The stock market rests on a few simple ideas. Understand these building blocks and the headlines suddenly make sense.
What is a share?
A share is a small piece of ownership in a company. If the company grows and profits, your slice can become more valuable; some also pay dividends.
What is a stock exchange?
A stock exchange is the regulated marketplace where shares trade — NEPSE in Nepal, or the NSE and BSE in India. It matches buyers with sellers.
Key idea: Prices are set by supply and demand. More buyers than sellers pushes price up; more sellers pushes it down.
What is an index?
An index is a basket of stocks used to measure a market in one number — the NEPSE Index, NIFTY 50 or SENSEX.
Primary vs secondary market
- Primary market: companies first sell shares (an IPO).
- Secondary market: investors trade those shares afterwards — the day-to-day market on a chart.
Key takeaways
- A share is part-ownership of a company.
- Exchanges match buyers and sellers; indices summarise the market.
- Prices move on supply and demand.
- Returns come from capital gains and dividends — with real risk.
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