STOCK ONLINE TRADING

Stock market
The stock market is a market for trading shares held by public companies and related financial instruments (including stock options, stock index trading and forecasting.

International markets
There are several stock markets in advanced economies, with the largest market in the United States, China, Japan and Europe.

Stock index
Price movements in the market or a part of the market are captured in price indices called stock market indices, among others, Standard & Poor's Index, Index of Financial Time. Index as above is usually measured by market capitalization.

Strategy
There are two types of trades involving real money or shares not owned short sales and purchase limits.

Short Sales
In short selling (short selling), a person selling shares they do not own, hoping the price will fall. They must eventually buy back the shares. Exit short positions by buying back shares is called "covering a short." Easily, one borrows shares owned by others to be sold at market price. Then people are hoping that the stock price has declined to be bought back at lower prices to be returned to its owner (in the form of shares) and pocket the profits (the difference between selling price and buying price).

Purchase limits
In the purchase limit, a person borrows money to buy stocks and hope that the shares could rise in the price. Many industrialized countries have rules that require that lending based on collateral from other stocks, this borrowing should be within a certain percentage of the price of other stocks. Other rules include prohibition of "freeriding" ; ie, put the message to buy shares without paying first, and then sell it and use the profits to pay for previous purchases.


Stock History

Type
There are several types of shares, including ordinary shares (common stock) and preferred stock (preferred stock). Preferred stock is usually referred to as a mixture of shares it is very important to have characteristics similar to ordinary shares. Usually the common stock has only one species but in some cases there is more than one, depending on the needs of the company. Ordinary shares have several types, such as class A, class B, class C, and others. Each class with its advantages and disadvantages own letters and symbols does not mean anything.

Characteristic

Preferred Shares
Preferred shares have the following characteristics:

• Have a variety of levels, can be issued with different characteristics
• Claims against assets and income, have a higher priority than common shares in respect of dividend payments
• cumulative dividends, if not paid from the previous period, it can be paid in the current period and earlier of the ordinary shares
• convertibility, may be exchanged into ordinary shares, if an agreement between shareholders and publishers formed an organization

Ordinary Shares
Has the following characteristics:
• The rights of a shareholder vote, the commissioners can memillih
• The rights of precedence, if the issuer organization issuing new shares
• limited responsibility, which is given only on the number of

Category
When viewed from trade performance, the stock can be grouped into:

1. Blue chip stocks, shares of common stock has a high reputation as a leader in its industry, having stable earnings and consistent in paying dividends
2. Income stocks, shares of issuers with the ability to pay dividends is higher than the average between the dividends paid on the previous year
3. Growth stocks, consisting of Well-Known and Lesser-Known
4. Speculative stocks, stocks consistently earn revenue from year to year, has a high income possibilities in the future, however uncertain
5. Counter cyclical stocks, shares are not affected by macro economic conditions and the general business situation

Application
Public can purchase common shares on the stock exchange via a broker. In Indonesia, the purchase of shares must be made on multiples of 500 shares or also called Fractional Shares with a lot (not rounded 500 sheets) can be traded over the counter. One objective of the public to buy shares is to benefit by way of:

1. Increasing the value of capital (capital gains).
2. Get the dividend.

Offer Shares to the public first before listing on the stock is called Initial Public Offering (IPO), while if it is registered (listing) and the company wants to increase the shares outstanding prior to giving rights to shareholders to buy his old called Preemptive Rights Formerly (ER) or also known as a right issue.


Some Indonesian companies to dual listing of shares on the Jakarta Stock Exchange and the New York Stock Exchange. Shares traded on the NYSE is commonly known as American Depositary Receipt (ADR). Stock prices, could rise or fall, in line with the existing situation and conditions. Like when the monetary crisis on September 15, 1998, Composite Stock Price Index (CSPI) is also a barometer of the stock in Indonesia slumped 292.12 points to its value. Also in September, reaching the lowest value of JCI 254 points. This has caused stocks in the country to be under value. In the period 2002-2007, the CSPI has been restored several times and even had a record-breaking. For example in the year 2006 and year 2007 JCI positioned itself as one of the index, which has the best performance of the world (ranked second after China, reaching the level of 2745.826 points). On December 11, 2007, JCI at the same time achieving the level of 2810.262 points made history as the highest index level in the history of Indonesia. In addition, JCI has increased average annual rate of 42.18% as compared with the highest index movement index increased in Asia.

Mechanism of stock trading in Indonesia
First you need to do is investors need to become a customer at the first securities firm. Investors pay a deposit to open an account with the amount of Rp 25 million, while others require the amount of Rp 15 million and beyond. The amount remitted varies. Basically, these restrictions or minimum nominal amount of shares purchased does not exist but in Indonesia Stock Exchange a minimum purchase of 500 shares or a lot, for example, XYZ company stock valued at USD 100.00 then the minimum funds required to purchase one lot = USD 50000.00 (500 shares multiplied by USD $ 100.00). The sale or purchase transaction can be performed on the day the stock. Trading mechanism, systematically as follows:

Factory
Another place to buy stock in addition to IDX / Indonesia Stock Exchange (Indonesia), namely the Nasdaq / Nasdaq Stock Market (United States), the NYSE / New York Stock Exchange (New York), SEAQ / Stock Exchange Automated Quotations (London), Euronext (the merger market shares between the state of Paris, Amsterdam, and Brussels), TSE / Tokyo Stock Exchange (Tokyo), SGX / Singapore Exchange (Singapore) and other trading places (there are approximately 69 places trading / stock markets around the world).

Sell empty
Usually, the first time an investor is buying shares and then sell it. With a short sale (short selling), which is in reverse. First, the shares are sold and then repurchased. This allows investors to profit from stock price declines. Done in a way, an investor borrows shares from a broker and sell them. Furthermore, short-sellers must buy the same stock to replace shares that have been borrowed. This activity is called to replace vacant positions (short covering positiion).