What Is CMP In Share Market |CMP In Stock Market

What is CMP in the share market | CMP means in the stock market

As, a beginner in the stock market you have to know every term used in the stock market for better investing. In this article, we just discuss one of the common terms which are mostly used by every trader.

Trading is not easy but if you know its fundamentals and technical terms then you can easily make success in the stock market. Let’s see CMP’s meaning in the stock market.

What Is CMP In Share Market

The term CMP means Current Market Price. Also, it refers to the current market price of the stocks. As well as the rough or approximate price of the particular stocks to buy or sell in the stock market.

You can’t predict the exact value of the stocks, because the stock’s values keep changing and fluctuating. So, as a trader, if you want to sell or buy a specific stock you can refer to the CMP current market price value for trading. The CMP value may not be accurate but it almost shows the nearest share value.

How CMP Used In the Share Market

The term CMP current market price is mainly used in every trade session. For, example if you want to sell a stock with the CMP value in your brokerage application, in a fraction of a second its selling value can be changed due to the impact of LTP’s Last Traded Price. Let’s see how CMP is used in different trading options.

What Is LTP in Stock Market

If you want to know clearly about CMP then you should know the term called LTP. The term LTP in the stock market refers to the Last Trade Price. LTP is the last trade price of a particular stock. LTP can affect the current market price. For, example if a stock trade with a high volume then its current market price may affect.

1. Market Orders

Market orders are one of the trading methods, in this method you can buy or sell a stock instantly. This type of trading ensures 100% of your order ( buy or sell ), but it doesn’t guarantee the price of the stocks. The market order completes around the seller or buyer price.

Explanation Of Market Orders

For, example you have a Demat account in any brokerage app, and you decided to buy Coal India shares at the price of INR 220 with the market order trade method. However, your shares will be allotted but the price of the stock may not be the same as the time you purchased it.

Due to the inconsistency and fluctuation in the stock market, the stock price may differ by a fraction of a second.

2. Limit Orders

When the stock market is going to fall down or bear trends start in the share market many investors use Limit orders for specific stocks which can reduce the loss for investors.

Explanation Of Limit Orders

For Example, you want to sell your 500 stocks for a specific stock with the price range of INR 2000 per share or buy 500 shares at a maximum price of INR 2000 per share.

In the Limit order method, the order can’t be completer without your price limit being attained. There is no trade was taken place before your price limit was completed. In this order, the method is the time taken in the process and may cause heavy brokerage charges for holding your stocks.

3. Stop Orders

You can insist your broker stop orders for particular stocks to sell or buy whether its value is down below or raise above its expected value. These stop orders usually help to reduce your loss in the stock market.

Explanation Of Stop Orders

For, example Mr. Lee purchased Adani Power 500 stocks at the rate of INR 1860 per share. So, he invests a total of INR 9,30,000. If the share value may decline due to various market reasons he can insist his broker stop ordering to sell his shares when the share value is down below INR 1840.

Conclusion

CMP is one of the most used terms in the stock market, based on CMP investors decide to buy or sell their stocks. Also, it can help to prevent heavy loss. Most investors buy or sell stocks based on CMP values.

Also Read: Fundamental Analysis Of Stocks

Also Read: Best Stock Market Books For Beginners

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