Name of companyShare price (starting date) Reliance Industries500Tata Steel340ONGC200ICICI Ban 150SBI400Infosys50Total1740I t means, for purchasing one share

of all companies, I need to invest 1740 Rs on day 1. This 1740value was considered as 1,000 (as a benchmar ). Now suppose, nex t day, some shares increased andsome decreased. Total value of 1,740 becomes 1,8 00. Now I need to invest 60 Rs. more to buy allthose shares. That means, the mar et has gone up by(1800-1740)/1740 = 60/1760 = 3.4% Now the index value will rise from 1,000 to 1,034. (Considering 3.4% rise in m ar et). This way, theindex value is being calculated everyday. The BSE Sensex st arted its journey at 1,000 and hasreached to todays level of 15,000. It means, th e mar et has gone up by almost 15 times in last 20-25years. Does and donts in share mar et 1.Dont fall into trap of advertisement which offers 30 days training and assures Rs. 1 la h incomeevery month. If it is that simple, why these guys are ta ing cl asses and not ma ing moneythemselves? People always tal about profit, remain si lent about losses, they have incurred.2.Never buy shares on Tips. Without nowledg e about that company, dont invest in it. You shouldread bro er reports and refers to tips given by experts on CNBC but dont rely on them blindly.Apply your logic. 3.It is not necessary to trade everyday, but mandatory to have a close watch on happenings inmar et. If you are a new investor, dont start intra day in first yea r, you are bound to lose money.4.Please see the website of the company, you are investing in. See board of directors, companys business and financials, major new s (all of this is available on www.moneycontrol.com)5.Important sources of infor mation Economic times- it is a Bible for you. The internet edition is available on its website freely. Lo satta- Artha Vruttant Every Monday CNBC Aawaz, - helps to understand share mar et, being in Hindi. Money control- the best website ever made for investors NSE, BSE Websites- a lot of information about daily happenings in the mar et5 Important Terms used in share mar et 1.Types of investors Although every investor does a basic role of investing in s hares andmutual funds, the origin of these investor and volume of shared traded by them differs.Followings are some of the types of investors. Retail or individual investors People li e you and me, which invests in shares,g enerally in small quantity are called as retail investors. These people ma e a v erysmall impact on price performance of any share as the quantity demand or sold by themis very low. HNIs (High Networth Individuals) - People who invest more than 1 la h Rs. in an IPOare called as HNIs. This doesnt mean that, every individual investing more tha n 1 la h becomes HNI. For this status, your financial position and credit worthi ness needs to bevery strong. FIIs- Any individual or a company investing in Indian share mar et but who is no t aresident of India and not listed as a business entity in India. This FII cate gory includescommon investors, mutual funds, pension funds, financial institutio ns also. Every FIIhas to register with SEBI prior to investing in India companie s. Even SEBI has formedsome restrictions on FIIs indicating up to how much % the y can invest in a singlecompany.

 DII (Domestic Institutional Investors) - Major financial companies, mutual funds ,insurance companies and fund houses based in India are called as DIIs. Generall y these players purchase and sell shares in crores and not in thousands. LIC, Re liance Mutualfunds, ICICI Pru mutual fund are some of the examples of players in this category.2.Governing Bodies in India- India has a very good structure of g overning bodies on all theimportant financial sectors. These bodies controls and develops the particular sector that theygovern. Another important function or r esponsibility of these bodies is to protect the interestof the investors or the customers. Followings are some of the bodies under this category. SEBI Securities Exchange Board of India- It is the governing body of all capital mar et transactions in India (Equity, debt and other commercial papers). Followi ngs aresome of the functions of SEBI1.Conducting any legal inquiry or ta ing any action which is necessary to protectinvestors interest.2.Regulating business of stoc exchanges and other securities mar et3.Controlling activities of custodian s, depositories, venture capitals4.Prohibiting unfair trade practices5.regulatin g acquisition and mergers issues6.increasing customer awareness RBI Reserve Ban of India has the supreme body in Indian ban ing industry. It is onof the most powerful bodies in India. Followings are some of the functions of RBI6 1.Maintaining smooth and adequate flow of credit to various sectors with the hel pof monetary policy.2.Regulating financial sectors and Indias financial system.3. Managing flow of foreign exchange in the country4.Issue of currency (notes and c oins)5.Other developmental functions in the economy. IRDA Insurance Regulatory and Development Authority- It is the controlling body of all transactions in Indias insurance sector. Followings are some of its functi ons1.Issue, renew, modify or to cancel the license issued to Indian insurance co mpanies2.Protect interest of insurance policy holders3.Specifying code of conduc t for surveyors, or to provide guidance on disputes.4.Regulating investment made by insurance schemes in various financial instruments.5.Exercising any legal ac tion, required by the circumstances. AMFI (Association of Mutual Funds in India) is not a governing body but a group of allmutual funds in India. This site gives information about Mutual funds indu stry, assetsunder management of all mutual funds and other related information.3 .Terms related to trading Bro erage- an investor has to purchase or sell the shares through any bro er (Sh are han, Motilal Oswal, and Kota Securities). These bro ers charge some fees to you for this purpose. This fee is called as bro erage. The bro erage is calculat ed as a %of amount purchased or sold. Intraday when a share in purchased and sold in a single day, it is called as int radaytrading. It is also nown as day trading. For this, you need to eep a watc h on ups anddown in the mar et for almost every minute. The profit margin in thi s trade is very low.Same way, the bro erage rate is also low. So, you need to bu y and sell shares worth Rs.1 la h everyday, so that you can ma e a profit of Rs. 1000 (considering 1% puremargin). Additionally there is no guarantee of this pro fit. Generally a new investor should not do intra day at least during first 1 ye ar. Delivery- When we purchase a share and dont sell it on that day, it is called as ta ingdelivery of shares. Once you ta e the delivery, the shares are credited to your accountwith in next two wor ing days. For. Ex. If you purchase 10 shares o n Monday and dontsell it till Monday evening (3.30 pm), you need to ta e delivery of those shares. ByWednesday evening, these shares will be credited to your acc

ount and the money will be debited from your account. Short sell In case of intra day trade, the buying quantity should be equal to se llingquantity. Suppose, Reliance Industries share increased 6% and trading on 2, 200 at12.30 pm and if you feel that, this share will decline from this point and at the end itshould settle down with 3% gain only. You can sell 100 shares of R eliance at 2,200 rate,even though you dont have 100 shares in your account. This is called as short selling. But you must buy 100 shares before 3.30 (closing of the day) otherwise you need to payheavy penalty. Suppose at 3.25, Reliance is trading at 2,250, then you nee d to buy at7 that rate and suffer a loss of 50*100= 5,000. Dont do short sell till the movemen t youget a good nowledge and good experience in normal trading