How Share Market Works, How to Invest in Share Market, Tips

Now, we are aware of What Is Share Market so coming towards further steps. In this article, we’ll understand How Share Market Works and How to Invest in Share Market in detail.

We’ll also understand more queries related to share market such as: Types of share Market, How to buy and sell shares, Share market investing tricks and formulas, etc. in detail.

So, let’s dig into the process of understanding more about Share market….

What Is Share Market

The share market is a marketplace where we work for selling and buying shares. The share market is not very common market where we can invest in anything. It is a market where investing in good equities can lead you in generating a lot of profits and a small silly mistake can bring you into bank corrupt condition.

People know it by many names like Share Bazar, Stock Market, Share Market, Equity Market, and Wealth Market, but the work of this market is mainly to generate investment in companies and for common people, its a place to earn money in just few hours to generate unexpected incomes.

There are lots of dangers in this market, but once you get enough contacts and knowledge of this market, then you can easily earn millions per month.

What is Stock Exchange

Share market is just a word that means Stock Exchange. Stock Exchange is the same terminology where shares of a company are listed and with the help of same exchange the shares are bought and sold.

Like BSE and NSE both these are the most known stock exchange criteria which include the most trusted and giant company’s share and all these are altogether known as share market.

Similarly, there are many different stock exchanges available around the world. It is not easy for everyone to know and learn all these Stock Exchange’s names, so instead of calling them by their names people usually know them by share market.

How Share Market Works

It is very easy to learn share market, you just have to understand Buy, Sell and Hold shares in it. Once you understand it, you will be able to earn money from share market very easily.

There are two ways of working in the stock market

1. Buy Share
2. Sell Share

If you want to buy shares, then it is very important to have a Demat account and trading account. If you do not have a trading account, then you will not be able to buy shares from the stock market.

Previously, the transaction of shares was done on paper and at that time when we used to buy shares, we had to go to Auctions and buy shares through bidding process. The shares that we used to get in exchange for money were also in paper form, which had to keep those documents very carefully.

But today we do not need to go anywhere and with the help of Demat account, you can buy and sell shares directly from the stock exchange in few clicks.

How to Invest in Share Market

You can buy shares from share market very easily with the help of your trading account. Nowadays, shares are even de-materialized, so we don’t have to wander anywhere to get them, as soon as we buy shares from the trading account, in just matter of minutes, the amount of share is registered with our name in our Demat account.

Even if we want to sell the shares, we do not need to go anywhere, just by opening the app and placing an order in the Stock Exchange from the trading account, we can sell the shares very easily. All this process is very easy and hassle-free in just a matter of seconds.

As soon as our Stock Exchange is diluted, immediately the shares are deducted from our Demat account and the money including profit is transferred to our Demat account.

Then we can transfer this money to our bank account and withdraw it from anywhere.

Nowadays, it is very easy to work in this because with the help of technology. We can also link all our accounts with each other and without any extra effort. We can also invest money this money again in share market.

How to Earn Money from Share Market

These things are needed to earn money from Share Market.

• An Active Bank account with Internet Banking facility.
• A Demat account which is links your bank account and trading account.
• A trading account to buy and sell shares.

If you have all this then you will be able to buy shares very easily.

Let us understand with the help of an example if we have all these things then how will we be able to earn money from the share market.

How to buy ICICI Bank shares

For example, If you want to buy shares of ICICI Bank.

In recent times, the share price of ICICI Bank is around ₹920 [$11], it is possible that when you see the market, the price may change because the market does not always remain the same, the price keeps on changing.

Click here to see ICICI Bank’s share price live.    

Today, when the market opened, the opening price of ICICI Bank’s share was ₹920 [$11], so now if we want to earn money from ICICI’s share in the market, we must first analyze its past performance and then fix a limit of shares that we want to buy.

In my case since I have already done a complete analysis of ICICI shares and according to my analysis, today’s market will go up so I will buy shares worth ₹50,000 [$599].

Whenever you buy shares in the stock market, you have to enter the number of shares in the Buying order you have to place in the Stock Exchange, you cannot buy shares worth ₹50,000 [$599] just like that.

Let us know that if we want to buy shares worth ₹50,000 [$599] from the stock market, then how many shares will we get for ₹50,000 [$599]. To know this, we will use a formula from which we will get information about how many shares we have to buy.

Stock Market Maths

Formula: (Invest Money ÷ Share price = Shares)

Example: (Invest Money ÷ Share Price = Shares) = (50,000 ÷ 920 = 54 Shares)

Total No of Shares = 54 x 920 = ₹49,840 [$599]

54 Shares Price = ₹49,840 [$550]

See, we have come to know very easily how many shares we have to buy, so now we will sell 54 shares of ICICI Bank at the price of ₹920[$11].

Now we will go to your trading account and place a Buying Order to buy one share quickly, in which we will buy 140 shares of ICICI Bank at the price of ₹920 [$11] and as soon as our order is completed, we will wait for the price to increase.

How to Sell ICICI Bank Shares

For example, we will sell shares of ICICI Bank.

Suppose our order is completed and 54 shares of ICICI Bank is now in our Demat account, now we will place an order to sell the shares.

We will go to our trading account and Sell Order in which we will sell ICICI Bank at a higher price than the purchase price. Keep in mind you have to sell these shares as immediately the price increases.

In this way, you can earn a lot of money from different shares. as soon as the price of shares increased, our order was executed and 

Share Market Calculation Formula

Formula: (Selling Price X Shares = Sell), (Sell – buying Price = Profit)

Example: (960 X 54 = ₹51,840 [₹629])

(51,840 – 4984० = ₹2,000)

Profit = ₹2,000 [$25]

See how easily we earned ₹2,000 in just few minutes. Similarly, you can also earn money very easily in few minutes.

All you have to do is keep updated with the information about the market and keep tracking the market, as soon as you feel that today this stock will go up, just buy the stock at a low price and sell it at a higher price.

• Share Market Trading Tips, Right Time to Buy and Sell Shares
• What Is Nifty, Bank Nifty, Nifty50, How Nifty Works
• What Is Stop Loss, How Stop Loss Works in Detail, Tips

How to Invest in Share Market

You can earn as much money as you want from the share market, but only when you start understanding the share market a little.

It is necessary to have knowledge about earning money from share market. First of all, research as much information as possible about any companies need and share. After this, keep investing in the market little by little as the market open in the morning.

Never invest on someone else’s advice unless you believe in yourself

Share Market Tips

Because there is no room for mistakes in this market, if you have make any mistake, then you will loose money, so always invest wisely and keep reading news about share market.

• Share Market Rules, 10 Golden Rules for Trading in Share Market
• How to Invest in Share Market, How To Buy and Sell Shares
• How to use Stop Loss, When to place Stop Loss, Uses in Trading

What is share market – FAQ

• What Is Share, Types of Shares, Trading Rules, Investment
• What Is Demat Account, Types of Demat Account, Create Account
• What Is Trading, Types of Trading, How Trading Works

Hoping, you have completely read the article about How Share Market Works and How to Invest in Shares in detail.

If you liked the information given by us, do tell us. if you have any queries in your mind, you can freely ask us by commenting below.