Investing in Stocks: Guide for Beginners - How to Invest in the Stock Market

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Equity | August 30

How to Invest in the Stock Market?

The stock market is the platform or market where you can buy and sell equities, bonds, mutual funds, IPOs, and various other types of securities. Investing in different asset classes in the share market help you grow your money over time.

In order to facilitate share market investment, many financial companies provide investors with the convenience of online trading.

Why Invest in the Stock Market

With the alarming rate of inflation and sky-high prices, your earnings might not be enough for future needs. You ought to find alternate sources of income for sustenance. And, one of the most lucrative sources for such additional income is through investment in the stock market.

However, if you want to be a smart investor in the stock market, you need to understand the intricacies and emotions of the market. Let’s take a look at a few points you should consider before making any share market investments.

1. Research and Diligence

Always invest in the shares or stocks of a business you are familiar with. Before investing in any funds, you should do your research to get an understanding of their business and industry. Check the past performance of their shares.

Your investment should be based on thorough research and analysis. Make sure to check vital information of the company before investing.

2. Monitoring

Follow a disciplined investment approach and monitor your investments regularly. Appoint a financial advisor to regulate your stock market transactions. Take informed decisions instead of blindly following the flock.

Remember that your investments are crucial to your financial future. So, never make impulsive decisions in moments of greed, anxiety, or fear.

3. Channelize Surplus Fund

Investment in the stock market does not guarantee profitable returns owing to the volatility of the market. It is advisable to invest your surplus fund in the stock market.

4. Diversification of Portfolio

Instead of restricting your investment to one or two stocks, create a broad portfolio. Investing in multiple asset classes from companies belonging to different industries can help you minimize risks and optimize returns.

Conclusion

Investing in the stock market is an intelligent way to get profitable returns if you invest with due diligence. You can always seek guidance from the experts.

If you have any queries related to the do’s and don’ts for online trading or share market investment, let us know in the comments below. Our financial experts will be happy to answer them!

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Attention Investors

1. Stock Brokers can accept securities as margin from clients only by way of pledge in the depository system w.e.f. September 1, 2020.
2. Update your mobile number & email Id with your stock broker/depository participant and receive OTP directly from depository on your email id and/or mobile number to create pledge.
3. Pay 20% upfront margin of the transaction value to trade in cash market segment.
4. Check your securities / MF / bonds in the consolidated account statement issued by NSDL/CDSL every month.

No need to issue cheques by investors while subscribing to IPO. Just write the bank account number and sign in the application form to authorise your bank to make payment in case of allotment. No worries forrefund as the money remains in investor's account."

Prevent Unauthorized Transactions in your demat account --> Update your Mobile Number with your Depository Participant. Receive alerts on your Registered Mobile for all debit and other important transactionsin your demat account directly from NSDLon thesame day.....issued in the interest of investors."

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