How to invest in Nepali Share Market, Detail information with Demat and ASBA

There is always risk of money loose in Share market as any Nepal Share company says read carefully there issued shares contact documents before making investment on it. But today we are not going to talk about its risks factor. I wrote this post to explain you simply understand how you can make an investment in Nepali Share Market and how to start.
First you have to have ‘Demat Account’ (?????????? ????) before you do anything. This is very important to get Demat account number because all your Shares information is going to linked in this Demat account.

To get Demat account number in Nepal?
Go to any nearest Commercial Bank in your place and open a saving account. That is your first step to do. If you have already Bank account then you don’t need to open another one just check if your bank is providing Demat account services. Ask bank staff to give Demat account opening form. You need to fill all the details that require alone with your recent photo, Nationality Card’s photocopy and one of your relatives photo and Nationality card’s photocopy. Normally to get Demat account number it takes from 3 days up to a month depending on bank services. You can request for online Demat services if you are familiar with online stuff.Nepal_stock-market-trading

Always safety first, you need to be very careful on money. SMS banking gives you detailed information about your debited and credited money on time. And even all that hidden fees details that bank staff sometime forget to tell you. SMS banking services charge from Rs.150-250 annually and some banks are giving free of charge also.

I have got my Demat Account what next?
Next thing is to invest on IPO, FPO, Mutual Fund and Auction Shares.
What is IPO?
Initial Public Offering (IPO)
IPO Shares are those Shares which any company or organization issues for the first time to collect capital. To do so any company needs to obtain permission from Government. Basically IPO offers below 3 type of Share,
1. for Promoter IPO
Anyone can apply for this Share from ASBA application.
2. for Public IPO
This mainly popular among people as it contains low risk compare to any other Share. Normally 1 Share unit Par value is Rs.100 in Nepal
3. for Locals IPO
This type of Share can be applicable only for local are of people. This Share is mainly issued for certain area and cannot be bought from others area.

What is FPO?
FPO stands for Further Public Offering. When any established company or organization need to expand their capital or need more capital to their operations this type of Shares are issued. This share is more expensive than IPO because premium value is added to its Par Value. This can be x2, x3, x4 or more expensive.

What is Right Share?
This Share is issued only for its Shareholders. Who have Share of that company or organization they are eligible to buy new Share. Others who are non-Shareholders cannot buy Right Share.

What is Mutual Fund?
Mutual Fund is issued to complete a certain work and it is for certain time of period. Normally for 7-10 years. Its IPO start from Rs.10 per unit par value up to Rs.100 per unit par value depending on a project and company.

OK I understand the basic of Shares now, how to apply and what form do I need to fill?
As of the Nepal Government rules any company or organization must publish Share Issuing in known National newspaper for several times with all details that required. From that advertisement you can have information about issuing date and issuing unit. To apply go to the bank where you have account and you can fill the ASBA form with the Demat account number and share you want to purchase. One thing to remember, only apply for the amount that you have with you in bank. After applying the bank will seize that particular amount until Share is issued.

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