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Basic Course - v5

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195 views5 pages

Basic Course - v5

Uploaded by

santoshdvg1997
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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TIDI ACADEMY

Gold Course

BASIC COURSE
Our Vision:

TIDI Academy aspires to become Best Stock Market Academy in India. We want to play major
role in Transforming India to Digital Investing.

Our Mission:
To Educate and create awareness about Stock Markets in Right manner.

WHAT IS STOCK MARKET?


Stock Market is a place where you can Buy/Sell Shares. Some of the Major Stock Exchange in
India, There is National Stock Exchange (NSE) and Bombay Stock Exchange (BSE).
Nifty Top 50 companies of NSE, based on weighted average gives Nifty Index value.
Sensex Top 30 companies of BSE, based on weighted average gives Sensex Index Value.

TYPES OF TRADING

There are only four types to play in Stock Market.


1. Intraday
2. Delivery / CNC
3. Futures
4. Options
1) Intraday:
In Simple it is called as trade within one day (Same day entry, same day exit), need to clear off
Positions within same day (9.15 am to 3.15 pm).You can buy first and Sell Later or Sell First and
Buy later.

2) Delivery /Short term / Long-term/Investing:


This is very safe Investing method, buy and sell shares when you like to. Here you can buy and hold
shares for 10 seconds or 10 years it’s your wish. No conditions from brokers as you’re Buying From
your own Cash. You need to buy first then only you sell later, here Sell First is not applicable as
your buying Actual Shares which will come your to demat accountinT+2 days.

1 | TIDI Academy Mutual funds, SIP, Demat accounts Mob no:9686529666


TIDI ACADEMY
Gold Course

3) Futures:
A Futures contract is an agreement made through an organized exchange to buy or sell a fixed
exchange to buy or sell a fixed amount of commodity or a financial asset on a date of future at
an agreed price.
● Contract between two parties through exchange
● Centralized trading platform
● Margins are payable by both the parties.

4) Options:
An option is a contract which gives the buyer the right, but not the obligation, to buy or sell and
underlying asset or instruments at a specified strike price on a specified date, depending on the
form of the options.
Options emerged as a financial instrument which restricted the losses with a provision of
Unlimited profits on buy or sell of underlying asset.

Types of orders:
Market order:
Market order in which shares are bought and sold at best prevailing price in the market.

Limit Order:
Limit order in which investor specifies a limit price for transactions to be carried out.

Stop Loss: SL-L Stop loss is like a brake in Vehicle. Stop loss will reduce your losses. It will
ask Limit Price and Trigger price. It’s like front brake and back brake
Suppose you bought share at 100 Rs, keep stop loss as (limit price 98.9Rs, trigger price as 99Rs –
Always trigger price should be bigger than limit price.

There are 2 types of Stop-Loss orders:

1. SL order (Stop-Loss Limit) = Price + Trigger Price


2. SL-M order (Stop-Loss Market) = Only Trigger Price

Validity (DAY or IOC): always select Day as Validity. If you select IOC (immediate or Cancel)
your order will be rejected if not executed.

Derivatives
Derivatives means Extract a sub Product from Underlying Asset.
Something like we derive Ghee from Milk. Here Ghee is sub product & Milk is Main Product

2 | TIDI Academy Mutual funds, SIP, Demat accounts Mob no:9686529666


TIDI ACADEMY
Gold Course
Futures & Options is called as Derivatives. It is introduced to Mitigate risk from Unexpected or Expected
Market Crash. Using this you can make money in Falling Markets & even in Raising Markets.

Futures:
Here anything you buy or anything you sell you need to do it lots – it’s like Monthly contracts.
 Buy in Lots Sell in lots
 You can hold this lots up to expiry date
 There will be Expiry Date for the Futures
Last Thursday of every Month is the Expiry date. Before the Expiry date you need to Square off the
Positions

Nifty lot Size = 50


Bank Nifty Lot Size =25

To Trade in Futures, we need to Deposit somewhere near 15 to 25% of Initial Margin of the Total Asset.

Example:
ACC , FUTURES
ACC SHARE PRICE: 2500 RS
ACC LOT SIZE: 250
TOTAL AMOUNT REQUIRED: 2500 RS X 250 = 6, 25,000 /-
BUT ADVANTAGE IN FUTURES IS: You don’t need to Pay Full Margin upfront, you just need to pay around
just 20%. For ACC Futures you don’t pay 6,25,000 /-but just pay around 1,22,000/-

If ACC Moves up 10RS you will make 250*10 = 2500RS profits and Vice versa

90% of Futures are traded in only in Index – NIFTY Futures & BANK NIFTY

Short Selling in Futures


You Can Short Sell in Futures and Hold this up to Expiry.

3 | TIDI Academy Mutual funds, SIP, Demat accounts Mob no:9686529666


OPTIONS
In Options there are two types. All the Premiums will Become Zero on Expiry date (OTM Calls).
If you Don’t Understand options never do options, as risk is highest and your entire investment
can become zero.

 Call option ( CE – Call Expiry)- Buy Call Option When you Predict Market Goes up
 Put Option ( PE – Put Expiry)- Buy Put Option When you predict market Goes Down

OPTIONS

CALL (CE) PUT (PE)

CALL BUYER
e CALL SELLER PUT BUYER PUT SELLER

MARKET MARKET MARKET MARKET


VIEW BULLISH VIEW BEARISH VIEW BEARISH VIEW BULLISH

 Buyer need to deposit premium only Seller need to deposit future margin
 Buyer limited loss Seller unlimited loss

NIFTY & BANK NIFTY = Expiry every week Thursday.


STOCKS = Monthly expiry last week of Thursday.

Important apps: Mobile apps, Money Control, Stock Edge, Edelweiss, Smstricks4u, and Market pulse.

5 Futures: | TIDI Academy Mutual funds, SIP, Demat accounts Mob no:9686529666
Websites: investing.com, in.tradingview.com, web.sensibull, opstra.definedge.com

Fundamentals:
Market capitalization: total number of shares issued by the company X share price Shares with above
50,000. Cr Market Cap is best for investment.

# Book Value: Total Assets of Company


Number of shares issued

Bigger the book value better the company (P/B < 5)


Smaller the P/B ratio better the company.

# EPS (Earnings per Share) = PAT (Profit after tax)


Number of shares issued
P/E < Industrial P/E
P/E < 20
It’s good to invest (P= Share Price) (E= EPS) Smaller. the P/E better the company.

Dividend: Dividend % X face Value.

5 Futures: | TIDI Academy Mutual funds, SIP, Demat accounts Mob no:9686529666

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