Every investor wants to earn big money from the stock market irrespective of his or her experience. It is easy to keep such a wish, but to make good money with the safety of your money, a good strategy is necessary.
- How to Start Investing in Share Market?
- What is Stock Meaning in Share Market?
- What is the Process of Share Market?
Along with prudence, understanding and strategy, endurance is very important for investing in the stock market. The key to good earning lies in these things. These things not only have the ability to give excellent returns but also save your money from drowning.
Investing is easy, but it should not be considered a game. For this, understanding of the market is necessary. There is no formula or short-cut to succeed in the market. But by following some things, profit can be increased. Let’s know what these things are.
Complete Your Homework before start Investment
Veteran global fund manager Peter Lynch says, “If you don’t study a company, then it’s a gamble to pick a good stock. You are doing your trick without looking at the cards.” Lynch said that invest only in what you know.
Dinesh Rohira, founder and CEO of the online finance portal 5 Nance, believes that there is no short-cut to earn from the market. He said, “It is imperative to have a deep brainstorm with patience. Invest in good business.”
Invest in Business can be a Good Idea
Investors should not invest in the share price but in the company’s business. Abhimanyu Sofat of IIFL Securities said, “Understanding any business improves the understanding of the company. This makes it easier to make investment decisions.”
For example, Warren Buffett’s primary philosophy of investing is that he invests only in companies whose business is understood. He invested $ 1 billion in Coca-Cola in 1988. The company gave a rate of 10 percent for 30 years.
Always Stay Aware of Others
Investing in worthless companies by coming to the words of an acquaintance, family or friend is like setting fire to money. People are investing, so you will also invest – this thinking should be avoided. People invested in many companies looking after others and they had to suffer.
For example, the Reliance Power IPO was subscribed to 14.4 times. The company received 19.5 lakh applications from Retelle investors. The issue price of the IPO was Rs 450. The current price of this share is only 30 rupees. Many such examples exist in the market.
Take Care of Discipline
There is a special place for restraint and discipline in investment. Stock markets are always volatile. Investors should be aware of their risk potential. Non-essential risk should be avoided. Waqar Naqvi, CEO of Taurus MF said that “Endurance and Patience give investors a better picture of the long term.”
Put all types of asset classes in your portfolio. In this way, you can earn better in less risk. The definition of diversity may be different for every investor. However, this makes it easier to deal with the market situation. Carefully choose the priority of the investment asset class.
Always Live Better in Reality
Many investors aspire to make money overnight. However, the market returns slowly. Earning is not easy. Naqvi of Taurus MF said, “No asset can deliver amazing returns for a long time. It is wrong to have high expectations.” There is also a time to enter and exit the stock market.
These opportunities come again and again according to the market situation. So it is important to keep some money in your hands. If the market is strengthening its base, then that fall should not be disturbed.
Try to Invest Additional Funds
Investors should invest only additional funds. They can also use the money that they do not want in a short period. The value may decrease in the short term due to instability. The market moves in cycles.
Sir John Templeton, the global market teacher, says the most dangerous sentence in the market is: “This time it’s different.” Investment requires the right thinking and mindset.
Focus on the Stock Market
It is not enough to just invest. Regulatory and market news should also be monitored. This has an impact on share prices. For example, shares of Ashok Leyland broke down due to an increase in the axle load limit for commercial vehicles. Good earnings can lead to a bounce in stocks.
How will you Earn from Share Market?
A strong desire to invest can be awakened by listening to things, but the pace of the market is often beyond comprehension. Therefore choosing the right strategy is important. Sometimes good strategy also fails. Currently, the Sensex is at a record level, but the price of most of the shares has fallen this year.
Such situations leave investors confused, where they cannot understand anything. It is better if the investment is made for a long period. Saving a penny in the market is also your earning. If you do not trust any business, do not invest in it.
The BSE Sensex has grown at a rate of 16 percent in the last 15 years, while Symphony, Borosil Glass Works, Mayur Uniquoters, TTK Prestige and Bajaj Finance have given a return of 50 percent during this period. Time to leave the market is also important.
The share price of Moser Baer India came to Rs 2 in July 2018. The share price was above Rs 110 in July 2003. During this time, MTNL shares have also dived from Rs 105 to Rs 15. The help of professional advisors can also be taken to select shares.
When should you Buy Shares?
You can buy shares at any time, there is no special time. You can buy shares at any time if the market is bearish or is booming.
Due to a festival or on special occasions, the profit of the companies increases their share prices, which then decrease further, at such a time, if you buy the shares at an increased price, then you may incur losses later.
Buy shares at a time when you think that the market will gain in a few days. You can do this through intra-day-trading in short term investment. But the best investment is long term investment, which if it is done for at least two to three years, then there is sure to be profit.
What to Buy in Stock?
While buying shares, you should never get into the words of your broker. First does the research by yourself then buy the stock of a company. Always buy good company shares whose economic condition, management is very strong.
According to me, if you are new, then you should buy shares of a company whose products we use daily in our lives, or see someone doing them.
For example, you can invest in a company – Toothpaste, Soap, Oil, Ghee, Phones, Vehicles, motorcycle, food products, bike, etc. You choose companies whose names are known.
What is the function of the Stock Broker in the Stock Market?
Common people cannot buy and sell shares from the stock market. Only a member of any stock exchange can buy and sell shares from there. These members of the stock exchange are called brokers.
All these brokers are registered in SEBI. While investing in the stock market, you will find many brokers, out of which you can open your trading account with any good support and service online or any other trading companies.
Some of the major online internet trading companies are – ICICIdirect.com, HDFCsecurities.com, ShareKhan.com, IndiaBulls.com.
How to Invest in Share Market?
To invest in a share market, you need 3 types of accounts. For equity investment, there should be a savings bank account, Demat account and Trading account.
Nowadays, there are many trading companies that allow the opening of all three types of accounts simultaneously. You can open 3 in 1 account in companies like Kotak, ICICI, SBI, etc., this is the best.
You should open an account with SEBI in Registered Brokerage Companies only. – The stock is bought through the trading account and held in Demat, while your profit is transferred to the savings account.
What is a Demat Account?
Demat Account is also called Share Depository Account. You can easily open it at any Depository Participants. Currently, National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CSDL) are the two major depository participants. But we recommend you again that you open only 3 in 1 account, this will help you.