What is stock market and how to analysis stock market

The preliminary function of a stock market is to buying and selling of stock and it will enable the business to earn profit. The stock market is the most volatile thing to observe and at every point of time the stock market changes. The share of each and every stock keeps fluctuating according to the scenario the investors invest in the stock market. All common investors are not aware about the market situation and the latest changes of the stock.  To have a better understanding of the stock market to the common investors, the services of a stock broker are essential as he advises about the right time to invest in stocks and can make some profit.

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Stock Market

The basic of stock market: If you are first time investor or new to the stock market here are the fundamentals of the stock market which you must know.

Stock quotes: A stock quotes always gives a clear understanding about the stocks and what their price and how they are performing in the market. If you are aware about the quotes of a particular stock, it will be very useful to take decision whether to invest in the stock or not.

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Stock brokers: They are the professionals how have got the first hand information about various stocks and shares. If you don’t pose the necessary knowledge of stock market, it is always advised to take the help of the stock brokers before you invest on any stocks.

The mechanism of price control: The price of every stock keeps on fluctuating every day. Make sure you are keeping a close eye on the price changes and the control mechanism.

Analyzing the stock market: It has been proved that if you have analyzed the stock market well, there is every possible chance that you will perform well in the stock market. To analyze the stock market, there exists various methods on which you can analyze the market. Here are the methods:

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Moving average method of analysis: Many of the investors prefer to analyze the stock market in this method. To analyze a stock the average price of a stock is calculated.   The average is calculated for a period of 20, 30, 50, 100, and 200 days. Based upon the average price from these days the stock is being traded. At the same time the fluctuation of the stock over the period of time is also being taken into consideration.

Relative strength index method: Under this method the relative high and low of a stock is taken into consideration. Generally for a time period of 9 to 15 days a stock is being observed for how many day it has traded high and low. Based upon the performance of the stock it is traded in the future days.

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Bollinger bands method: The Bollinger method is based upon three lines. The top line represents the higher value and the bottom line represents the lower stock vale. The middle line represents the fluctuation of the stock value. If the fluctuation between the higher and lower price of the stock is more the middle line goes wider. Whereas the middle line come closer when the fluctuation is least. From the behavior of the middle line the future value of the stock can be predicted.

Stock Market