Share market is an area where the trader or investor can trade or invest in the live market during the market hours and fetch profit as a result of his trading activity. For trading it is important that one knows what he trades in. The performance of some stocks has nothing to envy to those of their Western counterparts, which is a great opportunity for investors, provided they follow a few basic principles. Today, banks and investment companies give individuals the opportunity to make their fortune on twenty-nine financial markets in India. However, it is by no means a casino game. Buying actions require the method, patience, stamina, responsiveness, and mind of steel. Here are 5 tips that will help you get started on the stock market.
- Diversify your portfolio into shares
According to the stock market, you should never put all your eggs in one basket. It is generally advisable to build a portfolio of 8 to 10 equity lines to protect against the risk of price fluctuations. From this point of view, it is difficult for an individual to apply this precautionary principle in India. Indeed, investors have a much wider choice at the Stock Exchange, a financial marketplace.
- Target countries where the middle classes are rising
The proportion of people from the upper and middle classes is much higher in the English-speaking world. We need to target countries in which the telecom sector is developing, agribusiness, real estate, health and education, the middle class is the engine of growth in these countries, which partly explains the attractiveness of the Indian Stock Exchange.
- Information is the nerve of war
Before acquiring shares on the stock market, it is essential to obtain the best information on the state of health of listed companies, the level of skills of the management team, the strategy put in place, the market shares held in the sector of activity concerned, or the capacity of NSE Margin. All these factors have a positive or negative impact on the share price. You also have the possibility to obtain information by peeling the economic press or by consulting sites which grant a privileged place to the rising stars of the entrepreneurial scene.
- Use only money you do not need
The volatility of stock market prices is such that an investor risks seeing his investments go up in smoke or, on the contrary, has the possibility of becoming a millionaire. The wisest course for those who want to get rich on the stock market is to use only the extra money they do not need. Tapping into the family budget dedicated to current expenses can prove disastrous financially and psychologically in case of bad decisions because of the lack of relevant information on the listed companies concerned.
- Be patient
Investing in the stock market is a job that requires a lot of serenity and patience. Choose an investment horizon that varies between 5 and 8 years to expect good returns.