Question 1

What is a stock market?

Accepted Answer

It is a platform where people can make deals, exchange or buy securities and production contracts. The market's operation depends on supply and demand for different assets.

Question 2

How to invest in the stock market?

Accepted Answer

For an investor who has opened a brokerage account, two types of transactions become available. Spot transactions are intended for the currency and stock markets. Settlement on such transactions occurs instantly or several days after their conclusion. Forward transactions occur on the futures market. Their feature is the establishment of a certain period, after which it is necessary to either buy or sell the asset.

Question 3

How does the over-the-counter market work?

Accepted Answer

Transactions occur outside the exchange, hence the name. To conclude them, a special investor status is required. On the over-the-counter market, you can buy assets that are not available on licensed platforms.

Question 4

What is the futures market for?

Accepted Answer

In such a market, they trade not assets, but futures and options. They include an asset and an established period, after which it is necessary to conduct a transaction.

Question 5

How does a commodity exchange work?

Accepted Answer

On this platform, raw materials act as goods. Market transactions are most often concluded between legal entities. Investors cannot participate in trading.

Question 6

How to make deals on a currency exchange?

Accepted Answer

To trade currency on the Tajik Exchange, you need to open a brokerage account and become an investor.

Question 7

What is a stock exchange?

Accepted Answer

Different assets and securities are traded on the stock exchange.

Advantages of the stock exchange:

you can invest funds at a minimum rate;
easy start for novice investors;
secure transactions.

Question 8

What does a broker do?

Accepted Answer

A broker is a professional participant in the stock market. He acts as an intermediary between the investor and the market. A private investor cannot directly make transactions on the exchange without a broker.

Question 9

What does an issuer do?

Accepted Answer

This is a legal entity that deals with the issuance and sale of securities.

There are three types of issuers:

state;
subfederal;
private.

Question 10

What are the tasks of a depository?

Accepted Answer

This is a stock market participant who is responsible for storing and accounting for rights to own securities. The main task of the depository is to store information about all investor holdings.

Question 11

Who is a registrar?

Accepted Answer

This stock market participant is engaged in compiling a list that includes all investors who own securities.

Question 12

What does a regulator do?

Accepted Answer

Government agencies or non-commercial organizations act as regulators. The main task is to control the execution of transactions.

Other tasks of the regulator:

prevention of fraud and dishonest transactions;
approval of securities issuance;
license registration;
monitoring compliance with rights.

Question 13

What does a market maker do?

Accepted Answer

A market maker is a legal entity. Its responsibilities include maintaining supply and demand for securities during the opening of trading on the market. A market maker has the right to put securities up for sale that investors can buy at any time.

Question 14

What is a quote?

Accepted Answer

A quote represents the value of the last completed transaction on the stock market. It is used to build charts reflecting price dynamics for a particular security.

Question 15

What does volatility mean?

Accepted Answer

Volatility reflects possible changes in asset price dynamics. They are divided into two types: low and high volatility. The first includes bonds, and the second includes stocks.

Question 16

What does the spread value depend on?

Accepted Answer

The spread represents the difference between the price indicated in the best seller and buyer application.

The value can change due to several factors:

the spread decreases due to a large number of investors;
the spread increases due to a small number of market participants;
the spread increases directly proportional to volatility.

Question 17

What is securities issuance used for?

Accepted Answer

Government agencies and private individuals often resort to securities issuance. It helps attract new money for business development and expansion.

Question 18

What does the term ticker mean?

Accepted Answer

A ticker is a short name for a stock or bond. Each security has a unique ticker.

Question 19

What does a structured note include?

Accepted Answer

A structured note is a security consisting of two elements. Thanks to the protective part, the structured note guarantees the safety of invested funds.

The risky part includes stocks and other securities. The investor's income will depend on the growth of their value.

Question 20

What can be hedged?

Accepted Answer

Hedging is minimizing risks from asset price changes on the stock market. It is not free, but you can use the method for any security.

