“Financial markets are subject to market risk. Read all the scheme related documents carefully”.
Don’t these lines sound familiar? Yes! You guessed it right! We listen to them at the end of the advertisements based on investment purposes in Share markets. Have you ever wondered how traders invest in the markets? This isn’t any rocket science as it seems. Though Risk factors are involved with proper knowledge and information, you can bet your luck.
Why should one invest in Share Markets?
We all have different goals in our life. For example- Owning a house, buying a car, going abroad for studies, getting your daughters married and so many other things. Wait and think! Will your regular 9-5 job fetch you enough to fulfill your dreams? No! One must take care of financial budgeting for this. To achieve this, you need to have proper financial planning. By this we mean, you must inculcate a habit to invest. It has been seen that the earlier you start investing; the more chances you get to take the risks, your spending habits will be improved and how can one forget! Compound interest will make a difference in the long run. And, it is the returns which matter. Compound interest is the interest earned on interest. If you are reinvesting your earnings, you are exponentially increasing your Return on Investment (ROI). Based on your appetite for return and other dependency variables like age, you can try your hands in Share markets. Share markets’ returns are high and so does risk. Higher the risk, higher the returns.
What all you require to trade in open markets?
Firstly, you need to open a Demat and trading account then only you can start investing in Indian share markets. The point to be noted: You must familiarize yourself with the stock exchanges and their functions. Stock Exchanges facilitate the buying and selling of shares. In India, we have two most important Stock Exchanges- 1) Bombay Stock Exchange 2) National Stock Exchange and SEBI (Securities and Exchange Board of India) is the body that acts as a key regulator.
Important to note
-Dealing should be with the market intermediaries registered with SEBI / stock exchanges.
-Documents of the important nature should be sent by a reliable mode (preferably through registered post) to ensure delivery.
-You must ensure that you have money before you buy and you are holding securities before you sell.
Find the stocks which suit you and Invest
As per your need, choose an appropriate financial asset for your Investment. If you are looking for regular income and preservation of capital, you can opt for debt instruments like bonds. If you are willing to take up the risk then Equity is the one for you.
Large-Cap Stock
These are the stocks of companies with LARGE MARKET CAPITALIZATION. Generally, these companies are well-established and have a very strong presence in the market.
Medium-Cap stock
These are the companies that have the potential to grow big. The risk factor involved in these companies is comparatively low to Large Cap stocks.
Small-cap stock
Generally, start-ups fall under this category. The risk factor is higher than mid and large caps. It’s pure a gamble. It can be an overnight success or vice-versa.
Just a suggestion
-Don’t Follow the Crowd
Often the investor’s decision relies on the influence by the suggestions of his neighbors, relatives, and colleagues. If you don’t want to jeopardize your hard-earned money then make decisions wisely. Learn about the company’s profile, look at the past pattern, and analyze whether the investment would be useful or not. Never investment without taking informed choices.
-Have Realistic Goals
There’s nothing wrong to hope for the best outcomes from your investment but you could be in trouble if your financial goals are unrealistic.
For more information, you can tune in to the Podcasts- Mint Evening Market wrap-Mint Evening Market Wrap in Hindi | हिन्दी मे | KUKUFM, FinnovationZ.com FinnovationZ.com in Hindi | फिन्नोवशन ज़ी डॉट कॉम हिन्दी मे | KUKUFM and Paisa Vaisa (Hindi) in Hindi | हिन्दी मे | KUKUFM, https://kukufm.com/show/paisa-vaisa-3. Delve into the depths of financial markets and explore the limitations of your investment skills.
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