How to Start Investing in Stock Market
The current pandemic lockdown that happened post-Covid-19 pushed individuals to try luck in the stock market. Unemployment, worried inflation, brought lots of retail money to the financial market. Being new to the share market wondering how to start investing in the stock market.
Well, without having knowledge on specific things can bring barriers on the path. Then what next, you start looking for tutorials who can guide you well. Reading PDFs or watching videos can some extent help you making decisions on trade. But you need to go with the basics thumps rules, for example, a house can’t be built in a single day.
What I mean by a house can’t be constructed in a single day? That means the money you are investing in the stock market won’t get double in a single trading session. It needs time to grow your investment like watering the plant converting it into a large tree.
To start investment in the stock market at first open a Demat-Trading Account from the respective Stock Brokerage Firm. Follow the KYC norms during opening account, kept by the stock exchange. Add money to your trading account and start investing in selective large-cap shares.
You should know that investing money on shares need not required to be a market guru. Just look around and pick market monopoly players like TCS, Reliance, Pidilite, IRCTC, CDSL, BSE, BataIndia, HDFCBank, JubliantFood, AsianPaints and lots more. These stocks for beginners who don’t read balance sheet of the company, price earnings ratios etc.
Along with time, you would learn about the corporate listing on NSE and BSE. How corporates raised funds from investors. In short, a limited company during a fund emergency or crisis they bring shares in front of a public offer for sale. In other words, initial public offering where the shares of the company get sold to open public. And the shares of a certain company get listed for the first time in the stock market.
For inspirational quotes, you can follow the great Warren Buffet, Rakesh Jhunjhunwala self-made man. They research startup corporates, calculate the fair value of shares, and keep them in their portfolio for a longer time. The same thing you can apply to your investment skills, research is the most important tool in the stock market.
You can also check the comparison between Bank FD vs Shares Returns in a longer period. Before investing in any stock just look at the past history records how well the company has performed. In the last 5 years, a particular company’s share price was trading at what price compare to the recent current market price. Few ideas you can get from it how much high one shares went up from the last five years. Or you can check 52 weeks high and 52 weeks low these can help you most as a beginner.
There is a number of shares available in the stock market, which Share price is cheaper compared to some Profit making Corporates. But you should differentiate why such shares trading at below minimum price. Look at the quarter results whether the company made profit or loss for the respective quarter. Loss-making corporates should be avoid buying. A few exceptional cases can be considered if the fundamentals of the company its all right but the market devalues for a certain time. It’s ok, in the long run, that can be considered sometimes for example TataMotors. Taking another example of shares like DishTV, VodafoneIdea, DHFL once upon a time they were trading above Rs 100 per share but now they were available below Rs 10.
Decision-making in the stock market is important rather than randomly picking up the shares. So avoid taking wrong decisions hire some expert dealer or Financial Advisor who can guide you to buy quality stocks at your initial phase of the journey. Avoid intraday, go for long-term investment.
The trading timings, our Indian stock market opens at 9:15 am and closed at 3:30 pm. You can place an order before opening the market that is called Pre-Market starts from 9.00 AM to 9.07 AM. In some cases, we think some particular shares can rally after the opening bell then can place the order at a market price during the premarket session.
Every day you will gain knowledge from the mistake and also from the good takes. Avoid repeating mistakes in your future trade and discipline is most needed in the stock market. I hope my articles might help you a little in reading and also in getting how to earn money from the share market. Stay tuned for more live updates in Equity Market, Intraday Stock Picks, Corporate Results, and more.