Marks One mark one question. - Karnataka … mark one question. Marks: Two marks one question.Two marks one question. Ten marks one questionTen marks one question. Fi e marks one q

One mark one question.Marks :

Two marks one question.Two marks one question.

Ten marks one questionTen marks one question.

Fi e marks one q estionFive marks one question.Maximum 13 + 5 = 18.

TOPICS STUDIED1. Meaning and Definition of

TOPICS STUDIED: ea g a d e t o o

Capital Market.2 Need and importance of Capital2. Need and importance of Capital

Market and Money Market.3 Differences between capital3. Differences between capital

Market and Money Market4. Primary and Secondary Market

(concept)( p )

Stock Exchange:1. Meaning and Definition.2. Functions and Merits2. Functions and Merits3. Dealers in Stock Exchange-

J bb d B kJobbers and Broker.4. Speculators- Bull, Bear, p , ,

Lame Duck and Stag.

5. OTCEI- Meaning only.g y6. NSE- Meaning only7 SEBI Meaning objectives7. SEBI- Meaning, objectives

and functions.8. De- materialisation of

Shares and Debentures:Shares and Debentures:

FINANCEMARKET

CAPITAL MARKET

MONEY MARKET

PRIMARY SECONDARYPRIMARYCAPITALMARKET

SECONDARY CAPITALMARKETMARKET MARKET

CAPITAL MARKET:In this concept 1 or 2 marksIn this concept 1 or 2 marksquestions will appear

Capital Market is the market, which provides the fund forwhich provides the fund for long term. It is the market,which deals in shareswhich deals in shares,debentures and bonds.

PRIMARY MARKET:PRIMARY MARKET:

It is a type of capital market from whichthe business undertakings collect theirthe business undertakings collect theirlong term and medium term funds through the new issue of shares.through the new issue of shares.

Secondary marketSecondary market:

It is a type of capital market whichhelps to purchase And sell shareshelps to purchase And sell shares and debentures already issued.(It i thi b t t k E h )(It is nothing but stock Exchange)

MONEY MARKETMONEY MARKETIn this topic 1 or 2 marks questions

ill I i h fwill appear It is the system of Borrowing and lending of funds byg g yBusiness undertakings for meeting

h t t i t It i thshort-term requirements. It is themechanism of borrowing and ‘glending of funds for workingCapital requirementsCapital requirements.

Differences between Capital market and Money market (For 2 marks)Capital market Money market

It deals in medium It deals in shortterm and long term term funds term funds.

It arranges a large It arranges a smallamount of funds amount of fund

The fund is The fund isrequired for required for required for required for investing on investing onfixed assets working capitalfixed assets. working capital

The rate of The rate ofThe rate of The rate ofInterest interestis low is high

STOCK EXCHANGE:STOCK EXCHANGE: ( 1 OR 2 MARKS)

M i It i th l hMeaning: It is the place where shares and debentures of company and securities of government are bought and sold under the gprescribed rules and regulations.

Definition: ( 1 or 2 marks )

Stock Exchange can be defined gas “ a voluntary association of dealers which provides platformdealers, which provides platform or place for them purchase and sale of shares and securities”sale of shares and securities .

FUNCTIONS OF STOCK EXCHANGE:OR ADVANTAGES OR IMPORTANCE:

(10 M)

1 Channel for Investment:1.Channel for Investment:A Stock Exchange provides a channel for investment. The day today information given by the stock day information given by the stock Exchange helps the investors.

2. Determination of Prices:Stock Exchange provides ready and continuous market.ready and continuous market. This feature helps to determine the prices of variousthe prices of various securities.

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Further the day to day prices f h d itiof shares and securities are

published in newspaper and also brought to the notice of the people through different p p gmedia. This also helps the people to determine the pricepeople to determine the price very quickly.

