What is Stock Market

The Stock Market is a term which refers to a marketplace where listing of financial securities and transaction takes place.

  • Stock market operates electronically these days
  • Most transactions happen electronically
  • Transaction inside stock market is in auction form
  • When ask and bid of buyer and seller matches a transaction completes automatically

Types of financial securities are listed inside stock market

  • Stocks or equities
  • Derivatives product
  • Futures contracts
  • Options contracts
  • Exchange traded funds ( ETF )
  • Commodities contracts
  • Currency contracts etc

Purpose of stock market

Main purpose of a stock market is to provide the liquidity for investors and let listed companies raise capital from market participants.

Who can participate in Stock Market

Any one who is above 18 years of age is eligible to participate in stock markets.

Two types of participants

  • Financial institutions
  • Retail traders

When does stock market open

Every country has different stock exchanges and timing rules. Standard opening time for equity market is morning 09 Am and closing time is 03:30 Pm.

Stock Market sessions

There are 4 types of stock market sessions

Pre markets session

A stock market is opened for a certain period of time before the regular market timings

Post market sessions

Once the regular market hours close,after few minutes there is a post market session for few minutes

After market hours

After market hours is open for placing orders after the regular market hours

Next read – Types of financial securities inside the stock market

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