How to understand share market

I have felt that its mostly the psychology of common masses that goes into the value that a share carries.
Need inputs from expert how does one go about judging wehter to invest in a share or ipo etc.
Any good tutorials or courses about share market will be helpful.

Also any stories or lessons from personal experience / personal insights.
Rohit BajajAsked:
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I'm not in a good position to address your basic question but did want to comment on your first statement.  For the bulk of the stock market, I don't think it is the "common masses" that drive prices.  I think you'll find that the vast majority of transactions are initiated by people who make a living managing portfolios.  While they are also subject to their own biases, I'd bet that most of their transactions are guided by methods that are more consistent and logical than individual investors.
Dr. KlahnPrincipal Software EngineerCommented:
The stock market used to reflect human psychology to a large extent up until the middle 1970s.  At that time, investment firms and arbitrageurs found it profitable to hook stock tickers into computers and start doing real, serious mathematical analysis of stocks with a view toward maximizing quick profits.

Since then it has become progressively worse to the point where there was recently laid an undersea cable between the US and London specifically so that arbitrageurs could take advantage of a 3 millisecond speed increase over the normal internet speed.  That gives an approximate idea of the human involvement in the stock market today.  It's a random walk driven by computers all trying to make $5 on one million share trades.

Over the last 40 years, the only things I invested in that did well over the long run -- and today you have to be in for the long run, because over the short run the computers eat you alive -- were diversified mutual funds.  Sure, people point to Apple and say "Look at what they did."  But, for every Apple, there are thousands of "pink sheet" companies that came, and went, and never got listed on any reputable exchange.  Technology funds take a drubbing every ten years or so, the so-called "blue chip" financials ditto and utilities are offering rates of return less than the rate of inflation.

Warren Buffet told his investors:

Put your money in index funds and move on.  Seriously, you'll do better. In fact, he said, that's what I plan to do with my own money once I am gone.

That's pretty serious advice coming from one of the best investors in the world.  But it's true, and if I could step back 40 years that's what I'd do too.  Buy the NASDAQ as an index fund, sit back, and leave it alone.


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fred hakimRetired ITCommented:
I assume you are interested in the stock markets.   There are thousands of websites, radio/TV shows, books and brick and mortar companies with resources available for you.   There are all sorts of investment goals and strategies to achieve them, you don't mention any.  One cold invest for long or short term, for capital growth or dividends, for high risk or low risk.    

To me, the markets most closely resemble betting on horse races.  lots of information, lots of ways to place your bets and lots of ways to lose your money, if you don't know what you are doing.  You can also make good money too, when you pick winners.   For me, with both, you need to hook in with an expert, to show you the ropes.  Even if you just want to bet a hunch, an expert can guide you to the exact bet to match your intention.

If your need is urgent, then get registered with one of the online brokers.  All of them have tutorials, and explanations of the ways you can invest immediately.   See this fool page for info

The thing about the markets is that they follow a course that in hindsight always seems rational.   But when standing in the present, that course is hard to predict.   If you have a hunch that some company is going to be a big gainer, go ahead invest.  Its fun.  Just keep in mind what I do when heading out to the casino for a little blackjack.  Set aside and use only what you can afford to lose.
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