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Stock Market Terms

Sensex, short for Sensitive Index, is a stock market index in India that represents the performance of 30 well-established and financially sound companies listed on the Bombay Stock Exchange (BSE).

Nifty, officially known as the Nifty 50, is a stock market index in India that tracks the performance of 50 large-cap companies listed on the National Stock Exchange (NSE).

BSE, also known as the Bombay Stock Exchange, is the oldest stock exchange in Asia and one of the leading stock exchanges in India. It provides a platform for trading stocks, commodities, and other financial instruments.

NSE, short for National Stock Exchange, is the largest stock exchange in India in terms of trading volume. It offers a platform for trading a wide range of financial instruments, including stocks, derivatives, and currencies.

The stock market is a platform where buyers and sellers come together to trade stocks and other securities. It provides a mechanism for companies to raise capital and investors to buy and sell shares.

Equity refers to the ownership interest in a company. In the stock market context, it represents shares of ownership that investors hold in a company.

An index is a statistical measure used to represent the performance of a group of stocks or securities. It serves as a benchmark to evaluate the overall market or a specific sector.

A bull market is a prolonged period of rising stock prices and optimistic investor sentiment. It is characterized by increasing market participation, positive economic indicators, and expectations of further price gains.

A bear market is a prolonged period of declining stock prices, typically defined as a decline of 20% or more from recent highs. It is characterized by negative investor sentiment, widespread selling, and economic slowdown.

IPO, short for Initial Public Offering, is the process through which a private company offers its shares to the public for the first time. It allows the company to raise capital by selling ownership stakes to investors.

A dividend is a distribution of a portion of a company's earnings to its shareholders. It is typically paid in cash or additional shares and provides a return on investment for shareholders.

Blue-chip stocks

Blue-chip stocks refer to shares of large, well-established, and financially stable companies with a history of reliable performance and dividends. They are considered low-risk investments and are often leaders in their respective industries.

Mid-cap stocks are shares of companies with a medium market capitalization, typically falling between large-cap and small-cap stocks. They are generally considered to have moderate growth potential and higher risk than blue-chip stocks.

Small-cap stocks

Small-cap stocks are shares of companies with a relatively small market capitalization. They are often associated with higher growth potential but also higher volatility and risk.

Large-cap stocks

Large-cap stocks are shares of companies with a high market capitalization. They are generally well-established companies with stable earnings and a lower risk profile.

Market capitalization

Market capitalization, or market cap, is the total value of a company's outstanding shares. It is calculated by multiplying the current stock price by the number of shares outstanding and represents the company's size in the market.

A stock exchange is a regulated marketplace where securities, such as stocks, bonds, and derivatives, are bought and sold. It provides liquidity, transparency, and a platform for price discovery.

Securities and Exchange Board of India (SEBI)

The Securities and Exchange Board of India (SEBI) is the regulatory body responsible for overseeing the securities market in India. It regulates and supervises stock exchanges, brokers, mutual funds, and other market participants.

Brokerage refers to the fee or commission charged by a broker for executing trades on behalf of investors. It is the cost associated with buying or selling securities in the stock market.

A stockbroker is a licensed professional or firm that facilitates buying and selling of securities on behalf of investors. They execute trades, provide investment advice, and help clients navigate the stock market.