TERMINOLOGY

FACE VALUE: Price in the bond (i.e) your investment in the company.
MARKET OR PAR VALUE: It is current price of the share in the market.
DIVIDENTS: It is profit share of the company to the share holders.The profit is shared by the face value which share holder owns.
Premium: Difference between market value and face value.

SHARE?

In simple Words, a share or stock is a document issued by a company, which entitles its holder to be one of the owners of the company. A share is issued by a company or can be purchased from the stock market.

By owning a share you can earn a portion and selling shares you get capital gain. So, your return is the dividend plus the capital gain. However, you also run a risk of making a capital loss if you have sold the share at a price below your buying price.

A company's stock price reflects what investors think about the stock, not necessarily what the company is "worth." For example, companies that are growing quickly often trade at a higher price than the company might currently be "worth." Stock prices are also affected by all forms of company and market news. Publicly traded companies are required to report quarterly on their financial status and earnings. Market forces and general investor opinions can also affect share price.

Quick Facts on Stocks and Shares

• Owning a stock or a share means you are a partial owner of the company, and you get voting rights in certain company issues
• Over the long run, stocks have historically averaged about 10% annual returns However, stocks offer no
  guarantee of any returns and can lose value, even in the long run
• Investments in stocks can generate returns through dividends, even if the price

How does one trade in shares ?

Every transaction in the stock exchange is carried out through licensed members called brokers.

To trade in shares, you have to approach a broker However, since most stock exchange brokers deal in very high volumes, they generally do not entertain small investors. These brokers have a network of sub-brokers who provide them with orders.

The general investors should identify a sub-broker for regular trading in shares and palce his order for purchase and sale through the sub-broker. The sub/broker will transmit the order to his broker who will then execute it .

IPO?

Facts about  Initial Public Offering (IPO) you should know
An initial public offering (IPO) is the initial sale of shares by a company to the public.
Broadly speaking, companies are either private or public. Going public stands for a company is changing from private ownership to public ownership.

Going public raises funds and offers several advantages for a company.
The dotcom growth decreased the bar for companies to carry out an IPO. Many startups went public without any income and little more than a business plan.
Getting a hot IPO could be very hard, if not impossible.
The process of underwriting involves raising funds from investors by issuing new securities.
Companies hire investment banks to underwrite an IPO.
The path to an IPO consists primarily of assembling the formal written documents for the Securities and Exchange Board (SEBI) and selling the issue to institutional customer.
The only way for you to get shares in an IPO is to have a frequently traded account with one of the investment banks in the underwriting syndicate.
An IPO company is difficult to analyze because there isn’t a lot of historical info.
Lock-up periods prevent insiders from selling their shares for a certain period of time. The end of the lock-up period can put strong downward pressure on a stock.
A tracking stock is created when a company spins off one of its divisions into a separate entity through an IPO.