The Indian stock market is driven by two major exchanges, the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). These exchanges facilitate the trading of various financial instruments, primarily stocks and derivatives. They serve as vital platforms for companies to raise capital and for investors to participate in wealth creation.
How Does the Stock Market Work?
1. Stocks:
Shares or stocks represent ownership in a company. Investors buy stocks hoping for capital appreciation or dividends.
2. Indices:
Indices like the Nifty 50 and Sensex represent the overall performance of the stock market by tracking a basket of stocks.
3. Trading:
Stocks are traded through brokers either in the cash market (delivery-based) or derivatives market (futures and options).