Share market How to Invest and what is the right time to invest. Share market is not for everyone. Share market investmenbeginner be well thought off. The begginer investor should put a lot of research before investing. Get away from the general perception that anyone can start “earning” from investing in the stock market.
Let us first understand this better
What are Stocks/Shares?
Stocks, also known as Shares, equities represent ownership interests in businesses. Buying a Share means you are investing in ownership of the Company. Investors invest in stocks that they think to gain more value. When you invest in a stock you become a shareholder because you have a share in the Company. Companies issue shares to raise capital for business or to expand the existing lines of business. Investors invest in stocks to profit from the increase in stock price.
How does the stock market work?
Stock markets facilitate the sale and purchase of stocks. Investors can buy or sell shares through Sharebrokers or directly using Share trading websites. Supply and demand determine the price of a stock. More demand means the price will increase.
Let us understand this better with an example. There are two individuals X & Y, who decide to start siness XYZ PVT ltd with their own funds. When this business expands they borrow more funds from Friends/relatives and later with Banks as Loans etc. There comes a point where they cannot fund the business on their own and then they seek help from some established business (mostly called Angel Investor)/Venture capitalist.
When all the above options are exhausted or maybe before that XYZ PVT ltd can approach the public to invest in its business in the form of ownership (Which is called Shares). This very first listing by Company is called IPO (Initial Public Offering).
When a company O in Share Market, it is actually selling a share in its business to the Public. Taking the example forward, if XYZ PVT ltd have 3 Lakh Shares and they sell 7 Lakh shares to the public. Then Promoters will only have a 30% stake in its business.
A stock market is like any other Market where these Companies/individuals can sell their Shares. These Markets do not own the shares, it is just a Market for shares. There are close to 15 or more Stock exchanges in India, the primary being NSE (National Stock Exchange) and BSE (Bombay Stock Exchange).
Share market How to Invest in Share Market?
One can either trade in shares through Share brokers or through online trading platforms. You just need to inform these platforms/brokers about the No of shares and the price at which you want to buy or sell. You also need to have a Demat Account to keep your shares. These Accounts are mostly opened by the same platforms. But investing in stocks requires a lot of time, effort, and research. So make sure you do enough study before getting into stocks. Initial investments should always be in Less Risky/bluechip stocks.
Financial Analysis:
You should be good at reading the Financials of the company/stock you are buying. It means reading Audit Reports, Profit and Loss Accounts, Balance sheets, etc. The stock market is not a gambling platform. Even for gambling, you need to know it first. It is not just about checking historical data and predicting what the future will look like. It is much more than that.
Be prepared to Invest for a Long time:
“Shut it and forget it” works well in stocks. For beginners, don’t invest if you would be needing funds in anything less than 5 Years. Also, don’t check Stock prices daily and increase your stress level.
Diversify Investment and invest in small amounts:
Don’t put all your eggs in one basket. It always helps you to learn and also reduces risk when you try out different Stocks. There is no place for emotions in Stock trading and never set unrealistic Targets.
Share Market How to invest in share market or stock market investing Tips…. wait for a series of Blogs on this Website.
This is a link for more information on Stocks
https://www.cashay.com/what-is-stock-210908541.html
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