Can Anyone tell me about shares and IPO. I want 2 enter in Stock Business. I need help right 4rm how 2 start..

Question

This question is in regards to Stock Business.
I need help in this as I am completely new to it. All I have done is just got an account with ShareKhan, that is a demat as well as a trading account. Please help me. I have heard IPO is the safest way to earn in shares. Is it really true??
Kindly reply back as soon as possible.

Regards
Deep Sukhwani

Answer 1

If you are too lazy to do your own research you shouldn't be investing.

Answer 2

first the IPO (initial public offer). For some these are or can be a quick buck. If the company is well known then there will be demand for the stock so in the first few days it rises rather fast. The buck chasers sell high and leave it. Today many ipo are offered above what the stock should be offered at and go high and then drop back to realistic levels, so unless it is a company you want to invest in for the long term (mentioned by another, your goal) then don't bother unless you can watch and sell fast.

Otherwise what is your reason for investing? Build a retirement portfolio or to have something to sell later or what?

A retirement strategy should included a lot of safe companies, ones that are recession resistant. In industries you understand, like food, some utility types, things that people utilize every day and one other thing, pay a dividend.

Dividends means the large company is paying you for being a stockholder. So you buy and hold and collect as long as you want right into retirement.

But that's my ideal, not everyones.

Answer 3

Dear Deep,

IPO and share trading are really two different things. initial Public Offerings are generally share offerings made by firms wishing to raise capital for business expansion, they do this by making an offering inthe company through the stock market, be that Nasdaq or LondonFootsie 100 or any of the world stock markets,millions can be raised in this way. The firm has to be registered before they an make a public issue of their shares, it costs a whole lot of money to do this and the process is long as well, Banks, accountants and auditors will be involved.

You simply get a copy of the offering memorandom and make your subsription for the offered shares. This can be any amount as per the offering, you often get a situation where the offered shares are "oversusbscribed" and you do not get all the shares that you wanted due to heavy buying by institutional Investors.

The shares then float in the market and open at a market price as per the market makers, the shares are then officially trading in the market and you can buy and/or sell more shares, generally new issues open quite high and then settle depending on the market activity of public share holders.