what is stock market
stock market is a market of shares where (all listed companys' in exchange) shares are traded.
what are shares- suppose you and your friend named X starts a company, company capital is 1,000,000 you give 500,000 and x give also 500,000 you and X decide the FV is @2. (we are learning FV because FV is connected with shares and you can understand shares easily) its mean total shares are 100000 divided by 2= 500,000, so X give for company= 500000 divided by 2= 250000 and you also have 250000 shares. so FV is the price of companys' capital divided into finite number that is know as share. and your company is pvt. limited for sales of extra shares for money you have to make your company and you want to learn more about FV click here.
(we learn FV also, because we can understand shares more clearly)
exchange- exchange is mainly a stock market where shares are traded.
types of market
there are two types of market
Primary market- a company could register on exchange by the process of IPO in this process company sell their shares to people directly. when company sell his all shares the process is ended. so in primary market company sell his shares directly to people. in secondary market people couldn't trade shares by exchange.
Secondary market- after the process of IPO company is register on secondary market in this market people can trade shares by middle man and this middle man is exchange. so in secondary market people can trade shares by exchange.
we hope now you understand the stock market.
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