Introduction to Stock Markets PDF provides a beginner-friendly guide to investing and stock market operations. It explains the necessity of investing to beat inflation and build wealth, comparing asset classes like equities (14-15% CAGR), fixed income (8-11%), real estate, and bullion (8%).
The book covers market ecosystems, including regulators (SEBI), intermediaries (brokers, depositories), IPO processes, trading terminals, and settlement (T+2). It details corporate actions (dividends, bonus, splits, rights, buybacks) and key events (monetary policy, inflation, budget, earnings) impacting markets, emphasizing the importance of developing a point of view using fundamental, technical, or quantitative analysis for successful trading.
TABLE OF CONTENTS
| The IPO Markets – Part 1-2 |
| Clearing and Settlement process |
| Five corporate actions and its impact on stock prices |
| Key Events and Their Impact on Markets |
Excerpts
Why should one Invest?
Before we address the above question, let us understand what would happen if one choose not
to invest. Let us assume you earn Rs.50,000/- per month and you spend Rs.30,000/- towards your
cost of living which includes housing, food, transport, shopping, medical etc. The balance of
Rs.20,000/- is your monthly surplus. For the sake of simplicity, let us just ignore the effect of personal income tax in this discussion.
1. To drive the point across, let us make few simple assumptions.
2. The employer is kind enough to give you a 10% salary hike every year
3. The cost of living is likely to go up by 8% year on year
4. You are 30 years old and plan to retire at 50. This leaves you with 20 more years to earn
5. You don’t intend to work after you retire
6. Your expenses are fixed and don’t foresee any other expense
7. The balance cash of Rs.20,000/- per month is retained in the form of hard cash
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