market

This query is : Resolved 

09 March 2011 1. What is bullish and bearish market or face?

2. What are mid cap, samll cap and large cap?

3. What do you mean by Blue chip companies?


10 March 2011 hi poornima,

1.A bull market is associated with increasing investor confidence, and increased investing in anticipation of future price increases. A bullish trend in the stock market often begins before the general economy shows clear signs of recovery.

A bear market is a general decline in the stock market over a period of time. It is a transition from high investor optimism to widespread investor fear and pessimism.

2.Market capitalization (often market cap) is a measurement of size of a business enterprise (corporation) equal to the share price times the number of shares outstanding (shares that have been authorized, issued, and purchased by investors) of a publicly traded company.

There is no classical definition of mid-cap shares. The name ‘mid-cap’ originates from the term medium capitalised. It is based on the market capitalisation of the stock.

In case of India, the National Stock Exchange (NSE) defines the mid-cap universe as stocks whose average six months’ market capitalisation is between Rs 75 crore and Rs 750 crore. In the US, mid-cap shares are those stocks that have a market capitalisation ranging from Rs 9,000 crore to Rs 45,000 crore. In India, these shares would be classified as large-cap shares.

Thus, classification of shares into large-cap, mid-cap, small-cap is made on the basis of the relative size of the market in the country. The total market capitalisation of US markets is $15 trillion. In India, the market capitalisation of listed companies is around $600bn.

The name "blue chip" came about because in the game of poker the blue chips have the highest value.

Blue chip stocks are seen as a less volatile investment than owning shares in companies without blue chip status because blue chips have an institutional status in the economy. Investors may buy blue chip companies to provide steady growth in their portfolios.



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