Rise and Fall of Stock Market: Rumors Only?
Today I thought of writing on a prominent topic that is always talked about, Nepal's Stock Market. Stock Market is a place where the public listed companies are traded. It is a public venue where individuals or group of people buy and share the shares of the public listed companies that have issued shares. The price of each shares of companies rise and fall based on their demand and the traded price. Stock Exchange can be future savings, investments for greater returns as well as job for some.
The companies that cross a capital or are just established issue Initial Public Offering(IPO) which are simply the small shares of that company. These IPOs usually cost 100 NRs., but some might issue for 10 NRs. each. The interested individuals apply for different number of shares. However the shares offered by the company remains constant due to which we often encounter online news that the IPO has been applied 3, 4,5,6... times more than it was decided to be issued.
Then after the deadline of the application date, the companies allot different number of shares to many individuals. It is not necessary that those who applied has to be allotted the same amount applied or or even has to be allotted. Then the remaining amount returns to our respective Bank Accounts. Few years back, people had to stand in queues for hours to apply for shares but now can be applied online.
The rise and fall of price of shares of any company might rise or fall. It is almost unpredictable but the Stock Markets all around the globe are usually manipulated by various hoax and news. Talking about the Nepalese Stock Market known in every household as Share Bazaar is greatly affected by these rumors. A small hoax can change the fortune of any company within the hours. The price of newly established companies doing no work could be sky rocketing and the shares of A-listed Banks and Companies might be equal to peanuts in terms of price due to small rumors.
Moreover in Nepal Share Market also provides its share holders profits in every other year in the form of Dividends, Bonuses, Right Shares and Bonus Shares. The news of these profits elevate the stock prices of those companies remarkably.
References:
https://www.investopedia.com/articles/investing/082614/how-stock-market-.aspworks
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