Introduction to Share Market Beginners

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Share market is an area which fascinates each and every individual who is craving for more money. Some common phrases are “If we want to earn just try with share markets; my friend has made lot of money in that “.

As beginners we should understand one thing. If we are planning to invest in share market, first we have to categorize our self.

Are we a long term investor?

Are we a short term investor? (Daily trading).

Note:

In share market we are 95% secured if we are ready to wait (provided company fundamentals are good. Exclude cases like enron, worldcom.etc) .The problem comes when we have invested in a bank we can withdraw same amount with interests till date for any of our emergency.

Assume our money is in form of stocks we got an emergency by today evening 7 pm of 1 lakh. We have seen our stock’s worth in today’s closing was our investment 1 lakh+ whatever market price added to it. We think we have more than required and sell it tomorrow. But tomorrow fate decided the other way market falls our stock value becomes 90 thousand. If we sell that’s where the problem comes.

It may even go upto 1.25 laks next week /next month. Can we wait? That’s the million dollar question.

Case1 – short term investor (Risky)

Remember its here we play not invest.

  1. Make investment break ups: If we have “x” Rs in our hand don’t get carried away to buy shares for all “x” Rs. Always we should have fifty percent in our hand.
  2. Reinvest only when profits: Make the profits what we earn on the first trade if daily trader (if so happens) to buy extra shares. Suppose if 0ur stock didn’t go up after first investment wait till (may be months) till our holding goes up.
  3. Capital maintain: Always ensure that our capital is maintained with till date interest rate of banks. Though depository participants suggests us its always better we should have basic ideas of the company. We have lot of information sources (net, softwares).
  4. In case of IPO: Buy and sell within max 1 week of IPOS. Invest in established stocks. If we feel trend of IPO is good come back and invest.
  5. Sell well ahead of your expected need: Suppose we have a marriage and we wanted money for that. If we feel that today our investment + return (m-cap) is good may be 30 days ahead of marraige.sell it today. We are secured.

The very simple formula will be if we crave for more we have more chances to lose more.

Case 2 – Long term investor

It’s here we invest. We are most secured in this case because we don’t consider money invested to be used for emergency. Any company will one day have a growth curve. Even a sick company value can be raised by psychological factors of investors.

Use that opportunity!

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October 14th, 2006 in Introduction | tags:

44 Comments

AnonymousNovember 8th, 2006 at 6:38 pm

hey man.. the tips are really handy and will keep in mind while im trading… looking forward for more blogs…

Prabhu SNovember 10th, 2006 at 7:30 pm

hi senthil

thanks for your comments.as days go i am concentrating more on helping small investors to understand company fundamentals before investing.

thanks once again
prabhu.s

maheshAugust 5th, 2008 at 7:48 pm

Vry informative…thanks a lot..:)

sunil dwivediSeptember 18th, 2008 at 8:12 pm

sir i m a b.tech student i want to know about trading.
and how to work on mumbai dalal street. plz sir

saurabh kumarOctober 3rd, 2008 at 2:03 pm

hiiiiiiii .sir..
i m really interested..in knowing…how a share markets works..n who decide the rising n dipping price of
shares every days….
whats better ways to understand the share market..
lookin for ur valuable comment..
thanxs

RajiOctober 11th, 2008 at 2:19 am

hello sir! thankyou so much for your making us understand about stock market and types…please kindly share your views with us….we are very thankful to you…very informative…

yogesh dhokeFebruary 20th, 2009 at 11:37 am

Hi…… sir,i m yogesh dhoke from ngp.and currently doing MBA in finance.sir i m keen intersted to make my carrer in this sector so i kindely request to u please tell (send) me all relevent information on my email address.

shibaApril 25th, 2009 at 3:49 pm

good advice kindly let me know which shares to buy as of today so that i can start investing

naveenApril 30th, 2009 at 3:51 pm

this is Naveen
hey it was a good information for the starters….

krishna padhyMay 18th, 2009 at 5:57 pm

hi this is krishna
can u plz tell me hoe the price of any share changed overnight.
eg supose some xyz ltd company share closed at 100 rupees today how it is opened some more ruppes up or down next day

