Basics to Share Market investments

Lots of people are interested to invest in share market,majority of them doesnt know about it properly.For those people just read and understand the basics given below

What is a share?
A share is a share in the share Capital of a company. If that sound too
complicated it simply means by owning a share, you are one of those
millions of owners that own the company. Everyone who owns a share is an
owner of the company but he/she is not the sole owner as every
shareholder is only a part owner. Once you are a shareholder you get all the
benfits an owner of a company would get.

How does one become a shareholder?
To be a shareholder one has to buy shares from the market. It is not
possible for everyone to run around the place shouting out that they want
to buy/sell shares. So to facilitate this process we have something
called exchanges. So if one wants to buy and sell the shares he/she has to
go through the stock exchanges. We have many stock exchanges in India
out of these the Bombay Stock Exchange is one of the oldest stock
exchange not only in India but also in Asia. We also have the National Stock
Exchange which is Located in Mumbai (Bandra Kurla Complex) where
sharetrading can take place. Now it is also not feasible for millions to
visit the comparitively small buildings of the stock exhcange to buy and
sell shares. So we have middlemen called brokers. Brokers buy and sell
shares on behalf of a shareholder. Brokers do a good job but at times
they are mainly responsible for the fraud that takes place in the stock
markets. So to monitor them we have a governing body called SEBI
(Securities and Exchange Board of India) Therefore if you have any problems
whatsoever with your broker dont worry!! just visit
http://groups.yahoo.com/group/sharetrading/links we have a lot of
usefull links there, and one of them is complain to SEBI. Click on the link
fill in the details and complain online to SEBI and they will help you
out.
Some years back if one bought a share he would receive the share
certificate of the company physically. But nowadays it is in the electronic
format. If you have heard the word demat account quite a few times and
wondering what it is, to simplify it, I would call it an electronic
plastic bag wherein you put your share certificates (also other debt
instruments, securities and commercial paper). All demat accounts are held by
National Securities Depository Ltd. or NSDL http://www.nsdl.co.in/
Your broker who opened the demat account has to report to NSDL all the
details of the account and your details as well. Nowadays they are pretty
strict therefore your broker may ask you many details while opening an
account. Even a small thing like a change in the address if quite a
procedure. Things get tedious if you are an NRI.

What do I need to trade?
So to trade online one would need a Bank account, demat account and an online trading account. You may open an online trading account with
online portals. The famous ones are,
ICICI Direct
5 paisa
Sharekhan
Geojit

you may chose the one you desire put your money in the bank account and
start buying and selling shares.

Insurance as an investment

Agreed, insurance may not be the best place to invest your hard-earned money. But there are sufficient reasons for one to believe that it can be a highly lucrative avenue to facilitate savings. People often talk about yield on investment and tend to compare their values with those available on various insurance schemes. This is particularly typical within the Indian sub-continent where one conveniently forgets the element of risk covered by life insurance.

It is extremely unfair to compare the performance of insurance against other investments without considering the core features of insurance. The very essence of insurance is to protect your family from the uncertainty of your life. Hence it proves very logical to evaluate the costs involved towards this feature. Ask yourself this question

When you pay insurance premium for your car, do you get anything if fortunately no mishap happens? This means that you spent the amount to secure a valuable property.
Hence you must accept that out of the total amount paid by you for your life insurance, a certain amount is used for providing the risk cover and only the balance can be utilised as savings.

In other words, the total premium you pay minus the amount evaluated as the cost of insurance must be considered as the amount invested to get the maturity amount. If you calculate the yield from returns, you will be in for a surprise.

Now how do you compare the yield in such a situation? Is it 100 % or 1000 % or more?