Cash Trading in stock market
Posted by ways2capital on May 3rd, 2018
A cash market is a market place involving commodities and securities transaction. In this cash market it is a exchange of goods and money between the seller and the buyer. This market is also called as spot market. This cash transaction takes place on a regulated exchange or over the counter. A cash transaction required all aspects of trade by including delivery of payments to be finalized on the trade date. It involves less risk than margin trading, for this risk is limited to only the cash invested.
The stock market it refers to the collection of markets and exchanges were issuing and trading of equities, bonds and other securities. The stock market is one of the free economy market were it provides companies with access to capital in exchange for giving investors ownership. Stock market players are stock brokers, Traders, stock analysts, portfolio managers and investment bankers. The stock market allows companies to raise money by offering stock shares and corporate bonds. It provide investors a chance to participate in the financial achievements of the companies, making money through the dividends.
Equity market is the meeting points for the buyers and the sellers of stocks. Most of the large company investing as a stock is listed at multiple stock exchange throughout the world. To grow their business in the market for the capital the companies sell their stocks. There is an example when there is the price of stock is rise it means there is high demand to invest in the company, and when many investors sell their stock, the values comes down.
It is a market place between buyers and sellers were contracts are negotiated at future exchanges. Financial futures introduced in 1972 were its recent decades are currency future, interest rates future, and stock market index futures were played a important and large role in the overall future markets and mcx tips .
''Intraday traders'' is a stock trader which opens and closes a position in a security in the same trading day. At the top of the spectrum day traders and Intraday traders are the one. They follow certain guidelines to limit losses-
1. They invest what they can afford to lose
2. They choose highly liquid shares
3. They fix entry price and target levels
4. They book profits when targets are met
5. They don’t fight with the market trend.
In positional trading all open position are exited before the market closes and have a net profit or loss and it is based on your trades. It should be positional with 1-2 days time frame so that you can book profit or carry trades for a week or a month. The New York Stock Exchange (NYSE), which is using a real-world example, is a regulated cash market in the United States. The NASDAQ could also be considered a cash market. Therefore, it can be more than one cash market within an economic region.
In conclusion a stock market crash affects not only the stability of the stock exchange but its economy. It is caused due to insider selling, overpricing of shares and lack of effectiveness of the trading.
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