Santosh ChopadeJune 3rd, 2009 at 11:19 am

hiiiiiiiiiii everyone

i m so excited about share market. if we get full knowledge then we can invest more and make more.

so first of all do hardwork of taking knowledge of share market and then invest.

tip
1) find out max. 10 min 5 persons who have invested in share market. may be they dont give you full details but atleast u can get a idea about their Dmat account( bank) and companies they are investing .
2 ) open a Dmat account.
3) please keep in mind you may loose money unnesessarily so be alret.
4) atleast for some days keep a close look at the newspapers, news ,tv and most important keep in touch with your friends so tht you can get a quick message when to buy and sell the shares.

NitinJune 7th, 2009 at 8:47 pm

Hi,

Thanks. Good information. It would be appretiatable if you answer my below questions.

1. If we open demat account with any particular bank, do we need to pay to that bank… one time or while any trading? though they provides free account.
2. What is the min and max duration for long term investment?
3. Ca we Invest/withdraw immediate amount through online transaction?
4. If we open demant account with any particular bank, still I can trade with any compnay in the world?

Thanks
Nitin

sumit guptaJune 16th, 2009 at 11:48 pm

hi sir
i want to know about basic terms of share market.

thanks for information

ShwetaJune 25th, 2009 at 2:59 pm

Hi…… sir,i m shweta and currently doing MBA in finance.sir i m keen intersted to make my carrer in this sector so i kindly request to u please tell (send) me all relevent information on my email address.

niteshJuly 1st, 2009 at 5:59 pm

hello sir….,i m b-tech student & want to buy some shares….plz tell me which sector will be the bst one for short term…& shares that will yield gud profit….& what things i have to keep in mind before investing

StutiJuly 16th, 2009 at 7:12 pm

Hello….. Stuti here.. i am just in senior college(com) still, but this entire concept of share market really interests me..was great reading about all that you’ve put up…great job!! i really want to know about the entire points structure in the market, for example what does it mean that x company is at so much points today,etc. what are these points exactly??? Thank you.

ajit kumar singhJuly 29th, 2009 at 10:12 am

hello sir,

i want to invest in share market, but there is worry of loss within me coz i don’t have much idea about share market . i have such feelings like i can do well in these market i want u to guide me,to invest in which type of company before investing in any company what should be the factor of concern,which one would be the better for a beginners

1) long term investment
2) short term investment regarding company which one would be the better
3) blue chip company
4) small company

please clear my all above mentioned confusion.

i really want to know everything, anything which i have not ask but u think that is much important for any beginners please xplain that also to me…i would be very grateful to you…

AbhiAugust 2nd, 2009 at 5:29 pm

Sir i m very much interested in share market and i want to do share trading from icicidirect.com.sir plz can u suggest me what i have to do.plz

Digvijay singhAugust 12th, 2009 at 9:04 pm

Hello sir, tis is digvijay singh 4m lucknow. Sir i want to invest my money in share market..sir tel me about in which share wil i invest my money for short term?
Thank u.

Ritesh Kumar YadavSeptember 10th, 2009 at 3:48 pm

Hello sir i am ritesh i dont know about share trading but i wnted to intrested in this field please help me to know this investment field.

yogesh sharmaSeptember 28th, 2009 at 11:27 pm

Hello sir this is y sharma i dont know about share trading but i wnted to intrested in this field please help me to know this investment field.

please tell the procedure in details.

