Indian Stock Market Basics for Beginners in 2023
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Introduction: Before entering the stock market: We should know the Indian stock market basics for beginners people from India, must know the important terminology, which is important to invest money in the Stock Market.


What is the Stock Market: – 


Investors buy and sell shares of companies in the stock Market. It is a set of exchanges, where companies issue shares and other securities for trading purposes.


In simple language:- It is a place where shares of publicly listed companies are traded. In the primary market, companies float shares to the general public with an initial public offering (IPO) to raise capital.  

What is Stock:- 

 A stock is a type of investment in a company. Companies issue stock shares to raise money to finance operational needs and to fuel the growth of the company. Investors buy those stock shares as an opportunity to generate a return on their investment. 


What is the Stock Exchange:-


The Stock Exchange is the Marketplace of India where financial instruments like bonds, shares and commodities are bought and sold.. It is a platform where buyers and sellers come together to trade financial tools during specific hours of any business day. The stock exchange of India is guided by the rules of SEBI (security exchange Board of India).


There are two big stock exchanges in India. The NSE (National Stock Exchange) & BSE( Bombay stock exchange).NSE is the biggest stock exchange in India, whereas BSE is ASIA’s oldest stock exchange.


BSE is the first ever stock exchange in Asia, established in 1875 and the first in the country granted permanent recognition under the Securities Contract Regulations Act,1956.

Bombay Stock Exchange (BSE):- 

 BSE was established in 1875, by cotton merchant Premchand Roychand, a Rajasthani Jain businessman. BSE is the oldest stock exchange in Asia. It is the oldest stock exchange in ASIA. It is the 10th oldest stock exchange in the world. BSE is the 8th largest stock exchange with an overall market of more than RS.276.13 Lakh crore by January 2022.


Indian Stock Market Basics for Beginners in 2023

The National Stock Exchange (NSE):- 

NSE was incorporated in 1992. It was recognized as a stock exchange by SEBI in April 1993 and commenced operation in 1994. The market value of NSE is USD 3.4 Trillion as of March 2022. It is the 10th largest stock exchange in the world by 2021.NSE headquarters is in Mumbai, India.

Indian Stock Market Basics for Beginners in 2023

What is Dalal Street:-

The literal meaning of Dala means in Marathi Broker or intermediary. People in Bombay called this office Dalal Street, after the  first stock exchange  recognized by the Indian Government “ BOMBAY STOCK EXCHANGE “ IN 1874.

 Sensex & Nifty in the Stock Market:-


Nifty and Sensex are benchmark index values for measuring the overall performance of the stock market?


Sensexes is the Index used by the Bombay Stock exchange, where as Nefty is used in National stock exchange in India.


Bombay stock exchange is the oldest stock exchange in the world. It is also termed as ““BSE” Bombay stock exchange. It is a free-floating, economy-weighted index of 30 financially sound and very established listed on BSE.


Nifty Bank or Bank Nifty: – This is an Index comprised of the most liquid and large capitalized Indian banking sector stocks. It is a benchmark that provides investors  with a benchmark that captures the  capital market performance of Indian bank stocks. Bank Nifty has 12 stocks from the banking sector in India.


What is IPO in the stock Market:-When a private company first sells shares of stock to the public, this process is known as an Initial Public Offering (IPO). It means in IPO the company’s ownership is transitioning from private ownership to public ownership.


What is the difference between a Share Market& Stock Market:-

Share Market:-

1.The term” share” is associated with investment options like mutual funds and limited partnerships. Here are both markets that are doing Trading. Shares are units of the total valuation of a company.


2.When you invest in a company, you will receive a number of shares according to your investment. The share market is a market where a company offers its share to raise funds and continue the growth of its business.


3.It is a place where investors can buy a part of ownership in any         company. The share market is the platform where the investor buys or sells    shares in the stock market.


4.When you buy the shares, you become the shareholder of that company.


5.An investor also enjoys a part of the profits earned by the company through dividends.


6.In the share market, if the business does not perform well, the investor also needs to bear the loss.


Stock Market:


The Stock Market is also known as the stock exchange. It is a place where stocks, equities, and other securities and bonds are actively traded. The term stock is used to mean the ownership of the certificate of any company.


1.A stock market provides a fracture to trade in a secure and controlled manner. Stock market is a place where the buyer and seller work together.


2.The Securities and Exchange Board of India (SEBI) regulates the stock exchanges in India.


3.Stocks cannot be bought or sold if they are not listed on the stock exchange.


4.In India, two principal stock exchanges are operating in the market1. Bombay stock exchange (BSE) 2.Nationalstock Exchange (NSE).


5.The market tracks demand and supply of stocks and sets their price accordingly.

What is Investment:

Investment of money means the money you earn is partly spent and partly invested for future expenses. Instead of keeping your savings idle, you may want to use your savings to get returns in the future. This is called Investment.


Where to Invest:


(1)Physical Assets:-One May Invest in Physical Assets like real estate, gold/jewelers and commodities.


(2)Financial Assets:-Such as Fixed deposits in Banks, small savings instruments with post offices, Insurance, Pension funds, etc or securities market-related instruments like shares, bonds and debentures.


Who is the Stock Broker:


An investor cannot directly buy or sell shares on a stock exchange. Registered members of the stock exchange are called stock brokers. They trade on an Investor’s behalf.


They are either an independent service provider or employed at a brokerage firm. It is ideal for them to have the required qualifications and experience in the field of finance. A broker is a trading member in the stock market, who trades the shares or stocks.


Stock brokers are taking decisions on their judgment and knowledge of the market. They can make the right decision to purchase or sell the shares based on their experience and knowledge.


Here’s what a broker can do for you:-


1. guide and the representative you at the stock market.


2. Buy and sell stocks.


3. Provide the right information about the investment options available in the stock market.


4. Provide correct information on shares and their prices obligatory.


5. Inform you about appropriate market moves.


Indian Stock Market Basics for Beginners in 2023

What is a Trading Account:- 

A trading account is a bridge between your Demat and Bank accounts. It is opened by a stock broker .When an investor buys a certain number of shares, the first step is the amount transfer the money from Bank account to trading account.

Some important points of trading account:-


1. It will only take two to three working days for the trading account to reflect on the transactions.


2. An investor can open multiple trading accounts and a Demat account.


3.It is compulsory to open  both accounts with the same broker.


4. Investors must ensure that the form they submit to open their account mentions their account details correctly.



Demat accounts are where your security will be held digitally. You will need to furnish the following documents to open a new Demat account:-


1. A passport-size photograph.


2. A copy of your PAN Card


3. Identity Proof-Adhar Card, Passport, Voter ID, Driving License, Bank passbook, electricity bill, PAN card.


4. Address proof:-Address proof such as Ration card, passport, voter ID, Driving License, or Self declaration form.




Maharashtra accounts for the highest number of investors. More than 15 million(21%) registered investors, followed by Gujarat(8.6million), Uttar Pradesh (5.3 Million), Tamil Nadu (4.3 Million) Karnataka (4.2 million) investors in India, and Andhra Pradesh is (3.5) Million. West Bengal(3.1 million).


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I am Ajay Kumar Patra. ( & MBA-Finance) with 27years of Accounts & Taxation Experience in Large Manufacturing Units in India. In 2021 I started my own tax consultancy firm called “Ajay Tax consultant”. I started my Digital marketing on my website "".I have already published more than 100 Blogs on Business, Finance, startups, Digital marketing & Tours & Travel for my viewers.

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