By definition, the Stock market is where the purchase and sale of financial securities take place. However, it is much more than this. Historical data indeed shows one can get rich by investing in the stock market. There are several examples to support this claim. Today, one can begin stock trading by just downloading a share market app. These apps have made investing quite easier. Yet, for a newcomer, the world of the stock market may seem puzzling. Check out this guide and find answers to your queries.
Realise That An Investor Is Different From A Trader
Investors will have a lot of options when they get ready to begin trading. The stock market presents several opportunities. The reason behind this is a large number of strategies available for trading. Following these unique strategies, you can either become a long-term investor or a short-term trader. An investor is one who invests in good securities for a long time. They wish to grow their wealth by getting profits over a period of time. Basically, investors look for considerable returns from their investments in the future.
Traders are those who try to gain from the price fluctuations of stocks. They look for small and regular profits. They usually invest in assets for very short periods. Day trading is a striking example of short-term investing. Right at the beginning, you must decide what you want to become—an investor or trader. Since the strategies for each one will differ, you need to pick sides.
Understand Stock Market Basics
After deciding your investing strategy, start learning the basics of the stock market. The stock market is essentially a network of stock exchanges. However, there are various organisations like stockbrokers, sub-brokers, depositories, market regulators etc. involved in it. It would be best to learn every detail regarding how stock markets work. In addition, there are several technical terms that individuals must be aware of. Plenty of online material is available, so read all about those to get your basics right. Even a good share market app also contains useful study guides for beginners. In the eagerness to make money, several beginners skip this most important part. Understanding the stock market is really vital. The more knowledge one has, the better investor or trader he will be.
Why Research Stocks
Beginning to trade or invest isn’t so difficult, as it only involves a few clicks. Once you open brokerage accounts, you are all set to go. However, the vital part before that is researching securities. One cannot carve out a fortune for themselves by investing anywhere. It is essential to pick fundamentally strong assets to get maximum return on investments. Spend time searching for stocks that have a good track record. Analyse them thoroughly based on all key indicators. Learn fundamental and technical analysis methods, which shall help you greatly. Although they are a bit complicated, they are crucial to assess the performance of stocks. New investors should start with exchange-traded funds (ETFs) and index funds. They include a bundle of best stocks. So, the chances of losses will be less.
Choose A Suitable Broker
Stockbrokers are financial organisations that provide services to facilitate stock market transactions. Technically, they are known as Depository participants (DP). As many firms are offering stock broking services, it is important to find the best ones. Go with reputed brokerage houses offering comprehensive services. See if you get financial assistance, along with trading facilities. Also, check the brokerage charges for trading in different market segments. Look for firms like Kotak Securities, which offer a wide range of services in a single trading plan. They have a long legacy of providing financial services. Furthermore, investors also get access to their share market app, which is a one-stop solution for all your trading needs.
Quick Guide To Start Trading
Here’s a glance at the steps to start trading quickly.
- Open demat and trading account. Get them online from a share market app offered by firms like Kotak Securities.
- You will get the login credentials in your registered email id and phone number. Using them, access your trading account and add funds to it.
- Go to the buy stocks page and select stocks from the drop-down list provided.
- Make the due payment using any convenient mode.
- Place and confirm the order.
When you begin your journey, stock market trading or investing may seem puzzling. Learning to do it properly may seem even more stressful. However, the time you spend on strengthening your fundamentals will be handy later. Becoming a good investor isn’t a day’s job. It requires time to gather knowledge and hone your skills. So, be patient. At times you may encounter losses too. But don’t stress yourself. Keep rebalancing your portfolio from time to time. Mistakes will only make you better.