securities can enter into transactions to purchase and sell shares, bonds, debentures etc.

TYPES OF MARKET : 

Harsh Thakkar TYPES OF MARKET 1 PRIMARY MARKET 2 SECONDARY MARKET

PRIMARY MARKET : 

Harsh Thakkar PRIMARY MARKET The primary market is that part of the capital markets that deals with the issuance of new securities.

What are the types of issues in primary market? : 

Harsh Thakkar What are the types of issues in primary market? Primary market Issues can be classified into four types. Initial Public Offer Follow on Offer Rights Issue Preferential Issue

Slide 7: 

Harsh Thakkar Initial Public Offer (IPO): When an unlisted company makes either a fresh issue of securities or an offer for sale of its existing securities or both, for the first time to the public, the issue is called as an Initial Public Offer. Follow On Public Offer (FPO): When an already listed company makes either a fresh issue of securities to the public or an offer for sale of existing shares to the public, through an offer document, it is referred to as Follow on Offer (FPO).

Slide 8: 

Harsh Thakkar Rights Issue: When a listed company proposes to issue fresh securities to its existing shareholders, as on a record date, it is called as a rights issue. A Preferential issue A Preferential Issue is an issue of shares or of convertible securities by listed companies to a select group of persons under Section 81 of the Companies Act, 1956, that is neither a rights issue nor a public issue.

SECONDARY MARKET : 

Harsh Thakkar SECONDARY MARKET The secondary market is the financial market for trading of securities that have already been issued in an initial private or public offering.

2. What are shares? : 

Harsh Thakkar 2. What are shares? A share is one of a finite number of equal portions in the capital of a company, entitling the owner to a proportion of distributed, non-reinvested profits known as dividends and to a portion of the value of the company in case of liquidation.

3. What is a stock exchange? : 

Harsh Thakkar 3. What is a stock exchange? A stock exchange, share market or bourse is a corporation or mutual organization which provides facilities for stock brokers and traders, to trade company stocks and other securities.

Bombay Stock Exchange Limited or BSE : 

Harsh Thakkar Bombay Stock Exchange Limited or BSE The Bombay Stock Exchange Limited, or BSE has a nation-wide reach with a presence in 417 cities and towns of India. Its index, or market indicator is known as the Sensex.

National Stock Exchange : 

Harsh Thakkar National Stock Exchange The S&P CNX Nifty, or simply Nifty, is the leading index for large companies on the National Stock Exchange of India.

4. Who is a broker? : 

Harsh Thakkar 4. Who is a broker? A stockbroker is person who is licensed to trade in shares. A stock broker can plan, implement and monitor your investment portfolio, conduct research and help you optimize your returns.

5. What is a Demat A/c? : 

Harsh Thakkar 5. What is a Demat A/c? Investors who wish to trade in the market need to have a dematerialized, or demat, account.

6. Buying and selling of dematerialised securities : 

Harsh Thakkar 6. Buying and selling of dematerialised securities What is the procedure for selling dematerialized securities? You sell securities in any of the stock exchanges through a broker; You give instruction to your DP to debit your account and credit the broker's (clearing member) account before the deadline time specified by your DP; Before the pay-in day, your broker gives instruction to its DP for delivery to clearing corporation; Your broker receives payment from the stock exchange (clearing corporation); You receive payment from the broker for the sale of securities.

Slide 17: 

Harsh Thakkar How can I purchase dematerialized securities? You purchase securities through a broker; You make payment to your broker who arranges payment to clearing corporation on the pay-in day; Your broker receives credit of securities in its clearing account (clearing member account) on the pay-out day; Your broker gives instructions to its DP to debit its clearing member account and credit your account; You receive shares into your account. However, if standing instructions are not given at the time of opening the account, you will have to give 'Receipt Instructions' to your DP for receiving credit

7. How to receive income from shares? : 

Harsh Thakkar 7. How to receive income from shares? How would I get my dividend/interest or other cash entitlements? How would I get my bonus shares or other non-cash entitlements?

8. How much should you invest? : 

Harsh Thakkar 8. How much should you invest? Before starting and investment you can give online asset allocation test on any related website

9. How to make investment decisions? : 

Harsh Thakkar 9. How to make investment decisions? 1. Be a long term investor 2. Invest time and efforts in doing your homework 3. Pay the right price 4. Portfolio diversification 5. Do not buy on tips or rumors rather focus on fundamentals 6. Buy shares of companies whose business you understand 7. Don’t sell in panic 8. Do not borrow money to invest in equities 9. Do not marry a stock 10. Invest regularly and gradually build up your position 11. Monitor your portfolio

10. How to track your investments? (Portfolio tracker) : 

Harsh Thakkar 10. How to track your investments? (Portfolio tracker) Portfolio tracker is same as having your bank pass book

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