You buy on Tuesday morning. When are the shares actually sitting in your demat account?

Wednesday — Indian exchanges settle one working day after the trade

Tuesday, the instant the order matches

The following Monday, after a weekly cycle

The Nifty 50 is up 1%. What does that tell you about the one share you hold?

Nothing certain — the index summarises a basket of 50 large companies, and yours may not be in it

It rose, because index moves get applied to member companies

Lesson 2 of 3 · 7 min

Where shares trade, and where yours live

Primary market versus secondary, why the Sensex and the Nifty are thermometers rather than the room, and the T+1 journey a share takes into your demat account.

Shares are born in the primary market: a company sells brand-new shares to the public — an initial public offering, or IPO — and the money goes to the company.

Everything after that is the secondary market: investors trading existing shares with each other on an exchange. Not one rupee of it reaches the company; you are buying from another investor like you.

Primary vs secondary market

What to compare	Primary market	Secondary market
What is sold	New shares, created by the company	Existing shares, owned by investors
Your money goes to	The company	The investor selling to you
Price set by	The company and its bankers, in a band	Live demand and supply on the exchange
Example	Applying in an IPO	Tapping Buy on a broker app

The Sensex tracks 30 large companies on the BSE; the Nifty 50 tracks 50 on the NSE. Each is a thermometer: one number summarising how a basket of big companies moved today.

A thermometer reads the room — it is not the room. "Nifty up 1%" means that basket rose about 1% on average; your particular share may have done anything.

What happens when you tap Buy

Today (T) — seconds
Your broker sends the order to the exchange, which matches it with a seller.
The price you get is whatever the match happened at — it can differ slightly from the price you saw.
Today (T) — same day
The trade is confirmed and your contract note is generated.
The contract note lists every charge on the trade. It is worth actually reading once.
Next working day (T+1)
Settlement: the shares land in your demat account and the seller gets the money.
Indian exchanges settle on T+1 — one working day after the trade.

Quick check

You buy shares of a company on the exchange today. Who receives your money?

Check yourself

1 / 3

Kabir asks

Vikram buys 10 shares on the exchange this morning. Where does his money land?

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