Stock Market and Its Types in India
Introduction:
A stock market is the place where buyer and seller trade, however, it is the platform to raise the capital as well as the scope for investor to grow his wealth. It operates in India through SEBI or Securities and Exchange Board of India.
Types of Stock Markets in India:
Primary market:
Companies launch a fresh issue of newly issued shares to the stock markets besides that public issues their very first-time-issued shares simultaneously as well through IPO.
In the meantime when the issuing company first lets come the fresh-issue of company issued shares towards public then Initial public offering will happen.
IPO-Time that an organization floated it very first public-issue company-shares, therefore time being public-Issue.
FPO—Follow-on Public Offering: The listed company sells more shares.
Secondary Market:
Where investors buy securities from some other issuing entity after its initial issue in a primary market. Works almost like an exchange in Bombay Stock Exchange (BSE)- one of Asia's oldest National Stock Exchange (NSE)- largest Indian Derivatives market It is actually a derivative market because it's where one exchange of financial asset value is obtained by reference to another underlying asset or assets, such as Stocks, commodities Instruments
· Forward Contracts: This is another type of sale agreement and purchase, in which the trade regarding the particular asset, at a particular particular date in future, is completed on an agreed-upon definite price.
· Options Contracts: Such agreements entitle but puts no obligation of buying/selling a commodity of particular kinds at a prespecified amount of money.
Commodity Market:
The commodity market consists of a major portion of commodities like gold, silver, oil, agriculture products, and metals. Commodity Exchanges in India
· Multi Commodity Exchange (MCE)-It is the largest commodity exchange in India which trades in metals, energy, and agro-commodities.
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