What are important things to keep in mind for stock market beginners?
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- Updated On:24-May-2021
- Replies:2
Short Answer
For any beginner who is getting started in the stock market, you need to be aware of the broker you choose, the investment strategy, not letting emotions play in your investment and trading desires, and not trading with money that you can’t afford to lose.
Detailed Answer
If you’re looking to beat inflation and have an additional source of income, then the stock market happens to be a perfect place to start. However, if you’re a newbie or just getting started with things, then it’s better that you keep the below illustrated pointers in mind before you invest anything into the market.
Stock Market Beginners - Pointers to keep in mind
1. Choosing the right stock broker
To start investing in the stock market, you would need a stockbroker. Therefore, you need to choose the right one. Try researching online and see what the pros are using. Check out which one felicitates beginners and try opting for that. Moreover, different stockbrokers charge differently based on the type of trade and features. So choose wisely.
2. Never blindly invest
Once you have chosen the stockbroker, it comes down to the investment criteria to trade. Always remember that you alone are responsible for the trades, and you can never rely on anyone. Therefore, never have a herd mentality where doing things based on other investors would get you profits. Well, they might have different investment opinions and strategies. You need to figure out the investment pattern by yourself.
3. Education is a must
Educate yourself around the stock market. If you want, you can go through several free tutorials online about the stock market and what you need to look out for. In addition, there are thousands of videos that one can refer to. If you feel that you want expert guidance, then there are online courses that you can take and then begin your trading journey.
4. Never take loans
The investment that you decide on making should be your own money which is surplus. Never invest by taking loans or any such things. The stock market is quite volatile, and you never know when you might lose everything in an instant. Hence, keep in mind to invest what you can, and even if you lose it, it won’t make a difference.
5. Invest practically, not emotionally
Any decision that you take regarding investments has to be approached from a practical standpoint. Never let your emotions play in the stock market. Always have patience and see the different ways in which you can turn it around. Many times, stock takes a huge dip in price, and people start to panic sell to save their investments. But then waiting and holding the stock for a couple of days could give you considerable returns if the stock increases steeply.
Stock Market Beginner Tips
With that being said, a beginner looking to invest in the market would have to follow certain patterns and trendlines to ensure that their investments are calculated. Always keep in mind that you don’t have to invest huge sums to make profits. But then calculated investments over time do reap profits. Follow the above-given pointers, and you should have a stable trading experience.
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Discussion (1)
For significant returns, one can look forward towards stock funds, real estate investments, dividend stocks, target-date funds and so on. Each one of these investments does offer something better to investors based on their capital of investments made.
The best stocks for college students to invest in in India are those with strong fundamentals and high dividend yields, such as Reliance Ltd., ITC Ltd., and Infosys Ltd.
Shorting is nothing but the process of making a profit while the market is down. It's where the process of selling shares occurs first, and then buying takes place. the selling is the shares that are lent to you by the broker.
Generating 1000 times returns in the stock market is highly unlikely but not impossible. However, through aggressive trading, scalping techniques, trading in penny stocks, strategies for trading, technical analysis and trading with the market trend, you could get the relevant returns you’re looking for, provided everything favors your decision-making in the desired investment opportunities.
There are many stocks of companies that could be invested in. For example, companies doing good in the FMCG sector, Healthcare sector, Banking sector, Consumer product sector could be invested in. these are just a few as plenty other companies could be invested in based on your requirements and strategy for investing.
Intraday trading is more risky and challenging when compared to long-term investing. Is it not a preferred option for beginners as it requires considerable capital, expertise, adequate knowledge about trading, and multiple other factors. For beginners, the best way is to deploy the majority of your capital towards long-term investments and use the remaining for hedging or short-term trading.
Stock Market is always at risk and involves around a lot of aspects. A daily news viewer also needs time to understand what is exactly going on. To actually dive into the world of stocks, it is important to read about the companies and their strategies and that is what stockbrokers do. They understand the company, do their research and expect the price of stocks by studying the company's ways of dealing with stock market strategies and also about the market forces. Let us now go through the actual topic and understand things better.
There are plenty of advantages in choosing Paytm Money to open a Demat account and trading account with the stock broker. Some of the advantages include robust trading applications with web integration, 190+ banks supported for an easy transaction, net banking facilities, a low brokerage fee of 20 rupees, etc.
Making profits off the stock market is easier said than done. However, if you want to make 50,000 rupees as profits, you would have to consider intraday and F&O options in trading. But then factors such as stock selection, investment amount do play a significant role in the profits your reap.
Opening an account with a foreign stock broker can be a great way for Indian investors to diversify their portfolio and gain access to a wider range of investment opportunities. However,there are a few things to consider before opening an account with a foreign stock broker.
Harshil Patel
Psychology is of utmost importance. Forever, understanding your investment is another important factor. But to top all of this is the right entry point and exit point. So keep these pointers in mind, along with the ones mentioned in the article.