Dalal Street
First Word...
The capital market is now a happening place. Many a career is made here. Many a profit is earned here. Like someone said, “This could be your Ali Baba’s den.” The markets have dramatically changed in the last 20 years. Today, the Indian markets are no longer insulated from the happenings in the rest of the world. There is both depth and breath in the market. The result: no single player can move the market by his individual action. With India turning out to be an attractive investment destination, as also one of the finest turnaround stocks, interest in the Indian market is like never before. In the space of 4 years, the index has moved 5 fold making it the best investment option. Like every attractive investment it has its fair share of risks. Today it is imperative for any young Indian, more so a finance professional, to know about the stock market. Dalal Street Primer is an attempt at that. It seeks to speak the language of the stock market – explains the basic terms used in the market, narrates how the market works, talks about both the primary and the secondary market and chips in with basic tax laws. It also outlines how to make informed investment decisions. Well this book does not tell you everything about the markets. But by the time you finish reading it you should be in a position to hold your own in a 30 minute conversation on the stock market! To many of you this should be your initiation to stock market investing. Believe me wealth in the years ahead will be made principally in stocks as an asset class today’s crash not withstanding! Welcome to a ringside view of the stock market. This booklet would not have been possible but for the efforts of a large number of students including the trio Deepak K. Bhatt, Ravi Narayanan N, Shivaprakash Viraktamath, our editor Bhavani Moorthy and our designer Malaiselvam no quantum of thanks will be too much. V Pattabhi Ram patbram@gmail.com January 21, 2008 Chennai
INSIDE
First Word
The capital market is now a happening place. Many a career is made here. Many a profit is earned here. Like someone said, “This could be your Ali Baba’s den.” The markets have dramatically changed in the last 20 years. Today, the Indian markets are no longer insulated from the happenings in the rest of the world. There is both depth and breath in the market. The result: no single player can move the market by his individual action. With India turning out to be an attractive investment destination, as also one of the finest turnaround stocks, interest in the Indian market is like never before. In the space of 4 years, the index has moved 5 fold making it the best investment option. Like every attractive investment it has its fair share of risks. Today it is imperative for any young Indian, more so a finance professional, to know about the stock market. Dalal Street Primer is an attempt at that. It seeks to speak the language of the stock market – explains the basic terms used in the market, narrates how the market works, talks about both the primary and the secondary market and chips in with basic tax laws. It also outlines how to make informed investment decisions. Well this book does not tell you everything about the markets. But by the time you finish reading it you should be in a position to hold your own in a 30 minute conversation on the stock market! To many of you this should be your initiation to stock market investing. Believe me wealth in the years ahead will be made principally in stocks as an asset class today’s crash not withstanding! Welcome to a ringside view of the stock market. This booklet would not have been possible but for the efforts of a large number of students including the trio Deepak K. Bhatt, Ravi Narayanan N, Shivaprakash Viraktamath, our editor Bhavani Moorthy and our designer Malaiselvam no quantum of thanks will be too much. V Pattabhi Ram patbram@gmail.com January 21, 2008 Chennai
INSIDE
First Word