3. Equalisation of Prices of Securities:Stock Exchange helps to g pequalize the prices of securities in different stock market. If shares of a company are being sold for higher prices in a Stock g pExchange, the dealers can purchase shares from the other pstock exchange and sell the shares till the prices are pnormalised.

4. Formation of Capital:A Stock Exchange inducesA Stock Exchange inducespeople to save their earnings

5. Provides Ready and C ti k tContinuous market:Stock Exchange provides a ready market for the purchase and sale of securities.

6 Regulation of management 6.Regulation of management of company:Every listed company has to follow the strict rules and regulations of stock Exchange.

7. Mobilisation of Savings:A Stock Exchange mobilises A Stock Exchange mobilises the small savings of the people.

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8 Economic Barometer:8. Economic Barometer:It indicates the economic conditions of a countryconditions of a country.

9 Helping Government to 9. Helping Government to rise the fund:Stock Exchange helps the Stock Exchange helps the government to rise the fundsfrom the investors through thefrom the investors through theissue of bonds.

10.Providing Facility for Speculation:Speculation:Stock Exchange provide facilities for speculationfacilities for speculation.

Members of Stock Exchange: ( 2 Marks)

1. JOBBER:A Jobber is a member in a Stock Exchange who acts in his own name. He purchases and sell securities in his own name either from another jobber or broker.

2. BROKER :A broker is a member of StockA broker is a member of StockExchange who purchase or sells securities not in his ownsells securities not in his own name but on the behalf of jobbers.jobbers.

SPECULATION ( 10 Marks)It is an activity involvingbuying and selling of shares andy g gsecurities at two different timesfor different prices in order to for different prices in order to earn profit.

Speculators are those who h ll th h purchase or sell the shares or

securities without the transfer of shares or securities and make profit from the anticipated p pchanges in the prices.They neither take nor give the They neither take nor give the actual securities.

TYPES OF SPECULATORS:TYPES OF SPECULATORS:• BULL: A bull is a speculator who

t i i i f iti expects a rise in prices of securities. He is called “Tejiwala ” in the B b St k E h H Bombay Stock Exchange. He purchases securities at a lower price i d t ll th i f t t in order to sell them in future at a higher price.

BEAR• BEAR:A bear is a speculator who expects a fall in prices of securities. He is called “ Mandiwala ” in the Bombay Stock ExchangeStock Exchange.

BULL BEAR

• LAME DUCK:LAME DUCK:A lame duck is a bear speculator who has agreed to sell certain securities has agreed to sell certain securities on a particular date at a specific price but finds it difficult to supply price but finds it difficult to supply the securities on the settlement date.

• STAG:A Stag is speculator who applies for a new issue of securities with the main aim of selling them at a gprofit after the allotment of securitiessecurities.

O Th C t E hOver The Counter Exchangeof India: (OTCEI): ( 2 Marks )It is a national ringless and computerised Stock Exchangep gestablished by public sector banks public financial institutionsbanks, public financial institutionsand mutual funds to help both investors and medium sized investors and medium sized companies.

National Stock Exchange:(NSE) (1 Mark)

It was established on 27th

November 1992 as a companyby IDBI LIC ICICI UTI SBI GIC by IDBI, LIC, ICICI,UTI SBI, GIC and other Indian financial institutions at Mumbaiinstitutions at Mumbai.

Securities and Exchange Boardof India:(SEBI) ( 10 Marks)of India:(SEBI) ( 10 Marks)Securities and Exchange Board of India(SEBI) is the regulator ofof India(SEBI) is the regulator ofstock markets and watchdog ofIndian securities and stock markets. It was established on12th April 1988.