Question 21

What types of investments exist?

Accepted Answer

There are venture and portfolio investments. In the first case, investors invest in a business that can either grow or fail. In the second case, securities are bought to earn money from them. This does not require being an active participant in the company's activities.

Question 22

How is compound interest calculated in investments?

Accepted Answer

With compound interest, you can increase investment income. It can be calculated using the formula V × (1 + S)n. You multiply the amount of the first investments by the sum of one with the yield rate, which is raised to the power equal to the number of years during which the investor made investments.

Question 23

What is a repo transaction?

Accepted Answer

This transaction implies the mandatory repurchase of an asset after its sale, but only with interest payment.

Question 24

What is a stock?

Accepted Answer

A stock is a security whose owner receives dividends from the company's profit. After buying a stock, an investor has the right to receive part of the income of the company to which the stock belongs. There are preferred and common stocks. Holders of preferred securities have more opportunities in company management, but also more restrictions.

Question 25

What are depositary receipts for?

Accepted Answer

A depositary receipt confirms the right to own a security. The certificate is necessary for transactions on foreign and local exchanges. It can be both purchased and sold.

Question 26

What are the features of a warrant?

Accepted Answer

A warrant helps investors buy company stocks at a more affordable price, which is set for a certain period. A shareholder can either agree or refuse to buy a security.

Warrant features:

issued by the company;
perpetual warrants exist;
not traded on the stock market.

Question 27

How do stocks differ from bonds?

Accepted Answer

A stock gives its owner the right to receive dividends. A bond represents a debt that the issuer must return to the investor after the security is redeemed.

Question 28

Are there risks for stockholders?

Accepted Answer

Shareholders have the highest risks. They may not receive dividends due to a company decision. Stocks often fall into losses as they can drop significantly in price. Also, investments can be lost as a result of company bankruptcy.

Question 29

What bonds exist?

Accepted Answer

A bond is a debt obligation with an established term, after which the money must be returned.

What types of bonds exist:

Government. They also have the name OFZ — Federal loan bonds.
Subfederal.
Company-issued (corporate).
Issued in foreign currency.

Question 30

How to choose a bond?

Accepted Answer

Before buying a bond, you should pay attention to some indicators.

What is important to consider when choosing a security:

Income you can get after selling the bond.
Interest yield, which will show the amount earned by the owner after bond redemption.
The day when money needs to be returned to bond owners, i.e., the redemption date.
Coupon income that can be received after selling the paper.
The amount of payments for owning the bond.
How often you will receive coupon income.
The amount of partial redemption of the nominal value.

Question 31

Are there risks for bondholders?

Accepted Answer

It is believed that bond trading is the most reliable. But even their owners have risks. Bond prices constantly change, so they can both rise and fall significantly.

There is also a default risk. It occurs as a result of problems with the company's financial situation. In this case, investors may lose their investments that they lent to bondholders.

Question 32

How to redeem a bond?

Accepted Answer

To redeem a bond, an investor needs not to sell it before the established term. After its expiration, about 2 days should pass, and then the bondholder should return the money. It will be credited to the brokerage account within 1 week.

Question 33

What is amortization?

Accepted Answer

Amortization is partial redemption of the nominal value. Money is not returned immediately after bond redemption, but in parts. The remaining amount is included in coupon payments.

Question 34

What are the advantages of BPIF and ETF?

Accepted Answer

ETF stands for Exchange Traded Fund. This is a foreign fund, but its shares can be purchased through the Tajik market.

BPIF is a fund that is similar to ETF, but it is registered in the Republic of Tajikistan.

These funds have several advantages:

the ability to invest in shares of foreign companies;
reduced risk;
you can invest at a minimum rate;
convenient to use;
no need to pay income tax;
the investor always knows where his money is invested.

Question 35

What is a stock index for?

