In reality there are more than 100 stock market terminologies but here we are covering top 10 terminologies which are commonly used.
- Stock: Also known as shares or equity, stocks represent ownership in a company. When you own stocks of a company, you are considered a shareholder and have the potential to benefit from the company’s profits and growth.
- Stock Exchange: It is a marketplace where stocks, bonds, and other securities are bought and sold. In India, the two main stock exchanges are the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).
- Sensex: The Sensex, also known as the S&P BSE Sensex, is a stock market index of the Bombay Stock Exchange (BSE) that represents the performance of the top 30 companies listed on the BSE based on market capitalization.
- Nifty: The Nifty, also known as the Nifty 50 or NSE Nifty, is a stock market index of the National Stock Exchange (NSE) that represents the performance of the top 50 companies listed on the NSE based on market capitalization.
- Market Capitalization: Market capitalization, often referred to as “market cap,” is the total value of a company’s outstanding shares of stock. It is calculated by multiplying the stock’s current market price by the total number of outstanding shares.
- Bull Market: A bull market is a period of time when stock prices are rising and investor sentiment is generally optimistic, indicating positive market trends.
- Bear Market: A bear market is a period of time when stock prices are declining, and investor sentiment is generally pessimistic, indicating negative market trends.
- IPO: IPO stands for Initial Public Offering, which is the process by which a company goes public and offers its shares to the public for the first time. This allows the company to raise capital by selling shares to investors.
- Dividend: Dividend is a portion of a company’s profits that is distributed to its shareholders as a form of reward or return on investment. It is usually paid out in cash or additional shares of stock.
- Blue Chip Stocks: Blue chip stocks are shares of large, established companies with a history of stable earnings, reliable dividends, and a strong market presence. They are considered to be relatively less risky compared to other stocks.
