How to learn about the stock market?

1
How to learn about the stock market?
The stock market is a leading market of the
trading business where buying, selling, and
issuing shares take place. With this, it also
incorporates exchanges where the publicly held
companies invest. So, we can say that the stock
market is combined trading that includes markets
and exchanges. The activity of purchase and sell
of the shares is the core part of the stock
trading. The trade of financial undertakings is
carried out by exchanges or through
over-the-counter (OTC). The trade is operated
under a set framework of rules and regulations
for the safety of the people. The stock trade can
be made from any venue in a country for example,
in the UK, the biggest stock exchange is the
London Stock Exchange, preferred by investors of
the country and outside of the country to trade
in stocks and other securities. However, traders
use the two terms, stock market and stock
exchange, interchangeably. But, the stock
exchange is part of the stock market. In the
stock market, we buy and sell shares that are
listed on the stock exchange. So, if we talk
about the UK stock market, then the London stock
exchange is what comes to mind due to its
comprehensive services in the UK market.
2
How does the stock market work? Trading in the
stock market brings goosebumps because of the
horrifying stories being told in the market.
People lose their portfolios with huge margins,
and that scares most of us. But, its not always
the same. If an investor is interested in having
extra income trades in stock, they must be aware
of the market, shares, companies, commissions,
and factors related to the stock market. So, how
does the stock market process? The question
should be known and understood well enough for a
successful trading experience. The stock market
acts as a primary and secondary market, where
shares and other financial instruments could be
traded. The market is a secure and regulated one
with low operational risks. As we know by now
that shares are purchased and sold in the stock
market for earning profits. The trade could be
for a long period of time or short duration, all
depending upon the shareholder. The primary
market of stock trading includes Initial Public
Offerings (IPO). The stock market allows
companies to issue shares and sell the shares to
the public for the first time through IPOs. In
return, companies can generate capital from the
shares, thus increasing the companies capital
and profile in the market. In addition, the
process takes place at a market that is provided
by the stock market. In this, traders who
purchase the shares can get the benefit of
dividends that companies offer. The secondary
market is where shares are further traded after
their first issuance through IPO. After the
listing process of companies shares, the stocks
are regularly purchased and sold in the market.
This is what is called the secondary market of
the stock. The main speculation and trading of
shares and securities take place in this market.
Further, the secondary market benefits the stock
exchanges with a fee for every trading activity
at the exchange. The technological development of
nations has advanced the trading of stock as
well. The trade is now operated electronically
using all the equipment online for trade
transparency. The exchange and stock market have
managed their online trading orders. How to learn
about the stock market? How to learn to trade
stocks? Or the best ways to learn to trade. These
are the questions that we keep looking for
answers to. So, here we have a satisfactory
solution for all the doubts and worries.
3
We all know that there are several videos,
articles, books, and even the brokers
educational stuff available online to guide
novice ones. However, to enhance knowledge about
the trading and stock market, books are the best
source. Below mentioned are some of the top
books on the stock market. A beginners guide to
the Stock Market The trading book is written by
Matthew R. Kratter, with his twenty years of
experience in stock trading. The author has,
with his simple tricks, advised beginners of
stock traders about money-making. He believes
that the stock market is the greatest opportunity
machine that could be used for increasing
income. The book includes every detail of the
trade and how the stock market actually works.
Not only this, the book has some wonderful
examples to make it more understandable, like the
chapter that talks about Warren Buffett. Even
professionals can go through the book for
polishing their basics of stock trading. As the
book has easy ways of stock trading and how
traders can buy their first shares. It is the
best choice for beginners with a good rating of 4
out of 5. Think and Grow Rich Think and Grow Rich
is the bestseller book rated 4.5 out of 5. The
book by Napoleon Hill is a motivational book
that motivates traders to earn profits in the
trade. Being the granddaddy of all the
motivational books, the author has written it
with much sense and thought process. It talks
about the winners and how they are created? Hill
has interviewed several men and women to extract
their behaviour and motivation behind earning
wealth. The book says that with effort and
dedication, traders can achieve whatever they
want. The book was initially published in 1937
and still holds a good impact on tradersa
must-have book in the traders list. One Up On
Wall Street Peter Lynch and John Rothchild have
written the book to make average investors
believe that they can take advantage of the
stock market. The author feels that traders have
advantages over the Wall Street experts.
Beginners of the trade can learn about the
successful companies before the professionals and
can enjoy the benefits of the same. The book
explains stocks, how stock research could be done
and offers easy steps to trade in the stocks.
The author says that investors must not focus on
the ups and downs of the
4
stock market instead, they should keep an eye
over the companys fundamentals in which they
are investing or want to invest. Other factors to
know about the stock market are Educational
hubs The brokers with which traders open an
account have the facility of educational stuff.
There are videos, tutorials, webinars, articles,
blogs, e-books and many more. All these aids the
traders to understand the trading market. A
trader can anytime use the content for reference
or for increasing the knowledge
base. Videos Youtube offers a great variety of
videos relating to trade. A trader can search
about the stocks and how it works
easily. E-books Traders can download the books
online in pdf and read through the technological
devices. Audios The books are available in audio
format, where people who get bored with book
reading can listen to the audio of the books
online. The books discussed above are also
available in audio format online. Functions of
Stock Market The stock market has some primary
functions that it serves to the traders of the
stock market. For knowing how to learn share
trading, we should know its functions. Therefore,
lets quickly understand the functions of the
stock market Transparent dealing in
securities The stock market has access to the
whole market of share trade, and as per its rule
of demand and supply, all the stock market
participants are provided with instant access to
the stock market data. Thus, the stock exchange
furnishes investors and traders with buying and
selling orders, thus having a fair and
transparent trade. Price Discovery The stock
market offers its participants an efficient price
discovery method. The traders can know about the
price of the security by analysing the market.
Through demand and
5
supply mechanisms and other factors of the stock
market transaction, investors can analyse the
price fluctuations and discover the price of the
security. Liquidity The stock market does not
have control over the buying and selling of
stock. However, it can manage that all the
listed shares are traded in the market. Traders
are able to place orders and hold positions.
Thus, providing liquidity of the stocks for fair
prices. Security The stock market is huge and
incorporates many participantsa giant business
but the safest one. The stock market verifies
all the participants before they are allowed to
operate in the market. Thus, ensuring the
security of the trade and traders both.
Additionally, it has a set of legal rules for
participants of the stock market. Open for
all The market is open for all participants, be
it a trader, speculator, hedger, investor or
market maker. Thus, everyone can operate in the
market with different goals and
functions. Investor Protection The stock market
has various kinds of traders, from professionals
to beginners and wealthy traders to small stock
market investors. The stock market keeps updating
its investors about the market and the rules and
regulations at appropriate times to protect them
from any fraud. This safeguards trader and
ensures their trust in the market. All traders
are not well aware of the market, and for their
safety, the stock market keeps sharing
information.