Generally, people enter the financial market to enjoy a bit more income. However, they may lack knowledge of appropriate market terminology. It is difficult for a newbie to understand terms such as ‘share’, ‘stock’, and ‘equity,’ and not having a clear understanding can be problematic. An investor should be familiar with these terms well before they start investing. Being aware of the jargon helps you invest wisely. In this article, we will talk about stock market vs share market and see what their differences are. A new investor may not always know the difference between stock market and share market. As a result, their vision gets blurry. Let’s break the terms into parts and see their meanings first.
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The term ‘share’ is associated with investment options like mutual funds and limited partnership. But both markets are based on the same thing—trading.
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The stock market, also known as the stock exchange, is a place where stocks, equities, and other securities and bonds are actively traded.
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Even though these terms are used interchangeably, they differ in their modes of operation. A share market or a stock market is essentially a market where various kinds of bonds and securities are traded. The price of a company’s stock depends on the demand and the supply of that stock. A company can issue shares directly, but it cannot issue stocks in such a manner. When a number of shares are put together, it is called stocks. Also, keep in mind that shares can have a small value, while stocks will always have a significant amount of value. These are the major differences between stock market and share market.
Now that you know the how the stock market is similar to and different from the share market, trading is even easier. Click here to open a demat account and start trading today.
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