Investment Basics

OK, as Ajay asked let get few basic questions cleared...

whats the difference between stocks n shares?
Actually both stocks and shares are the same...
stock is used to describe the ownership certificates of any company, share indicates the number of parts of ownership..so when you buy a share of stock, you are actually taking ownership in the company in which you are investing.

whats the difference between derivatives- futures n options?
Derivatives are one whose value changes in response to the changes in underlying variables...
Futures and options are two commodity traded types of derivatives...
In case of options contract gives the owner the right to buy or sell an asset at a set price on or before a given date. But in futures contract is obligated to buy or sell the asset.

whats is liquidity in market?
Market liquidity means that there are people willing buyers and sellers at all times in the market without causing a significant movement in the price.

whats is cash reserve ratio(CRR)- how does it affect wpi?
cash reserve ratio (CRR) is the amount of funds that the banks have to keep with RBI,To make sure banks do not run out of money to pay for withdrawals, they're supposed to hold a certain percentage of deposits as free cash.A CRR hike means banks will have to hold more cash... and CRR one of the measures RBI uses to to curb inflation But for an investor hike in CRR implies a decline in liquidity.
The wholesale price index (WPI) is an indicator designed to measure the changes in the price levels of commodities and change in CRR effects WPI to control inflation.