Accepted Answer

This indicator reflects the price dynamics of stocks of certain companies. With the help of the index, you can see the economic situation and the number of investors of each company included in the list. A growing indicator indicates the company's prospects and its support from investors.

Question 36

What does benchmark mean?

Accepted Answer

A benchmark is the same stock index, only with the status "reference". It also shows fund returns and company prospects where investors invest their savings.

Question 37

What is an IPO?

Accepted Answer

An IPO is the initial placement of company shares on the market. Shareholders can purchase a security at the price declared by the company. After purchase, shareholders will be able to raise or lower the price of shares by trading them among themselves.

Question 38

What is needed to participate in an IPO?

Accepted Answer

Being the first to place your shares on the stock market is not easy. There is such a concept as allocation. It represents the total number of applications to participate in the IPO process. Therefore, a company can receive both approval and rejection. To participate in the process, you need to open a brokerage account or use margin trading. First, you need to submit an application. After its approval, money will be withdrawn from your account, and after purchasing shares, a 2% commission.

Question 39

What is a split or securities split?

Accepted Answer

This procedure is also called a split. It provides for reducing the value of individual company shares and increasing their total number. The company's capital will not change from this procedure.

Question 40

What does a company's share buyback mean?

Accepted Answer

When a company wants to return part of its shares from the market, it makes a reverse buyback. To carry it out, it is necessary to act step by step.

First, the company must notify the shareholder of its desire to buy back his shares. This must be done 20 days before the start of collecting applications.

Next, the company accepts applications from shareholders wishing to participate in the buyback. This continues for a month, and during their consideration, shareholders can cancel their applications.

Then a report is published. It indicates the number of accepted applications and the number of shares that the company will be able to purchase.

The last stage is payment. It must be made within 2 weeks after the report publication.

Question 41

What is a halal brokerage account?

Accepted Answer

A halal brokerage account is an investment account that operates in accordance with Islamic finance principles. It excludes interest-based operations (riba), impermissible assets and instruments that do not comply with Shariah requirements.

Question 42

How does a halal account differ from a classic one?

Accepted Answer

A halal account does not use interest-based mechanisms, excludes haram sectors, provides access only to assets that have passed Shariah screening, and operates on a transparent commission model without hidden interest.

Question 43

What instruments are available on a halal account?

Accepted Answer

Available instruments include shares compliant with Islamic finance principles, ETFs after Shariah screening, sukuk, and permissible commodities (gold, oil, etc.). Traditional bonds and interest-based instruments are not available.

Question 44

Is leverage used?

Accepted Answer

No. Leverage is not used, as it implies an interest component.

Question 45

Are interest or hidden fees charged?

Accepted Answer

No. Interest is neither accrued nor withheld. Fees are charged only for brokerage services and are known to the client in advance.

Question 46

How is compliance of assets with halal principles verified?

Accepted Answer

All instruments undergo prior screening in accordance with AAOIFI standards and international Islamic finance practice.

Question 47

Are separate bank accounts used for halal funds?

Accepted Answer

Yes. Funds of halal brokerage accounts are held and stored in separate bank accounts, segregated from classic brokerage account funds.

Question 48

Can funds be transferred between classic and halal accounts?

Accepted Answer

No. Internal transfers between classic and halal accounts are prohibited to avoid mixing of funds and to comply with Shariah compliance principles.

Question 49

Can a halal account be opened online?

Accepted Answer

Yes. A halal account is opened online via the "Stock Broker" mobile app after registration and verification.

Question 50

Is a halal account only for Muslims?

Accepted Answer

No. It is also suitable for investors who prefer ethical investing and avoiding interest-based instruments.

All questions about investing

Stock Market

All about the securities market

Who participates in trading and transactions

Types of securities

How to invest on the exchange

How and what to invest in

What stocks are for

All about bonds

Features of BPIF and ETF funds

Where to place and buy stocks

Halal brokerage account

Halal brokerage account

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