Functions of SEBI:1 R l ti th ti iti f1. Regulating the activities of

stock markets:2. Registration and Regulation

of working of Stock Brokers:of working of Stock Brokers:3. Registering and Regulating

Mutual funds:Mutual funds:

4. Promoting Investors’ Education and training:g

5. Regulating Substantial5. Regulating Substantial Acquisition of shares:

6. Prohibiting Unfair Trade P tiPractices:

7. Prohibiting Insiders Trading:

8. Conducting Research Activities:

9. Performing other works:

Dematerialization or Demat: ( 1 or 2 Marks)

Demat is a system of converting y gphysical forms of share certificates and debentures certificates into and debentures certificates into electronic forms in the demat accountsaccounts.

Stock Exchanges in India:Stock Exchanges in India:(Practical Section : 5 Marks)Write any 5 or 10 stock Write any 5 or 10 stock exchanges in India1 St k E h M b i1. Stock Exchange, Mumbai,2. Calcutta Stock Exchange g

Association Ltd. Kolkata.3 Chennai Stock Exchange 3. Chennai, Stock Exchange

Ltd. Chennai.

4. The Stock Exchange, Ahmadabad.

5 The Delhi stock Exchange 5. The Delhi stock Exchange, association ltd. New Delhi

6. Madhya pradesh stock exchange Indoreexchange Indore

7. Bangalore Stock Exchange Ltd. Bangalore.

8. The Hyderabad Stock 8. The Hyderabad Stock Exchange Ltd. Hyderabad.

9 C hi St k E h Ltd 9. Cochin Stock Exchange Ltd Ernakulum.

10 Th Utt P d h t k 10. The Uttar Pradesh stock exchange association limited Kanpur.

11. Pune Stock Exchange gAssociation Ltd. Pune.

12 The Ludhiana Stock Exchange 12. The Ludhiana Stock Exchange association Ltd. Ludhiana.

13 The Guwahati Stock Exchange13. The Guwahati Stock Exchangeassociation Ltd. Guwahati.

14. Mangalore Stock Exchange 14. Mangalore Stock Exchange Ltd. Mangalore.

15 M dh St k E h 15. Magadh Stock Exchange Association, Patna.,

16. Jaipur stock exchange ltd.J iJaipur

17 Bhubaneswar Stock Exchange17. Bhubaneswar Stock ExchangeAssociation Ltd.BhubaneswarBhubaneswar.

18 S ht K t h St k18. Saurashtra Kutch StockExchange Ltd. Rajkot.

19. Meerut Stock exchange LtdMeerut

20 Over the counter exchange 20. Over the counter exchange of India (OTCEI)

21. National Stock exchange ofIndia.(NSEI)India.(NSEI)

Q ti i Questions carrying ONE MarkONE Mark

1.What is the name of themarket which provides short term finance?provides short term finance?

Answer: Money Market

2 Write the name of the market2.Write the name of the marketwhich provides long term finance?

Answer: Capital Market

3 Write any one type of3. Write any one type ofspeculator.

Answer: Bull/ Bear/ Lame duck/ Stag

4. What does a Bear expect4. What does a Bear expectin the stock market?

Answer: Fall In price ofitisecurities

5 What does a Bull expect in the 5. What does a Bull expect in the stock market?

Answer: Rise in the price of psecurities

6 Expand OTCEI6. Expand OTCEI.

A O h C Answer: Over The Counter Exchange Of India.

7. Expand SEBI.Answer: Securities and

Exchange Board Exchange Board of India.

8. Expand NSE.Answer: National Stock

exchange. exchange.

9 Expand De mat9. Expand De-matAnswer: Dematerialisation

10 Mention any one of the 10. Mention any one of the dealers in the stock exchangeAnswer: Jobber or Broker Answer: Jobber or Broker

10 Marks Questions:10 Marks Questions:

1) E l i b i fl th f ti 1) Explain briefly the functions of stock Exchange or merits of stock exchange or importance of stock exchange.p g

2) Who is a speculator? Explain 2) Who is a speculator? Explain the different types of Speculators Speculators.

3) Explain briefly the functions of3) Explain briefly the functions of Securities and Exchange Board of India (SEBI)Board of India (SEBI).