The 2025 Pahalgam Massacre: A Tragedy That Shook India | Pahalgam terror attack

  The share market, also known as the stock market, is a platform where investors buy and sell shares (or stocks) of publicly traded companies. It plays a vital role in the economy by allowing companies to raise capital (money) for growth and expansion, and providing investors an opportunity to profit from these investments.

Share Market: Definition, Types and How to Invest

The share market serves as a platform for investor to participate in the growth companies, diversify their portfolio, and potentially to earn returns on their investment. In this article, we explore the share market, reason to invest in it, types of share market, and some essential terms that every investor should know..

How does the share market or stock market work?

The share market is a marketplace where people can buy and sell shares of different different companies. When the companies issue the share, wants to raise fund, which are then sold to investor. These investor become a part owner of the company.

Apps like Groww, Upstox, and Zerodha help people invest in the stock market easily through their phones or computers. Here’s what they do:

1. Buying and Selling Stocks: You can use these apps to buy and sell shares of companies, like how you might buy and sell items online. 

2. Investing in Mutual Funds: These apps also let you invest in mutual funds, which are a group of stocks managed by experts. 

3. Easy to Use: You don’t need to go to a broker or a physical office. You can do everything from your phone, like checking your portfolio, tracking the market, and making investments. 

4. Low Fees: These apps usually charge lower fees compared to traditional brokers, which means you save money on each trade. 

5. Account Setup: You can open an account to hold your stocks (called a Demat account) and another account to actually trade (called a trading account). 

6. Research and Tips: Many of these apps give you stock recommendations, market news, and tips to help you make smart investment decisions.

In short, Groww, Upstox, Zerodha, and similar apps make it easier, cheaper, and safer for anyone to invest in the stock market from their phone.

Types of Share market

The primary and secondary share markets constitute the two types. Here’s a brief to each of them:

Primary share market

It is here that companies first register themselves – by furnishing details about itself and stocks that it wants to issue - and follow it up by issuing shares with the objective to raise capital – a process referred to as 'listing'. Should a company issue shares for the very first time, they would have to do it through a process called Initial Public Offering (IPO). Simply said, IPO is the process through which a company goes public.

Secondary share market

Once the company is listed and its stocks issued, the subsequent trading happens over the secondary market. This is the marketplace for investors (buyers and sellers) to come together, transact (at a price that has been agreed upon already), and in the process, make a buck for themselves. Once shares are sold, investors can exit the secondary market.

Equity market

Here, stocks are traded with the buyers quoting what is known as a bid price and the order is transacted, usually by a broker, at a negotiated price (ask price) quoted by the sellers in the market. The buyer pays up the entire sum of the stocks, a calculation arrived at by considering the total number of stocks multiplied by the ongoing share price. On payment of the amount (including brokerage fees and transaction charges), the stocks are deposited to the buyer’s account.

Derivative market

Here, trading is executed primarily through two instruments – the Future contract and Option contract. In both the cases, stocks are purchased and sold in a big lot. Should you want to trade in the derivative market, you’d have to use either instrument. While a Future contract warrants completion of transaction at a fixed rate and more importantly, within a specified period of time, an Option contract gives you the liberty to ignore the financial arrangement.

Why You Should Take an Interest in Investment in the Share Market

In today’s fast-paced world, many people are looking for ways to build wealth and secure their financial future. One of the most effective ways to do so is by investing in the stock market. Here some points should be consider:

1. The Stock Market: A Wealth-Building Opportunity

The stock market can seem doubting at first, with its ups and downs, but it’s one of the most powerful tools available for growing your wealth over time. Historically, investing in stocks has outperformed other asset classes, such as bonds or savings accounts, especially when held over the long term. While short-term fluctuations might scare some, the stock market tends to show steady growth over the long period.

2. You Don’t Need to Be an Expert

A common misunderstanding is that you need to be a financial expert to invest in the stock market, but that’s far from true. With the wealth of information available online today, anyone can learn the basics of investing. Whether you’re starting with small amounts or looking to make more substantial investments, there are resources and tools that can help you navigate the market confidently.

3. Compounding: The Magic of Long-Term Investing

One of the most powerful concepts in investing is compounding — essentially, earning returns on your returns. When you invest in the stock market and reinvest any dividends or profits, your money starts to work for you in ways you might not immediately notice.

4. Staying Informed

While investing doesn’t require you to be an expert, staying informed is crucial. Following financial news, reading books or articles about investing, and listening to podcasts or webinars can help you build a stronger understanding of the stock market and improve your decision-making.

5. Investing is a Long-Term Game

One of the biggest mistakes new investors make is trying to time the market or chasing short-term gains. The stock market can be volatile, and investor wants to make quick profits by jumping in and out of trades, it’s usually a losing strategy. Successful investors understand that investing is a marathon, not a sprint. They stay patient, and focus on long-term growth.

Conclusion

The share market is dynamic ecosystem that provides opportunities for individual to become a part of the growth companies and potentially realise financial gains.