Stock Market For Beginners.

          How to start investing ?


  • What is Stock Market ?

So first let's understand what "STOCK MARKET" actually is .Well the wikipedia definition is as follows :  

                  

          “A stock market, equity market, or share market is the aggregation of buyers and sellers of stocks (also called shares), which represent ownership claims on businesses; these may include securities listed on a public stock exchange, as well as stock that is only traded privately, such as shares of private companies which are sold to investors through equity crowdfunding platforms. Investment in the stock market is most often done via stock brokerages and electronic trading platforms. Investment is usually made with an investment strategy in mind.”

  • Rules to follow while investing.

If someone wants to start investing in the stock market , there are few rules he/she should follow. Not following these rules can lead to large losses. So be sure you follow all these rules very strictly. 


So now see what are these important rules:

  1. Never lose money !

  2. Don't forget rule no.1.

  3. Always diversify your portfolio, never keep all your eggs in one basket. 

  4. Don't let emotions take control of your investments.

  5. Don’t panic if you are facing some losses.

  6. Always invest for the long term.

  7. Always do your own analysis of stocks or any particular assets.

  8. Don't believe all you hear or read in business news. 

  9. Start small first.

  10. Don't run after returns.  

These rules need to be followed strictly.

  • Magic of Compounding .

Compounding might seem a little difficult to understand at first , but remember this is the tool that made people money. As Albert Einstein famously said, “Compound Interest is the 8th wonder of the world. He who understands it, earns it; he who doesn't, pays it.” When Albert Einstein said this he was absolutely bang on.

 

Now let’s understand compounding with a small example :


Now let's say that you invested Rs 1 lakh and compounded at the rate of 10% per annum for the next 15 years, then you will have a base of Rs 4,17,725.


But the crucial point of the magic of compounding to happen you have to stay for long enough in the market , the longer you stay the higher you earn and vice-versa.The stock market fluctuates daily , so if you are not panicked by the fluctuations in the market and stay invested for long term you will always have an exponential growth.



You can start investing through applications and websites as they charge less compared to stock broking agencies. Some of the good sites are:


  1. Zerodha ( India )

  2. Groww (India)

  3. Acorns (USA)

  4. Robinhood (Almost all countries )


The reason we are not suggesting you any particular stocks that you can buy is that we want you to do your own analysis of a stock and then learn from the mistakes you make , and trust me no article is more valuable than your experiences so always do what you feel is right.

We hope this article will help you start your investing journey .Happy Investing


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