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Types of participants in stock market

Includes retail investors, institutional investors, brokers, traders, and market makers.

The stock market is made up of different types of players, each playing a unique role:

  • Retail Investors: These are everyday people like you and me, investing smaller amounts of money.

  • Institutional Investors: These are big entities like mutual funds, insurance companies, or banks that invest large sums of money in the market. Their buying and selling can heavily influence stock prices.

  • Brokers: Middlemen who facilitate the buying and selling of shares. You can’t trade directly in the stock market without a broker.

  • Traders: These are active participants who buy and sell stocks frequently, often multiple times a day, to make profits from short-term price changes.

  • Market Makers: These participants help provide liquidity by buying and selling stocks to ensure smooth market operations. They make money from the difference between the buying and selling price of stocks.

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