Ever wondered why every year a huge number of people move towards stock trading? Because of the potentially high returns it provides, with easy accessibility. You can start investing even with a very small amount anytime from your smartphone. 

Although so many people start stock trading, only a few are able to succeed. This is because many lack basic understanding about stock trading, which is the foundation of the entire stock market. In this article we will learn some basic and common terms about stock trading. So let’s get started. 

Mutual Funds:

You might have heard a lot about mutual fund app in the various advertisements. So mutual funds are the investment vehicles that allow pools of money from various investors to invest in a diversified portfolio of assets. It includes stocks, bonds and other securities. These are managed by professional fund managers. Mutual Funds offer investors a way to gain exposure to a broad range of assets without needing heavy knowledge or experience in individual stock selection. 

It reduces the risk by spreading investment across various assets.

Here, professional fund managers handle the research and investment decisions.

Investors can typically buy or sell shares of mutual funds easily

Equity Investment:

Invest in equity means to purchase shares of individual companies which are traded publicly. Equity investors by stock to become partial owners of a company, hoping to benefit from its growth and profitability. Equity investments can be made through stock exchanges, where shares are sold and sold.

Equity investments have the potential for significant capital gains 

Shareholders may influence company decisions through voting rights 

It provides the source of income in addition to potential capital appreciation.

Futures Trading:

Future trading involves buying or selling contracts that obligate the delivery or receipt of an asset at a predetermined price and date in the future. Futures contracts are used for hedging and are available for various assets including commodities, currencies and financial instruments. 

Futures can protect against price fluctuations in underlying assets.

Traders can profit from price movements without owning the underlying asset.

Futures markets are highly liquid, facilitating easy entry and exit.

NSE Option Chain Live

The National Stock Exchange of India (NSE) Option Chain Live provides real time information about options trading, including available strike prices, premiums, open interest, and bid-ask spreads. Options are financial derivatives that give investors the right, but not the obligation, to buy or sell an underlying asset at a specific price before a certain date. 

Options can be used for hedging, speculation or generating income. 

Investors can control a larger position with a relatively small amount of capital. 

Options can limit potential losses through strategic positioning.

By understanding the above mentioned financial terms like mutual funds, equity investment, futures trading & NSE India Option Chain Live, you can empower yourself to make right decisions in the financial markets. 

Each of these investment tools offers unique opportunities and benefits. Being well updated about these basic terms of stock trading & opening a trading account can help you in achieving your financial goals and reduce risks. If you are a beginner it is always advisable to start with learning the basics.