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You have always wanted to know about the stock market, isn’t it? There are people who think that it is very easy to make money in the stock market. But in reality it is not so. Unless you come to know how stock market works, you will not be able to make a good position in the stock market. Then there are some who believe that the stock market is chaotic and random in nature and it can make them millionaire overnight by investing in the Indian stock market. So let us see what exactly a stock market is.
What is a stock market?
Stock market is basically a platform for trading shares in publicly listed companies (PLCs). It is a place where you can invest money with the hope of getting good returns. The investment shrinks in case the companies in which it has invested do not perform well. So there is a risk associated with this type of investment. You have to take a risk on your cash when you invest in a stock market. This is the reason why you should always be careful when you make your investment in a stock market.
Working of the stock market
When you buy a stock, the investor is presented with two prices like 13-14. The first price (13) is always lower and is known as the bid or the sell price. The second price (14) is always higher and is known as the offer or the buy price. Can you see the difference? Well, this difference between the bid and the offer is known as spread.
There are people who go for day trading. But this type of investment is suitable for short-term investment. There are investors who think that this type of investment is very risky. Coming to the stock market, they are open only for set trading hours each day. So, in case you feel like investing in the stock market, be prepared to know all about how stock market works. Life is a risk and you can surely make it beautiful if you take some careful steps in your life ahead.
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