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Introduction to stock market-purpose of these

The stock market is the heart of today’s economy. It plays a vital role in the development and growth of any country.

By reading this page, you will know about the story behind establishing the stock market, the father of the stock market, purpose of this market.

What is the stock market?

A stock market is a place where people sell/buy their stocks of publicly listed companies. It is also known as the market of selling and buying shares or stock exchange or share market. It refers to a public market that stands for issuing, selling, and buying shares.

Types of stocks

  • Growth stocks
  • Defensive stocks
  • Tech stocks
  • Cyclical stocks
  • Income stocks 
  • Blue-chip stocks 
  • Preferred stocks

The history behind establishing a stock market

The world first traded company was the east India Company. It was in 1602. It was a widely recognized company. Mr Rakesh Jhunjhunwala, who started the first investment in the stock market. That’s why he is called the father of the stock market. His first investment was Rs 5000, and he earned $3.1 billion from that. 

Purpose of establishing a stock market

Nowadays, share markets are the most crucial part of the global economy. Many countries depend on the stock market for their economic growth. It is one of the most important markets for companies to earn money. The price of stocks and other assets is an essential part of the dynamics of economic activity. Stock markets enable companies to trade publicly. It promotes investment. This market is vital for not only the industry’s point of view but also the investor’s point of view. To make a country economically dynamic, there is no alternative to a stock market. It is called the lifeline of the economy.

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