STOCK AND COMMODITY

MARKET

Speculation has a special meaning when talking about money.

It is the transaction of members to buy or sell securities on stock exchange. With a view to make profits To anticipate rise or fall in price of securities.

SPECULATION

Speculator does not buy goods to own them, but to sell them later.

The reason is that he wants to make a profit from the change in price.

One tries to buy the goods when they are cheap and to sell them when they are expensive.

There is a good chance to profit as long as the market price of a good changes often in different directions.

SPECULATOR

DEFINITION OF SPECULATOR

A person who trades derivatives, commodities, bonds, equities or currencies with a higher-than-average risk in return for a higher-than-average profit potential.

Speculators take large risks, especially with respect to anticipating future price movements, in the hope of making quick, large gains.

Speculators

Jobber

Broker

BullBear

Lame duck

Stag

Contango

KINDS OF SPECULATORS IN STOCK EXCHANGE

JOBBER

Jobber is a professional speculator who has a complete information regarding the particular shares he deals. He transacts the shares of profit. He conducts the securities in his own name. He is the member of the stock exchange and he deals only with the members.

BROKER

Broker is a person who transacts business in securities on behalf of his clients and receives commission for his services. He deals between the jobbers and members our side the house. He is an experienced agent of the public.

TYPES OF BROKERS

1. Investment broker2. stock broker3. Discount broker4. Prime brokerage5. online broker6. OTC broker7. Exchange broker

With the expectation that there will be a rise in the price of certain security in the future.

A bull is known as tejiwala in BSE is a speculator who indulges in speculative buying activity.

He purchases to sell shares on higher prices in future. The activity of a bull speculator is technically called

Buying Long. He is called a bull because he pushes up the prices of

securities through his activities just as a bull throws his victim upwards.

BULL

He takes an advantage of an expected fall in prices.

A bear is known as Mandiwala. In the BSE he is a speculator who indulges in speculative selling activity with the expectation that there will be a fall in price of certain security in the future.

The activity of the bear (i.e. selling certain security which he doesn’t possess) is technically called selling short.

He is called the bear because he focuses the price down through his activities just as a bear presses his victim down to the ground.

BEAR

LAME DUCK A lame duck is a bear speculator who has

contracted to sell certain security on certain date at a certain price.

But finds it difficult to meet his commitment on the settlement day

As the concerned security is not available in the market and the other party is not agreeable to the postponement or carry over of the transaction.

He is called a lame duck because he is like a lame duck in the water struggles (i.e. Finds it difficult) to meet his obligation on the settlement day.

A stag is a speculator who applies for a large number of shares in a new issue with the expectation of selling them to the public immediately after allotment at a premium and making profit.

He is called a stag , as he is very caution in his dealings like a stag.

He takes his decision to purchase and sell securities only after weighting the pros and cons over and over again.

STAG (DEER)

He also keeps his dealings within limits so that his losses could be reduced, even if he suffers loss in his dealings.

A stag is generally considered as a special type of bull, as he specialises only in buying the shares in a new issue.

CONTANGO means to come over dealing to the settlement.

The broker is paid a reward to carry the settlement , it is also known as contango.

In some cases if buyer is unable to make the payment of securities on any particular date.

So he request the broker to carry on the dealing to the next settlement.

CONTANGO AND BACKWARDATION

BACKWARDATION is an interest which is paid by the sellers of securities to the buyers who wants to postpone transactions to the next account.

Thank you -

M.Dimple -ankita -vidya -nishta -twinkle -raziya -manju.b