Sonali KadamOctober 6th, 2009 at 9:54 am

Hello sir myself Mrs. Sonali Kadam, I dont know about share trading but i wnted to intrested in this field please help me to know this investment field.

please tell the procedure in details.

snehilOctober 8th, 2009 at 4:00 pm

sir i m a beginer

i want to know wat is a demat account?
how can i open this account?
how can i invest?

nithinOctober 16th, 2009 at 3:15 pm

sir….i would like to know more about share market….how i can invest money in share market?(means.. the procedures,good companys,disadvantages etc..)

shubham chauhanOctober 20th, 2009 at 11:44 am

Sir I a beginner. I want to know what is a demat account? How can I open this account? How can I invest?

rohanNovember 1st, 2009 at 10:33 pm

Thanks a lot for this great info.. really a good piece of information for the beginners.
Hats off to u sir..

harshadNovember 25th, 2009 at 10:13 am

heelo sir i opening new account in share market please help in account procedures

sureshDecember 15th, 2009 at 6:50 pm

sir….i would like to know more about share market….how i can invest money in share market?(means.. the procedures,good companys,disadvantages etc..)

nidhiDecember 29th, 2009 at 3:26 pm

hey
I am a bigginer for the share market .I want to know about share market. should I take for long term or should play intraday.what would be benificial. I am a housewife and having my own laptop.

PrabhuDecember 30th, 2009 at 11:41 pm

Hi Nidhi

i suggest to just watch certain companies price fluctuations first for few months.

relate these price changes to news released about these companies during these period.

start learning basics of financials about P/L and BS.

See companies strength in terms of Fundamentals.

invest long term

suhasJanuary 6th, 2010 at 1:09 pm

I am just beginner. I don’t no anything about share market.
Please tell me the steps and which company is best now for investing.
I am just starting with 1000 ruppes.

NilakanthaJanuary 15th, 2010 at 7:39 pm

I want to participate in share trading.I do not have any idea in share trading. Iwant to start investing Rs2000/.Please tell me the stepsand which company is presently suitable for investing.

IndrajitJanuary 21st, 2010 at 12:57 pm

Hello! sir,…….
I am indrajit. Could you tell me from which website i will get best ‘Intra Day Call ‘ for trading NSE share markrt per day?

MaruthupandiyanMarch 8th, 2010 at 10:54 am

Respected sir
i am doing the project area in share market
i need detail about share market

AvinashMarch 18th, 2010 at 11:28 pm

i am Avinash and i wanted to know whether a huge amount is compulsory for investing in shares or can i inivest with a small amount?please clear my doubt.

Soubhagya Ranjan BaliarsinghMarch 20th, 2010 at 12:03 pm

respected sir i am Soubhagya ,sir i am doing btech in IT,plz sir tell me about share,and i want to open an account in share market?plz tell detail for which i can open an account in share market.
thank you sir..

pavanMarch 27th, 2010 at 9:45 pm

sir from where we will get basic idea about company.sir is there any website which shows up and down of share online.
thank you sir.

Bidyut MaityApril 1st, 2010 at 9:14 am

sir i am the new comers…….& i am really suffering from economical problem & i have a least amount of money in my hand & i am intersested about daily trading pls will u help me how much amount i have to invest or need for daily trading

MR.SINGHApril 8th, 2010 at 4:59 pm

HI…..I LIKE TO INVEST MONEY IN SHARES ………..DID ANYBODY KNOWS …ANY WEBSITE WHICH CAN HELP ME ABT THE BASICS OF SHARE MARKET…………….

jatinApril 12th, 2010 at 3:05 pm

Sir I want daily 20 share tips please give me

MAHESHWARREDDYJune 2nd, 2010 at 2:39 pm

HI THIS IS MAHESHWARREDDY , I WOULD LIKE TO INVEST MONEY IN SHARE MARKET BUT I DONOT KNOW THE PROCESS WOULD YOU TELL ME DETATILS (HOW TO INVEST, WHICH BANK ACCOUNT DO U HAVE AND WHAT ARE THE RULES ) ABOUT THIS PLEASE.

salmanJune 9th, 2010 at 10:05 am

hello sir
I want to invest my rs2000 in shares, so plz tell me how can i invest my money?

ThangarajJune 26th, 2010 at 8:40 am

Sir i need to invest a small amount of rs 1000 where we can invest and how its?
Please give me the tips .
And i m studying computer technology i wont know any information about the share market to invest .Please give me the information.

SinuJuly 4th, 2010 at 11:36 am

Sir i want start a new a/c. Start with a 1000RS. when i invested this amount and which company selected.

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