Understanding Stock Market

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Sajha Gurus, I am very much intersted in understaning how stock market works. I want to know how NASDAQ, LSE operates...and so on I am an engineering student and I dont have any financial analysis background. Yet, i am intersted in learning volatility of the stock market. I started with few wiki articles but I could not understand the jargons... The question is where should I start? any tips, suggestions... Thanks, iinception

iinception · Sep 2, 2011 11:37 AM · 19,396 views

11 Replies

Not sure of any books. But why don't you post any questions you have here. It might just be a short cut to reading those books...

YoTaBhayanaNiSom · Sep 2, 2011 11:46 AM

I tried with wiki article(eg see NASDAQ wiki). I just could not get all those jargons of stock market so thought if there are some ways to learn those.....

iinception · Sep 2, 2011 12:36 PM

Post them one by one here...

YoTaBhayanaNiSom · Sep 2, 2011 12:39 PM

Simple rule is, when you start buying stock..start off with the one growing slowly and stick to it for long time. Rapidly growing companies fall down quickly in most of the cases.

जय नेपाल · Sep 2, 2011 1:02 PM

" how stock market works" iinception bro, this is how it works ! It's so simple. No need to waste your time reading books. :)

Nas · Sep 2, 2011 1:09 PM

thanks jay nepal and nas that is a good cartoon.. I do have that basic understanding..but how does the stock price are effected globally? like if the share price drops in NASDAQ, share price drops down on LSE or Tokyo Stock Exchange.. What is the dynamics here? Also, what is the "point" in stock exchange? what does it means when some say stock price fell down by 1000 points ... thanks...

iinception · Sep 2, 2011 1:15 PM

Points in stock market --> Index is nothing but a Average Share Price of companies. DOW has 30, S&P 500 has (duh), Russell 3000 lets assume, Inception Index has only 3 company in it, each company have stock price of 10 so total is 30 , average 30/3 = 10 if one 10, 10, 11 (price increase in one company) [Inception Index is now 10.33) next day trading, if 9,10,8 (Inception Index is 9) and so on.... Market--> is nothing but a place where you go and exchange (buy/sell) your goods. If market fell 1000 points means AVERAGE/MEAN came down!!  [ in our example one company share price is 15 and others dropped to 1 and 1 =17/3 =5.67 stock market dropped ~4 points, so it's a Overall Average of how Companies are doing (or its Stock atleast)!! Dynamics of World Economic....practically can't expalin in this thread but let me try. US Stock Market-->Japan (Nikkei)-->London(LSE) [3 major market and it kinda makes full 24 hours of Operaion if we combine hour of operation of three] Now just follow Nas's cartoon......SELL in US [Market Closes], Japan market opens and see the US Market down, damn we need to SELL too so they sell...and LSE market opens and they see US and Japan Selling so we better sell too!! I'm Engineer by profession too, I just sat for couple of Finanace and Economics classes in college just to broaden my horizon!! I read this book and feel it's a good read Understanding Wall Street   Last edited: 02-Sep-11 02:08 PM

Lahure Kancha · Sep 2, 2011 2:01 PM

Stock market is governed by 'emotion'. The emotion is driven by media and news..

ANS · Sep 2, 2011 3:41 PM

Stock Investing for Dummies good reference for starters. http://www.amazon.com/gp/produ...

parajn · Sep 2, 2011 8:04 PM

thank u guys!! i will take a look at those books!!

iinception · Sep 3, 2011 3:19 PM

search for eminitrader, samsara and couple of other guys  in sajha and go through their  threads.... at least that was what I did when I got started about a year ago, I wish they would come back on sajha...cuz they were really trading big time  ...but I guess they got old and got tired of the sajha scene...which is not always not that nice , anyways all the RESPECT to them if they are going through this ...

tyrannyoflogic · Sep 3, 2011 9:28 PM

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